Nick Goulding, of the Forum of Private Business, said the DTI agreed this week (3 December) to formally investigate his complaint about Rentokil’s payment policy for suppliers, issued by the company in an October circular.
The ultimatum insisted suppliers agreed to 60-day payment terms and a 1% interest rate for late bills. This is twice the length allowed by November’s Act, which also allowed small businesses to charge 8% interest above the base rate.
The investigation will be conducted by three members of the BPPG which champions the prompt payment of bills. Goulding said the DTI added Rentokil would be expelled if found to be in breach of the Act.
‘They’re breaking the spirit and the letter of the law,’ he said.
Accountancy Age’s exclusive story three weeks ago led to calls for Sir Clive Thompson, Rentokil chief executive, to resign as CBI president, a BPPG sponsor. Earlier this month, Rentokil FD Christopher Pearce offered to pay small suppliers the equivalent interest rate charged by banks on late bills.
Charles Grimaldi, Rentokil spokesman, insisted its payment policy had always been within the law and the ‘spirit’ of the new legislation. ‘None of our suppliers has any cause to be concerned,’ he said. But one FD of a small Rentokil supplier told Accountancy Age: ‘I was incensed by the letter which confirmed my lack of faith in the recent legislation.’
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