Foot and Mouth crisis still lingers on in the South West

Two years on from the Foot and Mouth crisis and many of the contractors in the south west that helped with the clean-up are still waiting to be paid by the Government says the Forum of Private Business (FPB). The Department for the Environment, Food and Rural Affairs, (Defra) admitted recently that £50 million owed to those who helped during the crisis is still outstanding. Yet, many in the sector feel that the real figure may be twice the official estimates.
FPB Public Affairs spokesman, Garry Parker, believes that a 'political solution' is necessary to solve the long-running problem. "These businesses were contracted by the official government department, Defra, to carry out the onerous tasks to clean up after the foot and mouth crisis. The jobs were completed and now they should be paid."
"The claims are legal and within the remit of contract law and as such should also be treated as commercial debts within the late payment legislation."
FPB successfully campaigned long and hard to have a statutory right to interest on late payment and it is in circumstances such as this that these regulations should assist businesses who find themselves in a tight corner because of deliberate late payment by Defra. The bill actually requires Government departments to pay promptly.
However, a number of the businesses that are owed money by Defra told FPB that they have been warned that any claims made under the legislation on this issue would be likely to be looked at 'unfavourably.' Rick Hopkins, FPB spokesman for the South West said: "These south west businesses were called upon in the foot and mouth crisis to quickly help a government to resolve the problem, but their payments have not reflected the dedication shown by so many businesses to resolve the crisis." "Legal contracts were signed and then the jobs were completed and now they should be paid without further delay." "If the government actually owned up and said that they can't afford to pay now, at least the banks could then arrange to help with companies' cash flow problems."
"Many of the businesses with outstanding monies owed by Defra are literally fighting for their survival and the protracted negotiations that are taking place between them and Defra are pushing many perilously close to the edge." FPB calculates that the statutory interest alone on the outstanding monies would amount to £14 million, yet the heavy-handed tactics of a Government department is preventing these businesses from claiming what is rightfully theirs. Many of the businesses have had to take legal action to recover monies owed or accept payments for a fraction of their original bills. They are then unable to talk about their case because of a confidentiality clause imposed by Defra as part of the settlement.
On the Late Payment aspects of the issue, FPB has the support of the Minister for Small Firms at the DTI, Nigel Griffiths. He has contacted his colleagues at Defra endorsing FPB's request for action. FPB Chief Executive Nick Goulding will be meeting with Defra this week as part of the Better Payment Practice Group (BPPG) to discuss the issues and to plead for early settlement before more business fail. The All Party Parliamentary Small Business Group (APPSBG) has committed itself to look closely at the matter and has organised a hearing on November 25 which will be attended by FPB.
FPB will lobby Exeter MP Ben Bradshaw, Parliamentary Under Secretary of State at Defra, at a meeting this month and is carrying out research in an effort to illustrate the full extent of the problems facing those many businesses who helped during a desperate time for many in the rural economy. FPB is keen to hear from any company that still has outstanding debts connected with the Foot and Mouth clean-up and will present this information to the Minister.
Any business that is still owed money is urged to visit the FPB website : (or call Andy Mowlah 01565 634 467) where they will be able to get more details about the November 25 hearing and join our campaign to finally bring to a close a crisis that has gone on far too long.
Notes to Editors:
FPB's mission is to influence laws and policies that affect private businesses and support members' profitability. The FPB is the only small business organisation whose policies are always determined by its members through research, including a unique Referendum postal ballot.
FPB Press Office 01565 634709
Rick Hopkins, FPB spokesman for the South West, 01637 830148,