The Government has unveiled a plan for small- and medium-sized businesses, setting out a series of initiatives that it claims will make the UK the best place to start and grow a business.

The measures that have attracted the most attention are those aimed at tackling late payments. Already some steps have been taken to address this problem, including new reporting requirements and the launch of the new Fair Payments Code (which we discussed here). However, the Government intends to go further and “legislate to end the scourge of late payments which costs the UK economy almost £11bn per year and closes down 38 UK businesses every day”.

According to the Plan, the new legislative proposals will include: stricter maximum payment terms; stronger powers for the Small Business Commissioner; mandatory payment of interest on later invoices; and fines against large companies who persistently pay their suppliers late.

Other measures in the Plan aimed at reducing the regulatory and compliance burden on smaller businesses include making reforms to the licensing regime, simplifying corporate reporting requirements, and encouraging the use of alternative dispute resolution.

The Government also seeks to unlock access to finance for SMEs, including by increasing the total financial capacity of the British Business Bank, expanding the Start-Up Loans programme, and working with the Financial Conduct Authority to publish an ‘Open Finance Roadmap’ in spring 2026.

Finally, the Plan announces the introduction of a new National Licensing Policy Framework to help grow the hospitality and night-time economies, as well as a series of measures to help SMEs identify and adopt digital technologies and to simplify the “business support landscape”.

To read the Plan in full, click here.