In fact, UK payment periods, at an average of 50 days, are better than in the European Community as a whole, where the average is about 65 days. In Italy the average is 90 days, according to a survey published last week.
The responses from nearly 5,000 small- and medium-sized companies spread among the 12 EC countries showed that the problem is becoming worse. More than 60 per cent reported longer payment periods than a year ago. Of the 75 per cent that were taking action to recover their debts, a third had resorted to legal action.
Patrick Brooke, a partner with the accountancy firm Grant Thornton, which carried out this first annual study with Business Strategies, the economic consultants, believes the problem casts a shadow over British companies looking to export. 'Portugal, Italy and Greece tend to have particularly long average payment periods, and so the British drive to export must be reinforced with a good system for ensuring payment. The possible legal problems of suing a foreign company if payment cannot be obtained should be borne in mind,' he said.
But companies content to operate in their home markets also feel pressure on cash flow if they are not paid on time. And with times of economic recovery traditionally putting pressure on firms' finances, the problem could become increasingly acute. 'There is clearly a need for a tightening-up of payment procedures if businesses are to sustain their cash flow and their ability to export,' Mr Brooke said.
The survey, which is claimed to be the most comprehensive of its kind, found overall that small- and medium- sized businesses were moderately optimistic about their prospects, although Britain, France and Germany were less upbeat than the smaller countries. But, while nearly a quarter expected to increase turnover next year and a fifth planned to increase exports, there was still a belief that more jobs would go and that profits would not rise. More worrying from a British point of view - and a point seized on by Gordon Brown, the shadow Chancellor - was the lack of commitment to training and R&D.
Belgium and the UK were the least optimistic about increasing spending on training. Less than a quarter of their companies said they would spend more on training in the next 12 months.
Nearly all the countries expected to reduce spending on new buildings, but only UK companies expected to cut expenditure on R&D.
Mr Brown said the findings confirmed Labour's belief that policies aimed at encouraging better investment and training were needed if Britain was to achieve a sustainable recovery and build a strong economy.
Mr Brooke added that it showed a 'worrying concentration' on the short term. 'It is disappointing that the Government's stress on training as the way to take advantage of the emerging opportunities seems to have escaped the attention of many British companies.
'The widening skills gap in the UK means that we are leaving ourselves open to competition from other European countries, such as Denmark, which have a much more enlightened view on investing in the workforce.'
The survey also discovered that the cost of finance was a particularly significant constraint on expansion in Portugal, Greece and Spain, but that a shortage of orders was the main impediment in Britain and France.
Less surprising is the finding that only the Republic of Ireland is worse than the UK at negotiating in another language. While 67 per cent of EC companies can field a foreign-language speaking executive, for Britain alone the figure is just 38 per cent.
'The European Business Survey' is available from Grant Thornton. Price pounds 95.
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