Local Authority Debt Collection

Local Authorities and Councils are notoriously difficult to obtain payment from even though they are bound by late payment legislation and additional Government directives to ensure public sector suppliers are paid on time. Large organisations with multiple departments and payment processes can push a creditor from pillar to post for months.

We had successfully recovered payment from a Borough of London Local Authority on behalf of our client back in 2019. The issue raised for non-payment was that the Local Authority refused to pay because the invoice did not display a purchase order number. With the assistance of our client, we were able to evidence that the services were requested and that the requester failed to supply a PO number when the onus was on them to do so. That case was fairly hard work and it took 12 days to receive payment.

The client recently instructed us again regarding a debt of £12,642 owed by a West Midlands City Council. This Council was again refusing to pay on the basis that they had not issued a purchase order for the services provided and that any invoices that did not display a purchase order number could not be processed in their payment system. This excuse from the debtor is a fairly common debt collection hurdle that our client was accommodating in assisting us in overcoming by supplying us with detailed information on the circumstances surrounding the debt and services provided.

Based in London, our client is a care staffing agency specialising in the provision of care to children with special needs. They had delivered services for a child with specific requirements under an Education, Health and Care Plan (EHCP). The EHCP contained provisions that must be funded by the Council in which the child was located, and it did not require the Council to instruct our client or issue them with a purchase order. Therefore, the requirement for our client to display a purchase order number on their invoice did not exist, and the Council had no reasonable grounds to continue to withhold payment.

Client information assists in swift recovery of £12,642

Armed with the un-contestable information supplied by our client, the debtor quickly agreed to process payment once Advocate became involved and provided the necessary information to facilitate payment. As a result, our client received full payment six days following our instruction and eight months after the issue of their invoice, and we received full payment of our charges at the same time.

It’s not just local authorities that rely on the no PO number excuse to delay payment, and it’s a barrier we often have to break down to secure payment for our clients. If you receive an instruction to supply goods or services that are not accompanied by a purchase order, the originator of the order cannot reasonably expect you to provide information that does not exist in order to receive payment.

This debt recovery case is an excellent example of how detailed information at the point of instruction can assist us in getting you paid as quickly as possible.

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