The Oldham Early Payment Scheme (EPS) Meet the Buyer Ben Jackson For the benefit of all… a voluntary scheme to inject cash into the local economy while saving money for the Council

2 Market conditions

3 The Challenge: Cash & Liquidity in the market Many contributory factors are making trading conditions increasingly difficult over and above late payment: Despite record low interest rates banks are increasingly reluctant to lend at any rate. Buyers (including council) spend down. Leading to: Suppliers having to build credit costs into price. Suppliers going into administration, disrupting supply and damaging the local economy.

4 The solution: Early Payment Oldham is leading the market in not just adopting the ‘Prompt Payment Code but introducing an Early Payment Scheme. Designed to support the supply base and deliver commercial benefits for Oldham Council. Participation for suppliers is optional.

5 How the EPS works There are no joining fees, just a simple contract amendment. The Council and supplier will agree an Early Payment Fee (EPF) % for payment on day 5 rather than 30. The actual EPF % applied to each invoice will reflect how close to day 5 the invoice is actually paid. The Council funds the early payment, leveraging its very strong credit rating to provide suppliers with a cost- effective means of improving cash flow.

6 Benefits The council, our suppliers and the local economy can benefit from such a scheme. Suppliers Improve cash flow / cash forecasting Reduce credit control and administration Integrated relationship with the Council Improved DSO The Council Reduce risk of supply Generate commercial benefit Puts cash to work. Local economy Inject cash into local businesses. EPS commercial benefits are directed to protect front line service.

7 Summary Oldham Council is being proactive in bringing this offering to its supply base, with over 130 suppliers already benefiting. Supplier benefits can be significant, though we recognise each set of circumstances are different. Payments nationally will continue to evolve as a key factor within commercial terms and conditions Oldham is working hard behind the scenes to optimise its payment processes to ensure accuracy and reliability.

8 Contact Information Early Payment Queries Mailbox –