Tuesday 10th June, 2013

While eInvoicing is increasingly being adopted by the private sector to successfully streamline the Accounts Payable function, take-up by government and public bodies is notably slower.

In an attempt to find out why, the government set up a Committee of Inquiry, under the chairmanship of Stephen McPartland MP.

A number of organisations, interested bodies and experts in the field sit on the committee including NSYS Services. With their experience of working with public bodies such as the Scottish Local Authority Accounts Payable Forum and Scottish Local Authorities, NSYS Services was called upon to share its technical expertise, insight and experience.

The results of the inquiry have now been published in a report – ‘Electronic Invoicing: The next steps towards digital government’ – which highlights the issues involved and contains the Committee’s recommendations.

The report recognises that in a world increasingly driven by digital innovation, eInvoicing can significantly improve efficiency and productivity, not just for businesses of every type and size, but also in the public sector.

The report also points to the significant reduction in trading costs that eInvoicing can make, quoting the £650million in savings that leading grocery retailers already make each year by not using manual, paper-based processing. If electronic invoicing were more widely introduced, it would save the public sector and its suppliers over £2 billion a year, the Committee concludes.

With BACS reporting that in 2013 nearly £30 billion was tied up in late payments, eInvoicing would also improve cashflow for many businesses that deal with public sector departments, potentially a key consideration when the government is keen to increase the share of public procurement with SMEs to 25%.

These monetary benefits are in addition to the obvious environmental benefits of reducing paper usage.

For larger private sector companies, eInvoicing has already become the norm – Tesco sends and receives over one million business documents every month – and thanks to new technological developments will become more affordable still, making it ever easier for smaller companies to enjoy its benefits.

To date the UK has not embraced eInvoicing as fully as other European countries like Denmark, Norway and Portugal, where eInvoicing is mandatory. However, the introduction of new EU Directives on Public Procurement, Utilities Procurements and Concessions Contracts should give fresh impetus to the wider implementation of electronic invoicing in the UK’s public sector.

That, the report concludes, would have the potential to open up new markets throughout the country and stimulate innovation and economic growth, and “now is the perfect opportunity for the UK government to lead by best practice.”