Cashflow problems are the biggest threat to the future of many local companies, according to a Bradford business chief who has endorsed a new survey which highlights the issue.

Nearly half of Yorkshire businesses covered by a survey released today by Santander’s corporate banking arm said they had concerns about managing cashflow over the next 12 months, with nearly a third citing late payment of bills as the main cause of their problems.

Sandy Needham, chief executive of Bradford Chamber of Commerce, which represents about 1,100 businesses in the district, confirmed that firms of all sizes continued to suffer from late payment – in spite of legislation designed to tackle the issue.

She claimed the Late Payment Act was “useless” as very few, if any, firms would use it, particularly small businesses which feared being blackballed by big customers.

Bradford East MP David Ward has urged ministers to beef up the Act to make it more effective.

Sandy Needham said: “We are hearing complaints about late and slow payment of bills all the time and it’s an issue that affects businesses of all types and sizes. Together with difficulty in accessing funding, late payment is the top challenge for local firms.

“We recently recruited a small business into chamber membership specifically because it wanted to use our debt collection service.

“It’s difficult, dispiriting and time consuming for owner-managers to have to spend valuable time chasing bad debts that cause serious cashflow problems.”

Neil Williams, of Santander, said: “Many businesses are missing out on effective alternative financing solutions such as invoice or supply chain finance – or relying excessively on loans and investments – and in doing so, are opening themselves up to unnecessary cash flow volatility and business risks.”