LOCAL authorities are being “highly destructive” in failing to pay invoices worth millions of pounds on time, business leaders have said.

Councils are paying millions of pounds of invoices more than a month late to small businesses according to figures obtained by The Argus.

In one case a company waited five years for a council to pay up.

Business leaders said the practice strangled growth and was “a greater evil” offsetting any support councils were offering.

Brighton and Hove City Council paid 5,437 invoices late to small businesses in 2013/14 – totalling more than £6.2 million.

More than 86% of all invoices paid by the council to small businesses in the last full financial year were late with about one in 30 invoices late by a full month.

West Sussex County Council paid 4267 invoices more than 30 days late in 2013/14, totalling £14.6 million.

The figures reveal Hailsham-based roofers Trojan Rose had to wait more than five years on a £171,000 invoice.

Other significant late payments by the authority include a four and-a-half-year wait for Muntham House School in Horsham to collect a £280,000 invoice and a three-and-a-half-year delay in Worthing College receiving £500,000.

Brighton-based accountant Trevor Freeman said he had dealt with start-up firms with one third of their turnover tied up in debts accrued largely by local authority and the Government.

He said: “Late payment strangles growth because all small companies are reliant on cash flow and if that is slowed down by late payment it has a direct knock-on effect and impedes expansion and investment and ultimately impedes employment.

“It’s a disaster for small business who don’t have a lot of resources.

“When the boot is on the other foot and they want money they are owed, local authorities can be very brittle about it and really start the threats quite early, they have the ability to close companies down.”

Catherine Vaughan, executive director finance and resources at Brighton and Hove City Council, said the authority was “proud” to have paid 86.33% of SME invoices totalling £120 million within ten days in 2013/14.

She added: “The council has streamlined its processes to ensure that SMES are paid efficiently and effectively.”

A West Sussex County Council spokeswoman added: “We know how important it is for small businesses to be paid on time – we are monitoring this on our new performance dashboard.”