Scottish Public Finance Manual

The Scottish Public Finance Manual (SPFM) is issued by the Scottish Ministers to provide guidance on the proper handling and reporting of public funds.

Annex 1: timing of payments

1. Goods and services

The timing of payment should be stipulated in the contract or in general conditions governing terms of business. Where there is no contractual provision or other understanding or accepted practice governing the time of payment it should be assumed that the suppliers terms are that payment should be made within 30 days of receipt of goods and services or the presentation of a valid invoice or similarly valid demand for payment, whichever is the later. Payments by relevant public sector organisations however should be made in accordance with the Scottish Government target for the payment of invoices within 10 working days of their receipt. Many suppliers should therefore receive payment in advance of their contractually agreed terms. Where payment for low value goods and services is being made by ePC, payment will take place immediately following the supplier’s processing arrangements. This will not be drawn from the operational area budget until the month after the purchase.

2. Works construction contracts

The timing of payment should be stipulated in the contract. The obligation to pay should arise when the work has been completed satisfactorily and validated in accordance with the requirements of the main contract. Payment should normally be made within 30 days of validation as defined in the contract. Payments by relevant public sector organisations however should be considered subject to the Scottish Government 10 working days target for the payment of invoices.

3. Grants or grants in aid

The arrangements for the timing and phasing of payments should be set out in the conditions of grant or the individual sponsored body's framework document and these arrangements should be observed. In cases where the Scottish Government disburses monies which it receives from a third party, such as the European Union, the timing of payment by may depend on the date on which the Scottish Government receives the monies.

4. Other payments

The timing of these payments (e.g. compensation payments) should be subject to the general requirement for payments to be made promptly and, where practicable, within 30 days of a requirement for payment being validated or determined. A delay of more than three months after a requirement for payment had been validated or determined would not normally be consistent with good administration.

Page reviewed: July 2021

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