The Forum of Private Business (FPB) has rallied the UK's public sector to continue aiming to pay small companies within 10 days despite the introduction of a 30-day EU standard.

Although the FPB has approved of the new European directive, it said that the public sector's ability to pay on time left much to be desired.

Phil Orford, chief executive of the FPB, said: "If approved by the European Parliament, as expected, these new rules under the late payments directive should make significant inroads in tackling the £24bn hole in the UK's economy caused by late payment to small businesses,

"However, although it is still not a widespread success across the public sector, abandoning the UK’s domestic 10-day payment target would be a significant step backwards in tackling the culture of poor payment."

According to the business support group, although central government departments are largely meeting the 10-day target, it is important that the UK’s public sector strives to follow a similar path.

The FPB also points to a special justification that allows the majority of public authorities a 60-day payment period in exceptional circumstances, which in essence, undermines the work many small firms carry out.

And as a result, while some NHS trusts pay more than 90% of their bills within 10 days, others process none of their bills in the allotted 30-day frame.