201405.30

Government payments to small business report released


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The number of invoices paid on time to small business by Commonwealth departments and agencies declined slightly in the 2012-13 financial year as revealed in the Australian Government Payments to Small Business report released today.

Under the previous Labor Government the number of invoices paid on time dropped from 96.8 per cent to 96.1 per cent last financial year.

Our plan will see all small businesses that provide services to the Commonwealth get the benefit of a ‘pay on time or pay interest’ approach to all financial obligations of the Commonwealth from 1 July 2014.

As part of this commitment department and agency budgets will not be topped up to cover any delinquency costs as an added incentive for them to pay small business on time.

Under Labor small businesses had to apply to receive interest for invoices that were between 30 and 60 days late.

We understand the vital contribution small business makes to the community and our economy and how important cash flow is.

No small business should be left waiting for payment, which is why as a Government we want to lift the standard of payment performance or compensate small business for the Commonwealth’s tardiness.

The Federal Government is demonstrating its commitment to ensuring small businesses get paid on-time and is implementing the changes necessary to ensure that the Commonwealth isn’t adding to the cash flow challenges many smaller businesses face.

The private sector is strongly encouraged to follow suit to ensure the small business sector has a sustainable future in Australia.

The 2012-13 Australia Government Payments to Small Business Performance Report isavailable via the Treasury website.