The Morrison Government welcomes the decision taken by businesses in recent days to change their payment terms with their suppliers.
Decisions taken by Telstra and Rio Tinto to improve their payment terms with suppliers, many of them small and family businesses, better align with the Morrison Government’s impending legislation and community expectation.
Minister for Small and Family Business Senator the Hon. Michaelia Cash said that these decisions confirmed the Payment Times Reporting Framework was the right policy to get best practice out of business.
“This legislation is all about transparency. So when big business react so quickly to community expectations in this instance, we know that they will be equally influenced by the Payment Times Reporting Framework,” she said.
Once implemented, the scheme will require Australian businesses with an annual turnover of $100 million or more to report how and when they pay their small business suppliers.
The scheme is essential to freeing up cash flow and ensuring small businesses are able to thrive.
“Slow or deliberately delayed payment times have a significant impact on small business cash flow and viability. This will be a landmark reform which will encourage fairer and faster payment times for small businesses.”
The Morrison Government is leading the way in ensuring small businesses are paid on time.
Since Scott Morrison became Prime Minister, the Morrison Government has introduced 20 day payment times for small business federal government contracts up to $1 million and has been actively pressuring the big business community to follow suit, with a large number of big businesses already reducing payment times to 30 days or less.
Australian businesses will also have improved cash flow under the Government’s new five-day e-Invoicing payment policy, which came into effect on January 1 this year. Faster payments will help small and medium-sized businesses (SMEs) to prosper by ensuring they are paid in a timely manner.
The Government will introduce the Payment Times Reporting Framework legislation in the autumn sittings of Parliament.
“At the last election, the Morrison Government promised to support small and family business every step of the way, whilst our Labor opponents proposed $387 billion in new taxes on our economy which would have severely damaged the small business sector. Unlike Labor, we understand the importance of small business to our economy.”
