The Albanese Government is committed to ensuring more small businesses are paid on time, recognising how important cash flow is to small businesses, and to sustaining growth across the economy.
That’s why the Government has released the written report of the independent review of the Payment Times Reporting Act 2020 (the Act) delivered by the Honourable Dr Craig Emerson.
The review outlines how faster payment times alleviate administrative burdens and reduce financing costs for small businesses.
The resulting gains to productivity can support higher wages and profits and expand the range of economic and employment opportunities, with flow on effects across the economy.
However, without government intervention, there are limited incentives for large businesses to improve payment times and small businesses often lack the market power to negotiate better outcomes.
The review finds that the Payment Times Reporting Scheme has merit but current legislative requirements impose unnecessary regulatory burdens on reporting entities, compromise the accuracy and accessibility of the payment times data and limit the effectiveness of the Regulator.
The review makes 14 recommendations, encompassing 23 actions for Government.
The Government will carefully consider the findings and recommendations from the review. I have asked the Treasury to immediately proceed with actions that require only changes to existing guidance materials and operational processes.
These will reduce the regulatory burden on reporting entities in identifying their small business suppliers and help improve the quality of reported data.
I would like to thank the Hon Dr Craig Emerson for conducting this review, as well as the secretariat team in Treasury that supported him, and the more than 100 stakeholders who engaged in consultation processes to inform the Review.