The Queensland government has announced that it will follow the likes of the NSW and federal governments to speed up the time frames in which it pays invoices to SME suppliers.
In a statement on Thursday (23 May), the sunshine state’s Minister for Employment and Small Business, Shannon Fentiman, said the government is committing to change its payment times from 30 days to 20 days.
It matches a commitment made last year by Prime Minister Scott Morrison for the federal government and its agencies on paying SME invoices.
Mr Morrison has also said large businesses tendering for government contracts will be forced to abide by the same payment time.
The NSW government, meanwhile, still maintains the benchmark it set mid last year, pledging to pay SME invoices within just five days by the end of 2019.
However, the measure will not be implemented by the Queensland government until next year.
“Queensland is home to more than 438,000 small businesses, and we want to help them to grow and succeed,” Ms Fentiman said.
“As of 1 July 2020, the Palaszczuk government will reduce invoice payment times from 30 days to 20 days for small businesses, and we will work on measuring our engagement so we can set a target for government procurement to support smaller businesses.”
She added: “Over the next 12 months, we will work to improve the capture, sharing and reporting of Queensland government procurement data, so we can set a baseline for our future target.”
The measure was timed to coincide with Queensland Small Business Week, which runs from Monday, 27 May, to Friday, 31 May.
‘Commendable, though disappointing’: ASBFEO
Kate Carnell, the Australian Small Business and Family Enterprise Ombudsman, commended the Queensland government’s announcement but said that it “is disappointing it couldn’t be achieved before 1 July next year”.
“The federal government has committed to reducing payment times to 20 days by 1 July, and down to five days for small businesses that adopt e-invoicing next year,” she said.
“Last year, the NSW government fast-tracked its payment policy to 20 days and committed to five days by the end of 2019.
“If they can do this for the small business sector, other states and territories should do the same.”
Ms Carnell noted that her office’s Access to Justice Inquiry last year found that payments times and terms were the leading cause of disputes for SMEs.
As such, she also pushed big business to follow the lead of these governments and adopt more realistic payment time frames as standard practice.
“Big business should also step up to the plate with faster payment times, instead of the 90 or 120 days we see from some big companies at the moment,” said Ms Carnell.
“That is abuse of market power.”
One Nation went to the election with a policy of mandating maximum payment terms nationally and attaching steep financial penalties for corporations found to have breached this rule, in a bid to address the issue of late payments to SMEs.
Adam Zuchetti is the editor of My Business, and has steered the editorial direction of the publication since the beginning of 2016. Before joining My Business, he worked on fellow Momentum Media titles The Adviser and Mortgage Business.
The two-time Publish Awards finalist has an extensive journalistic career across business, property and finance, including a four-year stint in the UK. Adam has written across both consumer and business titles, including for News Corp Australia and Domain.
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