The Payment Times Reporting Bill 2020 passed through the Senate today and awaits royal assent. The bill passed the House of Representatives on 11 June.
Under the new laws, a payment times reporting scheme will be introduced, requiring businesses with a total annual income of over $100 million to report on how and when they pay their small-business suppliers.
The bill also defined small business as those that have a turnover of less than $10 million, which covers 99 per cent of all businesses.
In response to the passing of the bill, MYOB chief executive Greg Ellis welcomed the said progress, saying small business can finally see due recognition is literally paid.
“Adding this level of transparency will help alleviate some of the cash-flow pressure that many small-business owners are under,” Mr Ellis said.
“Our most recent MYOB Business Monitor data demonstrates SME owners rank late payments and cash flow as high sources of pressure, with 38 per cent of SMEs stressed by late payments and 43 per cent citing cash flow as a primary source of concern.
“Pursuing the payment times reporting framework as a priority for Minister Michaelia Cash and Australian Small Business Family Enterprise Ombudsman Kate Carnell has aided the sector’s confidence in the government to give them a focus equal to their contribution.”
When the bill was introduced into Parliament, ASBFEO Kate Carnell said small businesses will be able to make more informed decisions about their potential customers.
“This reporting framework will require big businesses to be up front and honest about the time it takes to pay their small-business suppliers. It will be important that the information reported is easy to access and integrate,” Ms Carnell said.
“This gives small businesses some choice around who they do business with.”