Built environment body welcomes payment time boost for small business.

AN INDUSTRY body representing thousands of consulting firms in the built environment, Consult Australia, has welcomed the Federal Government’s move to ensure small businesses are paid faster. 

From July 2018, the government will be required to pay invoices for contracts worth up to $1 million within 20 calendar days – an improvement from the current policy of 30 days.

The CEO of Consult Australia, Megan Motto, said, “Small business is big business for the built environment and the Australian economy. Cutting red tape and making it easier to manage cash flow turns government into an enabler for small business – critical for industry confidence, our country’s competitiveness, and subsequently economic growth.”

As part of the government’s response to the Australian Small Business and Family Enterprise Ombudsman’s report into payment times and practices, the government announced it will: ensure small businesses are paid faster, setting a new benchmark for government and industry; increase the transparency and accountability of Commonwealth agencies and entities; and create the right environment for the development, innovation and adoption of technological solutions.

Ms Motto said, “The government spends billions each year on infrastructure alone, and whilst many of our large firms have the resource to work with the system, too many of our small firms feel they have to work against the system. For sole trader and small practice engineers, architects, and planners, time is money and their level of administrative burden, be it through contracts or managing debts, can be the difference between thriving or simply surviving.”

Consult Australia represents some 48 000 firms of which 72 percent are defined as ‘small’ through having less than 20 employees. It published ‘Economic Benefits of Better Procurement Practices’ in 2015 which identified $240 million could be saved each year through better procurement practices alone.

“We hear a lot about the government being a model litigant when it comes to procurement reform. This announcement is a step towards the government becoming a model client,” Ms Motto said.

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