The Business Council of Australia’s supplier payment code, introduced in May last year, was aimed at improving payment times across the economy and committing signatory companies to pay small businesses within 30 days of receipt of a correct invoice.
To date, 46 Business Council members and 37 non-members have adopted the code, including EY, MYOB and Xero.
Former ACCC chair Professor Graeme Samuel has been appointed independent reviewer, with the review to be overseen of a panel comprising of Australian Small Business and Family Enterprise Ombudsman (ASBFEO) Kate Carnell; Victorian Small Business Commissioner, Judy O’Connell; Council of Small Business Australia (COSBOA) chief executive, Peter Strong; and Rio Tinto Australia principal, Dirk Fourie.
“We are particularly interested in whether the code has made an impact on payment times since it was launched in May last year,” said Ms Carnell.
“We’d like to know how the code could be better promoted and if any of the code requirements should change.”
Further, Ms Carnell said the review was timely, considering how most small businesses were still suffering from delayed payments.
“More and more small businesses in Australia are falling victim to the unscrupulous payment practices of some big businesses and some government instrumentalities, which is a drag on the economy,” she said.
“Given small businesses typically operate on extremely tight margins, all payments should be made in 30 days or less. As any small business owner will tell you, cash flow is king.
“Chasing overdue payments causes stress and anxiety; it’s a waste of time and it stymies growth by forcing the business to focus on surviving rather than thriving.”
Interested stakeholders are invited to provide input into the review via written submissions by 28 September and can view the terms of the review here.
Jotham Lian is the news editor of Accountants Daily, the leading source of breaking news, analysis and insight for Australian accounting professionals.
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Before joining the team in 2017, Jotham wrote for a range of national mastheads including the Sydney Morning Herald, and Channel NewsAsia.