Regional small businesses back calls for faster payments from big mining companies
Small businesses in regional Queensland are 100 per cent behind calls from the Palaszczuk Government for mining companies to pay small businesses for their services within 30 days.
Payment periods are currently at a staggering 90+ days, a relic from policy introduced at the height of the mining downturn, which the Chamber of Commerce and Industry Queensland (CCIQ) brands as far too long in this current climate and the straw that could break the camel’s back.
CCIQ’s latest Pulse Survey showed regional businesses are experiencing weaker levels of profitability, meaning cashflow is now more important than ever for survivability.
A sentiment backed by CCIQ, Small Business Minister Shannon Fentiman believes the improvements in demand and prices across the resources sector should be the catalyst for fairer payment terms, which should be voluntarily adopted by the sector.
In a submission lodged last year, CCIQ recognised that small business suppliers have long been placed at the bottom of the food chain for corporates and larger companies.
Long payment periods, as well as late payments, have become “normal” for small businesses, despite them often providing vital products or services to these larger companies.
Furthermore, a survey conducted by CCIQ found that alarmingly over half of the surveyed businesses (56 per cent) had invoices paid more than two weeks late, and that one in five businesses (21 per cent) spend more than six hours a week chasing up late payments.
Australian Small Business and Family Enterprise Ombudsman (ASBFEO) Kate Carnell late last year launched the National Payment Transparency Register following the Payment Times and Practices Inquiry which looked at the growing trend in payment practices, particularly amongst large Australian and multinational businesses, to extend payment times.
CCIQ supports the roll-out of the Register and urge larger businesses to sign on to the initiative.
The Register promotes businesses who are committed to good payment time practices, and also allows for small businesses to contact the ASBFEO office should the terms on the register not be met.