Survey reveals which commonwealth agencies pay invoices on time

By Shannon Jenkins

Monday January 18, 2021


Federal government agencies are getting better at paying their suppliers on time, according to survey results released by the Department of Industry, Science, Energy and Resources on Monday.

The Pay On-Time Survey found that for 2019-20, agencies paid a record 90.6% of invoices for low value (less than $1 million) contracts within 20 days.

The survey performance report noted that this was a “significant improvement” from the previous year, when just 61.7% of invoices were paid on time.

In value terms, agencies paid 85.2% ($7.99 billion) of low value invoices in 20 days in 2019-20 — up from 42.9% the previous year.

The Pay On-Time Survey has been conducted annually since 2002 to measure commonwealth entities’ compliance with the supplier pay on-time policy. Under the updated policy, which came into effect this month, agencies are required to pay invoices up to $1 million in 20 days, or five days when using e‑Invoicing.

Read more: Commonwealth adopts new procurement payment policy, encourages states to do the same

Of the 92 agencies that took the survey, the Asbestos Safety and Eradication Agency, the Commonwealth Grants Commission, the National Competition Council, the Office of the Official Secretary to the Governor-General, and the Workplace Gender Equality Agency were the only entities to pay 100% of invoices within 20 days.

Among the least reliable entities were the Australian Building and Construction Commission (42.4% of invoices within 20 days), the Australian Prudential Regulation Authority (55.5%), the Department of Health (54.8%), and IP Australia (39.2%).

The Industry department said long and late payments were a major problem for small businesses.

“Research undertaken in 2019 showed that late payments from large to small and medium sized businesses were estimated at $115 billion annually, with $7 billion owed to small businesses at any given time,” the department said in a statement.

“Paying low value invoices in a timely manner demonstrates government commitment to support small business, and improve their cash flow to invest, hire and grow.

“By taking the lead on paying bills on time, the government is also setting a benchmark for industry to reduce payment times for small business.”

The survey has been compulsory for non-corporate commonwealth entities since 2019.

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