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Big end of town to pay on time! Or are they?

Saturday, June 03, 2017

It looks like truly good news. The ‘big end of town’, through the Business Council of Australia, last week launched a new small business ‘pay on time’ code. That is, big businesses signing up to the code have agreed to pay small business suppliers on time. And the Council of Small Business of Australia (COSBA) has endorsed the code.

Let’s be clear. It appears that BCA has moved on the code because the Victorian government has implemented one, the Federal Small Business Ombudsman, Kate Carnell, has been pushing for one and the ‘big end of town’ doesn’t want to see legislation forcing them on this.  

But we’re not so sure if it’s all as rosy as it appears! On our reading of the code, there are significant holes through which big businesses can appear to be ‘good’ payers but avoid on-time payment if they choose.

Here’s our full analysis in which we:
  • Detail the bureaucratic processes that big retailers in particular use to delay making payments. The BCA code will not stop these delays.
  • Show that the code does not commit big businesses to a genuine, independent dispute-resolution process.
Our conclusion is that the BCA code is more a public relations play than substance.

Independent Contractors Australia does not endorse the BCA code.

But it’s a good first step that needs to be given a go. And the Victorian government and Kate Carnell need to be congratulated for their initiatives.

However, we call on the BCA to amend the code to commit companies that sign up to it to adhere to a genuine, independent dispute-resolution process at a minimum.


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