Getting paid within 30 days should be mandatory at law

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The Payment Times Reporting Framework legislation does not go far enough to protect small business transport owner-operators.

NatRoad CEO Warren Clark said, “The federal Government should make 30-day payments a minimum payment period rather than a hope and a prayer for small business.

“We want to end the uncertainty and inconsistency of payment times for transport owner-operators as delayed payment or non-payment are the major contributors to business closure.”

NatRoad was pleased that this month the federal Government made a commitment to introduce its Payment Times Reporting Framework legislation into Parliament.  This legislation will have a positive impact on small business owners. It requires big businesses (with over $100 million turnover) to report on how they pay small business and within what time frame.

“This is a good first step but payments beyond 30 days should be made illegal. The well documented inconsistencies and blatant infringements of agreed payment terms by customers in the road transport industry mean that a new law making 30 days the longest payment period permitted at law would have real cut through to help small businesses.

“Remember that subcontracting plays a vital role within the hire and reward fleet. Many of these subcontractors are owner-operators with no employees. Less than 0.5% of all operators own a fleet of more than 100 trucks, and 70% have just one truck in their fleet,” said Mr Clark.

“Unreasonable payment times by suppliers means these small businesses are being used as a cheap form of finance. The effect of extended payment times affects all levels of industry, putting more cost and reliance on credit just to stay in business. As a result, more businesses are finding it too challenging to continue in a market that is already cost-competitive, fuelled by increased toll and landside port charges and a foreshadowed increase in road user and heavy vehicle registration charges from 1 July this year.

Natroad continues to lobby the Government for changes to the law to better support and protect road transport operators.