November 25, 2020
Australian Small Business Ombudsman Kate Carnell as welcomed a commitment by engineering group UGL to restore 30-day payment terms for its small business suppliers in the New Year.
The announcement by CIMIC – which owns UGL – follows concerns raised by the Ombudsman in September last year regarding reports the engineering company had extended its payment terms to 65 days and notified suppliers to contact Greensill Capital if earlier payment was required.
This prompted the ACCC to look into issues around extended payment terms and reverse factoring.
“We welcome the announcement that CIMIC and UGL plan to return to 30-day payment terms for all of its small business suppliers by early next year as part of its yet-to-be-released Small Business Policy,” Ms Carnell said.
“CIMIC says it will publish its Small Business Policy for its operating companies, including UGL and CPB contractors in the coming weeks, in which suppliers will be eligible for 30-day payments.
“My office looks forward to reading this policy in detail.
“We also acknowledge the leadership shown by Greensill Capital, which pledged in May to discontinue the use of supply chain finance facilities by companies that misuse its products by pushing out payment terms.
“We know that late payments make a huge difference to small business’ bottom line and that is only amplified for small businesses that have faced unprecedented challenges in 2020.”
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