Source: New Zealand Parliament – Hansard
Question No. 7—Small Business and Manufacturing
7. CAMERON BREWER (National—Upper Harbour) to the Minister for Small Business and Manufacturing: What recent steps has the Government taken to improve payment times for small businesses?
Hon ANDREW BAYLY (Minister for Small Business and Manufacturing): My colleague the Hon Melissa Lee and I recently announced that the Government is committed to supporting faster payments for small businesses, especially given that the Government spends over $50 billion annually with its suppliers. From 1 January 2025, the Government’s 135 agencies will be required to pay small businesses much more promptly, providing these businesses with the timely cash flow they need to grow and succeed.
Cameron Brewer: What is the time line for implementing faster payment requirements for Government agencies?
Hon ANDREW BAYLY: From 1 January next year, the 135 agencies must pay 90 percent of trade invoices within 10 business days, increasing to 95 percent in 2026. Secondly, as part of the Government’s focus on encouraging greater digitisation of the economy, from 2026, Government agencies processing over 2,000 domestic invoices annually must use e-invoicing, ensuring payment within five working days.
Cameron Brewer: What steps will the Government take to ensure compliance with these payment rules?
Hon ANDREW BAYLY: To ensure compliance, we will require Government agencies to report their payment results quarterly. These results will be published on the Ministry of Business, Innovation and Employment website. This will allow anyone to check the compliance of relevant Government departments. These agencies will also have to report why they have failed to meet the payment requirements and front up to their respective Minister.
Cameron Brewer: How will these new rules impact the day-to-day operations of small businesses?
Hon ANDREW BAYLY: These rules are set to make a substantial difference. We know that for small businesses, cash flow is critical, and waiting extended periods for payment can hinder growth or even threaten survival. By mandating shorter payment times, we’re providing business owners with the resources they need to invest in their operations, whether it’s hiring more staff, upgrading equipment, or expanding services. This is all part of the Government’s support for small businesses.