ATA pressed its concerns about payment terms with Australian Small Business and Family Enterprise Ombudsman Kate Carnell AO.
ATA pressed its concerns about payment terms with Australian Small Business and Family Enterprise Ombudsman Kate Carnell AO.

COVID-19 made payment terms issue worse

The Australian Trucking Association (ATA) has stood up for small trucking businesses this week and pressed its concerns about payment terms with Australian Small Business and Family Enterprise Ombudsman Kate Carnell AO.

In a video conference, ATA chief executive officer Ben Maguire highlighted the impact of unfair payment terms on small trucking businesses.

“Payment terms are an existing problem in the trucking industry, but the coronavirus pandemic has made the problem worse. Some customers of trucking businesses have started extending their payment terms to pre-empt what might happen with their own cash flow,” Mr Maguire said.

“At the same time, some suppliers are shortening their credit terms, for example from end of month+30 days to invoice+14 days,” he said.

Ms Carnell empathised with the trucking industry and said she understood the pressure faced by trucking businesses across Australia.

“It’s tough if you’re a truckie. You have to pay for things like (fuel) almost immediately,” Ms Carnell said.

Mr Maguire said the ATA was a longstanding advocate for a mandatory code to address the payment issues facing trucking, and thanked Ms Carnell for her support.

“We appreciate the work Kate Carnell’s office has done to highlight the impact of payment terms on small businesses and the need for stronger action from the Government,” Mr Maguire said.

“The ATA will continue pressing the Government to fix unfair payment terms as a matter of urgency. Australia’s economic recovery from the pandemic will depend on the nation’s small businesses – but they can’t do the job if they don’t get paid.

“The ATA has proposed that fair payment terms be delivered in the trucking industry through a mandatory code under Part IVB of the Competition and Consumer Act.

“Given the scope of the problem, however, the Government needs to follow the UK’s approach and include all business to business transactions in its planned payment terms legislation, with the statutory time period set at 20 days,” he said.