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Thursday, 6 March 2003
Page: 9351

Senator CONROY (9:33 AM) —I move:

That this bill be now read a second time.

I seek leave to have the second reading speech incorporated in Hansard.

Leave granted.

The speech read as follows—

Labor is introducing this bill to protect the interests of small business.

The purpose of the bill is to crack down on late payments by big business and government customers to their small business suppliers.

Many small businesses are finding that their big business and government customers are taking too long to pay their bills.

This creates cash flow problems for small business.

The bill implies a term in qualifying contracts that interest is payable on qualifying debts.

Interest starts accruing on the day after the debt is due. The Minister will determine the rate of statutory interest or the formula to be used for calculating the rate.

A qualifying contract is a contract for the supply of goods and services, where the purchaser is a large corporation or a Commonwealth agency, and the supplier is a small business and both are acting in the course of business.

Small business is defined as an independently owned and operated entity employing less than 20 people on a full time employment basis.

A large corporation is a corporation with a turnover in excess of $20 million per year.

Certain contracts are excluded from the definition of `qualifying contracts'.

Contracts which are not `qualifying contracts' are called `excepted contracts' and include contracts where the consideration is not monetary, consumer credit contracts and contracts intended to operate by way of mortgage, pledge or other security.

Contract terms which try to exclude the right to statutory interest are void unless there is a substantial contractual remedy for late payment of the debt.

The Government has demonstrated that it won't act to protect the interests of small business.

This bill shows that Labor will.

Small business groups have also stated their support for this bill. Those groups include the Council of Small Business Organisations of Australia and the Motor Traders Association of Australia.

I commend this bill to the Senate.

Senator CONROY —I seek leave to continue my remarks later.

Leave granted; debate adjourned.