Senator the Hon. Mathias Cormann
Minister for Finance
Hon. Bruce Billson MP
Minister for Small Business
Date: Wednesday, 19 March 2014
Through a range of red tape reduction initiatives the Government is delivering on its election commitment to make it easier for small businesses to do business with the Government.
This is about creating the right environment for businesses of all sizes to thrive and prosper and to drive investment and jobs growth.
As part of a number of measures, business of all sizes will soon find it much easier to supply their products and services to Government with the new Commonwealth Contract Suite.
A simplified process for tendering will apply for contracts below $200,000. Standardised terms and conditions, combined with user-friendly and intuitive online templates will remove the need for legal advice and other associated costs.
The Government tendering process can be daunting. That’s why we are also introducing new, easier to understand guidelines on the Department of Finance website. Government agencies will be encouraged to talk to potential suppliers during the tendering process.
We are introducing a streamlined low risk grant template, which will reduce the significant administration and legal costs associated with grant agreements.
The new low risk grant template includes a standard set of just 20 terms and conditions covered in just two-pages. This compares with a regular grant template which can stretch to 50 terms and conditions and be up to 50 pages.
We are making it easier for small businesses to be paid. With the introduction of a new policy, credit and debit cards will become the Government’s preferred payment option for purchases under $20,000.
These initiatives will all be operational from 1 July 2014.
These Repeal Day initiatives are just some of the hundreds of measures that are aimed at reducing red tape and support the Government’s commitment to reduce $1 billion worth of red and green tape each year.
For the Hon Cormann - Karen Wu - 0428 350 139
For Mr Billson - Kane Silom – 0408 468 772
Repeal Day Initiatives in Detail
Commonwealth Contract Suite
- The new Commonwealth Contract Suite replaces the old ‘Basic Contract Suite’ and increases the threshold for eligible contacts to $200,000.
- Almost 85% of contracts listed in AusTender are below the $200,000 threshold. As such, the vast bulk of Government contracts will now be able to go through this new, simplified process.
- The new contract suite is much more user-friendly with easy, intuitive online templates which will remove the need for legal advice every time you tender.
- In the lead up to the last election, we committed to removing obstacles and complexity for small businesses in securing Government contracts.
- This new contracting suite significantly reduces these barriers and is designed to encourage more participation by small businesses in tendering for Government contracts.
Online guidance during tendering processes
- Deciphering the do’s and don’ts in the Government’s tendering process can be a challenge, both for businesses and for Government agencies.
- The Department of Finance is now working to bust common myths associated with communicating with potential suppliers during the tendering process and provide better assistance.
- New information guides will go up on the Department of Finance website and Government agencies will be encouraged to talk to potential suppliers during the tendering process.
Low risk grant template
- The Government is introducing a streamlined, low risk grant template which aims to reduce the significant administration and legal costs associated with grant agreements.
- We will roll out the new low risk grant template across all agencies in Government, providing a previously unseen level of consistency for grant agreements.
- The new low risk grant template includes a standard set of just 20 terms and conditions covered in just two-pages.
- This compares to a regular grant template which can stretch to 50 terms and conditions, and up to 50 pages.
- The low risk grant template will suit applications for grants that run for up to three years, involve a single activity supporting a local community and from well established and stable industries and sectors.
- Once in full operation, it’s anticipated that the vast majority of the nearly 25,000 grant agreements issued every year will be suitable for the low risk grant template.
Use of credit/debit cards for payments under $20,000
- The Government is introducing a new policy that enables the purchase of products and services valued under $20,000 to be made using credit and debit cards.
- Currently, the payment for products and services by Government agencies are typically through accounts, which have 30 day payment terms. The establishment of accounts with suppliers often involve significant administration costs.
- Each Government agency also currently has different payment arrangements. This new policy will standardise payment arrangements and provide suppliers to Government with consistency and certainty.
- The use of credit and debit cards to pay for products and services under $20,000 will significantly speed up payment to small businesses, who often face cashflow concerns.