Industry leaders welcome BHP policy change
MACKAY's resource industry leaders have welcomed BHP's announcement of a change to its procurement policies, a move that will result in Australian businesses receiving payment terms of 30 days.
More than 340 Mackay businesses will benefit from the policy change and will receive preferential payment terms from December.
BAE Engineering director Ian Fahl is already reaping the rewards and said the change would allow the business to add an extra apprentice each year.
"The difference it will make to our cash flow is phenomenal. It's been a long drag through this period of 60 day terms so I think it will great for the industry," Mr Fahl said.
BHP's move follows last week's announcement by Peabody who also committed to 30 day payment terms.
Resource Industry Network (RIN) general manager Adrienne Rourke said the announcement would help businesses reduce the use of debt to fund operating costs.
"Businesses will be better able to fund intangible inputs such as research and development, and training.
"These drive the innovation that our sector is famous for," Ms Rourke said.
Federal Member for Dawson George Christensen said it was an excellent outcome for more than 300 businesses that supply to BHP.
"I pushed for a parliamentary inquiry into these payment practices and got it, and launched a major online petition called Make It 30 Days," Mr Christensen said.
Employment and Small Business Minister Shannon Fentimen said BHP's announcement to change their policy built momentum for others to follow.
"All businesses, big or small, have an obligation to support local communities where they and their employees work," Ms Fentiman said.