Senator the Hon Simon Birmingham

The Morrison Government is making it easier for small and medium businesses to engage with Commonwealth agencies as part of our plan to support Australia’s economic recovery.

Updates to the Commonwealth Procurement Rules (CPRs) will streamline processes and reduce costs for small and medium enterprises (SMEs) in the Government procurement market.

As part of the new rules, an exemption will allow agencies to directly engage SMEs for procurements valued up to $200,000, which will reduce tendering costs and work in conjunction with the Indigenous Procurement Policy.

Minister for Finance Simon Birmingham said the updated policy will cut red tape, reduce costs and provide quicker payment times to Australian small businesses who are engaged with Commonwealth agencies.  

“Small businesses are the engine room of our economy, and this change will cut red tape and reduce costs for small businesses within the government procurement market,” Minister Birmingham said.

“We expect these changes will put more small businesses in the mix for government procurement work, and that will help them grow their own operations and create more jobs for Australians.”

Minister for Employment, Skills, Small and Family Business, Michaelia Cash said the Morrison Government is focussing on reducing the barriers for small and family businesses.

“Many small businesses supply goods and services to the Australian Government. This change is all about providing more procurement opportunities to small businesses, so that they can grow and employ more Australians,” she said.

“These policies reflect the Morrison Government’s commitment to support small and family business and ensure that it continues to play a critical role in driving Australia’s economic recovery from the COVID-19 pandemic.”

These changes also support the Government’s Supplier Pay On-Time or Pay Interest Policy, which was updated earlier this year and includes five day payment terms for e-Invoicing.

The Government is also progressing implementation of the Payment Times Procurement Connected Policy and delivering on our promise to reduce payment times and improve business cash flow for small businesses.

The updated CPRs take effect from 14 December 2020 and can be found on the Department of Finance website.