What does the Pay On-Time policy promise?
Commonwealth entities must pay suppliers on time, or pay interest on the delay, under the Supplier Pay On-Time or Pay Interest Policy (RMG 417). The old $1 million contract-value ceiling was removed in July 2022, so the policy’s scope is broader than older summaries suggest. Recheck the current RMG for conditions and exclusions before relying on any figure here: policies are revised, and interest mechanics have fine print.
The promise runs on correct invoices. Wrong entity name, missing purchase order reference, non-conforming format: each restarts the administrative clock however promptly the policy reads on paper. Invoice discipline is part of cash flow, not admin trivia.
Where does eInvoicing fit?
Electronic invoicing through the Peppol network lets a correctly rendered invoice arrive machine-readable and triggers the policy’s five-day eInvoicing payment provisions. Five days is not automatic money (conditions apply, and the invoice must be correct), but eInvoicing removes the mailroom, the lost PDF, and the “we never received it” dispute in one move. If the buyer supports it, use it from the first invoice.
What is Payment Times Reporting, then?
A separate transparency scheme: large reporting entities file half-yearly reports on how fast they pay small business, published on a public register with an active regulator. Two reports a year, each covering six months, due within three months of period end. It tells you how a big prime or buyer behaves, useful diligence before signing as a subcontractor, but it creates no payment entitlement of its own. Reporting is not the promise. The contract and RMG 417 are.
What does this mean for the bid/no-bid call?
Model cash flow on the contract’s milestones and the buyer’s actual payment behaviour (the method is on payment terms and cash-flow risk), not on policy headlines. A five-day eInvoicing provision against ninety-day milestone verification is still ninety days. Read the schedule. The rules underneath are the Commonwealth Procurement Rules.