Contract payments should only be made in accordance with the provisions of the contract, which should incorporate, where appropriate, government policy for payments to small business.100 Payments should only be made where the contract manager is satisfied that the provisions have been fulfilled. Before payments are made, evidence is required that the goods and services have been received and have met the required standard of performance.
It is also important that payments for satisfactory performance are made in line with the timeframes set out in the contract. Payments for satisfactory performance should not be delayed because this can undermine the relationship with the contractor.
Payments should be made following receipt of a correctly rendered invoice or other statement of expenditure. All necessary authorizations and approvals should have been obtained prior to making payment.
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100 This policy requires agencies to adopt maximum payment terms 'not exceeding 30 days' from the date of receipt of correctly rendered invoices. Refer to the Department of Finance and Deregulation website, <http://www.finance.gov.au/ procurements, Procurement Connected Policies guide for details of this policy and other policies of the Commonwealth that interact with procurement.