President Obama announced a new policy that will accelerate payments to small business contractors so they can reinvest that money in the economy and drive job growth.
Small businesses are the primary engine of job creation and job growth across the country. However, in today’s economic climate many face tight budgets and limited resources. With these challenges in mind, last week in his address to Congress the President emphasized the need to take common sense steps to give small businesses the flexibility they need to invest and hire. And that is what we are doing today.
The Federal Government pays small businesses nearly $100 billion each year for goods and services. By taking actions that will enable these payments to be made as promptly as possible, we will improve cash flow for small businesses and provide them with a more predictable stream of resources.
Currently, payments must be made within 30 days from when the Government receives an invoice. Under this new policy, we are cutting the goal in half to 15 days and asking agencies to take all reasonable steps to make payments as quickly as possible. This will benefit tens of thousands of small businesses by getting money into their hands faster.
This new policy is another action that the Administration is taking to improve American competitiveness by helping companies grow and create jobs. The President’s Jobs Council played a critical role in spurring this initiative through its focus on small business financing. And through this collaboration with the private sector, Federal agencies, and small businesses themselves, we will continue to take necessary steps to help America’s small businesses obtain financing, create jobs, and grow our economy.
Jeff Zients is the Deputy Director for Management and Chief Performance Officer.