Australian Government Support for Defence Industry

March 27, 2020 – The Morrison Government is providing certainty and funding to help Australian companies through the COVID-19 pandemic, with fast-tracked payments to defence industry a key feature of initial assistance to help mitigate the effects of the global coronavirus pandemic.

This will mean some suppliers will receive payment up to two weeks earlier than usual.

Minister for Defence, Senator the Hon Linda Reynolds CSC said COVID-19 posed an unprecedented challenge to Australia’s defence industry.

“Defence industry makes an important contribution to our economy, our security posture and our safety,” Minister Reynolds said.

“That is why we brought forward the payment of more than $500 million to businesses in Australia, which ensures money is flowing into the Australian economy at a time of acute pressure.”

About 35,000 Australians are employed in the defence industry.

Minister for Defence Industry, the Hon Melissa Price MP said the Morrison Government was committed to ensuring Australian industry personnel were supported, so they could keep equipping and sustaining Australian troops.

“Australian small businesses are the backbone of our defence industry and we will continue to do everything we can to relieve the current pressures they’re under,” Minister Price said.

“Minister Reynolds and I are speaking today with major defence companies and industry groups to hear how we can further assist and provide support to Aussie workers and small businesses in our defence industry.”

Additional measures in place include:

  • Accelerating payments to Australian suppliers by making payment as soon as possible after their invoice has been approved for payment by Defence, irrespective of the contracted payment terms;
  • Reinforcing to strategic prime contractors the important role their Australian sub-contractors play in ensuring prompt payment across the supply chain; and
  • Providing appropriate relief to contractors in circumstances of demonstrated adverse effects as a result of the COVID-19 crisis on the supply of labour, equipment, materials or services required to meet current contractual obligations.

Defence assistance also extends to the sizeable Defence estate with a continued focused on delivering capital facilities and infrastructure works across Australia to support existing and new capabilities.

These works will help keep Australians in work across the construction industry, from large-scale firms to small, locally-owned businesses.

Defence has proactively amended and implemented all current and future contractual clauses to provide time and cost relief for COVID-19 impacts under its construction contracts.

This Government is committed to finding ways to bring forward Defence activities or additional works, to provide economic stimulus to the country, and support Australian industry during this difficult time.

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