State Services Minister Tony Ryall has announced that government departments have been directed to make sure they pay their bills on time, or earlier, especially invoices from small and medium-sized business suppliers.

The Government has told the State Services Commissioner Iain Rennie it expects all departments to urgently review their process for approving and paying invoices to their suppliers, and to bring forward payment dates where possible.

Government agencies are to, at a minimum, pay their invoices in accordance with their posted terms and conditions, and in any event, no later than the 20th of the month following the receipt of the invoice.

"Government agencies are substantial customers for many small to medium sized businesses. By ensuring these agencies pay their bills on time or earlier, we can help with business cashflow.

"The Commissioner has written to chief executives reinforcing Cabinet's expectation," says Mr Ryall.