Grylls grills Rio Tinto over payment extensions

Image: The West Australian

West Australian MLA Brendan Grylls has lashed out at Rio Tinto CEO Sam Walsh for increasing payment terms to suppliers and contractors, saying small businesses will fail as a result.

Rio Tinto announced they would double their terms of payments from 45 days from receipt of invoice to 90 days, an unprecedented period which could see invoices received at the start of the month paid 120 days later.

Walsh said the increased payment deadline would free up company cashflow as a way of dealing with low commodity prices, while the West Australian suggested the move would increase the company’s cash balance at the time of Walsh’s departure from the company at the end of the financial year.

Grylls has said he is presently considering a motion when state parliament resumes to establish an inquiry, and that he expected Prime Minister Malcolm Turnbull to turn his attention to the matter.

“Given we have the Prime Minister in WA, it’s incumbent on him to look very closely at this,” Grylls said.

“I would be hoping Malcolm Turnbull would be asking the ACCC to take a very close look at it.”

“I would be hoping Malcolm Turnbull would be asking the ACCC to take a very close look at it.”

-Brendan Grylls MLA

The former WA Nationals leader has already raised concerns with Rio Tinto Iron ore CEO Andrew Harding, and planned to speak with the Commissioner of Small Business and write a complaint to Sam Walsh.

Grylls raised the 2014 ACCC finding that Coles had engaged in unconscionable conduct in dealings with its suppliers, which resulted in refunds of more than $12 million.

Suppliers and contractors have privately voiced their displeasure with the new payment regime, however Rio Tinto has stated that the plan will help the company to free up cash and continue to support suppliers and preserve jobs.

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