Fonterra’s decision to extend its payment period for contractors is a blow to small businesses already struggling due to the plunging payout’s effect on farmers and rural communities, says Labour’s Small Business spokesperson Jacinda Ardern.
“It’s a tough time for small business contractors, especially those working in the rural sector. Cashflow is king for these companies so it is extremely disappointing for Fonterra to push out payment times.
“If this drives struggling contractors to the wall the blame can be laid at Fonterra’s door.
“Three months is not good enough. Clearly Fonterra is facing big problems with the fall in dairy price, however that is no excuse not to pay promptly.
“Fonterra needs to reverse its decision and treat its contractors fairly,” says Jacinda Ardern.