Member for Giles Eddie Hughes says GFG Alliance must act swiftly to reform the procurement system they have inherited from Arrium in order to ensure local suppliers get paid.
Mr Hughes said he had received assurance from GFG that they were working to fix the procurement system, acknowledging that ‘there is a problem that needs to be fixed’.
Mr Hughes said he had previously spoken to local contractors, GFG Alliance and South Australia’s Small Business Commissioner John Chapman about the situation.
He also facilitated communication between GFG Alliance and one contractor that was owed money at the time.
“Having to wait for pay puts small and medium-sized contractors in an incredibly hard situation. There is also that sensitivity in Whyalla given what our contractors have gone through in the past,” Mr Hughes said.
“The whole (payment) system needs to be tightened up. It’s too much to expect contractors to shoulder this burden.”
But Mr Hughes was confident the problems with GFG’s procurement system would be solved.
“This needs to be done as quickly as possible to ensure contractors are paid in a timely fashion,” he said.
“Speaking to (GFG) they were upfront about acknowledging there is a problem that needs to be fixed.”
GFG Alliance have said all outstanding invoices for local small and medium size contractors would be paid by March, when they plan to set up a Supplier Credit Facility with supply chain finance provider Greensill.