New guidance from the Office of Management and Budget directed agencies to accelerate payments to small business contractors.

It requires agencies to pay small businesses within 15 days of receiving an invoice, instead of the customary 30 days. The memo set a Nov. 1st deadline for agencies to tell OMB when they pay to accelerate the payments.

Guy Timberlake, the co-founder and chief visionary of the American Small Business Coalition, joined the Federal Drive with Tom Temin and Amy Morris to discuss whether the new guidance will make a real difference.

As it turns out, the guidance many not affect many small businesses because many act as subcontractors, meaning they don’t actually invoice the government directly.

Timberlake called the proposal a “nice gesture,” but said there remain larger issues to tackle, including the larger relationship between prime- and subcontractors.

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