While small businesses are anticipated to continue receiving high upfront payments, the Pentagon will reduce upfront payments to contractors, ending a well-liked pandemic policy.
The Pentagon will reduce the amount of money paid up front to contractors, ending a policy that had been implemented since the start of the pandemic. Contractors will now be paid 80% up front, down from 90%, but small businesses are still expected to receive 95% up front. The change will affect new contracts only and is expected to be implemented soon. The policy shift is aimed at reverting to pre-pandemic payment levels, and the Pentagon has said it will minimize disruption. Lockheed Martin had accelerated over $600 million to smaller suppliers in its supply chain over the first quarter of this year, and small businesses had been strong advocates of the accelerated progress payments.
Source: https://www.defenseone.com/business/2023/04/defense-business-brief-april-24-2023/385576/
