The Office of Management and Budget yesterday set out the details of the government's new policy for paying its bills: agencies have to pay them on time or pay a penalty.

The new policy was mandated by Congress this year, after prolonged lobbying by disgruntled businessmen who complained that the federal government paid billions of dollars worth of bills late each year.

However, OMB also said that bills should not be paid early, a practice the General Accounting Office says has cost the government billions that could be earning interest.

OMB staffer David J. Gribble acknowledged that some firms are not pleased with that. "But it's just good cash management," said Gribble. "If there's one thing this administration is trying to do, it's to be business-like about its financial practices."

After Oct. 1, federal agencies are supposed to make payments as close as possible to 30 days after "receipt" of a "proper invoice," but not later than that. The receipt date is either the date the invoice is received or the date the property or service is delivered, whichever comes later.

The government will have a 15-day grace period. But if the check has not been written by the 45th day, the government must automatically start paying interest, from the 31st day. Shorter time periods exist for purchases of meat and perishable agriculture commodities.

The interest rate will be established by the Treasury secretary twice a year. The rate will be 15.5 percent until the end of December.

"That's pretty high considering interest rates are dropping," Gribble said. "We don't want to create a situation where they want their bills paid late" because they can make more money from penalty payments than in short-term investments.

A "proper invoice" must include the invoice date, the contract number, description and prices of property delivered or service rendered, and shipping and payment terms. If the invoice is improperly prepared the agency must notify the contractor within 15 days of receiving it.

Some businesses give special discounts to clients who pay ahead of time. The government has been accused, in the past, of taking the discount but not paying early. If it does that after Oct. 1, it will have to pay an interest penalty.

Interest penalties will not be required when payment is delayed because of a disagreement over the terms of a contract.

Inquiries about the policy should be directed to OMB's Financial Management Division at 395-4773. Inquiries about interest rates should be directed to Treasury's Appropriations and Investment Branch at 566-5651.