The Department of the Prime Minister and Cabinet hopes to raise awareness of the benefits of procurement from Indigenous-owned businesses through a new strategy.
The Indigenous Procurement Strategy — released this week — has been developed in response to a recommendation from the Commonwealth government’s Indigenous Procurement Policy (IPP) and will be controlled by the department’s chief finance officer.
The IPP sets out targets for the number of contracts awarded to Indigenous enterprises, and their total value. It also directs some government contracts to Indigenous enterprises, and puts minimum Indigenous participation requirements in place.
The new strategy aims to influence PM&C’s current and future suppliers to work in line with the IPP, as well as to bring the department’s usage of majority owned Aboriginal and Torres Strait Islander businesses in line with Indigenous procurement targets.
The strategy says PM&C should adopt contract terms and conditions that reflect the IPP principles, to empower the Indigenous business sector.
“PM&C can develop and incorporate contract terms that encourage the supplier to apply the IPP principles to their own business practices and to any subcontractor arrangements that may be entered into by the contractor, and require that the supplier report on any engagement with majority Indigenous owned business within their supply chain,” it says.
It also argues that staff should think about how potential suppliers contribute to the IPP objectives when assessing value for money. To do this, PM&C should include a process to consider any broader economic benefit that non-majority Indigenous owned business might make to the IPP objectives and the wider Indigenous Advancement Strategy through their supply chain, subcontracting and employment practices.
The department should also continue to make its staff aware of the “benefits flowing from IPP based procurement activity”. It can do this by ensuring senior executives and decision makers understand and support the IPP, and through training material that makes staff aware of the mandatory elements and procurement efficiencies available through the application of the IPP.
Regularly sharing “success stories” about past engagements with Indigenous providers through internal communications channels, publishing a bi-annual Indigenous supplier newsletter, and encouraging staff to attend majority Indigenous owned business trade fairs and forums could also raise awareness.
Earlier this year, Indigenous businessman Dean Foley, who was behind the Barayamal Indigenous business accelerator, called for “greater impact in communities vs making a few people rich” through the IPP.
“The feeling within the Barayamal Network and the greater community is that the IPP only really benefits a select few and will only create a few Indigenous millionaires instead of helping close the massive disparity gap and making a difference in communities,” he said.