The release of new indigenous procurement policy with a mandatory 3% target and compulsory set-aside for indigenous business contracts create major new opportunities for indigenous suppliers and their delivery partners.
For the first time ever, there is a hard-mandated target, detailed rule changes for a large swag of contract opportunities and mandatory employment requirements for contracts above $7.5 million for a wide range of contract types.
If the United States experience is anything to go by, this fundamental change has the potential to create a major and sustaining economic development model for indigenous communities. A four-part interview series follows …
Tom Burton: Could I get you to introduce us to PwC Indigenous Consulting, how it came to be and the nature of its work?
Jason Eades: So PwC Indigenous Consulting is an Aboriginal business that’s focused on the full spectrum of management consulting where new business that is 51% owned by myself and three other indigenous people and 49% owned by PwC Australia. We were set up to really bring into life PwC’s societal relevance at work but from our perspective it’s also about having impact on issues that matter for indigenous Australians.
Tom: The new procurement rules which have just recently being developed and published out of Canberra for indigenous businesses, what do you say are the main opportunities for indigenous businesses coming from those rules?
Jason: There’s three main areas of opportunities. Firstly, to win business direct from governments, particularly where the targets have been set around the number of contracts to be awarded to Aboriginal businesses. Secondly, through the supply chains of our businesses who are delivering work to the Commonwealth and finally I think the other big opportunity is through very large contracts, and again through the supply chain mechanisms especially as they relate to remote Australia.
Tom: And we’ve had previous rules in this space but they didn’t really work. What makes you excited by these new rules?
Jason: I think the old rules still apply, interestingly enough or parts of them do. So the exemption 17 still applies and the Commonwealth is able to access and use that just to purchase up to any value of work. The part of the policy that didn’t work before though was the performance outcomes. There’s no real life behind them. There was no repercussions if people weren’t meeting those and I think the other thing that’s different is there’s a clear set of instructions that are being issued for public servants, actually understand how the rules apply and how to use them in a day to day decision making which wasn’t there before.
Tom: And as you reflected on these rules, what do you think, as we kick off into a what’s going to be a very large program, from an almost design perspective, what are some of the observations you have about optimising the whole program to really get the benefits we’re trying to get for indigenous businesses?
Jason: I think there will be some early wins that can easily be made from some existing indigenous businesses that will be able to take up the opportunities almost immediately. There’s further opportunities to actually work with businesses who might be on the cask of being ready, so helping them develop and I think the big opportunity is to actually the capability building through either new businesses being formed, say like we’ve done in our own business where we have brought capability in from PwC or having joint ventures. And the joint venture aspect is actually outlined in the policy itself and it allows for joint ventures where there’s 25% indigenous ownership.