Indigenous Firms Missing Out - The Australian

Indigenous firms missing out

ABORIGINAL employers receive only $6 million of the $39 billion in government work that is tendered out, prompting Tony ­Abbott’s parliamentary secretary for indigenous affairs to declare the government is failing to provide them with enough work.

Alan Tudge said last night the Abbott government wanted a dramatic lift in the amount of government work offered to indigenous businesses, after attempts by the previous Labor government failed to make a big dent.

“The current procurement policies have failed to make any meaningful difference,” Mr Tudge told a gala function organised by Supply Nation, an organisation that connects corporate and government customers with indigenous businesses and suppliers.

“Last year, 68,000 Australian government procurement contracts were made, valued at just over $39bn. Our best estimate, from admittedly poor data, is that only $6m of that $39bn went to indigenous businesses. That is, the indigenous business share is only hundredths of a per cent of the government spend.”

Mr Tudge said that, in recent years, government had enacted the Commonwealth Procurement Rules Exemption and the indigenous Opportunities Policy to increase government dollars flowing to indigenous businesses and boost indigenous employment.

“But both policies have had limited success,” Mr Tudge said.

“Since 2011, the procurement exemption has only been used on a handful of occasions, if at all. There are no incentives for agencies to use the exemption, but agencies might perceive it as a risk, so its use has been limited.

“The indigenous Opportunity Policy requires successful contractors to have a plan for engaging indigenous subcontractors if in areas of a high indigenous population, but there is no follow-up to see if it is enacted.”

Mr Tudge said the Abbott government was working “intensely” to improve policies for indigenous employment.

He said the final report of the indigenous training and jobs ­review led by mining magnate Andrew Forrest had not yet been delivered but the “fresh perspectives brought by the review process are already stimulating our policy thinking”.

“Indigenous-owned businesses are 100 times more likely to employ indigenous workers than non-indigenous businesses,” he said.

“But we as a government can also show leadership in supporting indigenous business, to help make the shift to an enterprise culture.”

He said he was concerned after the latest COAG Closing the Gap report showed the indigenous employment gap had widened by seven percentage points over five years.

“I do not believe that we can be fully reconciled as a nation unless indigenous people are engaged in the economy through real jobs at a similar rate as non-indigenous people,” he said.

“But on current trajectories, we are not closing the gap. And unless we can change this trajectory, I am concerned that in a decade’s time, we will be having the same conversation that we are having today.”