Experts have praised the Berejiklian Government’s new indigenous procurement policy but caution effective implementation and broader efforts to nurture businesses are crucial.
Three per cent of the NSW Government’s goods and services contracts will be offered to Aboriginal owned businesses under the state’s new Aboriginal Procurement Policy, which the government says will support 1,000 Aboriginal jobs a year over three years.
Given it spends $20 billion each year on goods and services contracts, Premier Gladys Berejiklian said the State Government was in a unique position to offer practical support for the creation of Aboriginal employment.
“These jobs could include electrical services, catering, recruitment and landscaping,” she said while launching the policy last week.
Under the changes, government agencies will be able to procure goods and services up to $250,000 directly from Aboriginal businesses, an increase on the current limit of $150,000.
The policy will also see procurement activities over $10 million required to “consider” employment opportunities for Aboriginal people and engagement of Aboriginal businesses.
For the first time, the government says it will track the number of jobs supported through the policy in addition to the number of contracts awarded.
Substantial policy: expert
Michelle Evans, an academic and partnership broker who leads research on indigenous business at the Asia Pacific Social Impact Leadership Centre, welcomed the policy, saying it appeared to tackle the barriers to government supply chains facing Aboriginal businesses.
“It follows the Federal Government’s great work in the indigenous procurement policy space, which has seen so many businesses come into the supplier chain of the government at the federal level,” she told Government News.
Dr Evans said that efforts to boost Aboriginal businesses would lead to job creation:
“We know that Aboriginal businesses are 30 per cent more likely to employ Aboriginal and Torres Strait Islander people.”
However, she said there were many different types of Aboriginal businesses and not all would benefit from a procurement policy, which means governments need to think of other ways of providing support.
“A lot of Aboriginal businesses, particularly the business-to-customer enterprises, are delivering cultural products and services, and they are doing it really tough. We can’t forget about these other types of businesses,” she said.
Implementation and monitoring is key
Jo Barraket, director of the Centre for Social Impact at Swinburne University, praised the policy’s inclusion of key targets.
“The research we’ve done in the past on social procurement suggests the only context in which there’s any semblance of success is where there’s concrete goals,” she told Government News.
Recent work had highlighted a concerning lack of follow-up monitoring or evaluation of the outcomes of social procurement practices internationally, Professor Barraket said.
“It’s terrific to have governments in Australia, NSW now being one of them, saying they’re going to commit to doing that work.”
Professor Barraket said that while good policy is welcome, effective implementation is critical.
“What we know about procurement is that having the policy isn’t enough. Policy commitments like these require implementation and that often involves changes to systems and culture within government agencies. That’s what is needed; its policy plus implementation.”
Commenting on indigenous procurement policies more broadly, Professor Barraket cautioned governments to be aware of potential unintended consequences.
“It’s reminiscent of some predatory practices that emerged when mining licences regulations changed about a decade ago to commit mining companies to stronger local economic development. We’re starting to hear anecdotal information about large firms building effectively shell companies in Aboriginal communities and embedding those in their supply chains in order to meet targets,” she said.
Australia was fortunate to have Supply Nation as an intermediary given it undertakes a lot of the certification and due diligence work, Professor Barraket added.
“That said, there’s still scope for some predatory practices to emerge.”