Mark Furner (Queensland, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Minister for Indigenous Employment and Economic Development, Senator Arbib. Can the minister please outline to the Senate how the government is using procurement policy to drive Indigenous employment and Indigenous business development? In particular, can the minister please outline recent policy developments in this area?

Mark Arbib (NSW, Australian Labor Party, Minister for Social Housing and Homelessness) Share this | Link to this | Hansard source

I thank Senator Furner for the question. One of the most important ways of driving up Indigenous employment is by driving Indigenous economic development. In particular, the government is supporting the growth of the Indigenous business sector. The Gillard government is doing this through significant reform of the procurement policy. In May this year, Senator Wong and I announced changes to the mandatory procurement procedures of the government. These changes provide an exemption to the mandatory procurement procedures for small and medium enterprises that are 50 per cent Indigenous owned. The Commonwealth agencies can now contract to these Indigenous companies without conducting a full tender process, while still delivering value for money. This change means increased opportunity and greater access to the government's procurement market for all Indigenous small and medium sized businesses. It also embeds into our procurement processes the Closing the Gap goal of halving the gap in Indigenous unemployment by providing an opportunity and avenues for Indigenous businesses to prosper.

The new policy complements the 1 July introduction of the Indigenous Opportunities policy. The policy is designed to drive Indigenous employment and supplier use within companies that tender for government contracts by requiring them to implement Indigenous employment and supplier use plans. This means that if a company wants to win a government contract worth over $5 million, or $6 million for construction, it must agree to implement actions that will drive Indigenous employment and Indigenous suppliers within its organisation. If that company wins the tender, they must apply these actions locally to where the contract applies. My department will work with them to ensure the implementation of the plans works at a local level. The company will then be required to report annually to government on the action it has taken. Companies that do not meet the actions or targets— (Time expired)

Mark Furner (Queensland, Australian Labor Party) Share this | Link to this | Hansard source

Mr President, my first supplementary question is: can the minister please inform the Senate on how the Indigenous opportunities policy and mandatory procurement guidelines change fit into the broader government aim of strengthening procurement policy to support Indigenous economic development? In particular, what other procurement measures does the government have in place to drive Indigenous business growth?

Mark Arbib (NSW, Australian Labor Party, Minister for Social Housing and Homelessness) Share this | Link to this | Hansard source

Companies that do not meet the actions or targets as outlined in their plans or have not demonstrated significant effort to do so will have their plans suspended. This means they will be ineligible to win government contracts until they rectify the issue. But it is not just procurement that we are using to drive the growth of the Indigenous business sector. We are working with the Australian Indigenous Minority Supply Council, AIMSC. AIMSC is an organisation that builds a network of Indigenous businesses across the country. So far, as at 31 May, AIMSC has 76 certified Indigenous businesses and 62 corporate and government members. It ties these businesses together with the corporate members and with government organisations to drive these businesses through procurement. Already it has facilitated $4.53 million in transactions and $13.4 million in contracts between members and certified Indigenous businesses. (Time expired)

Mark Furner (Queensland, Australian Labor Party) Share this | Link to this | Hansard source

Mr President, I have a further supplementary question. Can the minister please outline to the Senate how growing the Indigenous business sector will assist the government to meet its Closing the Gap target of halving the gap in employment between Indigenous and non-Indigenous Australians by 2018?

Mark Arbib (NSW, Australian Labor Party, Minister for Social Housing and Homelessness) Share this | Link to this | Hansard source

The reason building these Indigenous businesses works is that, as studies we have done show, 72 per cent of employees in these companies are Indigenous. By supporting Indigenous businesses to grow, you are supporting Indigenous employment.

Again, it is not the only work the government is doing. Since July 2009 there have been over 43,000 employment and training placements through the Indigenous Employment Program, IEP, and over 68,000 placements into employment through Job Services Australia and the Job Network. If we are going to meet our 2018 targets of halving the gap in employment outcomes, we must work with Indigenous communities and build Indigenous businesses. The reason Indigenous businesses are so important, apart from the employment side, is that they provide Indigenous leadership and Indigenous communities with the drive for economic development and to increase commerce within their communities. (Time expired)