Zed Seselja (ACT, Liberal Party) Share this | Link to this | Hansard source

My question is to the Minister for Indigenous Affairs, Senator Scullion. Will the minister advise the Senate of additional action the government is taking to increase Indigenous employment and enable Indigenous Australians to fulfil their potential?

Nigel Scullion (NT, Country Liberal Party, Minister for Indigenous Affairs) Share this | Link to this | Hansard source

I thank the senator for the question. Getting people into work is one of the Australian government's priorities in Indigenous affairs, and this government wants to lead by example. Indigenous businesses currently secure only a very small amount of government businesses—less than one per cent, or just over $6 million—despite having existing exemption policies in place which make it an awful lot easier for public sector agencies to purchase from Indigenous businesses.

We have set a target that three per cent of Commonwealth contracts will be with Indigenous businesses by 2020. This equates to about 1,500 contracts each year by 2020. In dollar terms this will be around $135 million each year based on an average contract value of $90,000. That is a massive increase in the current Commonwealth procurement spend. There are many Indigenous companies very capable of supplying services to the Commonwealth and winning a much greater share of the Commonwealth work.

Indigenous businesses are also more likely to be employers of Aboriginal and Torres Strait Islander people—I think it is by a factor of 100—so it is obvious that, if more Commonwealth procurement is won by Indigenous businesses, then more employment opportunities will be created for Indigenous people. To support this procurement push, the government will work with Supply Nation to expand and strengthen its register of Indigenous businesses and make that publicly available by 1 July 2015. This will make it easier for government departments to identify procurement and partner opportunities with Indigenous businesses. The process for Indigenous businesses to become certified will also be faster and less resource intensive.

Each minister and each agency head will be held accountable for achieving the target and performance which will also be published annually for the whole of Commonwealth and by portfolio. The new Indigenous procurement policy will also apply to Commonwealth contracts; and that means that, if we have a contract to build a road in Queensland, the Queensland government will be held to account in the same way as us. (Time expired)

Zed Seselja (ACT, Liberal Party) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. Is the minister able to inform the Senate of any international experience that supports the government's push to drive Indigenous economic development and employment through government procurement?

Nigel Scullion (NT, Country Liberal Party, Minister for Indigenous Affairs) Share this | Link to this | Hansard source

Both as employers and as major purchasers of goods and services, governments can create demand for the employment of First Australians and for their businesses.

As Mr Forrest's report pointed out, other countries, such as Canada and the USA, have successfully used procurement to drive economic development for minority and first nations peoples. In Canada aboriginal businesses are growing at five times the rate of other businesses thanks to government procurement policies. In the USA, NANA Corporation, for example, is owned by aboriginal people in Alaska and has grown from very small beginning to now turning over $1 billion annually. The company is very competitive without any government subsidy. Its success is based on changes to the government procurement alone and through the US government's aboriginal exemption policies.

Zed Seselja (ACT, Liberal Party) Share this | Link to this | Hansard source

Mr President, I ask a further supplementary question. Will the minister advise the Senate of any other initiatives the government is considering to further drive employment for Indigenous people?

Nigel Scullion (NT, Country Liberal Party, Minister for Indigenous Affairs) Share this | Link to this | Hansard source

From 1 July 2015 there will be clear and accountable targets to significantly increase Indigenous employees in the Australian government public sector to three per cent by 2018. This equates to around 7,500 Indigenous employees across the Commonwealth public sector. A strong whole-of-Commonwealth recruitment and retention strategy is being developed, with strong reporting measurements, with each entity being held to come up to its target. These significant reforms are in part in response to the Forrest review, Creating parity, and, along with changes to the Remote Jobs and Communities Program, from 1 July 2015, will over the longer term lead to significant growth in Indigenous employment. Increasing Indigenous employment is a joint responsibility of governments and the private sector, and I will have more to say about how the private sector can further contribute.