Engaging with the Indigenous Procurement Policy (IPP)


Engaging with the Indigenous Procurement Policy (IPP)

The Indigenous Procurement Policy was introduced on 1 July 2015 by the Federal Government to help bridge the gap and is a mandatory procurement-connected policy under the Commonwealth Procurement Rules.

This policy is designed to help Indigenous businesses to grow and to drive demand for Indigenous goods and services while stimulating the development of the Indigenous Economy.  The Federal Government requires Commonwealth agencies (including Federal Government Departments) to meet a purchasing target from Indigenous businesses which leverages the Commonwealth’s annual multi-billion procurement spend. 

Recently the IPP was amended, taking effect 1 July 2019, to ensure Indigenous businesses win higher value contracts at a level closer to those of non-Indigenous businesses. A new target, based on the value of contracts awarded, will be introduced at one per cent in FY 2019-2020 and will be increased by 0.25 per cent each year until it reaches three per cent in 2027.  And from 1 July 2020, Indigenous participation targets will be mandatory in high value contracts across more specified industries also.

In addition, for the following two types of procurements, the Commonwealth will need to consider whether an Indigenous business can deliver the required goods or services on a value-for-money basis before approaching the market more generally:

  • Procurements where the majority of goods or services will be delivered in a remote area.  
  • Procurements valued between $80,000 - $200,000 (without the need to go through an official tendering process)

Ngakkan Nyaagu (NGNY) is proud to have been engaged under this policy at the Federal level and enabling us to assist government procurement to move closer towards their IPP compliance - an official target that all government departments are mandated to achieve. 

NGNY is recognised as a 100% Indigenous owned business, running for 5 years and Supply Nation Certified since 2015.  We have been engaged under the IPP on several occasions, and continue to seek new engagement opportunities. Current clients include the Prime Minister & Cabinet and Department of Foreign Affairs & Trade, to name a few. We also have several NSW-based clients under the NSW Aboriginal Procurement Policy and we are expanding to Victoria and other states.  See  NGNY for a list of some of our clients.

For the procurements above, Commonwealth buyers’ first point of call is Supply Nation’s Indigenous Business Direct (IBD).  Buyers check the IBD which will quickly and reliably show whether there is an Indigenous business that can provide goods or services on a value-for-money basis.  

Considerations before approaching a Federal Government agency under the IPP

  • Is your business at least 50% Indigenous owned? 
  • Are you Supply Nation Certified?  If not, this would be an important first step and will bring you more exposure and recognition as an Indigenous business plus many other advantages.To be eligible for certification - you must be an Indigenous business that is majority-owned, controlled and managed by Aboriginal people or Torres Strait Islanders.  See what it means to NGNY to be a Supply Nation Certified Business 
  • Do you have the capability and capacity to deliver on the scope of the proposed project?
  • Have you identified the potential risks that could impede your ability to deliver the required outputs for the project in its entirety?
  • Do you know how to respond to and write a tender response? You may be able to get assistance with this and other issues from the  Indigenous Chamber of Commerce in your state who provide assistance and mentoring; likewise Indigenous Business Australia may be able to help you with a business loan or other support to help your business grow and win Commonwealth contracts
  • Are you aware that Federal government departments currently have a 1% target of spend with Indigenous suppliers? And this will increase annually to meet their targets
  • Did you know that Federal Government departments can engage your Indigenous business under the Indigenous Procurement Policy if the spend is between $80,000 to $200,000 without the need to go through an official tendering process (A target number of contracts that need to be awarded to Indigenous businesses.
  • There is a mandatory set-aside for remote contracts. See this map to clarify if your business is designated as ‘remote’

Also see the IPP Tips for Indigenous Business for further tips and guidelines - especially under heading TIPS FOR INDIGENOUS-OWNED BUSINESSES.

Eligibility for engagement under the IPP

Your organisation needs to be recognised as an Aboriginal/Indigenous business.  If you are already Supply Nation certified you are in the running for consideration. And you need to be ready to take on the business should you win the contract as per the considerations above.

We at NGNY hope you will appreciate the value and potential work opportunities for your business if you can meet the IPP requirements and successfully engage one or many of the Federal Government departments committed to this policy.