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More Indigenous Jobs through Commonwealth Procurement

Regulation Impact Statement – Department of the Prime Minister and Cabinet

On 1 July 2015, the Australian Government introduced the Commonwealth Indigenous Procurement Policy. The primary purpose of the policy is to stimulate Indigenous entrepreneurship and business development, providing Indigenous Australians with more opportunities to participate in the economy. The policy has three key components:

  1. A target for purchasing from Indigenous enterprises;
  2. A mandatory set-aside to direct some Commonwealth contracts to Indigenous enterprises; and
  3. Mandatory minimum Indigenous participation requirements for certain Commonwealth contracts. The RIS estimates the average annual regulatory cost savings of the preferred option to be $185,000. The OBPR has agreed to the regulatory cost saving.

The Office of Best Practice Regulation assessed the RIS prepared by the Department of the Prime Minister and Cabinet as compliant with the Government’s requirements but not best practice. This is because two major decisions were made during the policy development process that were not informed by an updated RIS. The RIS estimates the average annual regulatory cost savings of the preferred option to be $185,000. The OBPR has agreed to the regulatory cost saving.