Working with DFAT's new Indigenous policy

CANBERRA — New procurement rules from the Australian Department of Foreign Affairs and Trade will require tenderers for Australian aid contracts to describe how they will support Indigenous participation, entrepreneurship, and business development within the country’s aid program. A new request for tender template released in April highlights the growing importance of the Indigenous Procurement Policy within Australia’s aid program and follows announcements made at DFAT’s Aid Supplier Conference in February, where staff emphasized the importance of current and potential suppliers to better engage with Indigenous businesses. As Devex reported last year, opportunities available to Indigenous businesses within the aid program have been limited, with more prominence given to DFAT’s corporate and security functions. But the new procurement requirements are changing the status quo. Under the new RFT template, IPP will apply to all “large value aid tenders,” defined as contracts in excess of 3 million Australian dollars ($2.26 million). The new requirements for tenderers will come into effect by July 2018, with the additional requirement for tenderers to describe the wider social impact — including how they will involve women, culturally and linguistically diverse people, and people with a disability as part of their organization or project structure. How tenders will be evaluated for Indigenous participation Indigenous participation is front and center within the new RFT template, appearing in criterion one of a tender response. Tenderers will need to describe strategies they will be implementing to “give effect to the Australian government’s commitment to Closing the Gap and the Indigenous Procurement Policy,” as well as to facilitate greater participation of Indigenous people and stimulate indigenous entrepreneurship and business development. As part of DFAT’s evaluation of value for money in a tenderers response, consideration of diversity, inclusion, and benefit to the Australian economy will be part of this evaluation — including how the tenderer implements strategies to maximize Indigenous participation as well as “gender equality, disability inclusion and other diversity measures.” The new RFT will also ask tenderers to submit a diversity profile of their organization — identifying the number of full time equivalent staff in Australia and throughout the entire organization that identify as Aboriginal or Torres Strait Islander, a person with a disability, or LGBTI. But the new RFT template also require tenderers to submit an Indigenous Participation Plan, which needs to demonstrate how the tenderer plans to meet requirements of the IPP. Tenderers can respond to this requirement at the organization level, or specific to the contract being tendered for. This means that for the initial term of the contract, tenderers will need to meet a DFAT-specified target for percentage of the full time equivalent workforce that identifies as Indigenous, percentage of the subcontracted opportunities to Indigenous enterprises, and any other further requirements specified — either for the wider organization or specific to the contract. It will be possible for tenderers to meet the requirements of the IPP through subcontracts, making engagement with Indigenous businesses a priority for any organization seeking to engage in the aid program. Engaging with Indigenous Australian businesses Indigenous Australian businesses are defined as those that have 50 percent or more Indigenous ownership or are registered on Supply Nation. “Supply Nation provides a searchable directory — called Indigenous Business Direct — of verified Indigenous business and should be the first port of call for anyone looking to engage an Aboriginal or Torres Strait Islander business,” Jason Timor, deputy chief executive director of Supply Nation, explained to Devex. The current search function within Supply Nation could confuse aid suppliers as to the existing capability that exists within the Indigenous supplier network. A search for “humanitarian” will list two businesses. And “development assistance” will bring back businesses loosely tied to the term. In reality, more than 1,300 Indigenous businesses are listed with Supply Nation. But new functionality will be available over the coming weeks, providing an enhanced range of search functionality, including the ability to sort, filter, and save results. “The new platform will also provide more information on each supplier — allowing them to provide more detail to effectively market their business, and therefore giving buyers more data to inform their decisions,” Timor said. The search tool itself may not open the door to all potential suppliers — and Timor explained there are additional services to match Indigenous suppliers with business needs. “Companies looking to do more with the Indigenous procurement space can become members of Supply Nation to give them access to the full range of our services,” he said. “Supply Nation provides a business matching service to paid members. Typically, members provide a detailed brief and needs assessment to Supply Nation in order that we can find appropriate suppliers.” These services could help aid partners think outside the box as to what international development specialists need to look like. “Supply Nation has Indigenous businesses across a range of sectors who could work well in the development space, including civil engineering companies, logistics businesses, and organizations that work in maritime and air freight transport that have experience working in remote areas with the mining industry,” Timor said. “These organizations could easily re-orientate into the delivering services overseas. The possibilities when you explore down the supply chain are manifold.” Promoting the aid program as an opportunity for Indigenous businesses There is also a requirement moving forward to help promote opportunities to Indigenous businesses — and encourage them to think of international development as an area of potential growth for them. And DFAT will be involved in this process. At the upcoming Connect 2018 Indigenous Business Tradeshow, taking place in Sydney on May 22-23, DFAT staff will join an Australian Government Hub discussing opportunities for Indigenous businesses with government — including the aid program. And Timor said DFAT will be using the tradeshow as an opportunity to actively engage with Indigenous suppliers to help them make connections with attendees from the sector. Suppliers to Australia’s aid program, however, also need to be involved in promoting the opportunities available, and the message from Timor is that engaging with Aboriginal and Torres Strait Islander businesses isn’t just the right thing to do — it also “makes good business sense.” “Diverse supply chains have been shown to be less risky, more flexible, more innovative, and better value,” he said. “Indigenous businesses provide a huge range of products and services — so the likelihood is that if your organization has a procurement need, there’s probably an Aboriginal or Torres Strait Islander business that can fill it.”