Changes to Indigenous Procurement Policy

The NT Government will discontinue the Indigenous Employment Provisional Sum (IEPS) on all new tenders and contracts issued from today.

Key messages

  • Following receipt of an independent evaluation and identification of potential misuse, the Northern Territory Government announced the immediate suspension of the Indigenous Employment Provision Sum (IEPS) scheme.
  • While no new contracts under the Indigenous Employment Provisional Sum (IEPS) will be issued from today, businesses currently undertaking work under the IEPS will be able to complete their current project.
  • The Northern Territory Government will work with businesses and industry stakeholders to develop an alternative policy which will be in place January 2018.
  • There is significant opportunity to support local Aboriginal employment and economic development outcomes through government procurement activities and a new policy will be developed in partnership with business and industry over the next six months.
  • An inter-departmental Steering Group will be responsible for implementation of the new policy.
  • There will be regular audits to ensure compliance with the new policy once it is released.

Q&As

How are current awarded contracts that include IEPS impacted?
Contracts that have been awarded prior to today’s date are not impacted.

Will this affect other procurement policies e.g. Buy Local?
No, this will have no impact on other procurement policies, including Buy Local.

What type of alleged misuse was uncovered?
There are allegations of claiming falsely under the policy. As the matters are under investigation it would be inappropriate to comment further on the detail.

How will businesses and industry be informed of the new policy changes?
IEPS conditions won’t be included in any new tender documentation issued from today and the Department of Infrastructure, Planning and Logistics will amend their tender documentation for all future tenders.

How can businesses and industry contribute to the development of a new policy?
There will be a consultation process with industry, coordinated primarily through industry and business peak bodies, to consult on the development of a new policy. 

The new policy won’t roll out until January 2018, what will be in place for the next six months?
Encouraging Aboriginal employment and building of capability for Indigenous businesses will continue to be supported through the strengthening of Indigenous Development Plans.

Outside procurement policies, what other types of programs and support are available to Territory businesses.
The Department of Trade, Business and Innovation (DTBI) offers a range of programs to assist businesses to start, run and grow. This includes access to a dedicated team of small business champions who work one-on-one with businesses.

Will additional funding be allocated to rollout new policy and ensure compliance of policy is met?
This will be considered subject to the requirements of the new policy.

Did IEPS reach any of their targets? What impact did they have?
While there was overall support for the intent of the policy and getting more Aboriginal people into work, industry, stakeholders and businesses had raised concerns regarding the practical application of the policy.

More information 

Enquiries can be directed to the Department of Infrastructure, Planning and Logistics Media Unit by telephone 08 8929 4633 or 0437 868 115.

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