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Topic 1: Indigenous Procurement Policy

Policy objectives

  • Increase participation of Indigenous businesses in Commonwealth procurement
  • Create employment and training opportunities for Aboriginal and Torres Strait Islander people
  • Support long-term economic independence for Indigenous Australians
  • Build strong partnerships between government, industry, and Indigenous communities

See Indigenous Procurement Policy for more information

 

Eligible projects

The Indigenous Procurement Policy applies to projects of different types, values, and regions when they are funded by the Commonwealth Government. It also applies to public–private partnerships where the Commonwealth Government provides funding towards the project.

 

Minimum mandatory requirements

Head contractor must choose whether they will meet the Minimum Mandatory Requirements at an organisation or project level.

  • At the organisation level, they must report Indigenous procurement or participation outcomes equal to 3% of their overall business
  • At the project level, they must report Indigenous procurement or participation outcomes equal to 4% of the contract value of the project

The targets can be met by:

  • Employing Indigenous people
  • Purchasing goods and services from Indigenous businesses
  • A combination of both

Note: If the head contractor chooses to meet the MMR at an organinsation level, they will not report on Indigenous participation outcomes specific to the project. Subcontractors and suppliers will also be excluded from project‑level reporting. Instead, the head contractor will provide data on their overall Indigenous workforce and business spend across their organisation. This demonstrates how they meet the 3% organisational level target and confirms that opportunities for Indigenous employment and procurement are being delivered.

 

Key terms

To meet the Policy requirements, it’s important to understand the key terms it uses. These terms explain the responsibilities of contractors and suppliers, outline the targets that must be achieved, and show how compliance will be measured. The following definitions provide the foundation for understanding what the Policy expects and how performance is assessed.

Indigenous business

An Indigenous business must be at least 50% Indigenous‑owned and registered or certified through Supply Nation (or an equivalent accreditation body).

Indigenous participation

Indigenous participation includes both the:

  • Full time Equivalent (FTE) of Indigenous employees directly related to the project, and;
  • Contract value awarded to Indigenous businesses

Indigenous participation plan

At the tender stage, head contractors must submit an Indigenous Participation Plan. This plan outlines the:

  • Amount to be spent with Indigenous businesses
  • Number of Indigenous employment hours to be completed
  • Training opportunities for Indigenous people
  • Indigenous organisations that will partner in delivering the project

Full time equivalent (FTE)

Full‑time equivalent is a way of measuring the workload of employees by converting hours worked into the equivalent of a full‑time position.

Example: If a full‑time role is 38 hours per week, then two employees working 19 hours each would equal 1.0 FTE. Using FTE makes it easier to compare and report Indigenous employment hours consistently across different projects and contracts.

Minimum mandatory requirements (MMR)

The Minimum Mandatory Requirements sets out the Indigenous participation required on he project or by the head contractors organisation. The targets can be met by:

  • Employing Indigenous people
  • Purchasing goods and services from Indigenous businesses
  • A combination of both

 

Reporting

Reporting is a critical part of meeting the Indigenous Procurement Policy requirements. It provides transparency, demonstrates compliance, and shows how projects are contributing to Indigenous business and employment outcomes. Both head contractors and subcontractors have specific responsibilities in this process, and the accuracy and timeliness of the information they provide directly affects how performance is assessed.

Further advice on how to meet these reporting requirements is available in the Suppliers Guide.

Head contractors

The head contractor is required to:

  • Submit an Indigenous Participation Plan with their tender submission
  • Report quarterly via the IPP Reporting System
  • Submit a Final Indigenous Participation Report at project completion

These reports confirm progress against the policy targets and demonstrate compliance.

Subcontractors and suppliers

Subcontractors are required to:

  • Comply with Indigenous participation terms set in their subcontracts
  • Provide data to the head contractor in their monthly progress report

This information is essential for monitoring performance and ensuring that Indigenous participation outcomes are achieved.

 

Evidence

To accurately report on project outcomes, subcontractors need to give the head contractor evidence that proves their data is correct. This evidence must come in the form of acceptable documentation that meets the minimum requirements. Providing accurate and complete documentation ensures Indigenous business spend and participation are recognised, reported properly, and counted towards meeting Government procurement policy targets.

Indigenous business spend

Provide the head contractor with the value of contracts spent with:

  • Indigenous-owned subcontractors and suppliers that are certified with Supply Nation or an equivalent accreditation body
  • Joint ventures where Indigenous businesses hold at least 50% ownership

The head contractor does NOT need the value of contracts spent with businesses that:

  • Can not prove their certification with Supply Nation or an equivalent accreditation body (even if they employ Indigenous staff)

Provide the head contractor with a selection of acceptable documentation:

  • Copies of subcontract or supply agreements with Indigenous businesses
  • Invoices and payment records
  • Supply Nation certification or equivalent for each Indigenous businesses

The documentation must have the below information:

  • Project name
  • Indigenous business details (Name, ABN, address, contact details)
  • Type of goods and/or services provided
  • Dates the services or supply were provided
  • Cost of the services or supply they provided

Indigenous employment

Provide the head contractor with the FTE of:

  • Indigenous employees directly related to the project

In your reporting, do NOT include the:

  • Indigenous FTE for work not linked to the delivery of the project
  • Travel time to and from site

Provide the head contractor with a selection of acceptable documentation:

  • Timesheets and payroll records
  • Site attendance registers

The documentation must have the below information:

  • FTE of the total workforce
  • FTE of the Indigenous workforce

 

Non-compliance

Non‑compliance with the Indigenous Procurement Policy has serious consequences. It can affect contracts, trigger financial penalties, damage reputation, and reduce future tendering opportunities. Both head contractors and subcontractors are accountable for meeting their obligations, and failure to comply may lead to audits and further investigation by the Commonwealth.

Risks

Non‑compliance creates different risks for head contractors and subcontractors. The sections below outline the specific consequences each party may face.

  • May be treated as a contract breach
  • Possible penalties include:
    • Withholding of payments
    • Liquidated damages
    • Loss of future tendering opportunities
  • Non-compliance damages company reputation with both government and community
  • Can trigger audits and further investigation

  • Contract breach penalties – defined by contract but may include withholding security or retention and damages
  • Damage to reputational with both clients and community
  • Jeopardise ability to win future contracts off previous performance

Audits

Audits are carried out to check compliance with the Indigenous Procurement Policy. They provide independent verification of the data reported and ensure that evidence matches actual outcomes.

Audits are conducted by the Commonwealth (via NIAA or relevant agency) to:

  • Verify employment and subcontracting data
  • Check evidence provided matches reports submitted
  • Review Indigenous Participation Plans against actual outcomes

 

Project process

Keller follows a structured process to meet the Indigenous Procurement Policy across every phase of a project. From tender through to project close‑out, each stage includes specific actions to ensure compliance, demonstrate outcomes, and strengthen engagement with Indigenous businesses, people and communities.

Getting it right upfront

There is a suite of documents to provide detailed guidance on how to deliver each stage of the project effectively:

  • Project Checklist
  • FAQ & Troubleshooting Guide

The Commonwealth Government also have guides to assist you to comply with the Policy:

During the tender stage we need to demonstrate our capability and track record to secure the job. We review all documentation for references to the Indigenous Procurement Policy and identify how the head contractor expects us to contribute to the Minimum Mandatory Requirements, whether through Indigenous procurement, employment targets, or both. Where requirements are not achievable, we highlight these clearly and propose alternative ways we can add value.

1. Check if the Policy forms part of the tender documentation:

  •  A key indicator is if the developer is a Commonwealth government department (eg. Defense, Australian Federal Police etc.)
  • Search (Ctrl F) the tender documents for key words such as Indigenous participation, Indigenous business, or Indigenous employment

2. Can we meet the contractual clauses asking us to contribute to the Minimum Mandatory Requirements?

  • Liaise with delivery team to assess our capability to deliver our contribution to the Indigenous participation requirements
  • Identify risks and opportunities associated with contributing to these requirements using the Capability Assessment Template

3. Showcase our previous performance for Indigenous employment and procurement:

  • Submit the Past Performance Template with the tender submission

4. Provide a written statement of how we can contribute to the head contractor’s Indigenous Participation Plan:

  • Complete the Social Procurement Commitments Template with project specific employment and procurement opportunities
  • Flag any policy requirements we cannot achieve and highlight any additional value we can provide. The the Social Procurement Commitments Template has prompts to help you identify theses risks and opportunities
  • Submit the completed Social Procurement Commitments Template with the tender submission
  • In some instances, the tender may require you to write your commitments in their Response Schedules. If this is the case, you can ustilise the Social Procurement Commitments Template as guidance when drafting your responses

5. Liaise with the head contractor throughout the tender phase to ensure your understanding of the policy requirements

  • Document any exclusions or negotiated amendments to Indigenous participation requirements

The contract stage is where tender commitments are formalised. It ensures that negotiated requirements are accurately captured, achievable obligations are confirmed, and any agreed value‑adds are included before project delivery begins.

1. Liaise with Tender team to ensure the contract reflects what was agreed during the tender phase.

  • If not, request for the contract to be updated to reflect what was negotiated during the tender
  • Ensure any requirements we cannot achieve are not in the contract

2. Liaise with Project Delivery team to ensure those commitments can still be met and ensure any ways we can add value are in the contract

3. Document any exclusions or negotiated amendments

The planning stage ensures that Indigenous participation requirements are embedded into project delivery from the outset. It sets clear responsibilities, establishes processes for compliance, and prepares the team to collect and report accurate data throughout the project lifecycle.

1. Nominate a project lead. This person will be responsible for:

  • Conducting a hand over with the Contract Negotiation team to understand the Indigenous participation requirements
  • Ensuring the Indigenous participation requirements are met throughout the project
  • Reporting project outcomes to the head contractor

2. Write a project plan to ensure smooth compliance throughout the project delivery and clarify roles and responsibilities

  • Complete the Project Plan Template outlining the targets, action required to meet those targets, and reporting methodology
  • Use the  Project Planning Guide to identify sourcing channels for Indigenous participation
  • The Project Plan in an internal working document used to assist the project team in delivering a compliant project. It’s not shared with the head contractor or developer.

3. Set up a data collection folders and templates

  • Use the Folder Structure Guide to implement the data collection process in preparation for the project delivery stage

4. Train project team on the Policy and it’s requirements

  • Give project staff access to this training module

The delivery stage is where plans are put into action. It focuses on engaging Indigenous businesses and workers, collecting accurate evidence of participation, and reporting progress to the head contractor. Strong delivery ensures compliance with the Indigenous Procurement Policy and demonstrates tangible outcomes.

1. Follow the Project Plan

  • The project lead is responsible for ensuring the project team are following the Plan
  • Engage Indigenous businesses and workers as outlined in the Plan

2. Collect evidence

  • Record Indigenous employment in FTE and contracts with Indigenous businesses using the Social Procurement Tracker
  • Include subcontractor and supplier Indigenous employment and contracts

3. Submit reports to the head contractor monthly with your progress claim

  • Use the Monthly Reporting Template to provide consistent and accurate updates

The close‑out stage captures the results of the project and ensures lessons are carried forward. It focuses on reporting achievements, documenting outcomes, and refining processes so future projects can build on what has been learned.

1. Provide the head contractor with a final report to showcase project outcomes

  • Use the Project Completion Report Template

2.Draft a case study for use in future tenders

  • Refer to Case Study Template to highlight key achievements and demonstrate capability

3. Document achievements and lessons learned

  • Use Project Reflection Template to record successes and areas for improvement

4. Reflect and adjust

  • Apply insights gained to strengthen Indigenous participation strategies in upcoming projects
  • Adjust any templates or processes to improve efficiencies on future projects

Not intended as legal advice. Read full disclaimer.