• What's at the end of the Government's Indigenous Business Strategy roadmap? (iStockphoto)Source: iStockphoto
Natalie Cromb questions whether the degree of disadvantage in communities be alleviated by such Indigenous entrepreneurial opportunities.
By
Natalie Cromb

19 Oct 2017 - 2:41 PM  UPDATED 19 Oct 2017 - 2:45 PM

Held annually in October, #IndigenousBusinessMonth gives us the opportunity to celebrate the many Indigenous people who are successfully running their own businesses, giving leadership to their communities and inspiring others to follow in their footsteps. It's also an opportunity to examine the ways that the market can be improved to provide greater opportunities for Indigenous people in business.

Despite a growing increase in the number of self-employed Indigenous people, there is still a clear gap between Indigenous and non-Indigenous entrepreneurship; a gap that is largely a result of the circumstances Indigenous people are in. Put simply, Indigenous opportunity is significantly lagging compared to the non-Indigenous community.

We know the reality for a significant portion of Indigenous people in Australia is a life of disadvantage, if not outright poverty. As such, there is a sector of Indigenous Australia that sees business, industry and entrepreneurial opportunity as a way to address the poverty and provide means to overcome such disadvantage.

Consequently, the Indigenous business sector is a key policy of the Coalition Government, who aims to provide greater opportunity to Indigenous businesses through a procurement policy. This is something that Supply Nation, an organisation working in supplier diversity, has been working on since 2009 when it was founded under the name of Australian Indigenous Minority Supplier Council (AIMSC). After successfully completing their 3-year pilot phase on a $3 million budget, AIMSC rebranded to become Supply Nation in 2013.

 

The Government's Indigenous Business Strategy - what's it about?

Earlier this year, The Coalition Government committed to an Indigenous Entrepreneurs Package that included developing a road map for growing the Indigenous business – the Indigenous Business Sector Strategy. This strategy would be rolled out through the government-funded, Indigenous Business Australia, which is a conduit for Indigenous people to obtain information and training on business and business skills, obtain business finance as well as obtain home loans when traditional lenders aren’t accessible.

The Coalition's paper was released for stakeholder consultation and in statement released by Minister Scullion, 

From 1 July 2017, we will be changing IBA’s funding arrangements to focus it on supporting entrepreneurs who have low intergenerational wealth and need greater support,Minister Scullion said.

"These initiatives are on top of the $90 million Indigenous Entrepreneurs Fund that the Coalition has committed to help remote and regional Indigenous businesses get a foot in the game.

Minister Scullion considers the Coalition Government's Indigenous Procurement Policy (IPP) to be key in Indigenous business growth, as there needs to be a demand for Indigenous businesses in order for the incentive to be there. The incentive being that Indigenous people will take the steps required to start a business, despite the risk involved in going into business.

Just last month the two year score card was released on the Coalition Government’s IPP and Minister Scullion stated that within the first two years of the IPP, they have already exceeded the 2020 target of awarding 3 per cent of all government contracts to Indigenous businesses annually.

"Targets which were once thought impossible," Scullion said, "... and I’m proud that under the Coalition we are seeing 7 per cent of all government contracts go to First Australian businesses.”

He continues to say that Australia’s Indigenous business sector has long been overlooked by governments.

"Only four years ago Indigenous businesses were awarded just $6.2 million in Australian Government contracts. In the two years since this program commenced, 956 Indigenous businesses have won over $594 million in government contracts. A 95-fold increase is a success story in anyone’s book. The IPP has allowed the Australian Government to tap into the extraordinary capabilities of the Indigenous business sector.”

 

Is the strategy viable?

Whilst the significant increase in private sector growth for Indigenous enterprise is something that the Government has set out to achieve, it is doing so under its own self-assessment. What is more important, is to measure the impact of the increased business opportunities in communities.

The issue of disadvantage and poverty is still something that needs to be addressed and given that the Government’s investment is in the area of providing opportunities only – it is not sufficient to simply state that there is more contracts being awarded to Indigenous enterprises.

There needs to be a macro and micro examination of the impact of the policy on communities that are experiencing the most disadvantage in Australia, particularly those in rural and remote communities. It needs to be assessed on whether the degree of disadvantage has been alleviated by such Indigenous business opportunities, and unfortunately the healthy sceptic within me assumes that this may merely create a greater class disparity within the Indigenous community – a new middle class, if you will, that divides the interests of the community.

It is unlikely that there will be any governmental study of the effectiveness of this policy on communities, but the proof will be in the pudding. However, as we are two years into this new policy and the community sentiment is that the poverty experienced by Indigenous Australians is worsening not improving, suggests the Coalition's take on community welfare is a little underdone. 

 

Indigenous Business Month runs from 1st - 31st October.

Natalie Cromb is a Kamilaroi woman, writer, legal professional and mother. Follow her @NatalieCromb 

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