• The National Indigenous Agency (NIAA) opened for business on Monday operating as an executive agency within the Prime Minister and Cabinet. (AAP)Source: AAP
A parliamentary report has recommended independent audits and assessments of companies awarded Indigenous Procurement Policy contracts and a review of how Indigenous-owned businesses are certified.
Sarah Collard

14 Sep 2021 - 10:09 AM  UPDATED 14 Sep 2021 - 10:09 AM

Indigenous business owners are calling for greater scrutiny on large companies that may be exploiting government procurement policies.

A federal parliamentary report into Indigenous Employment and Business highlighted concerns about the government's Indigenous procurement policies (IPP) and so-called 'black cladding'.

The Standing Committee on Indigenous Affairs's report made 17 recommendations — including calls for independent audits and assessments of companies awarded IPP contracts to make sure Indigenous people are benefiting from the scheme. 

The report also recommends Supply Nation, an organisation that certifies and audits Indigenous businesses, review how it defines Indigenous businesses to ensure that procurement policies benefit Aboriginal and Torres Strait Islander communities. 

The report shows that in the six months from July to December last year, Supply Nation received eight complaints out of almost 2800 businesses, and only removed one was removed from the Indigenous Business Directory as it could not provide appropriate documentation. 

Yuin man Bill Bashford runs a consultancy business and teaches cultural awareness training in Canberra. He told NITV News there needs to be greater accountability from Supply Nation and its guidelines.

"The Indigenous procurement policy is a billion-dollar industry... we need to do financial audits on where the money's gone, we need to follow the money," he said.

Mr Bashford said he believed an independent body needs to be set up to investigate claims of 'black cladding'.

"I think one needs to be set up from scratch. Supply Nation has tarnished their own brand." he said.

He said black cladding is prevalent in many industries and there can be a reluctance to come forward and make claims public. 

"Everyone knows that it's going on. It's happened to me. I have been approached by that many people who have turned around and said 'all you have to do is be the Black face." he said.

Supply Nation's Chief Executive, Wiradjuri woman Laura Berry, said in a statement that all allegations of 'black cladding' are investigated thoroughly by Supply Nation.

"Supply Nation takes the issue 'black cladding' extremely seriously and has robust processes in place to manage any allegations,' she said.

Under the federal government's Indigenous Procurement Policy (IPP) an Indigenous business is defined as a business with at least 50 percent Indigenous ownership. Supply Nation registers and certifies businesses whose Indigenous ownership is at least 51 per cent.

Ms Berry said the business acknowledges the report of the parliamentary inquiry.

"Supply Nation actively participated in the Inquiry process and notes the recommendations of the committee regarding the Indigenous business sector," she said.

The federal government has awarded $14.6 billion to more than 100 organisations under the IPP strategy since July 2016. 

According to the National Indigenous Australians Agency's website almost 1000 Indigenous businesses have been awarded more than 7,749 commonwealth contracts during the 2019/2020 financial year worth $857 million.