From what period of time did the IOP apply?
The IOP commenced on 1 July 2011 and ceased on 30 June 2015.
What is the Indigenous Procurement Policy (IPP)?
The Indigenous Procurement Policy (IPP) replaced the Indigenous Opportunities Policy (IOP) on 1 July 2015.The IPP applies to all non-corporate Commonwealth entities subject to the Commonwealth Procurement Rules (CPRs). However, entities that are not required to comply with the CPRs are encouraged to adopt the policy as best practice.
The policy has three parts:
- A target number of contracts that need to be awarded to Indigenous businesses.
- A mandatory set-aside of contracts for Indigenous businesses to apply in certain situations.
- Mandatory minimum requirements for Indigenous employment and Indigenous supplier use applying to certain Commonwealth contracts.
For more information on the IPP, visit the Department of Finance website.
Who applied the IOP?
Previously all FMA Agencies. These are Australian Government Agencies subject to the Financial Management and Accountability Act 1997 and the Financial Management and Accountability Regulations 1997.
For 1 July 2014, the Public Governance, Performance and Accountability Act 2013 replaced the Financial Management and Accountability Act 1997 (FMA Act) and the Commonwealth Authorities and Companies Act 1997 (CAC Act).
In addition, all businesses tendering for projects with IOP requirements needed to comply by developing and obtaining approval for an IOP Plan using the MyPlan system.
Did my agency need to apply the IOP?
If you were a FMA Agency conducting an Approach to Market that was likely to result in a contract values at or above $5 million ($6 million for construction) and the main activity was in a region(s) where there was a significant Indigenous population (3% or above) then you were required to apply the IOP.
Was the Agency managing the contract responsible for ensuring the contractor complied with the requirements of the former IOP?
From 1 July 2011 to August 2013 compliance with the IOP requirements was managed by the IOP Administrator at the Department of Education, Employment and Workplace Relations.
Responsibility for the IOP was transferred to the Department of the Prime Minister and Cabinet in August 2013. The IOP Administrator managed IOP compliance arrangements through the contractor’s annual IOP implementation and outcomes report through the MyPlan system until the IOP ceased on 30 June 2015.
The IOP Administrator informed an Agency when a contractor was found to be non-compliant. It was then up to the Agency to determine how to act on this information.
What is a region with a significant Indigenous population?
For the purposes of the former IOP, a 'region with a significant Indigenous population' was one in which the proportion of Indigenous people in the region was equal to or higher than the national average of 3 per cent. These regions were determined using the most recent Census data from the Australian Bureau of Statistics.
How did the IOP apply when a project covered multiple regions?
Where a project occurred across a number of regions, tenderers were only obliged to implement the IOP Plan in the region(s) with the significant Indigenous population. However, tenderers could choose to apply the IOP Plan to the project as a whole.
For example, a contractor who delivered services both in the Australian Capital Territory and Queanbeyan would only be obliged to implement their IOP Plan in Queanbeyan as it was a region with a significant Indigenous population. For the sake of practicality a contractor could choose to implement the Plan in both Queanbeyan and the ACT.
What happened where a region of activity was unknown during the planning stages of the project?
In some instances Agencies were not able to anticipate the region(s) in which a project was to be undertaken. The agency could choose to apply the IOP prior to the execution of the contract or include the establishment of an approved IOP Plan as a contractual requirement.
This meant that the successful bidder (if the contract is over $5 million and in a region with a significant Indigenous population) was either required to have an approved IOP Plan before the contract was executed or within a time specified in the contract. These options should have been reflected in the Approach to Market documentation.
When tendering to provide a good/service in multiple Indigenous regions across Australia, were tenderers required to develop an IOP Plan for each specific location?
No. Once an organisation had an approved IOP Plan it should have been updated by the organisation to include any projects with IOP requirements. IOP Plans required organisations to select activities in the areas of employing and training Indigenous people and including Indigenous businesses in an organisation’s supply chain. Organisations were encouraged to tailor their IOP Plan to individual projects or regions and local labour market circumstances. .
Did Agencies need to contact the IOP Administrator if they were planning an Approach to Market?
The information available on the IOP website was designed to assist Agencies determine whether the IOP applied to their contracts. In order to reduce red tape and expedite procurement processes an Agency should have consulted with the IOP Administrator if it had any questions after reviewing the materials on the IOP website. The IOP Administrator also provided advice to Agencies on consulting other bodies that could assist with the planning stages of a project.
Why was a $6 million threshold for construction used? Was it intended to align to the 'Covered Procurement' definition thresholds in the Commonwealth Procurement Guidelines (CPGs) for construction which was previously $6 million but was been increased to $9 million?
As the Council of Australian Governments (COAG) agreed to strengthen procurement policies, revision of the IOP focused on ensuring the IOP was made more workable, had broad application and was more likely to achieve real change. Raising the monetary threshold to reflect the threshold in the CPGs would not have broadened the base of the IOP.
Did agencies have to apply the IOP to procurement activities undertaken overseas?
No. Agencies were not required to apply the IOP if the procurement activity occurred outside Australia.
Where can I go for further advice about how the IOP was previously applied?
Please send any queries about how the former IOP was applied to IndigenousProcurement@pmc.gov.au