Aboriginal Procurement Policy

Increasing Aboriginal economic participation in the development of NSW.

New policy starting 1 January 2021

The Aboriginal Procurement Policy (APP) and the Aboriginal Participation in Construction Policy (APIC) are merging into a new policy from 1 January 2021.

Preview the draft Aboriginal Procurement Policy starting 1 January 2021 by clicking below.

Draft Aboriginal Procurement Policy October 2020

The final policy document will be prepared by an Aboriginal graphic designer and will include the Aboriginal artwork commissioned for the 2019 policy review report.

Download draft policy document DOCX, 147.17 KB

1. Introduction

The NSW Government values the economic, social and cultural contribution of the Aboriginal community in NSW.

The Aboriginal Procurement Policy (APP) will contribute to the NSW Government’s strategic economic policy of Growing NSW’s First Economy.

Government procurement provides a significant opportunity to increase Aboriginal skills and economic participation.

The APP supports the NSW Government Plan for Aboriginal Affairs, OCHRE, and is a key deliverable under the Aboriginal Economic Development framework.

1.1 Objectives

  • Support employment opportunities for Aboriginal people.
  • Support sustainable growth of Aboriginal businesses by driving demand via Government procurement of goods, services and construction.

1.2 Targets by 31 December 2021

  • 1% of total addressable spend. The APP aims for NSW Government clusters to direct 1% of the cluster’s addressable spend to Aboriginal businesses.
  • 3% of total goods and services contracts. The APP aims for NSW Government clusters to award 3% of the total number of goods and services contracts to Aboriginal businesses.
  • 3,000 full-time equivalent employment (FTE) employment opportunities supported. The APP aims to support an estimated 3,000 FTE opportunities for Aboriginal people through NSW Government procurement activities.

2. The APP applies to the procurement of goods, services and construction by all NSW Government agencies

The APP applies to the procurement of all goods and services, including construction, by a government agency, within the meaning of section 162 of the Public Works and Procurement Act 1912 (the Act) (collectively referred to as ‘clusters’ or ‘agencies’ in this policy).

State-owned corporations, the Parliament of NSW and local councils are not covered by this policy. State-owned corporations are encouraged to adopt aspects of the APP that are consistent with their corporate intent.

2.1 Commencement

NSW Government agencies must apply the APP to all relevant procurement activities commencing from 1 January 2021. All agencies are encouraged to apply the policy at an earlier date where this is practical.

2.2 Identifying an Aboriginal business

For the purpose of this policy, an Aboriginal business is one that has at least 50% Aboriginal ownership and that is recognised through an appropriate organisation, such as Supply Nation or the NSW Indigenous Chamber of Commerce. These organisations maintain lists of Aboriginal businesses that are audited and undergo quality assurance.

2.3 Confirming Aboriginality of employees

For the purpose of this policy, suppliers reporting on numbers of FTE employment opportunities for Aboriginal people on the contract must be able to demonstrate their process to confirm Aboriginal or Torres Strait Islander heritage in line with the guidance to be issued prior to the commencement of the policy.

2.4 Accountability and transparency

The NSW Government will publicly hold itself to account for performance under the policy.

Performance against policy targets will be published on buy.nsw for the NSW Government as a whole and at a cluster level.

The success of this policy will be assessed on the following performance indicators:

  • an increase in the number of Aboriginal businesses awarded contracts with the NSW Government
  • an increase in direct spend with Aboriginal businesses
  • an increase in FTE employment opportunities for Aboriginal people on NSW Government contracts.

3. Applying the APP – NSW Government agencies

3.1 Plan: Aboriginal Participation Strategy

Agencies must publish an annual Aboriginal Participation Strategy that describes how the agency will meet its obligations under the APP.

The strategy should identify and address upcoming procurement opportunities for Aboriginal participation, at a minimum for procurements valued at $7.5 million or above.

Strategies may be written at a cluster or agency level and must be published on the cluster’s website.

3.2 Source: Aboriginal Participation in contracts valued at $7.5 million or above

Agencies must include minimum requirements for 1.5% Aboriginal participation in all contracts valued at $7.5 million or above by requiring one or a combination of the following:

  • at least 1.5% of the contract value to be subcontracted to Aboriginal businesses
  • at least 1.5% of the contract’s Australian based workforce (FTE) that directly contribute to the contract to be Aboriginal employees*
  • at least 1.5% of the contract value to be applied to the cost of education, training or capability building for Aboriginal staff or businesses directly contributing to the contract.

(*) The unit of measurement for workforce is the number of ‘full time equivalent’ workers according to the definition of FTE relevant to the industry in which the contractor operates. Suppliers must outline how they define and measure FTE in their Aboriginal participation plans.

Agencies should consider appropriate exclusions from the contract value in the calculation of Aboriginal participation requirements. Exclusions are determined by agencies and may include specialised goods and services with very limited opportunities for Aboriginal participation. The application of any exclusion is at the discretion of the agency.

Where a contract is valued at $7.5 million or above and it is determined that there is no scope for Aboriginal participation (for example, the purchase of high-value equipment or machinery) then an agency’s Chief Procurement Officer may approve that Aboriginal participation is not required in that instance. Relevant approval documentation must be retained.

Subcontracts with Aboriginal businesses that support the delivery of NSW Government goods and services contracts may be manually reported to NSW Treasury and count toward the cluster’s target of 3% of goods and services contracts.

Agencies must:

  • Require tenderers to submit an Aboriginal Participation Plan during the procurement process that sets out how the tenderer plans to meet the Aboriginal participation requirements.
  • Require tenderers to declare, during the procurement process, whether they have previously participated, or are currently participating, in a NSW Government contract that had Aboriginal participation requirements and, if applicable, demonstrate their compliance with the requirements. The past performance of a tenderer should be considered when assessing Aboriginal participation proposals.
  • Include the final Aboriginal Participation Plan in the successful supplier(s) contract requirements, including quarterly reporting against the plan and requirements for any Aboriginal participation spend balance to be retained by the agency or directed back to the agency to distribute to Training Services NSW.

Agencies should, whenever feasible:

  • provide a length limit for tender responses
  • use plain English and limit the complexity of tender requirements and documents
  • apply an Aboriginal participation non-price evaluation criterion.

3.3 Source: Applying the APP for procurements valued below $7.5 million

Agencies should whenever feasible give first consideration to Aboriginal businesses for procurements up to $250,000.

Agencies may negotiate directly with an Aboriginal business for all procurements up to $250,000, even if there is a mandated prequalification scheme or panel in place. The Aboriginal business engaged by the agency does not need to be a member of a NSW Government prequalification scheme. If one or more Aboriginal businesses are identified, the agency should engage with those suppliers before proceeding to a broader market.

Agencies are encouraged to disclose all contracts with Aboriginal businesses even where these are below the Government Information (Public Access) Act 2009 contract disclosure threshold. All disclosed contracts will contribute to the cluster targets of 3% of goods and services contracts.

Agencies should, wherever feasible, provide constructive feedback to unsuccessful tenderers on their tender responses. This feedback should be provided with a view to building the capability of Aboriginal businesses to apply successfully for future opportunities.

3.4 Manage

Agencies must:

  • Manage suppliers’ compliance with the APP including reporting in accordance with the APP reporting requirements.
  • Take reasonable steps to support suppliers to meet the requirements.
  • Confirm claims made by the supplier in relation to Aboriginal participation and address any compliance or performance issues if they arise.
  • Support and assist in audits in line with the NSW Procurement Board’s commitment to undertake a random audit of 5% of contracts annually.
  • Conduct a final review of performance against the Aboriginal Participation Plan at the completion of the contract.
  • Direct any remaining balance of Aboriginal participation spend to Training Services NSW within 3 months of the completion of the contract or earlier if the supplier confirms the Aboriginal participation targets will not be met.

4. Applying the APP – Government suppliers

Suppliers must:

  • Comply with the requirements in this policy and additional requirements set by agencies and the NSW Procurement Board in support of the policy objectives.
  • Allocate the minimum 1.5%, or a higher percentage as agreed with the contracting agency, of contract value to Aboriginal participation.
  • Submit an Aboriginal Participation Plan during the tender process that sets out how the supplier will meet the Aboriginal participation requirements of the contract.
  • Work with the contracting agency to successfully implement the Plan.
  • Report quarterly on progress toward the Plan in the format and method required by this policy.
  • Support and cooperate with audits of Aboriginal Participation Plans and reporting.
  • Provide a final report on completion of the contract, including a final reconciliation against the Aboriginal participation requirements. This report may be submitted as the supplier’s last required quarterly report in line with the reporting format and method required by this policy.
  • Where participation requirements have not been met, the remaining balance is to be collected by the contracting agency and directed to the account held by Training Services NSW. Funds cannot be transferred by suppliers. Agencies may choose to retain the Aboriginal participation spend at the start of the contract and allocate this spend progressively to suppliers as progress against the Plan is demonstrated.

4.1 Aboriginal Participation Fund

Training Services NSW has established the Aboriginal Participation Fund to receive payments when a supplier does not meet contracted Aboriginal participation requirements. Training Services NSW will use these funds to target skills and capacity gaps, education and capability building programs for Aboriginal people and businesses to enable Aboriginal participation requirements to be met for future NSW Government contracts.

NSW Government encourages supplier feedback on any areas of focus to enable future Aboriginal participation requirements to be met.

4.2 Reporting

Suppliers are required to report quarterly on the progress against their commitments in the Aboriginal Participation Plan in the format and method required by this policy, and as updated from time to time.

5. Target: 1% addressable spend

The APP aims for clusters to direct 1% of addressable spend to Aboriginal businesses by the end of 2021.

In response to the 2019 policy review recommendation to strengthen accountability, NSW Treasury will publish cluster targets annually and report on cluster progress towards the targets.

5.1 What is addressable spend?

The NSW Government categorises its procurement spend in accordance with the United Nations Standard Products and Services Code (UNSPSC).

For the purposes of the APP, we have defined ‘addressable’ spend as a category of spend where there are opportunities for agencies to engage Aboriginal businesses. Addressable spend has primarily been set based on categories of goods and services provided by businesses registered with NSWICC and Supply Nation.

‘Non-addressable’ spend is a category of spend where there are very limited opportunities for agencies to engage Aboriginal businesses. It includes categories where there are no recognised Aboriginal businesses able to supply to government, spend subject to mandated whole-of-government contracts, foster care payments or jury costs, spend on utilities, grants and spend to other government entities, State-owned Corporations or Statutory Authorities.

A uniform list of addressable spend categories has been set. Performance in spend categories and changes in opportunities across the categories will be reviewed annually.

5.2 Calculation of addressable spend target

The addressable spend for each cluster is the average of a cluster’s total spend in the addressable spend categories over 3 previous financial years.

The 1% addressable spend target is 1% of the cluster’s addressable spend.

Figure 1- Calculating the addressable spend target

Cluster addressable spend (CAS)
Addressable spend (AS)
CAS = The average of the cluster’s total spend in addressable spend categories over the 3 previous financial years.
CAS = (ASY1 + ASY2 + ASY3)/3
Cluster addressable spend target (CAST)
CAST = 0.01 x CAS
Y1, Y2, Y3 = Financial year 1, 2 and 3

5.3 How is cluster progress toward the spend target reported?

The Australian business numbers (ABNs) of verified Aboriginal businesses are matched against NSW Government procurement spend data.

Work is underway to capture spend with Aboriginal businesses on purchasing cards (P-cards).

In the interim, clusters may manually report P-card spend with Aboriginal businesses to NSW Treasury.

6. Target: 3% goods and services contracts

The APP aims for Aboriginal businesses to be awarded at least 3% of the total number of NSW Government contracts for goods and services by the end of 2021.

In response to the 2019 policy review recommendation to strengthen accountability, the targets are set by cluster.

The target excludes construction contracts and non-procurement contracts.

NSW Treasury will publish cluster targets annually and report on cluster progress towards the targets.

6.1 Calculation of contracts target

Targets are calculated annually based on 3% of the average total goods and services contracts disclosed by a cluster on the Government’s contract register over the previous 3 financial years.

Each contract disclosed is counted as one contract. The data may be adjusted in consultation with the relevant cluster to remove contracts excluded from the target.

This method has been adopted to set the targets as the total number of contracts awarded varies from year to year and will not be known in advance.

Clusters are required to disclose contracts valued at $150,000 or above (including GST) on the Government’s contract register, in accordance with the Government Information (Public Access) Act 2009.

Clusters are encouraged to disclose lower value contracts with Aboriginal businesses for increased visibility of engagements.

Figure 2 - Calculating the contracts target

Average cluster contracts(ACC)
Total cluster contracts (TCC)
ACC = (TCCY1 + TCCY2 + TCCY3)/3
Cluster contracts target (CCT)
CCT = 0.03 x ACC
Y1, Y2, Y3 = Financial year 1, 2 and 3
Contract count only includes goods and services contracts.

6.2 How is cluster progress toward the contracts target reported?

The ABNs of verified Aboriginal businesses are matched against disclosed contracts in the NSW Government’s contract register.

In response to a 2019 policy review recommendation, subcontracts with Aboriginal businesses directly related to a NSW Government goods and services contract may be manually reported to NSW Treasury and count toward the cluster’s contracts target.

Reporting on progress towards the targets will specify the number of direct contracts and subcontracts represented in the total numbers.

7. Target: 3,000 Aboriginal FTE employment opportunities

The NSW Government target for supporting employment opportunities for Aboriginal people is set at a whole-of-government level.

The APP aims to support an estimated 3,000 FTE employment opportunities for Aboriginal people through NSW Government procurement opportunities by the end of 2021.

This target commenced in July 2018 through the previous Aboriginal Procurement Policy and revised Aboriginal Participation in Construction policy.

7.1 How is progress toward the employment opportunities target reported?

Reporting against this target is captured via supplier reporting of employment opportunities supported on NSW Government contracts valued at $7.5 million or above.

The unit of measurement for workforce is the number of ‘full time equivalent’ workers according to the definition of FTE relevant to the industry in which the contractor operates. Suppliers must outline how they define and measure FTE in their Aboriginal participation plans.

For the purpose of this policy, suppliers reporting on numbers of FTE employment opportunities supported for Aboriginal people must be able to demonstrate their process to confirm Aboriginal or Torres Strait Islander heritage in line with the guidance to be issued before the commencement of the policy.

8. Governance

8.1 NSW Procurement Board

The NSW Procurement Board is responsible for the administration, monitoring and reporting of this policy. This includes:

  • conducting audits and reviews of the policy
  • dealing with complaints about the application of the policy via its established complaints handling procedures
  • exempting specific projects or classes of projects and allocating specific requirements against individual contracts
  • issuing directions to agencies, including use of standard form contract clauses, on contracts subject to this policy.

8.2 Procurement complaints

Complaints about procurement matters should be directed to the relevant contracting agency.

Complaints should be resolved in a non-adversarial and cooperative manner.

The Office of the Small Business Commissioner can provide mediation services to small businesses if necessary.

If complaints cannot be resolved directly with the agency, or further action is required, complaints should be managed in accordance with the NSW Government Complaints Management Guidelines.

8.3 Aboriginal Participation Fund

The Fund receives unspent Aboriginal participation funds from NSW Government contracts subject to the policy.

This Fund is administered by Training Services NSW.

Decisions relating to the distribution of funds are managed by Training Services NSW in consultation with the Aboriginal Participation Fund Governance Committee.

9. Review of the APP

The outcomes and effectiveness of the APP will be reviewed in 2022.

The Deputy Ombudsman (Aboriginal Programs) has a legislated function to independently monitor and assess the implementation of prescribed Aboriginal programs including OCHRE.

This function is an integral part of the overall accountability framework for OCHRE.

10. Further information

Support and guidance materials can be found through the links provided in this policy or on buy.nsw.

For further information, please contact buy.nsw on 1800 679 289 or nswbuy@treasury.nsw.gov.au


Current Aboriginal Procurement Policy

1.    Policy context

1.1    Purpose

The NSW Government values the economic, social and cultural contribution offered to NSW from the Aboriginal community. The Aboriginal Procurement Policy (APP) will contribute to the NSW Government’s strategic economic policy of Growing NSW’s First Economy.

Government procurement provides a significant opportunity to increase Aboriginal skills and economic participation. The APP supports the NSW Government plan for Aboriginal affairs, OCHRE, and is a key deliverable under the Aboriginal Economic Development Framework.

OCHRE aims to support strong Aboriginal communities in which Aboriginal people actively influence and fully participate in economic, social and cultural life. It recognises that the NSW Government and the business community have a key role to play in broadening opportunities for Aboriginal people to deliver positive socio-economic outcomes.

The NSW Government’s procurement capacity can be leveraged to support Aboriginal employment opportunities and the participation and growth of Aboriginal-owned businesses.

The NSW Government will continue to work meaningfully in partnership with businesses to build a sector that is viable, competitive and achieves outcomes for the benefit of the Aboriginal and broader community.

1.2    Objective

The APP will create opportunities for Aboriginal-owned businesses and encourage Aboriginal employment through the supply chain of NSW Government contracts. Key objectives for this policy are to:

  • support employment opportunities for Aboriginal people within Aboriginal-owned businesses
  • support employment opportunities for Aboriginal people within non-Aboriginal owned businesses
  • support sustainable growth of Aboriginal-owned businesses by driving demand via government procurement of goods and services.

1.3    Policy targets

The NSW Government targets for supporting employment opportunities and contracting with Aboriginal-owned businesses are set at a whole-of-government level as opposed to an individual agency level.

Target: Aboriginal participation in NSW Government procurement

In conjunction with the existing Aboriginal Participation in Construction (APIC) Policy, the APP will aim to support an estimated 3,000 full-time equivalent employment opportunities for Aboriginal people through NSW Government procurement activities by 2021.

The APP will aim for Aboriginal-owned businesses to be awarded at least 3% of the total number of domestic contracts for goods and services issued by NSW Government agencies by 2021.

The NSW Procurement Board may allocate specific targets to agencies or for different categories of expenditure, where it is considered appropriate to help achieve the overall whole of government target.The objectives and targets of the APP include Aboriginal and Torres Strait Islander owned businesses and Aboriginal and Torres Strait Islander peoples.

2.    Applying the APP

The APP applies to the procurement of goods and services of any kind by all NSW government agencies, as defined in Part 11 of the Public Works and Procurement Act 1912, excluding construction. The APIC policy’s Aboriginal participation requirements for NSW Government construction projects continue to apply.

The APP applies to all NSW Government departments, statutory authorities, trusts and other government entities (collectively referred to as ‘agencies’).

State-owned corporations are encouraged to adopt aspects of the APP that are consistent with their corporate intent.

2.1    Aboriginal-owned business

An Aboriginal-owned business is one that is considered to be an Aboriginal owned business through recognition by an appropriate organisation, such as:

The NSW Procurement Board will work with Aboriginal organisations to establish a central register of Aboriginal-owned businesses, to be made available for all NSW government agencies.

2.2    Commencement

NSW government agencies must apply the APP to all relevant procurement activities commencing from 1 July 2018. All agencies are encouraged to apply the policy at an earlier date where this is practical.

3.    NSW Government agencies

From 1 July 2018 agencies must:

  • Publish an annual Aboriginal participation strategy that describes how the agency will meet its obligations under the APP. This should identify and address upcoming procurement opportunities for Aboriginal participation, at a minimum for the procurement of goods and services valued over $10 million excluding GST.
  • Engage with suppliers and consider their capacity to meet the obligations under the APP for all relevant procurement activities.
  • Report all contracts valued over $50,000 excluding GST, entered into with an Aboriginal-owned business.
  • Ensure all suppliers are made aware of their obligations under the APP at the time of tender or before.
  • Incorporate supplier obligations under the APP into the contract.
  • All agencies must apply any further measures approved by the NSW Procurement Board in support of the APP

Agencies are authorised to apply additional measures to achieve the APP objectives, such as:

  • First consideration to Aboriginal-owned businesses on prequalification schemes before proceeding to market for procurements valued up to $250,000 excluding GST, where appropriate. If one or more Aboriginal-owned businesses are identified, the agency should engage with those suppliers before proceeding to market.
  • Direct negotiation with suitably qualified Aboriginal-owned businesses that can demonstrate value for money and delivery of quality goods and services for procurements not covered under existing prequalification schemes valued up to $250,000 excluding GST.
  • Apply an Aboriginal participation non-price evaluation criteria in relevant tenders where opportunities exist.

3.1    Major procurement actions

All NSW Government agencies must consider opportunities for Aboriginal participation in all major procurement activities over $10 million excluding GST, and must document these opportunities in their procurement strategy.

The approach used for Aboriginal participation should be consistent with the agency’s Aboriginal participation strategy, the objectives of the particular procurement activity, and the APP.

Agencies are encouraged to work with suppliers, Aboriginal-owned businesses and Aboriginal representative bodies early in the planning stages of procurement activities to identify effective ways of increasing Aboriginal participation in their contracts.

Aboriginal participation requirements for construction projects under the APIC Policy continue to apply.

3.2    Procurement from Aboriginal-owned businesses

In addition to the standard procurement processes, the below sourcing approaches are also permitted to be undertaken by agencies when procuring from Aboriginal-owned businesses:

3.2.1    First consideration

An agency should give first consideration to suitably qualified Aboriginal-owned businesses on prequalification schemes before going to market, where appropriate.

An agency may purchase goods and services valued up to $250,000 excluding GST, from an Aboriginal owned business after receiving a single quote provided that value for money and quality of goods and services can be demonstrated.

Alternatively, an agency should invite identified Aboriginal-owned businesses to a limited tender.

3.2.2    Direct negotiation

If the goods and services required are not covered under existing prequalification schemes, an agency is authorised to procure goods or services for values up to $250,000 excluding GST, via direct negotiation provided the Aboriginal-owned business meets all the requirements of value for money and quality.

3.3    Aboriginal participation strategy

Agencies are required to prepare and publish online an Aboriginal participation strategy. This strategy can be for an individual agency, group of agencies or cluster.

The Aboriginal participation strategy must:

  • Provide a public commitment that the agency will work with Aboriginal-owned businesses to grow the First Economy of NSW.
  • Explain how the agency is working with Aboriginal-owned businesses to identify and develop business and employment opportunities.
  • Set measurable targets for Aboriginal participation that the agency or cluster will adopt including, where appropriate, targets for specific categories of procurement and Aboriginal workforce strategies.
  • Report the outcomes that have been achieved and actions taken where targets have not been achieved.

An agency must maintain and update this Aboriginal participation strategy at least annually, at a time consistent with any requirements for reporting outcomes to the NSW Procurement Board.

3.4    Aboriginal participation in contracts

All agencies are expected to include targets for Aboriginal employment in procurement activities, if considered appropriate, and where opportunities exist. Agencies must include in tenders:

  • Requirements for suppliers to include an Aboriginal participation plan for all contracts over $10 million excluding GST, in their tender response.
  • Evaluation criteria for Aboriginal participation in tender responses for all contracts over $10 million excluding GST.
  • Supplier reporting requirements for Aboriginal participation in the contract.

The NSW Procurement Board may allocate specific Aboriginal participation minimum targets for contracts or identified procurement categories where opportunities exist.

3.5    Compliance and reporting by NSW Government agencies

All agencies are required to comply with the APP. Progress of implementation will be monitored to ensure consistent and appropriate application of the APP across NSW government. NSW government agencies must report on implementation and compliance of the APP in their Aboriginal participation strategy and must provide information to the NSW Procurement Board via mandatory agency and supplier reporting, including:

  • Contracts valued over $50,000 excluding GST, entered into with an Aboriginal owned business within 45 days after the contract becomes effective.
  • Aboriginal employment in Aboriginal-owned businesses.
  • Aboriginal participation and employment in non-Aboriginal owned businesses.

Contracting agencies are responsible for monitoring, administrating and holding their suppliers accountable for their Aboriginal participation plans, progress reports and Aboriginal participation reports, and submitting them to the NSW Procurement Board once evaluated and approved.

4.    NSW Government suppliers

The NSW Government values the contribution that the business community is making towards increasing Aboriginal participation in the economy. The government is committed to working with suppliers to create opportunities for Aboriginal-owned businesses and to support the employment of Aboriginal people.

All suppliers are encouraged to work with agencies and Aboriginal communities to identify opportunities to increase Aboriginal participation.

Suppliers that submit a proposal and are awarded a contract to supply goods or services to NSW Government will need to meet the requirements for Aboriginal participation under the APP and as specified by an agency.

Suppliers submitting proposals for construction contracts will need to comply with requirements in the APIC policy.

4.1    Supplier reporting requirements

For all relevant contracts covered by the APP valued over $10 million excluding GST, suppliers must:

  • Provide a draft Aboriginal participation plan as part of the tender response identifying how the supplier will meet the individual contract requirements and targets for Aboriginal participation.
  • Provide a final Aboriginal participation plan at the commencement of the contract demonstrating how the supplier will meet the individual contract requirements and targets for Aboriginal participation.
  • Provide progress reports against the Aboriginal participation plan to the contracting agency monthly or more frequently as determined by the contracting agency, in a format specified by the NSW Procurement Board.
  • Provide an Aboriginal participation report on completion of the contract or on a periodic basis as determined by the contracting agency.

4.2    Incentives and consequences

Agencies may introduce incentives to recognise suppliers where they exceed policy targets. Incentives may include repeat contracts, supplier recognition and/or financial rewards.

Consequences may also be applied to suppliers that do not meet specified requirements to drive greater compliance.

Consequences may include breach of contract, key performance indicators (KPIs) and service levels, and/or withholding payment.

5.    Governance

A key feature of the APP is improvement in data collection and reporting of Aboriginal participation in NSW Government contracts and NSW Government suppliers.

The NSW Procurement Board will work with agencies to optimise the capacity of existing systems and leverage current digital platforms, such as eTendering and eQuote, and prequalification schemes for reporting contracts with recognised Aboriginal-owned businesses. Improved data and industry intelligence will help agencies identify opportunities for Aboriginal participation, and inform the APP’s future targets and direction.

The NSW Procurement Board will work with agencies to monitor progress towards the APP’s targets. Under the authority of the NSW Procurement Board, NSW Treasury is responsible for the administration, monitoring and reporting of this policy.

5.1    Monitoring and publishing results

Under the authority of the NSW Procurement Board, NSW Treasury is responsible for the administration, monitoring and reporting of the APP. This includes:

  • Establishing a whole-of-government dashboard to monitor the outcomes of the APP, including:
    • percentage of government contracts awarded to Aboriginal-owned businesses
    • contractual spend awarded to Aboriginal-owned businesses
    • number of Aboriginal people employed on contracts awarded (direct employment and employment through subcontractors) by NSW Government suppliers.
  • Publish an annual review of the APP.
  • Annual review of the APP’s targets and relevant application to categories, projects and procurement value.
  • Managing complaints about the application of the APP via established complaints handling procedures.

5.2    Annual review

The NSW Procurement Board will undertake an annual review of progress against the targets in the APP, in consultation with Aboriginal Affairs NSW, NSW Government agencies and industry.

5.3    Evaluation of the APP

The outcomes of the APP will be reviewed in accordance with the NSW Government program evaluation guidelines. This outcome review will be undertaken in 2022, 12 months after the NSW Government target is due to have been achieved.

The APP is covered under the OCHRE Plan.

The Deputy Ombudsman (Aboriginal Programs) has a legislated function to independently monitor and assess the implementation of prescribed Aboriginal programs starting with OCHRE – the NSW Government’s Aboriginal affairs plan. This function is an integral part of the overall accountability framework for OCHRE.

What is the APP?

The APP is a whole-of-government procurement policy aimed at supporting employment opportunities for Aboriginal people and growth in the Aboriginal business sector in NSW through NSW Government’s purchasing of goods and services.

Why has the NSW Government introduced the APP?

The APP supports the NSW Government Plan for Aboriginal Affairs, OCHRE, and is a key deliverable under the Aboriginal Economic Development Framework.

What are the APP’s targets?

The APP establishes the following whole-of-government targets to be achieved by 2021:

  • In conjunction with the NSW Government’s existing Aboriginal Participation in Construction (APIC) policy, support an estimated 3,000 full time equivalent employment opportunities for Aboriginal people through NSW Government procurement activities.
  • Award Aboriginal owned businesses at least three per cent of the total number of domestic contracts for goods and services issued by NSW Government agencies.

When did the APP come into effect?

The APP became mandatory from 1 July 2018.

All agencies are encouraged to apply the policy at an earlier date where this is practical.

Who does the APP apply to?

The APP applies to all NSW Government departments, statutory authorities, trusts and other government entities (collectively referred to as ‘agencies’).
State owned corporations are encouraged to adopt aspects of the policy that are consistent with their corporate intent.

What type of procurement does the APP apply to?

The APP applies to the procurement of goods and services of any kind by all NSW Government agencies, as defined in Part 11 of the Public Works and Procurement Act 1912, excluding construction. The Aboriginal Participation in Construction Policy’s Aboriginal participation requirements for NSW Government construction projects continue to apply.

The APP sets requirements against major procurement activities valued over $10 million (excl. GST) and provides ability for agencies to directly engage Aboriginal owned businesses for values up to $250,000 (excl. GST).

What is an Aboriginal-owned business?

For the purposes of this policy, an Aboriginal owned business is one that is considered to be an Aboriginal owned business through recognition by an appropriate organisation, such as:

  • NSW Indigenous Chamber of Commerce
  • an organisation representing Aboriginal owned businesses in another state or territory that is a member of the First Australians Chamber of Commerce and Industry
  • Supply Nation.

Where required, NSW Government may seek additional information to validate the business is an Aboriginal owned business.

Does the APP also apply to Torres Strait Islander peoples?

The objectives, targets and measures of the APP include Aboriginal and Torres Strait Islander owned businesses and Aboriginal and Torres Strait Islander peoples.

Do the APP’s targets overlap with those of the Aboriginal Participation in Construction Policy (APIC)?

The APP is a separate policy to the Aboriginal Participation in Construction (APIC) Policy, however, both policies contribute to the NSW whole-of-government target to support 3,000 employment opportunities for Aboriginal people through NSW Government procurement activities by 2021.

How will the APP benefit Aboriginal-owned businesses?

It is expected that the APP will deliver a broader range of opportunities for Aboriginal-owned businesses to supply to government both directly and via subcontracting arrangements.

NSW Government agencies can engage directly with suitably qualified Aboriginal-owned businesses for procurements valued up to $250,000 (excl. GST).

Can an Aboriginal-owned business which is not formally recognised as an Aboriginal owned business by Supply Nation or the NSWICC benefit from the APP?

Aboriginal-owned businesses which are recognised as Aboriginal-owned by another appropriate organisation are eligible to supply to government under this policy.

Where required, NSW Government may seek additional information to validate the business is an Aboriginal owned business.

What can Aboriginal-owned businesses do to be considered for NSW Government contracts?

Aboriginal-owned businesses should:

  • Ensure they are recognised as an Aboriginal owned business by an appropriate organisation.
  • Identify and engage with NSW Government agencies that may require the types of goods or services provided by their business.
  • Review agencies' Aboriginal Participation Strategies for potential business opportunities.
  • Register under relevant prequalification schemes for goods and services provided by their business.
  • Respond to agencies' procurement opportunities by providing proposals that meet agency needs and are offered on competitive terms.
  • Seek feedback from agencies if a business proposal is not accepted.

What are Aboriginal Participation Plans and Aboriginal Participation Reports?

These are requirements for suppliers outlined in the APP related to identifying opportunities and monitoring of Aboriginal participation against individual contracts.

A draft Aboriginal Participation Plan should be provided to the contracting agency as part of the tender response and the final Plan should form part of the supplier's contractual obligations and will demonstrate how the supplier will meet the individual contract requirements and targets for Aboriginal participation. Suppliers are required to provide progress reports against the Plan to the contracting agency monthly or more frequently as determined by the contracting agency, in a format specified by the NSW Procurement Board. Suppliers are required to provide an Aboriginal Participation Report on completion of the contract or on a periodic basis as determined by the contracting agency to demonstrate whether the supplier has met the Aboriginal participation requirements.

For more information about supplier reporting requirements see Section 4.1 of the APP.

What are my agency’s obligations under the APP?

Agencies must:

  • publish an annual Aboriginal Participation Strategy (see Section 3.3 of the APP).
  • consider opportunities for Aboriginal participation in all major procurement activities over $10 million (excl. GST) and document these opportunities in their Aboriginal Participation Strategy. See Section 3.4 of the APP.
  • report all contracts valued over $50,000 (excl. GST) entered into with an Aboriginal-owned business.
    ensure all relevant suppliers are aware of and comply with their obligations under the APP by including relevant contractual obligations.
  • comply with additional requirements as directed by the NSW Procurement Board.

What measures are optional for agencies under the APP?

Agencies are encouraged to give first consideration (before going to market) to Aboriginal-owned businesses on prequalification schemes for contracts valued up to $250,000 (excl. GST).

Agencies are permitted to directly procure goods and services from suitably qualified Aboriginal-owned businesses for contracts not covered under existing prequalification schemes valued up to $250,000 (excl. GST).

For more information see Section 3.2 of the APP.

What is an Aboriginal Participation Strategy and what must it include?

An Aboriginal Participation Strategy can be prepared for an individual agency, group of agencies or cluster and provides a public commitment of how the agency will support the objectives and targets of the APP. The strategy must set measurable targets and identify future procurement activities with opportunities for Aboriginal participation, in particular for contracts valued above $10 million (excl. GST).

For more information see Section 3.3 of the APP.

When is my agency required to publish an Aboriginal Participation Strategy?

Agencies must maintain, update and publish online their Aboriginal Participation Strategy at least annually.

What is my agency required to report under the APP?

Agencies must report against targets in their Aboriginal Participation Strategy and must report contracts valued over $50,000 (excl. GST) entered into with an Aboriginal owned business within 45 days after the contract becomes effective.

Agencies must also validate supplier reporting against individual contract's Aboriginal participation requirements.