The Coalition Government is overhauling its support for Indigenous businesses by reforming Indigenous Business Australia and consulting on a new Indigenous Entrepreneurs Capital Scheme.
Minister for Indigenous Affairs, Nigel Scullion, who released the Indigenous Business Sector Strategy Consultation Paper at Supply Nation’s Connect Conference in Sydney today, said the Government was committed to co-designing the reforms with the Indigenous business sector.
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.
The paper released today for stakeholder consultation reflects feedback from Indigenous businesses, entrepreneurs and the financial sector in consultations held around the country since the Coalition was re-elected in 2016.
“The Indigenous Business Sector Strategy is particularly timely because of the significant increase in demand that our policies have created for the products and services provided by Indigenous businesses,” Minister Scullion said.
“The Indigenous Procurement Policy has been a game-changer for the sector and over its first 18 months, 708 Indigenous businesses have won more than $407 million in contracts – an extraordinary jump on the $6.2 million they were awarded in 2012-13.
“We are now extending its principles to infrastructure projects like Northern Australia roads investment and the City Deals. The Townsville Stadium to be built under the first City Deal will include targets of 6.6 per cent for Indigenous jobs and procurement.”
Minister Scullion said the suite of new initiatives would help grow the Indigenous business sector and keep up with demand.
“Many Indigenous businesses have told us they want assistance to access private sector finance products with all of the sophisticated infrastructure and networks that come with being part of the mainstream financial system,” Minister Scullion said.
“To facilitate this, we are looking to establish an Indigenous Entrepreneurs Capital Scheme that will work with Indigenous businesses that cannot access mainstream finance to connect them to a bank or financial institution, and de-risk the loan if needed.
“We are also looking to ramp up the support services available to Indigenous businesses including through business hubs, mentoring and back-office support – and we are seeking the views of Indigenous businesses about what kind of services they want.”
Minister Scullion also announced significant changes to Indigenous Business Australia (IBA) to focus it on helping start-ups and Indigenous entrepreneurs who need intensive support or tailored products that financial institutions won’t provide.
“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 to help remote and regional Indigenous businesses get a foot in the game.”
Indigenous business leader, Warren Mundine, welcomed the reforms announced today.
“In order to continue the success of the Indigenous Procurement Policy and other initiatives that are driving demand for Indigenous businesses, we need to increase the number of Indigenous-owned businesses that have the capacity and access to finance necessary to perform the work,” Mr Mundine said.
Media contact: Ben Houston (0429 236 016)