Aboriginal and Torres Strait Islander Procurement Policy (IPP)

What is the Indigenous Procurement Policy (IPP)?

The Aboriginal and Torres Strait Islander Procurement Policy, commonly known as the Indigenous Procurement Policy (IPP), is a Commonwealth Government initiative that requires Australian Government agencies to direct a proportion of their procurement spending to Indigenous businesses. Introduced in 2015, the IPP is one of the most significant demand-driven policies for Aboriginal and Torres Strait Islander economic participation.

How Does the IPP Work?

The IPP operates through three key mechanisms:

• Mandatory set-asides — contracts in regions with significant Indigenous populations or contracts valued between certain thresholds may be set aside exclusively for Indigenous businesses
• Minimum Indigenous participation targets — agencies must meet annual targets for the number and value of contracts awarded to Indigenous businesses
• Mandatory minimum requirements — for contracts above specified thresholds in certain sectors, tenderers must include an Indigenous participation plan

Indigenous businesses are identified through Supply Nation registration or certification as at least 50% Indigenous-owned.

Why Does the IPP Matter for Tenderers?

Whether you are an Indigenous business or not, the IPP affects tendering in several ways:

• Indigenous businesses gain preferential access to Commonwealth contracts that are set aside or have mandatory participation requirements
• Non-Indigenous businesses may need to include Indigenous subcontracting or employment commitments in their tender responses, particularly for larger contracts
• Joint ventures between Indigenous and non-Indigenous firms are increasingly common as a way to meet participation requirements while delivering capability

Tips for Tenderers

• Register with Supply Nation if your business is eligible — this is the primary verification pathway.
• Build genuine partnerships — agencies and evaluators can distinguish between tokenistic and meaningful Indigenous participation.
• Check the contract-level requirements — IPP obligations vary by contract value and location.
• Factor participation costs into your pricing — Indigenous participation plans require real investment, so budget accordingly.