The Federal Government is preparing to open the Indigenous business verification system to competitive tender for the first time, as changes to the Indigenous Procurement Policy (IPP) begin to reshape the sector.
Having confirmed it will release a Request for Tender later in the 2025-26 financial year, the National Indigenous Australians Agency (NIAA) will appoint a provider responsible for verifying Indigenous businesses under the strengthened IPP framework.
The tender process comes amid increasing national debate over Indigenous business certification, procurement integrity, and concerns about "black cladding" within government and private contracting systems.
The issue has become a growing focus for the recently formed National Indigenous Business Chambers Alliance (NIBCA), which has been advocating for stronger Indigenous control and greater transparency within certification and procurement systems.
Last year, NIBCA launched as a coalition of Indigenous chambers and peak business groups seeking to influence national policy settings around economic development, procurement, and business integrity. The alliance has argued Indigenous business verification systems must maintain strong community confidence and ensure benefits flow directly to Aboriginal and Torres Strait Islander business owners.
The Government's reforms will tighten eligibility rules for businesses seeking access to the IPP. From 1 July 2026, businesses will need to be at least 51 per cent First Nations owned and controlled, or registered with the Office of the Registrar of Indigenous Corporations (ORIC).
However, transitional arrangements will apply during the 2026-27 financial year, allowing businesses operating under the existing 50 per cent Indigenous ownership threshold to continue participating while transitioning to the new framework.
The NIAA said the transition period is designed to provide businesses with sufficient time to obtain verification under the strengthened system before the new requirements become mandatory.
Reforms follow consultations held between December 2023 and March 2024, which canvassed concerns about procurement integrity, ownership structures, and whether Indigenous businesses were genuinely retaining control and economic benefit from Commonwealth contracts.
The Commonwealth's Indigenous procurement target will also increase to 3 per cent from 1 July 2025, before rising incrementally to 4 per cent by 2030.
The Government has additionally committed to exploring stronger transparency measures around Indigenous participation requirements in major contracts, while improving pathways for reporting suspected black cladding conduct.
