06 January 2021

How to help Close the Gap through building and construction

As Australians, we are starting to see the impact of our government’s shared commitment to achieving equality in health and life expectancy for Aboriginal and Torres Strait Islander people within a generation.

As Australians, we are starting to see the impact of our government’s shared commitment to achieving equality in health and life expectancy for Aboriginal and Torres Strait Islander people within a generation.

To make significant progress towards closing the gap, we need to share ownership, responsibility, and accountability for this collective journey.

BY Group is an indigenous-owned and managed building and construction company with our head office in Sydney.

We offer a unique way to partner with Aboriginal and Torres Strait Islander people to make a tangible difference to the lives of current and future generations. This is also known as a social benefit.


What is Closing the Gap?

Closing the Gap is an Australian government strategy that aims to reduce disadvantage among Aboriginal and Torres Strait Islander people by 2030. It’s not only about achieving equality in health and life expectancy. It also aims to provide equality in:

· early childhood education access

· education and training

· employment.

At BY Group, and as one of Sydney’s top construction companies, we’re helping to close the gap through indigenous employment, training, support and other assistance. We engage our network of local indigenous subcontractors across our supply chain for our construction projects.

Closing the Gap is different from past government strategies. There’s been a shift in the way governments work with Aboriginal and Torres Strait Islander people. They now have a genuine say in the design and delivery of this strategy, and other policies, programs and services that affect them. This approach is needed to meet the government’s aim to close the gap and provide social benefit to our communities.


Local action and partnership

Close the Gap has a greater focus on partnerships between governments and Aboriginal and Torres Strait Islander people. Local action underpins this partnership. This close partnership recognises that to close the gap, Aboriginal and Torres Strait Islander people must be involved in the process and all decisions.

In July 2020, all parties signed a new National Agreement on Closing the Gap, which sets out 16 priorities and targets for the next 10 years.

All federal, state or territory, and local governments are working with Aboriginal and Torres Strait Islander people, their communities, and businesses like ours, to roll out the National Agreement.


Setting targets and measuring success

The outcome for one of the 16 priorities for the next 10 years is the strong economic participation and development of Aboriginal and Torres Strait Islander people and their communities.

For this priority to be a success, by 2031, the proportion of Aboriginal and Torres Strait Islander people aged 25-64 who are employed will have increased to 62%.

BY Group is proud to be an Indigenous business. Increasing Indigenous participation is not just a function of doing business, it is our business. We focus on driving sustainable and measurable outcomes by engaging Indigenous businesses through our supply chain and directly hiring Indigenous people.

We also invest in the local Indigenous communities where we operate.


Indigenous Procurement Policy (IPP)

IPP is how governments in Australia are helping to stimulate local action and provide more opportunities for Indigenous businesses like our construction company to participate in the economy.

For federal government projects, including building and construction, there’s an exemption (known as ‘Exemption 16’) of the Commonwealth Procurement Rules (CPR). This exemption allows Australian Government buyers to purchase directly from small and medium Indigenous enterprises like ours. There are no size and value limits under this exemption. The IPP also provides a simple quote process.

To follow IPP, a business must either:

• directly hire more Aboriginal people

• subcontract to suppliers like us who currently hire Aboriginal people

• engage Aboriginal businesses like BY Group.


Indigenous Participation Plan

When you work with us, we prepare an Indigenous Participation Plan as part of the process. This is a requirement under social procurement legislation. Our plans include our existing network of Indigenous contractors, resources, organisations and suppliers.

Unlike non-Indigenous companies, we do not simply offer a list of Supply Nation suppliers. Instead, we use our extensive network of community contacts through our staff, family, and community networks.

We also:

· contact local Indigenous organisations and the Local Aboriginal Land Council (LALC)

· identify existing trades and businesses through:

o Supply Nation

o NSW Indigenous Chamber of Commerce (NSWICC)

· identify skilled and unskilled local Indigenous people who suit the project and are available to work.

We are not governed by price alone. We will use an Indigenous contractor or supplier if they meet the requirements of the project.[SM1]


Supply Nation certification of Indigenous businesses

Supply Nation is an independent organisation that links suppliers with Aboriginal and Torres Strait Islander businesses.

BY Group is a Supply Nation certified supplier. This means we are a current, approved Indigenous business, having met Supply Nation’s certification criteria.

Using a Supply Nation certified business is an important part of following IPP requirements.


Australian Government annual targets for purchasing from Indigenous enterprises

For the first time, all levels of government are jointly accountable for the outcomes and targets under the National Agreement to ensure the aims of Closing the Gap are achieved.

Every 3 years, the Productivity Commission will report on progress towards those targets in the National Agreement. An Indigenous-led review of progress follows every 3 years.

Australia has 2 targets for purchasing from Indigenous enterprises:

1. Volume target – they award the equivalent of 3% of the number of eligible procurements to Indigenous enterprises each financial year.

2. Value target – they award the equivalent of 3% of the value of eligible procurements to Indigenous enterprises each financial year (from 1 July 2027).

A series of progressively increasing value targets apply, up to a maximum value in 2027-28.

Financial year

Target (by value of the contracts)

2019-20 - 1%

2020-21 - 1.25%

2021-22 - 1.5%

2022-23 - 1.75%

2023-24 - 2%

2024-25 - 2.25%

2025-26 - 2.5%

2026-27 - 2.75%

2027-28 - 3%


Reporting against IPP targets for suppliers to government

To measure and report on the aims of the National Agreement, as part of our reporting we capture:

• how many Aboriginal businesses we engaged

• the value of purchases we made with Aboriginal businesses

• the total number of Aboriginal people we employed on a government contract

• the total number of hours Aboriginal people we employed worked on a government contract.

Our reports also capture the figures for our suppliers and their subcontractors against each of these listed measures.


BY Group Indigenous engagement benefits

When we engage local Indigenous businesses, we help them with typical barriers to market such as:

• offering 7-day payment terms to improve their cashflow

• helping with paperwork to ensure they meet our safety system requirements

• helping with contract security requirements.

BY Group delivers true value for our clients and the Indigenous community while maintaining industry best practice and quality in all our construction projects.


Growing Indigenous building and construction talent in Sydney and NSW

BY Group is growing and as we continue to work on more building and construction projects in Sydney and NSW, we’re adding more permanent Indigenous employees to our team.

After completing the Building 153 project at HMAS Creswell, we permanently hired the 3 full-time casual people we employed for this project. They are now permanent members of our team.

For the LIA Accommodation project, we employed a further 4 full-time local Indigenous people, taking our total to 8 local Indigenous people [SM2] who we directly employ.

We are proud of our business. 75% of our employees are Indigenous. We have 6 team members in formal education and training. Staff retention is 90%.


Engage with Indigenous sub-contractors

Not all Indigenous businesses, and especially smaller businesses, are Supply Nation certified. And even if a business is Supply Nation certified, it does not mean the jobs or investment is going to Indigenous people.

What we do is identify local Indigenous trades, suppliers, and businesses to work on our projects. We will support them through the project to develop their business and manage some of the barriers to success of Indigenous businesses.

Our cooperative contracting arrangements ensure the success and profitability of our subcontractors and suppliers.

These outcomes are sustainable and measurable for all our clients.


Supporting our local Indigenous community

We are focused on investing into the local Indigenous communities where we operate. This goes beyond employing local Indigenous people.

Transport is a common barrier for Indigenous people to gain a job and stay employed, especially when public transport doesn’t provide easy or direct access to our building or construction sites.

To remove this barrier, we bought and 12-seater bus that picks up and drops staff each day, making it much easier for our workers to get to and from work. This initiative has seen our retention rate dramatically increase.


Meet your IPP targets

When you directly engage BY Group, we can help you meet your social procurement requirements and IPP targets.

For projects valued over $10 million (excluding GST), according to NSW’s social procurement requirements suppliers must:

• Provide a draft Aboriginal participation plan as part of the tender response identifying how you will meet the individual contract requirements and targets for Aboriginal participation.

• Provide a final Aboriginal participation plan when the contract starts that shows how you 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 if the contracting agency requires it, in a format the NSW Procurement Board specifies.

• Provide an Aboriginal participation report when the contract is complete or periodically if the contracting agency requires it.

We can help you meet the requirements, prepare the participation plan, and report during and after the project.


Learn how building and construction social procurement can help Close the Gap

Closing the Gap has unified Aboriginal and Torres Strait Islander people and together with all Australians we can create equality by 2030.

Not only are we experts in building and construction, we are Indigenous-owned and managed.

We are working towards our legacy, which is to help grow local Indigenous talent in the building and construction industry, and you can be a part of that.