Ottawa removed 1,100 companies from Indigenous procurement list: Hajdu

Ottawa removed 1,100 organizations from a database of Indigenous-owned businesses that were not eligible for a multi-billion-dollar procurement programme that has been criticized for lax oversight and escaped rules.

The Indigenous Business Directory (IBD) is simply a authorities database intended to database First Nations, Inuit oregon Métis-owned businesses eligible to entree “set aside” contracts lone accessible to Indigenous companies.

Indigenous Services Canada Minister Patty Hajdu told MPs Tuesday that successful 2022, 1,100 companies were removed from that list. Hajdu was not pressed connected wherefore the companies were removed, and gave nary denotation which companies were not eligible.

As of Tuesday, determination were a full of 2,945 companies listed connected the IBD.

“Every 2 years the section audits the Indigeneity of businesses, conscionable due to the fact that businesses alteration rather a spot betwixt audits,” Hajdu told a House of Commons committee Tuesday morning.

“In 2022, 1,100 Indigenous businesses were removed from the Indigenous Business Directory arsenic portion of a cleanup of businesses that were registered earlier 2019.”

The section antecedently couldn’t accidental however galore audits it had conducted connected companies listed connected the IBD successful effect to a Global News investigation, successful collaboration with researchers astatine First Nations University, into the Indigenous procurement program.

The Procurement Strategy for Indigenous Business was acceptable up successful the precocious 1990s successful bid to assistance First Nations, Métis and Inuit companies vie for national work.

The associated probe recovered it was an unfastened concealed wrong Ottawa’s procurement assemblage that non-Indigenous companies person been uncovering ways to get astir the program’s rules successful bid to summation entree to billions successful yearly contracts meant for First Nations, Métis and Inuit business.

Global News besides revealed that, until 2022, Indigenous Services Canada allowed companies to self-identify arsenic Indigenous with small request for proof. That’s contempt decades of warnings from Indigenous leaders – and the national government’s ain programme reviews – that the programme risked being undermined by “fronts” and “shell companies” claiming to beryllium Indigenous.

There is nary denotation that the 1,100 companies removed from the database successful caller years were not Indigenous-owned oregon controlled erstwhile they applied for the IBD.

Hajdu noted that companies alteration ownership implicit time. Other companies whitethorn person ceased operations but inactive may be included connected the IBD.

The minister also noted challenges with the national authorities determining who is and is not Indigenous.

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“The situation is, of course, those definitions evolve,” Hajdu said.

“There (are) criteria for inclusion connected the Indigenous Business Directory … These are the commitments we’ve made arsenic a authorities is to proceed to person these analyzable conversations with Indigenous radical arsenic they specify for themselves however to specify their memberships.”

The Procurement Strategy for Indigenous Business was created successful 1996 by the erstwhile Liberal authorities with the volition of helping Indigenous companies vie for national contracts against multinationals and much established vendors.

The thought was that by “setting aside” a definite percent of national contracts for Indigenous firms, it would springiness those companies acquisition with the lucrative satellite of authorities procurement, assistance turn the businesses and person knock-on effects for First Nations, Inuit and Métis communities.

However, interior national reviews obtained by Global News amusement that arsenic aboriginal arsenic 1999, determination were warnings that the programme risked being undermined unless the authorities verified the companies getting the contracts were, successful fact, Indigenous-owned and controlled.

The existent Liberal authorities has upped the percent of national enactment going to Indigenous firms to astatine slightest 5 per cent, oregon astir $1.6 cardinal annually.

After Global News’ investigation, 3 Indigenous groups — the Assembly of First Nations, the Algonquin Anishinabeg Nation Tribal Council, and the Assembly of First Nations Québec and Labrador — called connected Auditor General Karen Hogan’s bureau to probe the program.

Hogan’s bureau confirmed successful September that they’re considering an audit.