How Defence contracts are empowering Indigenous communities

Spending figures show a soaring enthusiasm to engage and develop Indigenous businesses, with outcomes that make the effort completely worthwhile.

For some organisations delivering Defence projects, Indigenous procurement mandates are not so much targets to meet, but targets to beat. And the economic and social wellbeing of Indigenous Australians are better for their enthusiasm.

As a project delivery services (PDS) provider for the Defence Estate Works Program (EWP), JLL, known as Augility under its subcontract arrangement with Dyncorp, has been increasing its spend on Indigenous businesses year after year. 

In the 2020/2021 financial year, Indigenous construction companies received 39% of JLL’s total spend on EWP projects. This is up from 15% just three years prior, making the multi-disciplinary property services company a benchmark-setter in the business community.

Defence’s performance in this space has been reflecting these efforts. In 2020/2021 – a particularly successful financial year – Defence awarded 6,476 contracts to Indigenous businesses, outperforming its target of 676, with the EWP’s project delivery partners, JLL (under Augility), Aurecon and Ventia, playing no small part. The target contract value of $110.7 million was surpassed by JLL’s spend alone in the same year, achieving $127.60m.

“We are immensely proud of the way we continue to pursue positive, sustainable growth for Indigenous businesses,” says Geoff Camp, JLL’s Defence lead. “It is deeply satisfying to see them mature and win Defence contracts in a competitive tender process, and it is because of our long-term partnership with Defence we are able to support them.”

Majority Indigenous-owned construction company TVN On-Country is one of Defence’s success stories. Winning contracts under the EWP has enabled the company to grow from three people in an office in Wodonga, regional Victoria, to a workforce of 41, with operations in Melbourne, Adelaide, and Hobart.

Company director Jonathon Whelan credits the guidance of JLL and Defence’s delivery partners for its outstanding growth.

“It was evident from our first Defence project, RAAF East Sale Local Emergency Generators, JLL would go the extra mile to teach us what it takes to deliver projects on the Defence Estate,” Whelan says.

“JLL and the EWP’s delivery providers are extremely supportive which is why we have continued to tender more projects and higher individual valued projects, including our largest Defence project to date for just under $20m.”

As well as a track record now brimming with Defence projects, TVN On-Country boasts 20% Indigenous employees and 32% of staff who are female – well above the construction industry average. Ex-servicepeople make up 15% of its workforce.

The company’s Defence experience has also primed it for non-Defence projects, building resilience into its business. 

Meanwhile, the company has established the not-for-profit organisation On-Country Pathways, which is developing and delivering employment and career pathway programs for First Nations youth.

“The positive outcomes aren’t limited to the people that we employ,” Whelan says. “It includes the suppliers, subcontractors and consultants. It’s the future positive change that can come about by placing an Indigenous person in a job and helping them create a career pathway. It’s the substantial opportunities for local small-to-medium enterprises and small Indigenous businesses to have their own start in Defence Projects, and it’s sponsorships with local groups, and involvement with community organisations.”

For JLL, whose clients beyond Defence span other government agencies as well as industries including banking, energy, healthcare, law, life science, manufacturing and technology, supplier diversity in their procurement programs is a business imperative.

In fact, these clients are subjected, and encouraged to, hold JLL accountable to 10% to 12% Indigenous engagement targets.

“Supplier diversity for us is not just a procurement program, it’s a way to drive competitive advantage and positive social outcomes,” says Ben Price, JLL’s supplier diversity manager.

“The temptation is to search for low-hanging fruit,” Price says. “But transactional relationships with Indigenous businesses are risky as they do not ensure long-term growth and don’t foster trust with vendors, which is needed for them to invest in their business.”

JLL commits to setting the foundations for long-term growth, as well as reducing risk to its clients, by ensuring Indigenous business invited to tender meet strict due diligence requirements, performance standards, and are driving adoption of technology and innovation.

As well as actively identifying and opportunities for Indigenous businesses so they are given adequate time and information to plan, JLL supports their capability growth through mentoring and a steady increase in opportunities.

“The work being done to grow the depth of indigenous business engagement across the JLL supply chain is maturing,” says JLL’s Camp. “I am often taken by the emotional investment shown by Defence and commercial procurement staff, as well as that of our regional staff when they discuss what goes into a success story.

“We are proud to be involved with businesses and government departments that share our values and prioritise initiatives to support the growth of Indigenous businesses and economies.”