PSAB – Procurement Strategy for Aboriginal Business


PSAB Policy and Implementation

There are currently more than 37,000 Aboriginal owned businesses in Canada, covering a wide variety of economic sectors. The Government of Canada recognizes that an effective way to improve the well-being and quality of life of Aboriginal people in Canada is to improve their economic opportunities. Aboriginal economic development also helps strengthen the Canadian economy in general.

The Government of Canada spends approximately $14 billion a year on goods, services, and construction. As the Government’s main purchasing arm, Public Works and Government Services Canada (PWGSC) plays a key role by helping departments define their requirements or scope of work, and obtaining the goods and services they need at the right price. However, you don’t have to be a big firm to do business with the federal government. In fact, most government contracts are valued at less than $100,000.

The Federal Framework for Aboriginal Economic Development, launched in 2009 by the Government of Canada, aims to ensure that First Nations, Inuit and Metis have every opportunity to share in Canada’s economic opportunities and prosperity. PSAB delivers on the Framework’s strategic priority of strengthening Aboriginal entrepreneurship by enhancing support for Aboriginal businesses to market their goods and services.

A contract that is set-aside for Aboriginal Business means that only Aboriginal businesses are acceptable bidders. The Set-Aside program has two parts: the mandatory set-aside and the voluntary set-aside.

Mandatory Set-Aside

All procurements over $5,000 for which Aboriginal populations are the primary recipients are to be restricted exclusively to qualified Aboriginal suppliers. Set-aside procurements are subject to the normal competitive principles of contracting policy intended to ensure that Canadians receive best value for their money. The procurement will often be open for competition, limited to Aboriginal firms. The contracting authority must feel confident that operational requirements, best value, prudence and probity, and other elements of sound contracting management, can be assured.

Voluntary Set-Aside

Used by federal departments and agencies in procuring goods, services, or construction where Aboriginal capacity exists. Federal departments and agencies voluntarily decide to apply set-asides where sound contracting management can be assured and maintained. In all cases, the Aboriginal supplier must be PSAB registered.