Canadian businesses now eligible for federal contracts awarded to Indigenous employers have skyrocketed to the tune of a 40% increase since the Trudeau government introduced the program.
Over 800 new businesses registered for enrollment in the Indigenous Business Directory over the past year, a database which lets eligible companies participate in the federal government’s procurement strategy to bolster the Indigenous economy.
The spike in enrollment has some community leaders fearing that the government’s overly broad criteria has left the door wide open for exploitation.
The database which held only 1,900 businesses last year, now stands at 2,700 as of last month.
The Trudeau government promised to have at least 5% of the total value of federal contracts awarded to Indigenou businesses in 2024.
Called the Procurement Strategy for Indigenous Business, the program’s total value has increased to $862-million in the 2022-23 fiscal year, more than four times its worth five years ago, at $170 million.
According to the Globe and Mail, Karine Vetvutanapibul, a spokesperson for Indigenous Services Canada, the spike in new registrants is partially because of the federal government’s efforts in promoting the program’s benefits to Indigenous communities.
The Trudeau government confirmed that they would review the program, which has been utilized by some of the same contractors who previously worked on the ArriveCan app, now the subject of a major scandal for Trudeau’s administration.
Dalian Enterprises, a previous contractor involved in the Arrivecan App, also identifies as “aboriginally owned” and has frequently made use of the program.
President of the Inuit Tapiriit Kanatami Natan Obed said he would like to see Ottawa impose stricter criteria when it comes to business eligibility for the program, arguing that it should be limited to groups that are rights holders solely under the Constitution.
Obed calls the program’s current eligibility standards, “far too inclusive.”
“We are now living in an era where there are tremendous opportunities to be had for qualifying as a First Nations, Inuit and Métis business,” Obed told the Globe and Mail in an interview. “There are many actors in this country who want to take advantage of that.”
Indigenous Services Minister Patty Hajdu called the process of defining an Indigenous person as Indigenous “really complicated” earlier this year.
According to Hadju, the government is considering transferring the power of the directory to an Indigenous organization, which would be controlled at arm’s length.
Chief executive officer of the National Aboriginal Capital Corporations Association Shannin Metatawabin is certain that the government’s current directory includes people who are not Indigenous.
“There’s organizations in Canada that accept self-identification as a mechanism of building membership, and in turn the government of Canada accepts those organizations on their business registry,” he said. “Right now, the whole system is flawed.”