In 2021, the Government of Canada established a mandatory target: by fiscal year 2024-25, a minimum of 5 percent of the total value of federal contracts must be awarded to businesses owned and operated by Indigenous peoples.
Implemented across three phased cohorts of federal institutions, the policy seeks to advance economic reconciliation and leverage federal purchasing power to expand opportunities for First Nations, Inuit, and Métis enterprises.
How the Target is Tracked
To qualify toward the federal target, a contractor must meet established ownership criteria (typically 51 percent Indigenous ownership and control) and be registered in the Indigenous Business Directory maintained by Indigenous Services Canada (ISC).
In federal proactive disclosure releases, departments indicate whether a contract is associated with the Procurement Strategy for Indigenous Business (PSIB) or an Indigenous set-aside process.
Performance Across Cohorts
The proactive disclosure record reveals notable progress alongside uneven departmental adoption:
- Early Adopters: Organizations with mandates closely aligned with northern and community infrastructure (such as Crown-Indigenous Relations and Northern Affairs Canada and Indigenous Services Canada) consistently surpass the 5 percent threshold, often allocating upwards of 15 percent of contracting value to Indigenous enterprises.
- Large Technical Departments: Departments with massive capital procurement budgets (such as National Defence and Public Services and Procurement Canada) face structural challenges in meeting percentage targets, given that multi-billion-dollar aerospace and naval shipbuilding projects dilute overall shares.
As independent auditors and parliamentary committees continue to review verification processes, tracking disclosed Indigenous business indicators provides a factual baseline for assessing the real-world impact of federal procurement reconciliation.