Sam Buchanan. Credit: IMAA
The Independent Media Agencies of Australia (IMAA) has welcomed the federal government’s introduction of a formal definition of an Australian-owned business in procurement rules, calling it a long-overdue change that will benefit independent agencies.
From November 17, agencies pitching for direct government contracts worth between $10,000 and $125,000 will need to meet new criteria under the Commonwealth Procurement Rules.
The threshold rises from $80,000 and, for the first time, includes a clear definition of what constitutes an Australian business.
IMAA chief executive Sam Buchanan said the move would help level the playing field.
“This new rule is a win for the Australian independent media agency sector, but more needs to be done,” he said.
A company will now need to be at least 50% Australian-owned or traded primarily on an Australian equities market, be an Australian resident for tax purposes, and have its main base of operations in Australia.
The requirement extends to any parent entity.
“This is the first time we’ve seen the Federal Government set this type of parameter, with clear definitions around what exactly an Australian business is,” Buchanan said.
“This new rule genuinely prioritises smaller Australian suppliers and ensures only true Australian-owned businesses qualify for certain government work.”
He said the change would help independent agencies play a bigger role in government contracts.
“It gives government departments access to diversity of thought and true local expertise, along with the many other benefits of working with an independent agency,” Buchanan said.
“There are no longer any barriers to working with indie agencies plus there is the unique benefit of keeping profits in Australia and supporting our local economy.”
The update forms part of the government’s target for at least 25% of contracts by value to go to small and medium enterprises for projects worth up to $1 billion, and 40% for contracts up to $20 million.
Buchanan said the IMAA would continue to advocate for stronger representation of Australian-owned agencies in master media contracts.
“The momentum for supporting Australian agencies is there, but it’s still very early days,” he said.
“If the government talks about supporting Australian business they need to back it up with their agency selection.”
Buchanan pointed to the Western Australian Government’s requirement for agencies to demonstrate how their work benefits the local economy but said it failed to ensure profits are reinvested locally.
“This needs to change,” he said.
“We will continue to call on all levels of government to provide more opportunities for the independent media agency sector in master media contracts.
“We’re hopeful that this new rule is the first of many to change in the Federal Government procurement process.”
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