ABC media staff are being ordered to set aside a quota of all credit card purchases for Aboriginal companies, under a policy criticised by free market policy makers as "offensive".
Under a Federal Government edict that departments must spend 3 per cent of all procurement contracts on indigenous businesses, the taxpayer-funded media giant sent out an email last week telling workers to find indigenous companies when paying for items on their corporate cards.
The email headed "How you can easily identify an indigenous Business for your ABC supply needs", from a procurement manager, instructs "ABC Credit Card holders" that the organisation has committed to the 3 per cent quota by 2020.
"Where an indigenous business can demonstrate best value for money for the ABC, sourcing goods and services from them supports the ABC's commitments in its Reconciliation Action Plan and also benefits the indigenous community," staff were told.
The policy, introduced under the Gillard Government and strengthened by former prime minister Tony Abbott in July 2015, mandates government departments use indigenous companies.
But Simon Breheny, policy director at free market think tank the Institute of Public Affairs, said the only reason for a procurement quota was "if you think the business case doesn't stack up without it".
"A quota sends a message that businesses owned and run by indigenous Australians are not as good as those run by non-indigenous Australians," he said. "It's incredibly offensive, and it's totally misguided."
"Quotas never help the people they are designed to assist. They breed resentment, and they don't address any of the underlying problems."
Liberal Democratic Party senator David Leyonhjelm described it as "demeaning" to Aborigines and part of a push for positive discrimination that started with gender quotas.
But Aboriginal leader Warren Mundine defended the policy, calling it a game-changer, lifting indigenous people out of poverty using the market and not welfare.
"I reckon it's the greatest policy ever created by any government since Federation," he said.
"An indigenous business has to be commercial like any other business. It will create a very strong indigenous private sector that will be able to stand on its own two feet."
An ABC spokesman refused to comment on the policy.
A spokesman for indigenous Affairs Minister Nigel Scullion said the policy is not about quotas or charity and all contracts had to demonstrate "value for money".
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