Pauline Hanson’s One Nation has renewed its campaign against the Federal Government’s Indigenous Procurement Policy (IPP), pledging to abolish the scheme if elected and replace it with a procurement system based solely on merit rather than the ownership background of businesses.

In a statement released this week, the party argued that government contracts should never be awarded on the basis of race and described the current policy as fundamentally unfair to Australian businesses that do not qualify for Indigenous procurement preferences.

“When it comes to government procurement, no Aussie should gain either an advantage or a disadvantage based on their race,” One Nation said.

The party claims the current system has created unequal treatment by giving eligible Indigenous-owned businesses preferential access to certain Commonwealth contracts.

According to One Nation, more than 90,000 contracts worth in excess of $14 billion have been awarded since the Indigenous Procurement Policy was introduced. The party also referred to allegations of so-called “black-cladding”—a term used by critics to describe arrangements in which businesses are accused of presenting themselves as Indigenous enterprises to gain access to procurement opportunities.

Those allegations have attracted political attention following media investigations and reviews into whether some companies met the spirit, rather than merely the technical requirements, of Indigenous ownership rules.

One Nation argues these cases demonstrate that the policy has become vulnerable to abuse and should be abolished altogether.

“The whole thing now seems to have descended into farce,” the party said, adding that every Australian business should compete for government work under the same rules regardless of the racial background of its owners.

The Indigenous Procurement Policy was originally introduced by the Coalition Government in 2015 with the objective of increasing economic participation by Aboriginal and Torres Strait Islander businesses.

The policy requires Commonwealth agencies to direct a proportion of procurement spending towards Indigenous-owned enterprises and has expanded significantly over the past decade.

Supporters argue that Indigenous businesses have historically faced structural barriers to accessing government procurement opportunities and that targeted purchasing helps create employment, build commercial capability and stimulate economic development in Indigenous communities.

The Albanese Government has continued to support the policy, describing Indigenous procurement as an important element of its broader Closing the Gap agenda.

Government ministers have argued that increasing Indigenous participation in the economy delivers long-term benefits through employment, business growth and stronger local communities.

Officials have also pointed to safeguards that have been strengthened over time, including tighter verification requirements for businesses seeking certification as Indigenous-owned enterprises.

Nevertheless, questions surrounding procurement integrity have periodically emerged.

Reports into alleged “black-cladding” arrangements prompted calls for stronger compliance measures to ensure businesses genuinely satisfy ownership and control requirements rather than using Indigenous partners solely to qualify for contracts.

The National Indigenous Australians Agency and Supply Nation have both introduced stricter oversight processes in response to those concerns.

Supply Nation, which certifies Indigenous businesses for many government procurement programs, requires businesses to demonstrate at least 51 per cent Indigenous ownership as well as genuine management and control before certification is granted.

Political debate over the IPP reflects broader disagreements about how governments should pursue economic equality.

One Nation argues equality is best achieved through identical rules for every Australian regardless of ethnicity, maintaining that public contracts should always be awarded on price, capability and value for taxpayers.

The party says removing procurement preferences would restore confidence that government purchasing decisions are based entirely on commercial merit.

Supporters of the current policy, however, argue that identical treatment does not necessarily produce equal opportunity where longstanding economic disadvantages exist.

They contend targeted procurement has helped create thousands of Indigenous-owned businesses, expanded employment opportunities and generated wealth in communities that have traditionally experienced higher unemployment and lower rates of business ownership.

Business groups have generally supported improving transparency and compliance while cautioning against abandoning Indigenous procurement altogether.

Many argue that stronger auditing, clearer certification standards and tougher penalties for fraudulent behaviour would address integrity concerns without removing opportunities for legitimate Indigenous enterprises.

The debate also raises wider questions about how governments balance economic efficiency with broader social objectives when awarding public contracts.

Procurement policies are increasingly used around the world not only to purchase goods and services but also to promote regional development, environmental sustainability, small business participation and social inclusion.

Australia’s Indigenous Procurement Policy sits within that broader international trend of governments using purchasing power to pursue economic and social outcomes beyond the immediate value of individual contracts.

Whether that approach should continue remains a matter of political disagreement.

For One Nation, the policy represents an example of race-based decision-making that should be removed from government administration.

For Labor and supporters of the IPP, it remains a mechanism designed to expand economic participation for Aboriginal and Torres Strait Islander businesses while contributing to long-term efforts to reduce disadvantage.

As debate continues ahead of future elections, the Indigenous Procurement Policy is likely to remain one of several issues highlighting the contrasting philosophies of Australia’s political parties on equality, economic opportunity and the role of government procurement.