The Yukon First Nations Chamber of Commerce has signed a letter of understanding with the Yukon government under the territory’s new First Nation procurement policy.
The letter signals intent to develop a Yukon First Nation Business Registry.
The new procurement policy, announced in December, aims to boost the representation of First Nations businesses in government contracts. The registry will provide a list of businesses available to accept those contracts.
According to the chamber of commerce, the new procurement policy aligns with visions of past leaders and enables First Nations to develop a “solid economic base.”
“It has taken 25 years to develop the Yukon First Nation Procurement Policy,” the chamber of commerce said in a press release.
“It will have its challenges, but in the big picture, it will be a positive path forward, not only for Yukon First Nation businesses, but for all Yukon businesses in the territory.”
The new policy aims to grant 15 per cent of territorial government contracts to First Nations businesses.
It will also give applicants competitive advantage with proof of First Nation ownership and workforce. Businesses at least 50 per cent First Nation-owned will receive a five per cent reduction of the estimated bid price. An additional five per cent reduction is available if the contract occurs in that business’s traditional territory.
The chamber of commerce says the procurement policy will attract increased investment to the territory.
“It is meant to enhance, not replace, the work of individual businesses and corporations,” the chamber of commerce said.
Not everyone, however, is happy with the new policy.
One local contractor has hired legal counsel requesting that more consultation outside of First Nations be conducted before the final proclamation of the procurement policy.
In a Feb. 12 letter to Richard Mostyn, minister of highways and public works, a lawyer representing JS Sidhu Trucking Ltd. argues that the new policy lacks consultation and constitutionality.
The letter says the new policy is contrary to the Umbrella Final Agreement (UFA), which promises that bid procurement systems would remain competitive. It continues to argue that JS Sidhu Trucking Ltd. has a “clear track record of employing a large number of First Nations citizens,” tying its success to the goals outlined in the UFA.
It argues the new procurement policy will reduce competitive market activity and remove existing companies from the local marketplace. It suggests that the policy creates “perverse incentives” to subcontract work, distancing companies from projects and leading to inefficiencies, liabilities and increased costs.
“Monopolistic procurement policies drive up prices for Yukon First Nations peoples in a way that ultimately economically harms the very people the policy is intended to support,” it says.
“Companies will spend increased time and resources on gaming the system to fit within the arbitrary percentages and definitions of identity outlined in the policy.”
The letter requests that the policy be delayed pending further discussion. “Failure to do so may result in our decision to launch a constitutional challenge of the policy,” the letter says.
Contact Gabrielle Plonka at [email protected]