Fortescue awards $1bn in contracts to Indigenous companies

Fortescue has reached its set target of awarding more than $1 billion in contracts to Indigenous businesses by the end of 2013.

The miner says it passed the target after it awarded contracts worth around $500 million to six Aboriginal joint ventures owned by Native Title Groups for accommodation services at its camps in the Pilbara.

FMG originally set the goal in December 2011, and since that time has awarded 102 contracts and subcontracts to more than 50 businesses for its 'Billion Opportunities' program.

To come under the initiative, a company had to be at least one quarter Indigenous owned.

Of the contracts awarded, Fortescue says more than 80% were Aboriginal businesses that were at least half Indigenous owned.

Ownership was validated by KPMG.

Nev Power, Fortescue's CEO, said the company is extremely proud of the success of its initiative, having reached its goal six months ahead of schedule.

"I hope these contracts are just the first of many that these Aboriginal business secure and they each go on to become large, successful businesses providing jobs and opportunities to their communities and all of Australia," Power said.

Brian Tucker, a member of the Nyiyaparli people, said a Fortescue contract was a major thing for the Morris Corporation and "the biggest thing that has happened to my people since mining began in the Pilbara".

Tucker went on to say that "there has been a lot of frustration on our part trying to get to this point; we struggled and we felt that no one believed in us".

"But we kept knocking on doors and now Fortescue has given us this opportunity.

"We want this to be the first of many' we want to provide sustainable jobs to our people in this country and hopefully this will change communities, people's lifestyles, and the environment."

The milestone was also welcomed by Fortescue chairman Andrew Forrest, who has set a number of goals within the company, and Australia, to aid Aboriginal people.

His company has previously set a number of employment goals for Indigenous workers as part of its Summit 300 initiative which was a commitment to 50 000 sustainable jobs for Aborigines.

Andrew “Twiggy” Forrest has long been a supporter of indigenous training and employment and was the founder, along with James Packer, of the Generation One campaign, which aims to end the disparity between indigenous and non-indigenous Australians in a single generation.

Forrest stated that it is about creating sustainable employment.

"We could have given our traditional owners only money, but that would have been the easy option. Once that money is gone it is gone," he said.

This is not the first time Forrest has taken this stance.

In 2011, instead of offering a lump sum payout to the Yindjibarndi people his company instead offered of $500 000 signing fee, $4 million per year in cash and $6.5 million in housing, jobs, training and business assistance.

However, some traditional land owners rejected this offer, saying they want more cash in exchange for the estimated $280 billion worth of iron ore the company expects to extract over the next four decades, demanding a minimum 2.5% of the royalties from the region.

Forrest said cash payments are akin to mining welfare and will not help towns such as Roebourne which he says is currently in a state of “social breakdown.”

"We know what that does to communities and the heart of Fortescue, my own heart just can't be part of that," he told the program.

"It's easier to do it, but we won't do it."

He reiterated this, stating that "we are Fortescue do the opposite of typical welfare policies: we teach a mean to fish and give him a rod. They can feed themselves for a lifetime".

"We gave our traditional owners something more important; we gave them the opportunity to start their own business, which means they can provide jobs for their own people, build capacity and build assets.

"This means that when their contracts with Fortescue are over they are left with a business that, hopefully, continues to grow and provide more opportunities.

"I am extremely proud of the commitment we made and proud of the Aboriginal businesses that grabbed these opportunities and ran with them. I hope it marks a turning point in this country's relationship with Aboriginal people."

In regards to directly employing and training Indigenous workers, as of June 30 the miner directly employed 461 Aboriginal people, which accounted for 12% of its total workforce, with an additional 504 Aborigines employed by its contracting partners.


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