Indigenous Services Canada's Report on the Mandatory Minimum 5% Target - Fiscal Year 2023-24

roman numeral 3III.1.1. 2023-24 results dataset publication

In response to feedback provided by partners, including at the Table, on the 2022-23 Annual Performance Report^{Footnote 4} and dataset, ISC has published two performance (results data) datasets on Open Government.

In March 2025, ISC published the 2023-24 performance report which presents high-level aggregated performance data and insights, following the same format as the 2022-23 report. Building on this, ISC released a secondary dataset in June 2025 that includes contracts and amendments awarded to eligible Indigenous businesses valued at $10,000 or more^{Footnote 5}. This dataset provides new details not previously published by ISC, including:

• vendor names and first three digits of their postal codes (based on the vendor business address)
• commodity/service descriptions
• contract and amendments values
• details on whether the contract was awarded through the PSIB set-aside program or through a non-PSIB process

Additional data sharing and publication have, in part, been made possible through the data validation processes developed by ISC. While these processes are continuously adapted, they currently include, to the extent possible, verifying line by line details to ensure that all the individual data entries match the overall percentage reported by the organization. Economic codes are also cross-referenced against official codes (for example, the Economic Object Code dataset^{Footnote 6} maintained by Public Services and Procurement Canada (PSPC)) and updating missing or erroneous information by verifying with Open Government. These steps help improve data accuracy and reliability. In parallel, the active participation of organizations in the results reporting process has played a significant role, as their engagement directly influences the accuracy and timeliness of the data.

ISC provides continuous support to organizations throughout the reporting cycle. In addition to biannual information sessions to help complete reporting templates, ISC has developed a range of best practices to encourage engagement and build capacity. These include:

• ISC presentations to the Indigenous Procurement Coordinators Network, aligned with key reporting periods
• monthly informal question and answer sessions
• one-on-one meetings, tailored to organizational needs

These touchpoints help clarify reporting requirements and foster dialogue, learning, and continuous improvement. Together, they support a more consistent, informed, and transparent reporting process, advancing the shared goal of meaningful Indigenous procurement data.

roman numeral 3III.1.2. 2024-25 and 2025-26 planning dataset publication

We understand that the time between a tender opening and closing can be brief, and procurement planning information can assist Indigenous businesses in preparing for potential tender notices. In response to this and informed by feedback from Indigenous partners, changes were made to improve how planning data is captured and shared.

To better connect Indigenous businesses with opportunities, ISC has made efforts to further disaggregate service and commodity data and provide delivery location information for planned procurement. Although a work in progress, such efforts have generated more comprehensive lists of commodities and services that the Government of Canada is planning to procure. ISC has also introduced qualitative data fields to capture efforts currently in place to assess Indigenous business availability and gaps that was published on Open Government in January 2025, reflecting ongoing efforts to better align with Indigenous partners' expectations for transparency, accountability, and meaningful data.

roman numeral 3III.1.3. Reporting burden and data quality: process changes and considerations

Since the first year of implementing the mandatory minimum 5% target in 2022-23, ISC has received consistent feedback from organizations about challenges with planning and results reporting. Organizations have noted that overlapping reporting exercises and differing timelines exacerbated a pre-existing reporting burden, affecting data quality. Analysis also revealed that procurement plans frequently underestimated actual activity^{Footnote 7}. This reflects broader challenges in planning across organizations, where factors such as operational demands and the evolving nature of procurement can limit the accuracy and completeness of forecasts. In response to these challenges, larger departments may apply planning thresholds to avoid inefficiencies when forecasting thousands of smaller contracts, though this approach can result in gaps in reported figures.

To address these issues, ISC has been engaging with organizations to better understand their reporting environments which are often shaped by diverse systems, processes, and resource constraints. These conversations continue to inform proposed adjustments aimed at improving alignment and reducing burden.

One key change, now in place for future planning and data collection periods, is the shift from a two-year to a one-year planning period^{Footnote 8}. This change aims to improve data accuracy and better align related corporate processes. While it may appear to conflict with the goal of longer-term planning, it responds to recurring issues such as underestimation and misalignment between plans and results^{Footnote 9}. ISC remains committed to supporting long-term planning. Through the Co-Development Table, ISC continues to collaborate with Indigenous partners on practical, community-informed approaches that reflect Indigenous priorities and improve data.

roman numeral 3III.2.1. 2023-24 contract awards to Indigenous businesses: breakdown by contract value and type

roman numeral 3III.2.2. Performance across phases

Implementing the minimum 5% Indigenous procurement target in phases has allowed organizations time to adjust procurement practices, build capacity, and improve planning. Tables 4 and 5 show performance by phase in 2022-23 and 2023-24, highlighting how organizations at different stages are progressing toward the target. Phase 1 and 2 organizations, those further along in implementation, have consistently performed above the 5% threshold. In contrast, Phase 3 organizations, which are not yet required to meet the target, showed lower results, suggesting that full implementation and sustained engagement are key to improving Indigenous participation in federal procurement.

Phase 1 and 2 organizations were expected to meet the mandatory minimum target of 5% by 2022-23 and 2023-24 respectively. When comparing performance of organizations in Phases 1 and 2 across the two fiscal years:

• Phase 1 organizations saw a marginal decrease in the total value of contracts awarded to eligible Indigenous businesses. However, there was a significant reduction in the value of deputy head-approved exceptions sought. Despite the slight decrease in the value of contract awards to Indigenous businesses, the overall performance suggests organizations are prioritizing Indigenous business participation in the federal procurement process
• 2023-24 marks the first year that organizations in Phase 2 were required to meet the target and the value of contracts awarded to Indigenous businesses appears to have remained stable from previous year. However, due primarily to a 53.2% increase in the use of deputy head-approved exceptions, the percentage of Indigenous procurement has increased by 1.30% from 2022-23
• while not required to meet the target in 2023-24, Phase 3 organizations have demonstrated mixed performance compared to last year. Organizations in this phase awarded less than half the value of contracts to Indigenous businesses compared to the previous year. The use of deputy head-approved exceptions has also doubled, marking the largest increase across all phases^{Footnote 15}

Tables 6 and 7 highlight the top 5 performing organizations in Phase 1 and Phase 2. To provide a fair comparison across organizations of varying sizes, throughout this report, where applicable, each organization is categorized based on its total procurement budget^{Footnote 16}. The 5 expenditure categories are defined as follows:

• very small - total procurement budget: less than $1 million
• small - total procurement budget: $1 million to $10 million
• medium - total procurement budget: $10 million to $100 million
• large - total procurement budget: greater than $100 million to $1 billion
• very large - total procurement budget: greater than $1 billion

Although organizations in Phase 3 are not scheduled to meet the minimum 5% target until fiscal year end 2024-25, these organizations provided both performance (results) and procurement plans (see Table 8).

In 2023-24, 27 of 43 (63%) organizations in Phase 3 met or exceeded the target. Of note:

• 8 organizations awarded between 10% and 29.9% of the total value of all contracts (including subcontracts) to Indigenous businesses
• 4 organizations awarded 30% or higher of the total value of all contracts (including subcontracts) to Indigenous businesses
• similar to Phases 1 and 2, the top performers in Phase 3 typically have smaller procurement budgets, under $10 million annually (see Table 8). This reflects a similar pattern observed in 2022-23, where smaller organizations were more likely to report a higher overall value of contract awards to Indigenous businesses

Organizations with large volumes of procurement transactions, large projects and budgets may have more significant challenges related to Indigenous business capacity. The 2023-24 results illustrate that top performers in Phases 1, 2, and 3 are mostly small organizations (see Table 6, 7, and 8). Conversely, Table 9 and 10 illustrate that mostly large Phase 1 and 2 organizations were unable to meet the target in 2023-24. As ISC builds more reliable data and receives feedback through engagements, it aims to build the necessary evidence to determine success factors, which could have broader policy and procedural implications.

Overall, planning and process changes, including government-wide procurement officer training, are helping the Government of Canada achieve the minimum 5% target. Organizations continue to reimagine departmental procurement to maximize Indigenous participation by adopting innovative policies and operational approaches that support Indigenous procurement. Outreach efforts are expanding, with more events specifically organized and developed for Indigenous businesses and tailored to the unique needs of communities, commodity groups, and sectors. These findings are consistent with those observed last year. They demonstrate a sustained commitment to embedding strategies that maximize Indigenous business participation within Government of Canada procurement.

roman numeral 3III.2.3. What are Phase 1 and 2 organizations that did not meet the target doing to ensure success in the future

Among the Phase 1 and 2 organizations who were required to meet the target by 2023-24, only 6 (12%) organizations did not meet the minimum 5% target. In 2023-24, the number of Phase 1 organizations that did not meet the target reduced by 50%, from 4 to 2 organizations. PSPC, while still reporting results below the 5% target, contracted for more than $140 million and showed improvement compared to its 2022-23 results. Canadian Heritage (PCH), an organization that met the minimum 5% target last year, did not this year. For both PSPC and PCH, no deputy head-approved exceptions were reported.

Overall, factors such as overseas operations, scope and scale of procurements, and unexpected contracting demands are identified barriers for organizations that have not met the minimum 5% target in 2023-24. Despite ongoing challenges, these organizations are continuing to develop strategies to drive improved outcomes for future fiscal years.

roman numeral 3III.2.4. What are deputy head-approved exceptions and where are they being applied

Deputy heads may exclude the value of certain contracts from the calculation on an exceptional basis. As set out in E.2.2.2.3 of the Government-wide Directive on the Management of Procurement (Directive), the decision to apply deputy head-approved exceptions may not be delegated. The Treasury Board of Canada Secretariat (TBS) guidance recommends that when exercising discretion to apply deputy head-approved exceptions, departments should formally document:

• engagements that have taken place with relevant stakeholders such as, but not limited to, ISC, PAC, and Indigenous partners, including National Indigenous Organizations and communities
• the rationale for carrying forward the same exceptions applied in previous fiscal years
• a mitigation strategy to avoid having to apply an exception again in future procurements, where appropriate
• considerations to develop and include an IPP to enable the growth of industry capacity

In 2023-24, 20 organizations applied deputy head-approved exceptions totaling $14.7 billion. Overall, exceptions accounted for 42% of the total Government of Canada contracting value of $35.02 billion which increased from 22.41% in 2022-23 - see Table 11.

The total value of deputy head-approved exceptions increased by 95.65%, from about $7.51 billion in 2022-23 to $14.7 billion in 2023-24 (see Table 11). This indicates a significant increase in the use of exceptions. The value of exceptions for DND doubled from approximately $6.45 billion to nearly $12.9 billion. DND's share of total exceptions increased slightly from 85.8% to 87.7% (see Table 12). This shows that DND is the primary driver of deputy head-approved exceptions and that its share of total exceptions has grown incrementally.

While the dollar value of deputy head-approved exceptions reported by DND is high, the percentage of contracts where an exception has been applied is exceptionally low. In 2022-23, DND applied deputy head-approved exceptions to only 5 contracts, representing 0.002% of all contracts awarded. In 2023-24 deputy head-approved exceptions were applied to 59 contracts awarded by DND, representing 0.05% of all contracts awarded^{Footnote 21}.

As a Phase 3 organization, DND is required to meet the 5% commitment by the end of fiscal year 2024-25 and is expected to implement the target gradually and effectively over this period, making adjustments based on lessons learned. DND promotes developments that lead to a robust defence industrial landscape in Canada, which must include Indigenous suppliers. DND continues to encourage Indigenous capacity-building efforts and opportunity creation to generate socio-economic benefits for Indigenous communities, empowering them to become active participants in the Defence Supply Chain. Results from 2022-23 and 2023-24 offer a baseline of DND's efforts to apply an Indigenous lens to procurement contracts and will help identify commodities where DND can support capacity-building efforts. Over time, it is expected that the number of contracts for which DND applies an exception will decrease.

2023-24 is the first year that ISC has requested more detailed information on deputy-head approved exceptions. Organizations responded using varying approaches, some provided individual contracts where an exception was applied, most provided aggregate values representing groups of contracts with either economic object codes or reporting object codes. Overall, organizations across all phases cited an inability to identify an eligible Indigenous business that could fulfill the requirements of the contract as the primary reason for seeking a deputy-head approved exception. For example, the Public Health Agency of Canada requested exceptions for pharmaceuticals, the CSA for space-related research and development, and DND for defence-specific materials including vehicles and controlled goods such as firearms and ammunition.

Additional reasons organizations provided for seeking exceptions included the mandated use of standing offers, such as for Commissionaires services by the Immigration and Refugee Board of Canada and Innovation, Science and Economic Development Canada, and for procurement taking place internationally. Pre-existing contracts and intellectual property restrictions with specific vendors resulted in exceptions for several organizations including the Military Police Complaints Commission and STATCAN.

roman numeral 3III.2.5. In which areas were Government of Canada contracts awarded to Indigenous businesses in 2023-24

Performance data for 2023-24 illustrates commodity/service areas^{Footnote 22} where Government of Canada contracts were awarded to Indigenous businesses. Figure 1 presents commodity/services by reporting object name where the total procurement value is greater than $3 million and represents only contracts over $10,000. Informatics services ($277 million), informatics equipment and parts ($211 million), and other services ($47 million) are the top 3 three areas (by reporting object names).

Interestingly, both informatics services ($558 million) and informatics equipment and parts ($243 million) were also reported as being top areas for Indigenous procurement in 2022-23, suggesting well developed Indigenous business capacity in these areas. See Annex B for a full list.

Text alternative for Figure 1: Goods and services (by reporting object name) procured in 2023-24 (greater than $3 million)

A graph showing the total procurement value (original contract value plus amendments) of goods and services by reporting object name.

Goods and services (by reporting object name) procured in 2023-24 (greater than $3 million)	Total procurement value (original contract value + amendments)
Informatics services	$276,983,127.99
Acquisition of informatics equipment and parts	$211,402,643.25
Other services	$47,480,107.91
Repair and maintenance - Machinery and equipment	$35,285,453.68
Rental of informatics equipment	$27,272,695.28
Management consulting	$24,906,102.11
Acquisition of residential buildings	$21,919,855.31
Acquisition of office equipment and furniture including parts	$21,643,488.30
Repair and maintenance - Buildings	$20,094,750.42
Rental of aircraft and ships	$17,646,752.55
Mineral products	$15,926,496.54
Business services	$15,514,253.36
Health and welfare services	$14,487,743.49
Scientific and research services	$8,314,190.50
Rental of machinery, office furniture & fixtures, & other equipment	$6,623,216.39
Interpretation and translation services	$6,347,456.32
Acquisition of engineering works	$5,936,205.99
Engineering and architectural services	$4,992,863.84
Acquisition of equipment and furniture including parts	$4,325,300.54
Miscellaneous goods and products	$4,276,950.81
Training and educational services	$3,449,878.05
Acquisition of non-residential buildings	$3,413,695.15
Repair and maintenance - Engineering works	$3,162,674.56

Figure 2 presents goods and services procured in 2023-24 broken into a sub-category, by economic object name, where the total value of contracts awarded to Indigenous businesses was greater than $3 million and represents only contracts over $10,000. Information technology and telecommunications consultants ($276 million), computer equipment related to distributed computing environment - desktop/personal/portable (includes all related parts and peripherals) ($150 million), and "other professional services" not elsewhere specified ($46 million) make the top economic object names (see Annex C for a full list).

When comparing these results to those from 2022-23, office furniture and equipment (including parts) was an economic object name that previously ranked in the top 3 categories. This year, it has been replaced by "other professional services". While office furniture and equipment still represent a significant portion of overall government contracting with Indigenous businesses (e.g., $22 million vs. $171 million), this shift highlights how government procurement priorities can change from year to year.

Text alternative for Figure 2: Goods and services (by economic object name) procured in 2023-24 (greater than $3 million)

A graph showing the total procurement value (original contract value plus amendments) by economic object name.

Goods and services (by economic object name) procured in 2023-24	Total procurement value (original contract value + amendments)
Information technology and telecommunications consultants	$275,859,363.82
Computer equipment related to Distributed Computing Environment (DCE) - Desktop/personal/portable (includes all related parts and peripherals)	$150,476,134.08
Other professional services not elsewhere specified	$45,588,715.92
Computer equipment related to Production and Operations (P&O) environment - All servers, storage, printers, etc. (includes all related parts and peripherals)	$42,637,906.47
Management consulting	$24,906,102.11
Residential buildings	$21,919,855.31
Office furniture and furnishings, including parts	$21,379,974.31
Repair and maintenance - Communications/Networking equipment (includes analog, digital and combined analog/digital equipment, cabling, parts and peripherals)	$20,905,387.31
Repair and maintenance - Institutional buildings	$17,911,040.40
License/Maintenance fees for client software related to Distributed Computing Environment (DCE)	$12,853,784.84
Gasoline	$12,110,918.81
Rental of aircraft	$10,443,301.86
Other business services not elsewhere specified	$9,901,059.71
Welfare services	$9,542,814.68
License/Maintenance fees for application software (including COTS) and application development and delivery software	$8,598,022.01
Repair and maintenance - Computer equipment related to production and operations (P&O) environment - All servers, storage, printers, etc. (includes all related parts and peripherals)	$8,501,376.88
Client software related to Distributed Computing Environment (DCE)	$7,630,706.85
Rental of ships	$7,203,450.69
Communications/Networking equipment (includes analog, digital and combined analog/digital equipment, cabling, parts and peripherals)	$6,680,890.24
Rental of machinery, office furniture and fixtures and other equipment	$6,623,216.39
Translation services	$5,839,278.96
Research contracts	$5,323,433.23
License/Maintenance fees for operating system and utility software related to servers, storage, peripherals and components	$5,061,667.93
Other health services not elsewhere specified	$4,944,928.81
Repair and maintenance - Computer equipment related to Distributed Computing Environment (DCE) - Desktop/personal/portable (includes all related parts and peripherals)	$4,003,427.14
Engineering consultants - Other	$3,964,351.88
Application software (including COTS) and application development and delivery software	$3,290,950.56

roman numeral 3III.3.1. In which areas are organizations planning to procure with Indigenous businesses in 2024-25

Planning data for 2024-25 illustrates where Indigenous business capacity is greatest (see Figure 3). Information equipment and parts, office equipment and furniture including parts, and informatics services are the top 3 areas (by reporting object name) where the Government of Canada is planning to procure from Indigenous businesses. A year over year analysis has revealed that the same top commodity areas were identified for Indigenous procurement in 2023-24.

Text alternative for Figure 3: Goods and services (by reporting object name) federal organizations plan to procure in 2024-25

A graph showing the number of organizations who plan to procure specific goods and services by reporting object name.

Goods and services (by reporting object name) federal organizations plan to procure in 2024-25	Number of organizations
Acquisition of informatics equipment and parts	54
Acquisition of office equipment and furniture including parts	37
Informatics services	37
Other services	36
Rental of informatics equipment	22
Business services	21
Interpretation and translation services	20
Miscellaneous goods and products	20
Management consulting	19
Temporary help services	15
Communications professional services	11
Engineering and architectural services	8
Training and educational services	8
Acquisition of equipment and furniture including parts	6
Postage, freight, express, and cartage	5
Protection services	5
Repair and maintenance - machinery and equipment	5
Scientific and research services	5
Special fees and services	5
Wood, paper and wood products	5

roman numeral 3III.3.1.1. In which areas may Indigenous businesses not be active in 2024-25

Planning data for 2024-25 also illustrates where Indigenous business capacity gaps may be the greatest in the upcoming fiscal year (see Figure 4). Other services, informatics services, and management consulting are the top 3 areas (by reporting object names) where Indigenous businesses are not active in federal procurement. It is notable that some of the same categories (e.g., informatics services) appear as areas where organizations have plans to procure but also where Indigenous business gaps exist, a trend also noted in 2022-23. Potential factors contributing to this gap may include the limited number of Indigenous businesses operating in this sector, their geographic concentration in specific regions, or current capacity constraints that limit their ability to engage with a broader range of organizations.

See Annex E for a further breakdown of commodity categories into economic object codes and names.

Text alternative for Figure 4: Goods/services (by reporting object name) where Indigenous business capacity gaps may exist

A graph showing the number of organizations who identified Indigenous capacity gaps for goods/services by reporting object name

Goods/services (by reporting object name) where Indigenous business capacity gaps may exist	Number of organizations
Other services	13
Informatics services	12
Management consulting	10
Business services	9
Communications professional services	7
Scientific and research services	7
Acquisition of equipment and furniture including parts	6
Miscellaneous goods and products	6
Health and welfare services	5
Protection services	5
Rental of informatics equipment	5
Repair and maintenance - machinery and equipment	5

roman numeral 3III.3.2. Observations – 2023-24 Indigenous Procurement Plans vs. 2023-24 Results

A comparison of planned versus actual procurement for 2023-24 reveals significant discrepancies across organizations, which highlight gaps in forecasting and planning accuracy. Due to 2023-24 being the first year for which planning reports were collected, only 84 organizations submitted data that supports a comparison between the two years. Therefore, these values may not align exactly with the overall results, as this is not a comprehensive list. However, it remains broadly comparable for 84 of 95 organizations captured.

On the whole, organizations underestimated both their planned overall and planned Indigenous procurement spending. Planned overall spending across the 84 organizations for which we have data was $11.7 billion, while actual spending reached $16.6 billion, more than 40% higher. Similarly, planned spending with Indigenous businesses was $596 million, but actual spending totaled $1.1 billion, an increase of almost 85%.

While 14 organizations planned to use procurement exceptions totaling $1.28 billion, 20 ultimately applied exceptions totaling over $14.7 billion. This reflects the continued difficulty organizations may have with forecasting procurement needs. These findings suggest that procurement plans often do not reflect actual forecasted spending.

It is also observed that organizations tend to underestimate their procurement activity, as they typically report planning percentages that are lower than their actual performance. This issue persists across organizations of all sizes, indicating that challenges with forecasting procurement activities may not be limited to large organizations.

Through ongoing collaboration with organizations submitting Indigenous procurement plans, ISC has found that, in many cases:

• procurement planning activities commonly happen in the same fiscal year they are meant to cover due to delays in budget approvals, limiting the ability to anticipate needs
• separation between procurement and finance processes is common which hinders effective forecasting and planning
• a lack of alignment exists between the Government of Canada's Integrated Business Planning processes (e.g., the Departmental Planning, and Departmental Results reporting processes) and ISC's 5% planning exercise requirements, which can lead to planning and reporting fatigue

Information from organizations about operational challenges, combined with an analysis highlighting gaps between planning data and actual outcomes, have resulted in changes to the planning report process to enhance data quality (as discussed in section roman numeral 3III.1.3). However, more work is needed to identify innovative approaches that better align data with the needs of Indigenous communities.