Procurement Strategy for Aboriginal Business (PSAB)

The Procurement Strategy for Aboriginal Business (PSAB) was a Government of Canada strategy intended to increase the number of Aboriginal suppliers bidding for and winning federal contracts. It used mandatory and voluntary set-asides, partnerships, joint ventures, subcontracting and other measures to raise Aboriginal participation in federal procurement. Federal program documentation describes it in these terms.

PSAB was launched in 1996 and applied to all federal departments and agencies. "Aboriginal" is the historical name found in older policies and procurement documents. The program has since been updated and renamed the Procurement Strategy for Indigenous Business (PSIB), as the Public Services and Procurement Canada transition book confirms.

What PSAB was designed to do

The goal was practical: more Aboriginal businesses competing for, and winning, federal work. PSAB did not rely on a single tool. It supported joint ventures, partnerships, subcontracting and strategic alliances involving Aboriginal businesses, alongside set-asides that restricted certain competitions to eligible suppliers. The departmental reporting on the strategy shows it applied government-wide rather than to a single department.

Mandatory and voluntary set-asides under PSAB

PSAB had two kinds of set-aside. Mandatory set-asides covered contracts valued at more than $5,000 for goods or services primarily benefiting an Aboriginal population. Those requirements were competed only among Aboriginal businesses, as set out in the strategy documentation.

Voluntary set-asides covered everything else. Federal departments and agencies were encouraged to set aside other requirements for competition among Aboriginal suppliers where practical, a point reflected in earlier federal reporting.

A set-aside is not sole-sourcing. The requirement is competed among eligible businesses, and ordinary procurement rules and procedures continue to apply.

From PSAB to the Procurement Strategy for Indigenous Business

The current name of the program is the Procurement Strategy for Indigenous Business. It is the Government of Canada's program for setting aside contracts, or portions of contracts, for exclusive competition among Indigenous businesses. Indigenous Services Canada now administers and describes the former PSAB under the PSIB name.

On CanadaBuys, a requirement designated as set aside is restricted to qualified Indigenous businesses, while all applicable procurement policies and procedures still apply.

Clauses, policy and other public-sector buyers

The federal contracting framework carries the strategy into solicitations. The CanadaBuys Standard Acquisition Clauses and Conditions Manual includes clause S3035T, Set-aside for Indigenous Business, with further requirements referenced in the Supply Manual.

Treasury Board policy also applies. The Directive on the Management of Procurement contains mandatory procedures for contracts awarded to Indigenous businesses and supports the federal Indigenous procurement target.

Other federal public-sector buyers follow similar approaches. The CMHC procurement policy states that CMHC may reserve procurements for competition among First Nations, Métis and Inuit businesses. It identifies procurements over $5,000 that primarily benefit those populations as mandatory set-asides.

What it means for a supplier bidding on Canadian public contracts

Check whether the solicitation is marked as a PSAB or PSIB set-aside. If it is, confirm that your business meets the definition and qualification requirements for an Aboriginal or Indigenous business, then submit a compliant competitive bid. Where the solicitation allows it, you can also take part through joint ventures, partnerships or subcontracting arrangements with a qualified business. Look for clause S3035T in the solicitation documents on CanadaBuys, and treat older references to PSAB as references to PSIB.