Portfolio focus: Finance and leasing options that support Indigenous businesses and services.
IBA provides asset leasing solutions to Australian Government departments, Indigenous businesses and other providers of services to Indigenous communities. The funding is derived from a combination of asset transfers, program funding from other government agencies and seed capital from IBA. The solutions are delivered through the Indigenous Economic Development Trust and IBA Leasing. In total, around 85 per cent of the leasing product is delivered to businesses in rural and remote regions across Australia.
An Investment Highlight – ‘Healing the spirit at Mareeba Therapeutic Community’
Through its trusts and subsidiaries, IBA can provide meaningful financial and leasing support to Indigenous businesses and services.
Mareeba Therapeutic Community provides Aboriginal and Torres Strait Islander peoples in the Cairns and surrounding region with access to an effective and culturally appropriate drug and alcohol residential rehabilitation service.
In 2012, as a trustee for the Indigenous Economic Development Trust, IBA helped re-establish the service with the Queensland Drug and Alcohol Council (QDAC).The property has 14 hectares of agricultural land that QDAC plans to incorporate into its program of training and accreditation in agriculture.
Read more about the social impact of this initiative in ‘Healing the Spirit at Mareeba Therapeutic Community’.
Indigenous Economic Development Trust
The Indigenous Economic Development Trust uses government agency funding to provide vehicle, machinery and property leasing solutions, primarily as part of remote community programs. The beneficiaries of this trust are Indigenous Australians.
The largest source of funding is $19.5 million from the Department of the Prime Minister and Cabinet for the leasing of assets under the Community Development Program. At 30 June 2016, around half of that funding had been deployed as new assets; the remainder is forecast to be used by 30 June 2017.
The other major component of the trust’s asset base is properties, collectively valued at $15.2 million, which are managed on behalf of other government agencies. The agencies fund the purchase of the properties and provide the trust with ownership. This arrangement assists the agencies to focus on their core business (for example, the provision of health services) by outsourcing property management and maintenance. The Australian Government retains control of the properties, and the agencies are able to ensure that the properties are used for their intended purposes.
IBA provides leasing solutions directly to Indigenous small businesses from IBA seed capital. The leases offer competitive terms on a range of assets (usually vehicles and equipment) to help people establish, consolidate or expand commercially viable businesses.
For further information
Read about other asset groups within IBA’s investment portfolio including: