U.S. Defense Secretary Pete Hegseth said the Pentagon will take aim at a contracting program that’s become a critical part of the business portfolios for many Alaska Native corporations.

“We’re actually taking a sledgehammer to the oldest DEI program in the federal government,” Hegseth said in a video posted to social media on Jan. 16, referring to diversity, equity and inclusion policies the Trump administration and its allies have attacked extensively.

He was referring to the 8(a) Business Development Program, overseen by the Small Business Administration. Established during the Civil Rights era, 8(a) is a “federal contracting and training program for experienced small business owners who are socially and economically disadvantaged,” according to the SBA.

The program has created substantial opportunities and benefits for Alaska Native corporations, the regional and village entities established under the Alaska Native Claims Settlement Act to benefit tribal members holding shares in the companies. The most lucrative of those benefits is access to no-bid federal contracts, with none of the dollar limits that many other 8(a)-eligible companies are subject to, and fewer restrictions on subsidiary activities.

The head of the Native American Contractors Association, a group representing Indigenous-owned companies dealing with federal contracts, said the organization is willing to work with the Pentagon on improving the 8(a) program, but disputed the assertion it is a “DEI program.”

Members of Alaska’s congressional delegation say they support the program and are working with the Trump administration on the issue.

Speaking in general terms, Hegseth said the program’s stated goals are “laudable,” but that 8(a) had morphed into “swamp code words for DEI race-based contracting.”

Hegseth said that effective immediately, the Pentagon would review all sole-source 8(a) contracts worth more than $20 million.

The message added a culture war framing to an issue that, over the years, has drawn criticism from across the political spectrum. But members of the Trump administration, as well as some of its Republican allies, have stepped up their attacks on 8(a) over the previous few months.

A 2016 Government Accountability Office report estimated that in 2014, the 8(a) program committed $4 billion worth of federal contracts to some 344 companies owned by Alaska Native corporations.

A series of articles by the investigative outlet ProPublica published in 2010 and 2011 documented the rise in 8(a) contracts among Alaska Native corporations.

“While contracting dollars to 8(a) firms grew nearly fivefold from 2000 to 2009, money to ANC companies in the program increased more than twentyfold — from $280 million to $5.7 billion — thanks to a rule that allows them to obtain no-bid contracts of unlimited size,” ProPublica reported.

Quinton Carroll, executive director of the Native American Contractors Association, disputed the thesis of Hegseth’s remarks.

“Native participation in the SBA 8(a) Program is not a DEI initiative. It is grounded in the unique political and legal status of tribal nations under U.S. law and fulfills longstanding federal trust and treaty obligations to tribes, Alaska Native corporations, and Native Hawaiian organizations,” Carroll wrote in an email Jan. 22.

Besides audits and reviews, it’s not clear what permanent or legislative actions Hegseth and other agencies will take.