Native Title Report 2006: Chapter 2: Economic Development Reforms on Indigenous land

Native Title Report 2006

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Chapter 2: Economic Development Reforms on Indigenous
land

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Chapter 1 << Chapter 2 >> Chapter 3

• Introduction
• The government policy framework
• Indigenous land tenures
• 99 Year headleases over Indigenous townships
• Use of the Aboriginal Benefits Account to pay for Government 99 year headleases
• Modifications to the permit system
• Discontinuation of funding and services to homelands
• Shire councils to replace Indigenous community councils
• Housing and home ownership
• Indigenous employment
• Programs supporting Indigenous enterprise and economic development
• Agreements and economic development
• Assessment of the self-access model for Indigenous economic development
• Conclusion
• Findings
• Recommendations
• Introduction to the case studies

Introduction

In 2006 the Secretary of the Department of Prime Minister and Cabinet made a
revealing statement about Indigenous affairs. He argued that his own
government’s policy performance in the Indigenous portfolio had been a
failure. He went further to say that while well intentioned, the policies and
approaches of the past 30 years had contributed to poor outcomes for Indigenous
people.

I am aware that for some 15 years as a public administrator too much of what
I have done on behalf of government for the very best of motives has had the
very worst of outcomes. I and hundreds of my well-intentioned colleagues, both
black and white, have contributed to the current unacceptable state of affairs,
at first unwittingly and then, too often, silently and
despairingly.^[1]

This statement was made in the context of the Australian Government’s
ambitious reform agenda aimed at significantly recasting Indigenous policy in
remote Indigenous Australia. During 2005 and 2006 the Government implemented
legislative and policy reforms that will change the face of Indigenous
communities located on communally titled land. The Government argued that
communal tenures prevent Indigenous people from improving material wealth and
economic circumstances. According to the Government, individual property rights
will allow Indigenous Australians to accumulate assets and participate in market
economies. The Government’s reforms are designed to emphasise the
individual as an agent in economic self development through ‘building
wealth, employment and an entrepreneurial
culture.’^[2] According to the
Minister for Indigenous Affairs:

It is individual property rights that drive economic development. The days of
the failed collective system are
over.^[3]

This Chapter will focus on the Government’s
economic reform agenda with discussion about the following:

• individualising title on Indigenous communal lands through 99 year
  headleases;
• liberalising public access to Indigenous land through the modification of
  the permit system;
• home ownership on Indigenous lands;
• centralising government services in large Indigenous townships;
• developing regional shire councils to replace Indigenous community
  councils
• employment and CDEP; and
• access to capital for Indigenous economic and enterprise development.
  

The government policy framework

The Australian Government’s policy agenda is
contained in the 2006 Blueprint for Action in Indigenous Affairs(hereon referred to as the Blueprint). The
Blueprint defines the Government’s intention to replace protectionist,
welfare-based approaches to Indigenous affairs with market-based approaches to
land, housing, enterprise development and employment. This means opening up
Indigenous land to the wider Australian public and creating more interaction
between remote communities and the Australian economy. The discourse that
accompanies the Government’s policy reforms defines a need to
‘normalise’ Indigenous communities through mainstreaming service
delivery and creating market economies.

We will need to remove barriers to economic opportunity. But we are not
proposing to use government programs to create artificial economies. It
doesn’t work. We are talking about creating an environment for the sort of
employment and business opportunities that exist in other Australian
towns...

Land tenure changes will be progressively introduced, subject to the
agreement of traditional owners, to allow for home ownership and the normal
economic activity you would expect in other Australian towns.

In places like Wadeye, Cape York and Groote Eylandt this is just beginning to
happen. We want to get to the point where people living in these remote
communities are not solely dependant on community or public housing. They should
be able to buy their own homes. Those who don’t should make a fairer
contribution in rent.^[4]

In 2005 the Australian Government announcedlegislative amendments to the Aboriginal Land Rights (Northern
Territory) Act 1976 (Cth) (hereon referred to as ALRA). One significant
addition to the ALRA was a provision that permitted Governments to negotiate 99
year headleases over Northern Territory townships under Indigenous communal land
rights tenure. The headleases would then be divided into sub leases for
individual tenants, home purchasers, businesses and government service
providers.

Accompanying the tenure reforms in 2006 were proposed
changes to the ALRA permit system. The ALRA permit system currently requires all
visitors, non Indigenous residents and non residents to obtain a permit to enter
and stay on Indigenous land. The Australian Government’s aim in reforming
the permit system is to liberalise land access so that the providers of goods
and services can enter Indigenous land without restriction.

Integral to the government’s
‘normalisation’ strategy are proposed changes to the Indigenous
housing system and housing markets. The intention is to increase home ownership
and reduce reliance on government subsidised rental accommodation. According to
the Government, these reforms are dependent on 99 year leases. The Minister for
Families, Community Services and Indigenous Affairs has determined that
funding for home ownership schemes will be contingent on the states and
territories amending their land rights legislation to make provision for 99 year
headleases.

Finally, the Blueprint sets out the Australian
Government’s intention to limit the supply of services and financial
support to small ‘unsustainable’ Indigenous communities. If
Indigenous people on homelands and outstations want to access health and
education services they will have to move to the larger townships.

The precursor to the Blueprint is the 2003 Council of Australian Governments
report, Overcoming Indigenous Disadvantage, Key Indicators (The COAG
Report). The Report is the framework on which the Indigenous reform agenda has
been developed. The COAG Report has a dual focus. It maps the extent of
Indigenous disadvantage using 2001 census data and it provides a framework for
the focus of government action. ‘Economic participation’ is the apex
of the tripartite COAG framework, along with creating healthy families and early
childhood. The COAG Report recommends: ‘improved wealth creation and
economic sustainability for individuals, families and
communities.’^[5]

A key finding of the Overcoming Indigenous Disadvantage Key
Indicators

2003 Report is that economic development is central to improving the
well-being of Indigenous Australians.

A strategic goal of the Australian Government’s Indigenous policy is to
increase Indigenous economic independence, through reducing dependency on
passive welfare and stimulating employment and economic development
opportunities for Indigenous individuals, families and communities.

The COAG Report aims to implement ‘economic participation and
development’ through seven specific areas for action. These are contained
in the COAG strategic areas for action and include the following:

• employment (full-time/part-time) by sector (public/private), industry
  and occupation;
• CDEP participation
• long term unemployment;
• self employment;
• Indigenous owned or controlled land;
• accredited training in leadership, finance or management; and
• case studies in governance
  arrangements.^[6]
  

The COAG Reports on Overcoming Indigenous Disadvantage will
be issued on a two yearly basis and will be formulated from a range of data
sources including the Australian Bureau of Statistics (ABS), the Australian
Institute of Health and Welfare and the Productivity Commission as well as
government departments. Successive Reports will be used to evaluate the reform
agenda.

Progress will be monitored through the Overcoming Indigenous
Disadvantage reports, which measures key indicators in Indigenous social and
economic well-being from a whole-of-government perspective. In particular, the
increased participation of Indigenous Australians in employment and increased
wealth of Indigenous Australians—collective and individual—will be
monitored. In addition, improvements will be continually monitored through
agencies measuring their contributions against each initiative in the
strategy.^[7]

Indigenous land tenures

The Australian Government’s reforms must be considered with full
knowledge of the location, infrastructure, and legislative parameters of
communally titled Indigenous land. As of June 2006, Indigenous Australians held
communal rights and interests to land encompassing almost 23 percent of the
Australian land mass.^[8] While there
is no doubt that the Indigenous ‘estate’ is now considerable, most
of the land that has been returned to Indigenous people since the 1970s is
remote, inhospitable and marginal. The process of colonisation over two
centuries ensured that the best land was granted, taken or purchased by
non-Indigenous Australians. The Crown land that was still unallocated by the
1970s remained so for good reason. However, in recent times some of the remote,
coastal land under Indigenous tenure has become attractive to developers,
governments and non-Indigenous residents. This trend is likely to continue as
residential markets spread along the Australian coastline. Land in the central
desert belt of Australia is unlikely to attract residential markets, now or into
the future.

There are three ways that Indigenous land has been returned to Indigenous
people. It has been allocated by governments through statutory land rights,
claimed under the native title regime, or purchased on behalf of Indigenous
people with funds established to provide land to the dispossessed. Indigenous
Australians have also purchased land as individuals, in the same way as
non-Indigenous Australians and through land councils in some states. Land that
has been returned to Indigenous Australians is largely unallocated Crown land.
The majority of the land is located in very remote desert regions with limited
or no infrastructure, roads or utilities.

Native Title

Indigenous traditional owners have varying rights and interests to just over
8.5 percent of the Australian land mass as a consequence of native title
determinations.^[9] By June 2006 there
were 60 determinations that native title exists. However, in the majority of
cases the traditional owners do not have exclusive possession of the land.
Traditional owner rights to land are limited to the same customary activities as
those that were practiced centuries ago and recorded by the ‘first
contact’ non-Indigenous colonisers. The claimable land that exists under
the native title regime includes unallocated Crown lands, some reserves and park
lands, and some leases such as non-exclusive pastoral and agricultural leases,
depending on the state or territory legislation under which they were issued.

Across Australia, just over 96 percent of all native title land is classified
as very remote by the Accessibility Remote Index of Australia (ARIA), the
most widely used standard classification and index of
remoteness.^[10] In terms of the
size, Western Australia has by far the largest areas of native title land of any
Australian jurisdiction. Ninety two percent of the area of native title
determinations is in Western Australia (WA). A large proportion of native title
land in WA is in the Gibson, Tanami and Great Sandy Desert regions as well as in
the Kimberley. In the other states and territories native title rights and
interests have been recognised over smaller parcels of land. In Queensland land
under native title is in the ‘very remote’ Cape York region and in
the Torres Strait. In South Australia native title interests and rights have
been recognised in the ‘very remote’ north central region of the
state which is partially located within desert regions. In the Northern
Territory native title interests and rights have been recognised over land and
seas in ‘very remote’ regions and in Alice Springs, classified as an
‘outer regional’ by ARIA. In Victoria, native title land is located
‘remote’ and ‘outer regional’ areas and in Tasmania
there are no successful native title claims to date. By June 2006, New South
Wales was the only jurisdiction that successfully achieved a native title
determination in an ‘inner regional’ area. The land parcel is very
small comprising 0.1 square kilometres on the New South Wales Coast.

Overall, the land over which native title interests and rights have been
recognised is some of the most marginal and inhospitable land in Australia.
Chart 12 shows the location of Indigenous land under native title by remoteness.

CHART 12: NATIVE TITLE DETERMINATION AREAS MAPPED AGAINST REMOTENESS -
2006



Source: National Native Title
Tribunal 2006

Indigenous land rights statutes

Indigenous lands granted under state, territory and federal statute
constitutes 14.4 percent of the Australian land
mass.^[11] Land under statute has
been granted or purchased by governments for Indigenous people since the 1970s.
Like land under native title tenure, while the land area is extensive, the vast
majority of it is marginal, located in desert regions or in remote locations in
the north of Australia.

Chart 13 demonstrates that the land under statutory land rights is
overwhelmingly represented in the central desert regions of Australia. Vast
tracts of Indigenous land traverse Western Australia, the Northern Territory and
South Australia. There are also large tracts of Indigenous land in the remote
north eastern regions of the Northern Territory, in the coastal regions of
Western Australia’s northern belt and the coastal Cape York areas of
Northern Queensland.

The high commercial value of the land in New South Wales (NSW) provides an
exception to the trend for land to be remote and marginal. While the land
granted to land councils in NSW is in many small parcels rather than large areas
of country, some of it is very valuable in terms of its potential for
development, both residential and
commercial.^[12]

Chart 13 shows the location of Indigenous land under statutory land rights.

CHART 13: STATUTORY LAND RIGHTS AREAS MAPPED AGAINST REMOTENESS - 2006



Source: National Native Title
Tribunal 2006

Note: This map does not include Indigenous land purchased
by the Indigenous Land Corporation

Other Indigenous communal land tenures

In addition to native title and land rights tenures, Indigenous land has been
purchased on behalf of Indigenous people by the Indigenous Land Corporation
(ILC) since June 1995. Indigenous Australians can apply to the ILC for purchase
of land under the categories of cultural, social, environmental and economic
benefit. Applicants must identify the ways in which the land purchase addresses
dispossession. They must also define a specific purpose for the land under one
of four categories and set achievable milestones and outcomes.

• Applicants are asked to enter into a lease while the ILC owns the land. The
  terms of the lease include a staged work plan, including capacity development
  activities, and applicants are required to report on and monitor how work is
  going.
  
• Progress towards a land grant depends on successful completion of the work
  plan. It is the ILC's opinion that it is usually reasonable to grant land within
  three years of buying it.
• The ILC's purchase and divestment policy is aimed at ensuring that the land
  purchased will remain Indigenous-held and can provide future generations with
  cultural, social, environmental or economic benefits.
  
• The ILC must grant title to land to an Aboriginal and Torres Strait Islander
  Corporation as defined in the Aboriginal and Torres Strait Islander Act
  2005.^[13]
  

Land purchased by the ILC covers over 5.5 million hectares and cost
almost $170 million by June 2006. Since 1995 the ILC has made a total of 201
land acquisitions, 27 have been acquisitions in urban
locations^[14]

The size and location of Indigenous communities

The 2001 census data identifies a total of 458,520 Indigenous people in
Australia. Of these 121,163 were residents in remote and very remote
regions.^[15] There are 1,139
discrete communities in remote and very remote regions, of which more than half
(577 in total) have populations of less than 20
people.^[16] In most cases, larger
communities represent Indigenous living areas formerly constituted as government
and mission settlements. The smaller populations are outstations or homeland
communities.

[O]utstation communities... had their origins in voluntary and spontaneous
resettlement of Aboriginal country commencing the 1970’s. These
settlements are found predominantly in central Australia, the Kimberly, the top
end of the Northern Territory and the Cape York
Peninsula.^[17]

Chart 14 provides information about the number, population size and location
of Indigenous communities.

CHART 14: NUMBER OF DISCRETE INDIGENOUS COMMUNITIES BY SETTLEMENT SIZE AND
REMOTENESS REGION, 2001

Settlement Population Size	Major Cities	Inner Regional	Outer Regional	Remote	Very Remote	Total
1-19	0	0	6	33	577	616
20-49	0	1	8	36	228	273
50-99	1	7	13	17	64	102
100-199	3	5	12	9	51	80
200-499	1	6	11	11	77	106
500-999	0	0	0	1	17	18
1000+	0	0	3	2	16	21
Total	5	19	53	109	1,030	1,216

Source: Australia Bureau of Statistics, Housing and Infrastructure in
Aboriginal and Torres Strait Islander Communities,
2001^[18]

Economic development limitations of Indigenous land

The Indigenous land base is not comparable with land in urban environments
and large regional townships. In remote Indigenous communities almost all
services are provided by governments or by church organisations. The land is
inhospitable, and usually cut off from markets and cities by distance and poor
road infrastructure. The tropical north is inaccessible by road during the wet
season which can extend to four months each year. The climate, soil and weather
are not conducive to cultivation, and tourist markets are limited in the
majority of the desert regions. It is therefore difficult to develop and
maintain significant enterprise ventures on Indigenous land.

Experience in remote Australia suggests that a goal of developing
under-developed Indigenous-owned land will not of itself be the driver of
private-sector finance availability. On its own terms, whether this land was
freely alienable or not, much of this land is in the poorest land classes and is
remote from markets.^[19]

Economic opportunities are further limited by the fact that land rights
regimes in Australia provide only the most minimal rights to subsurface
minerals. The New South Wales Aboriginal Land Rights Act 1983 (NSW)
provides rights to minerals though significantly excludes rights to gold,
silver, coal and petroleum. In Tasmania under the Aboriginal Lands Act
1995 (Tas), minerals other than oil, atomic substances, geothermal
substances and helium are the property of Indigenous people to a depth of 50
metres. No other land rights regime in Australia provides rights to subsurface
minerals. Indigenous land holders have to apply for licences for mining activity
in the same way as anyone else. While for the most part Indigenous Australians
have no mineral entitlements, the existence of a mining tenement can provide
royalty payments to traditional owners. Information outlining mineral rights
under the land rights legislations of all Australian jurisdictions is provided
at Appendix 1 of this Report.

Although commercial rights are not specifically excluded from the Native
Title Act 1993 (Cth), sections 211(2) and (3) indicate that native title
interests and rights are generally expected to encompass traditional activities.
These include hunting, fishing, gathering, participating in spiritual or
cultural activities and acting for the purpose of satisfying personal, domestic,
non-commercial or communal needs.

The case law that has defined and interpreted the Native Title Act 1993 (Cth) clarified that subterranean minerals and petroleum are the property of
the states and held this property right is sufficient to extinguish native title
rights. The High Court judgement in Ward^[20] determined that
native title entitlements should be characterised as a ‘bundle of
rights’ rather than an ‘underlying title to land.’ The
practical effect of Ward is that the potential economic entitlements of
the claimants are severely restricted. The ‘bundle of rights’
interpretation limits the legal recognition of economic and resource rights.
Only exclusive possession under native title vests land ownership rights in
traditional owners, including the right to exploit mineral resources within the
existing restrictions and caveats of Australian law.

Economic development has never been primary aim of land rights legislations.
If it were, valuable mineral rights would have accompanied the return of the
land as it has in countries with treaties such as Canada, the USA and New
Zealand. In these countries the treaty relationship means that governments have
an obligation to negotiate in good faith and recognise their fiduciary duties to
compensate for dispossession. This has led to large scale financial compensation
settlements that have provided indigenous peoples with a solid foundation for
economic development.

The real value of land returned to Indigenous
ownership under Australian land rights legislation has always been strongly
connected to its potential to compensate for dispossession, restore Indigenous
peoples’ spiritual relationship with the land, and recognise the right to
self-determination. These findings are strongly reinforced by the findings of
HREOC’s survey of traditional owners in Chapter 1 of this Report.

Strategies for economic development on Indigenous land must therefore be made
in full cognisance of the limitations of both the land itself and the land
rights legislative frameworks. The topographic and location limitations of
Indigenous land are integral to any considerations or policy approaches to
improve economic outcomes for Indigenous people. Strategies that work in cities
or on resource rich land are not applicable to the remote, marginal country that
characterises much of the Indigenous ‘estate.’ Governments must look
to approaches that have worked in environments that broadly approximate those
for Indigenous Australians.

99 Year headleases over Indigenous townships

During 2006, the Australian Government began implementing land reforms in the
Northern Territory where the land rights legislation is the jurisdiction of the
Commonwealth. Underpinning the land rights reforms was the 2005 National
Indigenous Council’s (NIC) Land Tenure Principles which were
discussed extensively in last year’s Native Title Report 2005. The
NIC Principles supported the maintenance of inalienable, communal tenure rights
for Indigenous land, but argued to amend land rights legislations ‘in such
a form as to maximize the opportunity for individuals and families to acquire
and exercise a personal interest in those lands, whether for the purposes of
home ownership or business
development.’^[21]

In 2006 the Australian Government added a new section 19A to the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) (ALRA) to
provide that with ministerial consent a Land Trust may grant a 99 year headlease
over an Aboriginal township to an approved entity of the Commonwealth or the
Northern Territory Government.

The 99 year leasing provision of s 19A of the ALRA has the practical effect
of ‘alienating’ Indigenous communal land. While a lease is not
alienation in fact, it will have the same effect in practice. Ninety nine years
is at least four generations. With potential to create back-to-back leases,
there is a high probability that the leases will continue in perpetuity.

Amendments of the nature of the ALRA are likely to be replicated in other
Australian jurisdictions. During 2006 the Australian Government announced that
it intended to encourage other states and territories to make similar amendments
to their land rights legislations through home ownership funding incentives and
bilateral agreements.

I hope these changes (amendments to ALRA) motivate other state governments to
amend their Indigenous land legislation to facilitate similar opportunities for
Indigenous Australians who reside on community land,’ Mr Brough said.

The 2006-07 Budget sees the allocation of $107.5 million towards the
expansion of the Indigenous Home Ownership on Indigenous Land Program.

The new tenure arrangements contained in the Bill will enable Aboriginal
people in the Northern Territory to access this new
program.^[22]

Obtaining consent for 99 year headleases

The 99 year lease agreements are voluntary. In order to establish a 99 year
headlease, section 19A(2) of the ALRA provides that governments must consult
with the wider Indigenous community of the township, and obtain consent for the
headlease from traditional owners through their representative Land Councils.
The provisions for 99 year headleases are as follows:

A Land Council must not give a direction under subsection (1) for the grant
of a lease unless it is satisfied that:

(a) the traditional Aboriginal owners (if any) of the land understand the
nature and purpose of the proposed lease and, as a group, consent to it; and

(b) any Aboriginal community or group that may be affected by the proposed
lease has been consulted and has had adequate opportunity to express its view to
the Land Council; and

(c) the terms and conditions of the proposed lease (except those relating to
matters covered by this section) are
reasonable.^[23]

Section 77A of the ALRA specifies the circumstances under which traditional
owners can give consent as a group.

Where, for the purposes of this Act, the traditional Aboriginal owners of an
area of land are required to have consented, as a group, to a particular act or
thing, the consent shall be taken to have been given if:

(a) in a case where there is a particular process of decision making that,
under the Aboriginal tradition of those traditional Aboriginal owners or of the
group to which they belong, must be complied with in relation to decisions of
that kind – the decision was made in accordance with that process; or

(b) in a case where there is no such process of decision making – the
decision was made in accordance with a process of decision making agreed to and
adopted by those traditional Aboriginal owners in relation to the decision or in
relation to decisions of that
kind.^[24]

Under traditional or agreed decision-making processes, a minority group may
be able to consent to a 99 year headlease on behalf of the majority. Given what
is at stake, it is essential that agreement and consent processes are documented
and authorised by the wider traditional owner group prior to any
negotiations for a headlease. Agreement about what constitutes traditional
decision-making, or agreed decision-making, should be decided in a separate and documented process. Unfortunately the ALRA does not contain a
provision that specifies a discrete process to authorise decision-making.
The step to authorise decision-making is a crucial check and balance. Given that
99 year headleases provide pecuniary benefits to traditional owners, there is
potential for money matters to override traditional considerations. Therefore,
traditional owners must have certainty about who has authority to make
decisions, and how those decisions should occur. This will also ensure
that traditional owners control the pace of decision-making and cannot be rushed
into giving consent by governments who operate on different timetables and
imperatives.

The Commonwealth Native Title Act 1993 (Cth) affords greater
legislative protections to claimants and native title holders in negotiating
consent for land use. The authorisation process for native title Indigenous Land
Use Agreements (hereon referred to as ILUAs) provides a relevant threshold.
Before an ILUA can be registered, the Registrar of the National Native Title
Tribunal must be satisfied that all reasonable efforts have been made to ensure
persons who hold, or may hold, native title in relation to land or waters in the
area have been identified, and that all persons so identified have authorised
the making of the agreement.^[25] Authorisation can occur through a traditional decision making process, or
through an agreed process by all persons who hold common or group native title
rights.^[26] The National Native
Title Tribunal provided the following explanation of the authorisation process:

• The Native Title Act 1993 requires that one form of Indigenous Land Use
  Agreement, the area agreement, be ‘authorised’ by all the persons who hold or may hold native title to the area covered by the
  agreement.
  
• The first step is to make all reasonable efforts to identify all persons who hold, or may hold, native title to the area covered by the
  agreement. The second step is to obtain the authority of persons identified in
  the first step (the native title group) to make the agreement.
  

The authorisation of the native title group may be given in one of
two ways:

• In accordance with a traditionally mandated process under the traditional
  laws and customs of the native title group to make decision of this kind, for
  example if decisions must be made by a council of elders (possibly a few people
  who can bind the rest of the group).
  
• If there are no traditionally mandated decision-making processes, then the
  group must agree upon and adopt a decision-making process that will be used to
  authorise the decision.
  

In looking at whether an agreement has been appropriately
authorised the courts have considered:

• Whether there is a body existing under customary law that is recognised by
  the members of the group and the nature and extent of that body’s
  authority to make decisions binding the members of the group and the fact that
  that body actually authorised the relevant action (Moran v Minister for Land
  and Water Conservation for
  NSW).^[27]
  
• Where the process is one agreed to and involves the holding of meetings, the
  purpose of, and agenda for, the meeting where authorisation was apparently
  given, and how and to whom notice of the meeting was given, as well as who
  attended the meeting and with what authority (Ward v Northern
  Territory).^{[28] [29]}
  

Provisions of this nature should be adopted under the ALRA to
ensure that Indigenous communities and traditional owners are able to give free,
prior and informed consent to 99 year headleases.

The amended ALRA also provides that under section 21C a new Land Council can
be established on a slim 55 percent majority vote of people in a Land Council
region or ‘qualifying
area.’^[30] Previous to the
2006 amendments, a substantial majority was required to establish a Land
Council.^[31] The 55 percent majority
is of particular concern for traditional owners of large townships. Due to
dispossession, the mission movements, and the centralisation of government
resources in larger communities, many Aboriginal townships are regional hubs
that accommodate large numbers of Indigenous people, many of whom are not the
traditional owners of the town area. Therefore, there are many townships where
traditional owners would not constitute a 55 percent majority.

The following example demonstrates the potential problems of setting 55
percent majority. The Wadeye region is home to over 2,300 people, though
population numbers vary.^[32] The
Kardu Diminin people are the traditional owners of the Wadeye township area.
They share their town with members of 19 other clan groups of the broader
Thamarrurr region. Members of regional clans first began to move to the Wadeye
township in the 1930s with the establishment of the mission. This has caused,
and continues to cause, tension in the region. The traditional owners in the
region do not constitute a majority of the people on the township.
Hypothetically, if a vote to establish a new Land Council was to occur in the
Wadeye Thamarrurr region, the traditional owners would not have the numbers to
override a community decision to establish a new Land Council. Should such a
Land Council agree to a headlease and fail to appropriately consult with
traditional owners, under s 19A(3) of the ALRA, this would not nullify the
headlease agreement.

Alternative lease models

The Australian Government will not consider alternative lease models to its
99 year scheme and in 2006 rejected an alternative 40 year lease proposal from
the Wadeye Thamurrur Council. The Wadeye proposal would vest the land title and
governance with the Wadeye Thamurrur Council. The traditional owners argued that
the 40 year model was preferable because it gave them ongoing decision-making
authority over land. According to the CEO of Wadeye's Thamarrurr Council:

The concept of a Town Corporation controlled by the traditional owners, the
Diminin people, is a critical aspect of the lease... The community had a right
to govern itself, and would continue to oppose federal government
plans.^[33]

The Wadeye proposal was prepared with expert legal advice, though the
Minister for Families, Community Services and Indigenous Affairs rejected it on
the grounds that banks would not provide finance for mortgages and business
proposals on 40 year lease
tenures.^[34]

It's been rejected on economic grounds, it's simply unsustainable...You don't
get, and will not get, banks to back the sort of financial investments that they
may be asked to make in regards to substantial
businesses.^[35]

Despite differing views on the views on the financial viability of lease
terms, the Minister will have the last word on this matter as $9.5 million in
housing funding for Wadeye is contingent on the Thamurrur Council agreeing to a
99 year headlease.

[T]he Minister is using as a bargaining chip, money that has already been
allocated to Wadeye. He's held up $9.5 million in housing funding,... Initially
he said he was holding it up until our people stop fighting and we're told the
day before yesterday that the $9.5 million that's been frozen in a trust account
in Darwin won't be freed up until this lease is
signed.^[36]

The Australian Government’s intransigence over the Wadeye proposal is
evidence that it will not take a research-based approach to land reform by
trialling different land tenure schemes such as the one proposed at Wadeye.

In fact, there are many alternative options to 99 year leases. In my Native Title Report 2005 I provided evidence that it is currently
possible to set up leases under every piece of land rights legislation in
Australia except one (the Victorian Aboriginal Lands Act 1991). Leases
can be for both residential and commercial purposes. Under land rights statute,
leases require traditional owner consent, and depending on the length of the
lease, Ministerial consent may also be required. Under the native title regime,
leases may be issued by governments if the native title representative body
agrees through an Indigenous Land Use
Agreement.^[37] In many Indigenous
townships these leases are currently operating on communal lands. The benefits
of these leases are that traditional owners retain decision-making control over
the land. Under the Government’s 99 year headlease plan, the
‘established entity’ will make the decisions affecting all future
development on Indigenous land.

International Experience

Perhaps one of the most compelling arguments against the Australian
Government’s individualised land lease scheme is that it is not based on
successfully evaluated models elsewhere in the world. In fact, international
evidence demonstrates poor outcomes for Indigenous people when communal tenures
are individualised. While individual title may provide appropriate structures
for asset management and accumulation in Western urbanised economies, it is not
a model that is readily transferred to economies based on communal rights. There
is ample evidence from New Zealand, the United States and the World Bank
confirming these shortcomings.^[38]

I covered this issue extensively in last year’s Native Title Report
2005 providing detailed examples of the problems associated with this
approach. It is difficult to comprehend the Australian Government’s
determination to implement a strategy that has been trialled, tested and shown
to be flawed in other OECD countries. In fact, due adverse outcomes, the United
States, New Zealand and World Bank are reversing past policies that facilitated
individual titling. During the 1970s, the World Bank evaluated individual tenure
reforms and found that they led to:

• significant loss of land by indigenous peoples;
• complex succession problems – that is, who inherits freehold or
  leasehold land titles upon the death of the owner;
• the creation of smaller and smaller blocks (partitioning) as the land is
  divided amongst each successive generation; and
• the constant tension between communal cultural values with the rights
  granted under individual
  titles.^[39]
  

Recent research about similar reforms in Kenya in the 1950s
corroborates the findings from New Zealand, the United States and the World
Bank.^[40] The findings from 40 years
of individual titling in Kenya demonstrate no real economic benefit and limited
economic leverage opportunity. In fact, formal, individual title made the land
more vulnerable to bank foreclosure to recover debt. Some of the recorded
disadvantages include:

• there was no evidence supporting a link between formal title and access to
  credit;
• that only a very small minority of Kenyans had used title to secure loans
  and they were generally the richer and more productive farmers;
• there had been some loan defaults leading to foreclosure and loss of the
  asset;
• families were hesitant in using the asset as collateral for enterprise
  development for fear of losing the family land;
• in passing the asset on to family members there were negative distributional
  consequences, including the sale of the asset;
• that the sale of the asset occurred in emergencies such as a need to pay
  medical expenses; and
• that women were significant losers when titles were formalised due to
  customary practices that ensured absolute legal ownership with the male head of
  the family.^[41]
  

The idea of utilising the ‘dead capital’ of communal
land is an argument put by many modern nations struggling to economically engage
indigenous populations. Some of the arguments that promote individual title come
from the difficulties encountered by Maori and Australian Indigenous
corporations in attempting to use communal land as security for business
development.^[42] Hernando de
Soto’s documented research into the formalising land title in Peru is
perhaps at the forefront of arguments advocating individual land title.

[B]ecause the rights to these possessions are not adequately documented,
these assets cannot readily be turned into capital, cannot be traded outside of
narrow circles where people know and trust each other [and] cannot be used as
collateral for a loan.^[43]

At a Land and Development Symposium in August 2005, these theories for the
use and registration of customary land were discussed in relation to the Asia
Pacific. Academic representatives from the Asia Pacific School of Economics and
Government, the University of the South Pacific and the Australian National
University promoted the formalisation of customary title, arguing for secure
individual title.^[44]

[C]ustomary land is dead capital, the declining productivity of land would
cause higher poverty and insecure access to land had dissuaded long-term
investment into fixed
infrastructure.^[45]

Arguing against this position was the Papua New Guinean Land Titles
Commissioner, Josepha Kanawi, who put forward an argument for the registration
of land to protect customary title. Along with other PNG representatives, he
argued that customary title provides security, that the registration of
customary land should be voluntary, and that customary titles should be able to
be used as security for bank
loans.^[46]

Customary land ownership...[provides]...security for the people, but ... it
is under pressure from social and economic change, and therefore must be
protected by registration.^[47]

Banks in Papua New Guinea and Kenya have rejected the use of customary lands
as security for loans. PNG banks ‘made it clear that they would not accept
customary land as security for loans until it was converted to either freehold
or state land.’^[48] In New
Zealand banks indicated that ‘business proposals involving Maori land
might be of lower priority for institutions able to obtain easier business
elsewhere.’^[49] However, while
communal title has been rejected by banks to leverage loans, formal title on
small land holdings has not necessarily convinced banks of sufficient loan
security. For example in Kenya, ‘banks tend to shun small scale
(particularly rural or agriculture-dependent) land holders [and land title] does
little to change these
biases.’^[50] The associated
potential for loss of the land asset through loan default is further
disincentive to using land title for collateral.

It is essential that governments ensure that all stakeholders in lease
negotiations are well informed of potential pitfalls as well as benefits and
opportunities. Ultimately traditional land owners should be well armed with
information and able to give informed consent to whichever economic model suits
their purposes. There may be groups of traditional owners who decide to give
consent to 99 year leases once they have considered all available evidence about
its likely impacts. The concern under the current ALRA provisions is that the
consent threshold is too low and it lacks the necessary checks and balances. In a non-Indigenous context, such standards for negotiation and consent
over land title would never be tolerated. It is essential that
the Australian Government provide the highest level of protections for
traditional land owners.

Use of the Aboriginal Benefits Account to pay for
Government 99 year headleases

A further concern about the administration of 99 year headleases is that they
are to be funded, at least initially, from the Aboriginal Benefits Account
(ABA). The ABA is an account that contains Aboriginal mining royalty monies. The
only express direction on the use of ABA is that it is to be used ‘to or
for the benefit of Aboriginals living in the Northern
Territory.’^[51] Under the
amendments to ALRA, a new s 64(4A) states that payments must be debited from the
ABA to be used for acquiring, administering and paying rents on 99 year
leases.^[52] To quote Minister
Vanstone:

The scheme is designed to be self financing in the longer term with sub-lease
rental payments covering the costs. Until then all reasonable costs will be met
from the NT Aboriginals Benefit Account (ABA), subject to consultation with the
ABA Advisory Committee.^[53]

Northern Territory Land Council estimates expect head leasing to costs up to
$15 million over 5 years. Other commentators suggest that this is a conservative
estimate.^[54] This is a significant
portion of the ABA which provides approximately $30 million in royalties per
year. Spending ABA money to pay for headlease rental will significantly reduce
the overall amount available for Land Councils and the range of land management
and other programs that are funded through ABA. Minister Brough’s Second
Reading Speech for the ARLA Amendments Bill ominously observed that ‘in
future, Land Councils will be funded on workloads and
results.’^[55]

The use of
ABA funds to pay for headleases is contrary to its purpose. The purpose of the
ABA is to provide benefit to Indigenous people above and beyond basic
government services. The administrative costs of land leasing are basic
government services. Furthermore, the use of the ABA for headleases is targeted
distribution of funds to communities that sign to the leases, while others will
not benefit at all.

By taking control of Indigenous land and the ABA funds, the Australian
Government is limiting the capacity for Indigenous Australians to be self
determining and self managing. On the one hand the Government has argued that it
is promoting a culture of Indigenous economic independence through amending
ALRA, and on the other it takes away the discretionary funds and control of land
that provide the capacity to do so. In 1999, the House of Representatives
Standing Committee on Aboriginal and Torres Strait Islander Affairs report Unlocking the Future recommended:

As a reflection of its core principles, the Committee agrees that Aboriginal
people should take as much responsibility as possible for controlling their own
affairs. This applies too, for the administration of the...
(ABA).^[56]

Modifications to the permit system

Under the current permit system in the Northern Territory, traditional owners
can regulate and restrict access to people entering Indigenous land. Visitors
require a permit in writing from the relevant Land Council or traditional
owners.^[57] However, in 2006, the
Minister for Families, Community Services and Indigenous Affairs responded to a
question in Parliament by announcing that it was time to remove the permit
system.^[5] Within a month the
Minister issued a media release calling for written submissions in response to
an Australian Government discussion paper on the permit system in the Northern
Territory.

...the permit system has created closed communities which are restricting the
ability of individuals to interact with the wider community and furthermore to
participate in the real economy.

The permit system has not acted to protect vulnerable citizens, including
women and children, and in fact makes scrutiny over dysfunctional communities
more difficult.^[58]

The Governments Permit Discussion
Paper^[59] contains five options
for action. In summary they are:

1. authorise access for people with estates or interests granted under section
   19 of the ALRA ;
2. provide open access to communal or public space and maintain the current
   permit-based system of restricted access to non-public spaces;
3. widen the current permit-based system by expanding the categories of people
   eligible to enter Aboriginal land without being subject to permission.
4. reverse the current restrictive permission-based access system to a liberal
   system with specific area exclusions. Access to Aboriginal Land would not
   require a permit unless a particular area was designated as restricted; and
5. remove the permit system altogether and replace with the laws of trespass,
   with any necessary modification for Aboriginal land.
   

Amendments to the permit system are part of the Government’s
‘normalisation’ of Indigenous townships. The Government intends to
open up Indigenous land to people who are neither traditional owners nor current
residents and thereby increase interaction between remote Indigenous people and
with the wider Australian economy.

At the heart of debate about the permit system is the right of traditional
owners, through their representatives, to decide who to include or exclude from
entry onto Indigenous land. Along with this is the right to information about
who is entering or exiting Aboriginal land. As the Minister for Families,
Community Services and Indigenous Affairs correctly observes that:

given the vastness of the Aboriginal land estate and the consequent
difficulties in applying normal laws of trespass, the permit system has operated
to respect the privacy and culture of Aboriginal
people.^[60]

The permit system operates as a kind of passport system allowing Aboriginal
people to exercise property rights on an equal footing with other Australians.
The Northern Land Council made this point in its submission to the Reeves
inquiry:

Traditional Aboriginal owners of Aboriginal land, like any other landowners,
have as part of their title to the land the right to admit and exclude persons
from their land. This is a fundamental aspect of land ownership under the
general law and is also fundamental to the achievement of the aims of the Land
Rights Act.^[61]

The question of
whether a permit system is discriminatory was examined in the High Court case of Gerhardy v Brown.^[62] While
the High Court found that the permit system established by s19 of the Pitjanjatjara Land Rights Act was a racially discriminatory measure,
contrary to s10 of the Racial Discrimination Act, it also found that s19
was a ‘special measure’ pursuant to s8 of that Act and was therefore
valid. Consequently, the permit system provides equality before the law and is a
special measure to ensure non-discrimination.

Section 8 of the Racial Discrimination Act 1975 (Cth) is modelled on
Article 2(2) of the International Convention on the Elimination of All Forms
of Racial Discrimination (ICERD) ^[63] which obliges parties to the
Convention to undertake, when warranted, special measures to ensure the adequate
development and protection of certain racial groups or individuals belonging to
them, for the purpose of guaranteeing them the full and equal enjoyment of
rights and fundamental freedoms. Special measures should not bring about the
maintenance of separate rights for different racial groups after the objectives
of the measures have been achieved.

The Minister’s argument that the permit system has prevented economic
development, and that its abolition will provide economic benefits requires
close scrutiny. The FaCSIA Discussion paper, Access to Aboriginal Land under
the Northern Territory Aboriginal Land Rights Act – Time for a change? Observes that,

[m]any Aboriginal communities on Aboriginal land in the Northern Territory
are already remote geographically. The permit system has operated to maintain or
even increase that remoteness – both economically and socially. It has
hindered effective engagement between Aboriginal people and the Australian
economy.^[64]

Liberalisation would also bring economic benefits that would help to promote
the self reliance and prosperity or Aboriginal people in remote
communities.^[65]

The Minister argues that if Indigenous lands are opened to non-Indigenous
interests, there is a high probability that outside operators will take the
opportunity to develop businesses, especially because the commercial competition
in these communities is very limited. However, I believe the economic benefits
to the Indigenous community are likely to be minimal. They may include greater
choice as consumers and, at most, the ability to secure waged employment with a
business operator. Nevertheless, ABS data demonstrates that the private sector
is not a good employer of Indigenous
people.^[66] There is therefore some
risk and great cost in giving private operators free reign on communal lands and
assuming that they will assist in improving employment outcomes for Indigenous
people. By giving private operators access to Indigenous lands, an opportunity
is lost for the Indigenous residents. In the case of enterprises involving
tourism for example, rather than owning the business, Indigenous land owners
become the employees of companies who in turn capitalise on Indigenous land and
culture. The most likely consequence of the Government reforms will be the
profit of non-Indigenous operators from undeveloped markets.

To continue the tourism example, an alternative arrangement would be for
governments to support the maintenance of the permit system while providing
opportunity for Indigenous people to develop or become partners in joint venture
tourism enterprises. Maintaining restricted access to the land adds rather than detracts from the unique nature of the tourism experience and
ensures that Indigenous Australians don’t have to compete in an open
market with highly resourced operators. A strategy such as this one actually
achieves the Government’s objective of improving economic outcomes for
Indigenous Australians.

There are also environmental impacts to be considered. The land degradation
caused by unchecked tourism and four wheel drive activity would be impossible to
monitor in national parks and on Aboriginal lands without a permit system. Open
access would require greater vigilance in protecting cultural heritage, sites of
significance, and sacred sites. This too is a resource issue and one that is not
addressed in the Australian Government’s Discussion Paper. Ultimately, the
degradation of the land is the degradation of the most precious asset of
Indigenous Australians, both in economic and cultural terms.

As it stands, the Discussion Paper does not canvass enough options for
economic development. It does not consider for example, charging fees for the
issue of permits. Currently there are some instances where permit fees are
charged to visit areas such fishing spots, (on a per car basis), and art
centres.^[67] If the Government is
concerned about increasing economic opportunity for Aboriginal people, one
option under the permit system could be to charge entry to popular sites.
Ultimately the Government has responsibility to canvass the widest range of
options and to engage Indigenous Northern Territorians in the development of an
economic development plan.

Discontinuation of funding and services to
homelands

As a consequence of the Homeland Movement of the 1970s, thousands of
Indigenous Australians moved out of missions and settlements and back onto
traditional lands. The decision to return to country was primarily to resume
cultural, spiritual and ceremonial connections and responsibilities to land.

It is estimated that approximately 20, 000 Indigenous Australians live in
communities of less then 100 people. The size of homeland communities varies,
some with less than 50 people, and others with 100 and
more.^[68] According to the ABS, 70
percent of Indigenous Australians over 15 years of age recognise homelands or
traditional country. Affiliation with traditional country increases with
remoteness; 86 percent of people living in remote areas claim affiliation
compared with 63 percent in non-remote
areas.^[69]

In 2005 and 2006 the Australian Government signalled an intention to reduce
or withhold services to homeland communities. The Minister for Families,
Community Services and Indigenous Affairs asserted:

The investment and effort will focus on remote Aboriginal communities or
towns that have access to education and health services. This will include many
small settlements. However, if people choose to move beyond the reach of
education and health services noting that they are free to do so, the
government’s investment package will not follow them. Let me be specific
– if a person wants to move to a homeland that precludes regular school
attendance, for example, I wouldn’t support it. If a person wants to move
away from health services, so be it – but don’t ask the taxpayer to
pay for a house to facilitate that
choice.^[70]

National policy does not determine formulae for health and education service
provision. These are determined by the states and territories. For example,
education provision in the Northern Territory is based on a student to teacher
ratio. A fully qualified teacher is provided when there are 22 attending
students aged between six to twelve years of age. Homeland communities are
usually serviced by larger ‘hub’ communities. The school at
Maningrida in the Northern Territory provides services to 12
‘satellite’ homeland communities and attracts a teacher formula
based on the total number of students attending in region. Teachers visit
homelands for varying numbers of days per week depending on the teacher
allocation that the homeland attracts under the formula.

At this stage there is insufficient detail to assess whether homelands and
other small communities will be disadvantaged as a result of the Australian
Government’s funding agreements. It will be through bilateral agreements
that the Australian Government will be able to link funds to preconditions as it
is doing with housing.

Shire councils to replace Indigenous community
councils

Alongside the land tenure reforms is the Australian Government’s plan
to reform the Indigenous local government system by rationalising the large
number of small local community councils and replacing them with larger regional
shire councils. The Australian Government has supported the Northern Territory
Government’s plan to reform its community councils and the Queensland
Government is finalising the transition to shire council arrangements.

Currently, across Australia remote communities are governed by local
governments or community councils that are based within each community. In the
Northern Territory for example, the Government developed a plan to replace its
56 remote Indigenous councils with nine shire councils. The four municipal
councils in Darwin, Palmerston, Alice Springs and Katherine will remain
unchanged. The Northern Territory Minister for Local Government argued that the
shire council model is designed to improve governance and service delivery to
remote communities.

Change will ensure people in the regions have access to the services and
experts many of us take for granted in the urban centres...The new local
government will create a framework of certainty and better and more reliable
services.^[71]

Queensland has commenced a four year transition process to transform
Aboriginal Councils into full Shire Councils. The stated intention of the
transition is to improve governance. The Shire and Island Councils will be
responsible to build, operate and maintain a range of infrastructure and to
assist in the delivery of
services.^[72]

The transition to shire councils is an effort to rationalise resources and
concentrate high level administrative expertise at the regional level. While
this may achieve efficiencies in terms of the cost of local government
administration it will also impact on Indigenous employment options in remote
communities. The removal of community councils, including community housing
associations will remove one of the few sources of remote employment.

As the lack of employment opportunity in remote communities is one of the
main impediments to economic development, governments must take care to balance
policy approaches. If rationalising housing services reduces employment, then
one saving will mean another cost. In order to benefit from any home ownership
incentives or policies, Indigenous Australians require employment.

Housing and home ownership

During 2005 and 2006 the Australian Government announced a number of
incentives to increase the rates of Indigenous home ownership and reduce
Indigenous dependence on subsidised housing in remote communities. During the
publicity that surrounded the initiatives, private home ownership was described
as a right for all Australians who can afford this goal. In 2005 the Prime
Minister had the following to say:

I’m a supporter of home ownership for everybody who can afford it, I
really am. And I don’t think there should be any distinction between
Indigenous people and the rest of the community. I think it’s patronising.
I think it’s discriminatory to take the view that somehow or other home
ownership is something for the white community but not for the Aboriginal
community...Now I’m not trying to undermine the Native Title Act but what
I’m saying is that where we can develop methods of private home ownership
within Indigenous communities, we should do
so.^[73]

Just over 7 percent of remote Indigenous Australians own, or have a mortgage
over a home. Australia-wide the rates of Indigenous home ownership are higher at
27 percent.^[74] Nevertheless,
Indigenous Australians fall well behind the 74 percent of non-Indigenous
Australians who are either buying or own their home outright.

The Australian Government’s remote housing strategy is part of a reform
package to encourage Indigenous Australians to embrace a culture of asset
accumulation and management with paid employment as its foundation. According to
the Government, land tenure reforms on communally owned land have been required
in order to make home ownership possible. The Attorney General's Department
along with the Department of Families, Community Services and Indigenous Affairs
(FaCSIA) and Indigenous Business Australia have collaborated in the home
ownership strategy. In fact initiatives for home ownership were released almost
simultaneously with the announcement of the proposed amendments to the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) in 2005. The
home ownership initiatives included:

• funding for Indigenous Business Australia (IBA) for the Community
  Homes program which will provide low cost houses for purchase at reduced
  interest rates in remote communities;
• an initial allocation from the Community Housing and Infrastructure
  Program to reward good renters with the opportunity to buy the community
  house they have been living in at a reduced price;
• using the Community Development Employment Projects (CDEP) program to
  start building houses, support home maintenance, and to maximise employment and
  training opportunities.^[75]
  

While the initiatives are described as ‘Australia-wide
measures’ they are exclusively available to states and territories if, or
when, they amend their land rights legislations to allow for 99 year leases. To
quote the Minister for Families, Community Services and Indigenous Affairs:

These programs will be available to all States that follow the Australian and
Northern Territory government’s lead to enable long term individual leases
on Aboriginal land... The Australian Government will consult with the States to
promote any necessary amendment of State Indigenous land rights regimes to
ensure access to the new
programs.^[76]

The Department of Families, Community Services and Indigenous Affairs has
committed over $100 million to increase remote home ownership from 2006 to 2010.
However the Northern Territory is the only jurisdiction in a position to access
this funding to date. Other states are beginning the process of reviewing their
land rights legislations and it is not certain whether they will include
provision for 99 year leases.

From 1 July 2006, the Australian Government is providing $52.9 million plus
capital of $54.6 million over four years for initiatives to promote Indigenous
home ownership on community title land.

The measure will assist Indigenous families living in communities on
Indigenous land to access affordable home loan finance, discounts on purchase
prices of houses, and money management training and
support.^[77]

The Australian Government has targeted its programs and incentives to a
select group of communities in the Northern Territory; Galiwinku, Tennant Creek,
Katherine and Nguiu.^[78] Forty five
new houses will be constructed for private purchase across Galiwinku and Nguiu.
Discounts of up to 20 percent on house purchase prices will be available in
other communities.^[79] The discounts
will be available to good renters and there is sufficient funding for up to 160
low interest home loans specifically targeted to
remote.^[80]

FaCSIA will also provide money management training and support to the four
Northern Territory communities and two Western Australian communities through a MoneyBusiness program. This program is a partnership with the ANZ Bank
and is designed ‘to develop skills in budgeting, bill paying and
saving.’^[81]

The incentives and announcements of 2005 and 2006 are likely to be a
precursor to broader reforms in Indigenous housing. In June 2006 the Minister
for Families, Community Services and Indigenous Affairs announced a
comprehensive audit of Australian Government and State and Territory Government
funding on public housing.^[82] Accompanying the announcement were numerous statements about the cost of
Indigenous housing and concerns about whether the states and territories were
adequately managing and contributing these programs. In 2006 the Government
released a discussion paper to raise potential directions for Indigenous
housing: Community Housing and Infrastructure Program (CHIP) Review Issues
Paper. The Best Way Forward: Delivering housing and Infrastructure to Indigenous
Australians (Hereon referred to as the Issues
Paper).^[83]

While the Review has not been released, the topics canvassed in the Issues
Paper foreshadow the areas of reform. They include the rights and
responsibilities of tenants, rent payments and collection, measures to increase
home ownership, improved access to mainstream public housing, and strategies to
avoid duplication of municipal services and
infrastructure.^[84]

The remote Indigenous housing profile

The dominant housing tenure for Indigenous people in very remote communities
is community rental housing. In 2001, 84 percent of all remote Indigenous
households were renters. Approximately seven percent of remote Indigenous
householders are home owners.^[85]

Community rental housing is built and maintained by governments. Over the
past 30 years, somewhere between 500 and 1,000 community rental houses have been
built each year in Indigenous communities across Australia. Once built, the
houses are vested in Indigenous community organisations for ongoing management
and the collection of rental payments. The medium weekly rental payment in very
remote regions is $42 per
household.^[86] Rents are either set
at per person or per household rate and are generally lower than rents in larger
townships and cities. Rental payments for community housing covers some of the
asset maintenance and other recurrent costs.

The provision of housing in remote communities is failing to meet the demands
of the growing Indigenous population. The problems are both with the number and
size of houses and the quality of the housing stock. In 2001, 41 percent of
remote Indigenous households reported problems with overcrowding. Fifty two
percent of the Indigenous remote population reported living in dwellings
requiring at least one extra bedroom, compared to 16 percent in non-remote
areas.^[87] Just over 58 percent of
remote Indigenous Australians reported major structural problems of their
dwellings at almost double the incidence of non-remote at 32.5 percent. The
Australian Bureau of Statistics summarised the problems in remote communities in
the following terms: ‘overcrowding and lack of adequate facilities such as
a clean water supply and sewerage disposal are particularly problematic in
remote areas.’^[88]

Indigenous housing programs and funding

The responsibility for Indigenous public and community housing is shared
between the Commonwealth and the states and territories. However, the Australian
Government is the main contributor of funding, providing 73 percent of total
funds, while states and territories contribute the remaining 27
percent.^[89] The annual contribution
of the Australian Government to Indigenous housing is more than $375 million. It
is clearly a large commitment and one which accounts for 30 percent of all
Australian Government spending on public and community
housing.^[90] The program through
which the funding in administered is the Community Housing and Infrastructure
Program (CHIP). In remote regions CHIP provides housing infrastructure and
funding to maintain essential municipal infrastructure and sanitation
infrastructure.^[91] Six hundred and
sixty Indigenous community-controlled housing organisations throughout Australia
manage funding for local infrastructure and maintenance as well as collecting
rental on Indigenous community houses. These entities provide employment for
Indigenous people in remote and regional communities, though it is likely that
these organisations will be rationalised into regional entities in the near
future.

The Indigenous Business Australia home loans program

In the 2006-07 Budget the Australian Government announced a $107.4 million
package over four years to develop home ownership opportunities on Indigenous
land. This funding will be used to build houses and to provide loans to
Indigenous people on communal lands where individual leases are possible. The
Australian Government’s remote home ownership program is managed through
Indigenous Business Australia’s (IBA) Community Homes program.

IBA will expand its home lending program, Community Homes... and will
manage and deliver incentives to assist in overcoming the barriers of the high
cost of housing, low employment and income levels in remote
areas.^[92]

According to Indigenous Business Australia the additional funds will expand
its home lending program, by supporting 460 families or individuals to purchase
their own home.^[93] Community
Homes will provide access to home loan finance in all states and territories
where land title enables an individual long term interest on a block of land.
IBA will work with the Department of Families, Community Services and Indigenous
Affairs (FaCSIA) to provide discounts on the purchase price of houses and
financial literacy training for eligible
participants.^[94] Incentives also
include purchase price discounts on existing community rental homes of up to 20
percent for Indigenous families with a good rental record. These incentives are
part of the Good Renter Scheme initiative.

The Community Homes scheme will offer loans to low income earners with
incomes starting from $15,000. Maximum repayments will vary according to income
level, starting at 15 percent of gross income for those on the minimum income
level and up to 30 percent of gross income for those on higher incomes. For
those on lower incomes, commencing interest rates on loans will start from zero
percent per annum incrementing by 0.2 percent each year up to the maximum rate
of 6 percent per annum. Grants for co-payments of up to $2,590 each year for the
first ten years will assist eligible low income borrowers to repay the loan
within a loan term of 30 years. IBA will pay up to $13,000 for loan
establishment costs including legal costs, surveys, property valuations,
independent legal and financial
advice.^[95]

Home buyers in Australia

Housing affordability is determined by many factors. In attempting to
determine whether remote Indigenous Australian will be able to benefit from the Community Homes scheme, it is necessary to consider employment
opportunities and earning capacity. A typical Australian home buyer for example,
is one who lives in a city and depends on an urban economy to generate work
opportunities and an income that will sustain a mortgage over a 30 year period.
First home buyers are typically couples aged approximately 35 years. They have a
life expectancy up to 78 years for males and 83 years for
females.^[96] They have above average
incomes and in Australia, a growing proportion of first home buyers have two
incomes. The majority of owner-occupier households reported gross weekly incomes
in the top two income brackets.^[97] This is an average weekly income of $612 to $869 or at the highest bracket $870
or more. The first home buyer relies heavily on debt finance and during 2004 and
2005 the average loan for first home buyers was $210,000. The average weekly
housing costs for first home buyers were
$330.^[98]

A domestic unit with an income of say $60,000 per annum may buy a dwelling
and land package for $240,000, and spend $15,000 per annum over anywhere between
the next 20 and 30 years in paying off this capital. In addition, such domestic
units undertake to meet the recurrent costs of housing maintenance, so that
their asset does not depreciate, as well as paying recurrent government taxes
and charges, such as annual land rates and infrastructure service fees. Covering
these capital and recurrent housing costs can consume as much as one-third or
more of income in these household economies, particularly in the early years
after entry to the market or when income falls through developments such as
child rearing or
unemployment.^[99]

The typical remote Indigenous household has an average gross weekly income of
$267 per week.^[100] The remote
Indigenous adult has a 36 percent chance of having a disability or a long term
illness which will affect income earning capacity and an average life expectancy
17 years lower than non-Indigenous
Australians.^[101] The life
expectancy for Indigenous males is 59 years and for Indigenous females, 65
years.^[102] These circumstances
limit the ability of Indigenous householders to service home loans over a 30
year period. According to the ABS, Indigenous adults are four times more likely
to report financial stress than non-Indigenous households. ‘Financial
stress’ was defined by whether the household could raise $2,000 within a
week in a time of crisis. Almost three quarters of remote Indigenous residents
reported experiencing financial stress as did half of those Indigenous
households in regional areas.^[103]

On a $150,000 loan the weekly repayments over 30 years at an interest rate at
3 percent is $145.37 per week. This is 54 percent of the average gross weekly
income of a typical remote Indigenous household. Even at an interest rate of 0.2
percent, the weekly repayments are $98.75. This is almost 37 percent of the
weekly income of a remote household. By any measure this level of repayment is
not sustainable. Given that Indigenous Business Australia will not lend amounts
where the repayments exceed 30 percent of the household income, it is evident
that the average remote Indigenous household is in no position to support a home
loan, with incentives or otherwise.

In its 1996 Evaluation of the Home Ownership Program, the Office of
Evaluation and Audit the observed that the ‘profile of the Indigenous home
owner is quite similar to non-Indigenous home owner in Australia.’ ^[104]

Compared to the non Indigenous home owner, the Indigenous home owner is
likely to be older and better educated, to have mainstream employment, higher
income, and a non-Indigenous spouse, and to belong to a ‘typical’
nuclear family in a neighbourhood with relatively lower rates of social
dysfunction. ^[105]

This profile of the Indigenous homeowner has not changed in the ten years
since this report. According to more recent ABS data, those who are capable of
home ownership exhibit many of the demographic characteristics of their
non-Indigenous counterparts including geographic location, employment status and
income level.^[106]

Remote Indigenous Australians are the most disadvantaged group of any
Australian group against every social indicator. The Government strategy to
address this situation is to increase the debt burden through a home ownership
scheme that will exclude the majority of remote Indigenous householders. While
the Government is offering financial incentives to encourage participation, it
is likely that owning a home in remote areas will be a financial liability
rather than an asset. The ongoing financial burden for all but a very small
minority of remote Indigenous Australians may exacerbate poverty in remote
communities and highlight disparities between the ‘haves’ and the
‘have nots.’ Notwithstanding, some Indigenous people in remote
communities might be able to afford to purchase a home and governments should
extend all support and encouragement to facilitate the home purchase.

Cost, quality and maintenance of Indigenous housing

In 2006, Indigenous Business Australia put out an Expressions of Interest paper calling for tenders for an ‘Innovative, Affordable Housing
Project.’ The winning tenders will ultimately provide the materials and
design for houses available under the Government’s home ownership scheme.
The functional brief for the ‘Innovative, Affordable Housing
Project’ includes three, four and five bedroom house types designed with
regard to culturally appropriate living arrangements, security from intrusion
and robustness of materials. The Expression of Interest paper specified
building code compliance with climatic zone categories including tropical,
subtropical, humid-arid, dry-arid, warm-temperate, cool-temperate, alpine and
cyclone ratings. Notwithstanding these aims, the Expression of Interest specified the following:

The single most important design parameter is cost effectiveness. If
solutions are not significantly more affordable than prior models, they will not
achieve the objective of the Project.

Skilled onsite labour is hoped to be kept to a minimum so ‘this may be
achieved by using...pre-fabricated modular building elements and avoiding the
use of materials and finishes which require on-site labour such as in-situ
concrete, plumbing, electrical work etc. The potential to use local labour to
assist with the erection of buildings is anticipated to reduce the end cost of
housing and provide much needed Indigenous employment in remote
communities.^[107]

The quality of the houses will be critical to the longevity of the asset and
the cost of maintaining it over time. The Australian Bureau of Statistics
outlined the following about Indigenous housing.

Although there are many factors which contribute to the sustainability of
housing, the adequacy of design, construction and maintenance of Indigenous
housing plays a crucial role. When houses are not culturally appropriate in
their design, are poorly built, or where there is no systematic approach to
their repair or maintenance, minor problems can escalate over time and shorten
the life expectancy of houses. Given the serious backlog of housing need in
rural and remote communities, it is important that resources are well targeted
and provide the maximum benefit to Indigenous
Australians.^[108]

There are indications that the houses proposed for the Government’s
home ownership scheme will not be of the quality that governments currently
provide. The new homes will be ‘self built’ kit homes that are to be
built at less than half of the cost of current Government housing cost in
remote. According to the Tiwi Local Government Housing for example, the cost of
a government built house on the Tiwi Islands is
$320,000.^[109] The kit homes
earmarked for the home ownership scheme have been costed ex-factory at
approximately $150,000 per
home.^[110] According to the
Government they are built to cyclone
code.^[111]

[Forty-five] new houses [are] earmarked for home ownership, which [are] to be
built on community land... as well as $6 million for innovative housing
solutions in remote indigenous communities... it is to look at using self-built
type housing construction as a means of more cost-effective housing design and
construction in remote communities... it is a reflection of concerns of the high
cost of building in very remote
communities.^[112]

Up to 12 of the proposed 45 houses will be available to residents in Nguiu on
the Tiwi Islands through a land reform program package and the remaining homes
are earmarked for Galiwinku on Elcho
Island.^[113] In an exchange in
Senate Estimates regarding the quality of the homes, the Associate Secretary of
the Department of Families, Community Services and Indigenous Affairs said the
following:

We know of kit homes that are being used... in other parts of Australia - the
Torres Strait for example - that are meeting all of the building requirements in
that area and are cyclone rated.

The Rawlinson’s Australian Construction Handbook 2006 is widely
used by industry and governments to cost infrastructure. It sets out the cost of
building residential housing per square metre in urban and remote regions of
Australia. In addition it provides comparative cost analyses of residential
housing in major cities compared with regional areas. For example, the cost of
building a house in a city such as Adelaide is the benchmark at 100 percent.
However according to Rawlinson, the cost of building the same house in Groote
Eylandt is 170 percent due to the freight of materials and the need to bring in
tradesmen. In Milikarpiti on the Tiwi Islands the cost is 154 percent. In dollar
terms the cost of building a150 sqm house in Adelaide is between $152,200 and
$161,200; in Milikarpiti between $226,196 and $239,336; and on Groote Eylandt
between $254,750 and
$270,050.^[114] Given the inflated
costs of remote infrastructure, it is difficult to see how governments will
manage to build houses of quality for $150,000. If the houses are of poor
quality, the maintenance and structural liability will be transferred to the
homeowner, most of whom have not had the opportunity of independent advice or
choice of design or construction materials.

The Australian Government has committed to building quality, healthy houses.
In 2005, the Minister for Immigration and Multicultural and Indigenous Affairs
introduced the Healthy Indigenous Housing policy aimed at improving the
viability and sustainability of Indigenous community housing organisations and
the quality of Indigenous housing in rural and remote
communities.^[115] The aim of the
initiative is to:

• improve the viability and sustainability of Indigenous community housing
  organisations and the quality of Indigenous housing;
• reform governance, asset and tenancy management practices; and
• continue a programme of assessing and repairing up to 500 houses in around
  15 communities and continue to deliver the Army Aboriginal Community Assistance
  Program (AACAP) to at least four
  communities.^[116]
  

Healthhabitat is a non-government organisation with
responsibility to improve the health standards of Indigenous housing in
Australia.^[117] Since 1999 it has
inspected over 4,500 houses situated in tropical, rural, remote and urban
settings. One of the three Directors of Healthhabitat, Mr Paul Pholeros
argues that 'reduced capital cost' housing has a great capacity to pass on
infrastructure and maintenance costs to the household through poor construction,
inappropriate design and poor materials. For example, a house without roof
insulation will be cheaper to build but the costs of cooling the house in a
45°c desert summer, or heating it at night in minus 5°c winter is
passed on to the household. These costs increase with remoteness as the cost of
electricity increases dramatically. The failure of households to pay the
electricity bills can then lead to the power being cut off which in turn makes
cooking and food storage exceptionally difficult. Thus, 'reduced capital cost'
housing has health implications as well as poor outcomes in terms of the house
life-cycle and maintenance
costs.^[118]

Mr Pholeros is in favour of strategies which seek to alleviate the Indigenous
housing crisis. He stresses this problem can not be solved by providing more
poor quality housing, merely because it is initially cheaper for governments.
New housing must reflect critical minimum standards in key areas such as
electrical safety, water supply and good quality taps to avoid leaks and
failures, hot water provision, waste removal with well installed drainage and
treatment of sewage. He cites examples of poor choice of materials in
communities reliant upon bore water and other areas with high levels of mineral
salts which quickly degrade taps and plumbing which may cost up to $2,000 a
visit in remote areas to repair a single
fault.^[119]

Maintenance of infrastructure in remote areas

Housing maintenance in remote Indigenous communities is expensive and access
to maintenance services is intermittent. Small communities often lack relevant
tradespeople, meaning that plumbers, electricians and others need to be flown in
to carry out routine maintenance. Given the structural problems with housing
stock, and extreme climatic conditions that characterise remote living in desert
communities and the tropical north, home maintenance requirements are high. For
example, between 2001 and 2002, over 80 percent of Indigenous communities with a
population in excess of 50 experienced interruptions to electricity provision.
Twenty percent experienced more than 20 interruptions over this period. Sixty
three percent of power outages were caused by storms, 59 percent occurred
because of equipment breakdown, 42 percent were planned outages for maintenance,
and 5 percent were due to system overload. Significantly, vandalism accounted
for one percent of all power outages.

Between 2001 and 2002, 48 percent of Indigenous communities experienced
sewerage system overflows or leakage. Rather than poor management or vandalism,
the predominant causes were blocked drains at 51 percent, equipment failure at
33 percent and design or installation problems at 28
percent.^[120]

These statistics affirm the claims of Indigenous people and their advocates
who observe that the poor quality and unsustainable design of remote
infrastructure is the cause of many of the maintenance problems. These figures
refute Australian Government claims that infrastructure is not respected and
poorly maintained because the asset is not
owned.^[121] This view was
expressed by the Prime Minister in a speech in October 2005 where he observed:

[O]ne of the reasons... [that the houses are in] appalling [condition] is
that people don’t own them. Simple as that... once you own something you
value it and you look after it, it’s human nature. That’s been the
experience of all societies... home ownership, private land ownership is a key
to family and social stability and Aboriginal people are no different from the
rest of us.^[122]

CDEP home building and maintenance scheme

In a policy announcement in October 2005, the then minister for Indigenous
Affairs announced the use of the Community Development Employment Projects
(CDEP) program to build houses, support home maintenance, and maximise
employment and training opportunities in support of the home ownership
scheme.^[123] To date there has
been no national data to outline the size or impact of this
initiative.^[124] As the Australian
Government has not yet collected or collated CDEP housing maintenance and
building data, it is only possible to assess progress by individual project.
Programs such as Alpurrurulam in the Northern
Territory,^[125] and the Torres
Strait Infrastructure
program,^[126] are involving small
numbers of CDEP recruits in manual labour and apprenticeship placements. The
planned housing construction program in Wadeye has also been designed to involve
CDEP participants in the assembly of kit
houses.^[127] The projects include
constructing roads and sewage systems as well as apprenticeship programs geared
toward community infrastructure support and maintenance.

Ultimately the quality of the housing construction will impact on the life of
the asset and the cost of its maintenance. It will be essential that the highest
standards are applied to the development of any asset targeted for the
Indigenous home ownership scheme. At this stage the Australian Government is not
monitoring the development of the CDEP house building and maintenance scheme and
therefore there are some serious concerns about coordination and quality
control.^[128]

Australian
housing markets

While not an immediate issue for the remote housing market, wider trends in
property prices in Australia will be relevant in the future. The escalating
housing market in Australia provides increasing financial impediments for
potential home buyers in many Australian cities and coastal areas. In 2006,
Australia’s home affordability fell to a level comparable to that reached
in 1989 when interest rates were at 17
percent.^[129] While interest rates
are now at 7.55 percent, it is the increase in the cost of houses as well as
taxes that have moved property out of the reach of many. In fact, by
international standards, Australia has a dismal rating in housing affordability.
According to the 2007 Annual Demographia Survey, every Australian city is
rated as ‘seriously’ or ‘severely’ unaffordable in a
global study of 159 cities.^[130]

The Demographia survey rates housing ‘unaffordable’ when the
median house price passes three times median household incomes. Housing is
‘seriously unaffordable’ when it passes four times median household
incomes and ‘severely unaffordable’ when it passes five times median
household incomes.^[131]

After Western Australia, the Northern Territory property market had the most
rapid growth during 2006. Property prices in Darwin increased by 17.6
percent.^[132] The median house
price in Darwin is now $344,
000.^[133] Interstate investors
have been the main contributors to the rising house prices in Darwin. In recent
years, investors have moved their attention from the flattened markets of the
eastern states of Melbourne, Sydney and Brisbane to more remote markets like
Darwin.

The real concern for prospective Indigenous home buyers is that investors
will buy in their remote communities in search of new markets with capital
growth. While desert communities are never likely to tempt the investor, remote
coastal townships may be attractive given that Australian coastal real estate
prices have escalated over past decades. A township like Nguiu in the Tiwi
Islands for example, has potential appeal because it is located in an idyllic
setting and it offers recreational activities such as fishing in pristine
waters.

The property market trends are ominous for low income earners in remote
regions. There is a real risk that the Government’s home ownership
strategy will create property markets that will exclude the very people they
have been designed to benefit. Even with incentives and low price houses, the
cost of housing and the increases in the market will make home ownership very
difficult for the majority of remote Indigenous Australians. We may see a
situation where non-Indigenous investors and sea-changers buy the absolute
waterfront blocks of the many coastal townships where 99 year leases are
available. Over successive generations, low income Indigenous families may be
relegated to the cheaper back blocks. Should some remote property markets move
in the same ways as they have across Australia, the Government scheme will be
encouraging the most disadvantaged Australians into a property market that is
one of the most impenetrable markets in the world.

There is great potential for non-Indigenous Australians to benefit from the
Government’s long-lease tenures on communal land. Non-Indigenous investors
and home buyers will be able to move into emerging remote markets with relative
financial ease. This will add additional pressure to the cost of housing for the
Indigenous residents as markets are established and prices become competitive.
The most probable consequence of the Government’s strategy is that remote
Indigenous Australians will be further marginalised in their own communities.

Summary of concerns and challenges regarding remote Indigenous
housing

The Australian Government’s home ownership policy is poor policy for
the following reasons. First, it is not based on an evaluated approach. Rather,
the policy is contrary to evaluations of international models which show that
similar individual land tenure approaches were seriously flawed and led to a
loss of communal lands. Second, the home ownership incentives are poorly
targeted and will not be accessible to the vast majority of remote Indigenous
Australians for whom the policy is intended. Over time, in some regions housing
markets will become increasingly inaccessible and Indigenous people with incomes
on the margins will miss out. Third, it is more likely that non-Indigenous
people will be the main beneficiaries emerging markets in remote communities.

If these are the consequences of the home ownership policy, then the
Government strategy will further entrench Indigenous disadvantage and become
another policy failure in the litany of failures that the Secretary of the
Department of the Prime Minister and Cabinet so eloquently
describes.^[134]

The Australian Government and others will continue to argue that remote
Indigenous Australians should not be prevented from purchasing their own homes
in the same way as the majority of other Australians can purchase a home. In
principle, this is correct. However it is not useful to consider home ownership
as a right. It is not a right when the vast majority of Indigenous people in
remote communities are not in a financial position to achieve this goal. By
international human rights standards, adequate housing is a
right.^[135] It is essential
therefore that governments support this right and ensure that adequate funding
is maintained in community and public housing programs.

As I argued in last year’s Native Title Report 2005, if
Indigenous Australians and others want to purchase homes on communal lands they
can already do so without changes to land
tenures.^[136] There are existing
leasing options to accommodate home ownership that do not require Indigenous
land owners to sign their lands over to governments. In addition, some
Indigenous councils are aiming to mange their own lease tenures and home
ownership programs while maintaining decision-making control over developments
on communal lands. The Yarrabah Housing Project case study at Chapter 7 of this
Report describes this model.

Governments can best assist Indigenous people to be home owners by investing
in their personal and skills development, by developing an ethos of responsible
personal finance management, by discussing the virtues of home ownership over an
extended period of time and by focusing incentives on responsible renting.
Through such initiatives and over time, more Indigenous Australians will be
financially able and better placed to make an informed decision to purchase a
home.

Indigenous employment

The current labour force participation rates, occupations and locations of
Indigenous Australians demonstrate the potential challenges of the remote
economic reform agenda. Access to sustainable employment will be essential for
remote Indigenous Australians who are keen to participate in the home ownership
scheme.

As a proportion of the population, Indigenous Australians are represented at
a much higher rate in very remote regions of Australia than in any other region.
The remoteness means that Indigenous Australians are dependant on smaller
economies for employment, government services and life opportunities. Economies
of scale dictate that opportunities in remote areas are not as abundant as those
routinely available to urban citizens. Almost 70 percent of Indigenous
Australians live outside the major urban centres and almost 18 percent live in
very remote regions of Australia. Chart 15 shows the proportions of the
population by region. In very remote areas, Indigenous people are 45.4 percent
of the population, while they are only 1.1 percent of the urban
population.^[137]

CHART 15: INDIGENOUS AND NON-INDIGENOUS POPULATION DISTRIBUTION BY
REMOTENESS CATEGORY, 2001

	Non-Indigenous	Indigenous	Indigenous % of total
Major city	12,732,492	138,494	1.1
Inner regional	3,932,907	92,988	2.3
Outer regional	1,907,688	105,875	5.3
Remote	284,160	40,161	12.4
Very remote	97,473	81,002	45.4
Total	18,954,720	458,520	2.4

Source: Australian Bureau of Statistics (ABS) 2003a

Across Australia the employment rates for Indigenous people aged 15 years and
over are 42.7 percent, and much lower than for non-Indigenous people who are
employed at almost 64
percent.^[138] The ABS includes in
its ‘employed’ data category, Indigenous people who are
participating in the work for the dole scheme; the Community Development
Employment Program (CDEP). This means that the real employment rates for
Indigenous people are lower than the figures suggest. CDEP employs approximately
28 percent of remote Indigenous people compared with 3.6 percent in non-remote
areas, so it is remote regions where Indigenous employment rates are most likely
to be inflated. Nevertheless, Chart 16 demonstrates that Indigenous people in
remote regions are less likely to be employed in full-time work than Indigenous
people in non-remote areas. It should also be noted that most government funded
projects that generate employment opportunities are funded on an annual basis
and are submission based projects.

CHART 16: INDIGENOUS AND NON-INDIGENOUS LABOUR MARKET PARTICIPATION AS A
PERCENTAGE OF THE POPULATION, 2002

	Indigenous				Non-Indigenous
	Remote	Non-Remote	Total		Total
Full-time Employed	18.9*	25.3*	23.6*	Full-time Employed	45.2
Part-time employed	28.8*	15.4*	19*	Part-time employed	18.3
Total Employed	47.9*	40.8*	42.7*	Total Employed	63.5
Unemployed	4.4	11.3	9.4	Unemployed	3.7
Not in labour force	47.8	47.9	47.9	Not in labour force	32.8

Source: Australian Bureau of Statistics, National Aboriginal and Torres
Strait Islander Social Survey, 2002

*This data includes people
employed through CDEP

An important factor contributing to low employment rates is the lack of
employment opportunity in regional and remote regions where 70 percent of
Indigenous Australians are
located.^[139] The
Government’s 2006 policy to put a 12 month limit on CDEP participation in
regional and urban areas is likely to inflate unemployment rates in the
future.^[140] Chart 17 identifies
the sources of income for Indigenous people by their location. Indigenous people
in remote and non-remote locations are most likely to source their income from a
government pension or allowance. Indigenous people in remote areas were less
likely to be in waged employment than people in regional and urban areas.
Participation rates in CDEP were highest in remote locations.

CHART 17: SOURCE OF INCOME FOR INDIGENOUS PEOPLE AGED OVER 15 YEARS BY
REMOTENESS AS A PERCENTAGE OF THE INDIGENOUS POPULATION 2002



Source: Australian Bureau of Statistics, 4714.0, National
Aboriginal and Torres Strait Islander Social Survey, 2002

Occupation

In 2001 the most common occupation for Indigenous people Australia-wide was
labouring work. Rates of Indigenous labourers increased with remoteness.

The main occupation group for employed Indigenous persons was Labourers and
Related Workers (24%) while the main occupation group for non-Indigenous persons
was Professionals (18%). A relatively high proportion of both Indigenous and
non-Indigenous persons were employed as Intermediate Clerical, Sales and Service
Workers (18% and 16%, respectively).

The proportion of employed Indigenous persons working as Labourers and
Related Workers rose markedly with increasing geographic remoteness from about
one in ten (11%) in major cities to about one in two (47%) in very remote
areas.^[141]

In 2001 the private sector was the employer of 55 percent of all employed
Indigenous Australians. In comparison, the private sector was the employer of 82
percent of non-Indigenous
people.^[142] This finding is
significant in the light of the Government’s argument that a private
sector market economy will provide real employment to Indigenous people. To
date, the private sector has not been a strong employer of Indigenous people. If
these employment trends are replicated on Indigenous land, it is unlikely that
Indigenous Australians will be major beneficiaries of a remote market economy.

Collectively, the labour market data demonstrates poorer outcomes for
Indigenous Australians against all indicators. If remote Indigenous Australians
are put in a position where they have to compete with non-Indigenous people for
employment, it is almost inevitable that there will be an increase in levels of
Indigenous employment disadvantage. In recognition of this disadvantage, the
Minerals Council of Australia (hereon referred to as the MCA) is working with
the mining industry sector to ensure employment quotas for Indigenous
Australians through Indigenous Land Use Agreements under the native title
regime. The case studies of the MCA Memorandum of Understanding and the Argyle
Agreement at Chapters 3 and 5 of this Report outline industry-based Indigenous
employment initiatives in more detail. Similar interventions are required in
remote communities without mines. Without these interventions, Indigenous people
will fall further behind non-Indigenous Australians. Unfortunately, under the
Government’s intended reforms, such interventions are unlikely.
Interventions such as these would be contrary to the Government’s
intention to create market economies to replace the interventions of welfare
economies and CDEP.

Programs supporting Indigenous enterprise and economic
development

In order to support and stimulate economic development on Indigenous land,
the Australian Government has developed a range of programs that provide funding
and resources to Indigenous organisations and individuals. The programs are
based on a self-access model requiring applicants to undertake tasks such as
developing business plans and applying for start up funds. Program funding is
available through Australian government departments and statutory authorities
including the Indigenous Land Corporation and Indigenous Business Australia. The
programs cover a wide range of areas including home ownership schemes, business
development schemes, employment programs, governance training, finance programs,
financial management programs, loan schemes, and joint venture projects.

In order to assess the take-up rates and expenditure on national Indigenous
economic development programs, I surveyed government agencies and statutory
authorities with responsibility to administer national programs during the 2005
– 2006 financial year. Nine entities provided data on 33 national
programs. Funding entities provided information about the
following:^[143]

• the aims of the program;
• the number and type of indigenous entities applying for funding;
• the number of successful applicants;
• the reasons for unsuccessful applications;
• the category of applicant by organisation type;
• total budget allocation for program; and
• total expenditure for the program.
  

Survey Findings

The survey responses from Australian Government Departments and statutory
authorities demonstrate that there are a good range of economic development
programs available to Indigenous Australians. The programs fall under the
following categories:

• industry and business development;
• land management, heritage protection and the environment;
• employment;
• land acquisition;
• community infrastructure; and
• capacity building.
  

The aims and targets of the programs demonstrate good strategic
alignment with the objectives of the Australian Government’s Indigenous
Economic Development Strategy. According to the survey data, during 2005
– 2006 the total annual expenditure across all programs was in excess of
$246,503,887. Detailed survey responses for each program are provided at
Appendix 2 of this Report.

Industry and Business Development

Four government departments and one statutory authority provided funding
towards ten programs for Industry and Business Development during 2005
– 2006. Providers of program funding include:

• the Department of Employment and Workplace Relations (DEWR);
• the Department of Agriculture, Fisheries and Forestry (DAFF);
• the Department of Industry, Tourism and Resources (DITR);
• the Department of Communication, Information Technology and the Arts
  (DCITA); and
• Indigenous Business Australia (IBA).
  

The ten programs provided funding and support for Indigenous
business development, Indigenous business support, development projects on
Indigenous land, advice and training on ways to improve returns from trusts and
investments, and programs to support home
ownership.^[144] It is not possible
to provide an accurate total expenditure under the category of Industry and
Business Development because DEWR could not disaggregate funding data across
their various programs.^[145] DAFF
were unable to provide any funding data for programs relevant to this category.
Aggregated expenditure under Industry and Business Development which
includes DCITA, DITR and Indigenous Business Australia in the 2005-2006
financial year was $78,999,570.

Land Management, Heritage Protection and the Environment

Three government departments provide funding towards five programs
specifically related to Land Management, Heritage Protection and the
Environment. They include the Department of the Environment and Heritage;
the Department of Agriculture, Fisheries and Forestry; and the Indigenous Land
Corporation. The programs are all directed to improved heritage and conservation
outcomes and improved land management. In the 2005-2006 financial year a total
expenditure in excess of $17,894,248 was allocated to Indigenous program
applicants.^[146]



Employment

The Department of Employment and Workplace Relations administers all six
programs related to Indigenous employment. All programs aim to address the
particular disadvantage of Indigenous Australians in the labour market, and
stimulate Indigenous economic activity through employment
opportunities.^[147] Individual
program expenditure was not provided by DEWR for employment programs.

Land Acquisition

The Indigenous Land Corporation administers the funding related to land
acquisition. The programs include the Environment Acquisition Program, the
Cultural Acquisition Program, the Social Acquisition Program, and Economic
Acquisition Program. In the 2005-2006 financial year a total of $7,934,024 was
expended on land acquisitions.

Community Infrastructure

The Department of Families, Community Services and Indigenous Affairs, and
the Department of Communications, Information Technology and the Arts provide
funding for five programs specifically related to access to, and improvement of
community infrastructure. In the 2005-2006 financial year in excess of
$31,483,097 was allocated to Indigenous program
applicants.^[148]

Capacity Building

The Department of Transport and Regional Services, and the Department of the
Environment and Heritage provide funding towards six programs specifically
related to capacity building.^[149] These programs contribute to the development of self-reliant communities through
partnerships with other governments, communities and the private sector. In the
2005-2006 financial year a total of $32,482,948 was allocated to Indigenous
program applicants.

Applications for program funds

In excess of 1,544 funding applications were submitted for the 33 economic
development programs and 1,109 were successful. While this is a 72 percent
success rate, 414 of these applications were not successful.

Five of the nine entities were able to provide data specifying which
categories of Indigenous organisation were successful in their funding
applications.^[150] The following
is collated data by Indigenous group type:

• Aboriginal Shire/Community Councils were successful in 529 of their 752
  applications across seven programs;
• Community Corporations were successful in 227 of their 334 applications
  across nine programs;
• Native Title Representative Bodies were successful in 20 applications across
  six programs. Data regarding success rates was
  inconclusive;^[151]
• Land Councils were successful in 78 of their 98 applications across eight
  programs;
• Prescribed Bodies Corporate were successful in 77 applications across four
  programs. Data regarding success rates was inconclusive;
  and^[152]
• individual traditional owner groups submitted 38 applications across five
  programs. Data regarding success rates is
  inconclusive.^[153]
  

Given that only five entities could identify their funding
recipients by organisation type, I was unable to make any overarching assessment
of the relative capacity of Indigenous organisational types. It would be
beneficial for the Australian Government to conduct an audit of all 33 national
programs and collate the data to determine which Indigenous organisational types
are accessing programs. This information will determine whether there is
equitable distribution of economic development funding and support across the
Australian Government economic development strategy. Given that the programs
provide targeted funding to redress disadvantage, it is important to be able to
assess the overall efficiency and effectiveness of the strategy to see whether
it is achieving its intended objectives.

Without data provided across all departments it is difficult to:

• assess the priority areas for funding;
• determine which organisations are applying for categories of funding;
• determine which organisations require more intensive assistance with the
  preparation of funding applications; and
• determine whether there are regional variations in funding applications.
  

The nine entities were asked to specify the most common reasons for
unsuccessful funding applications. Almost without exception across the 33
programs, the reason for unsuccessful applications included:

• failure to adequately address selection criteria; and
• incomplete applications.
  

To ensure that all Indigenous organisations can be competitive in
the application process, targeted assistance in the form of workshops, plain
English guides, application templates and training in the preparation of
applications is required. While ultimately the availability of program funding
provides equality of opportunity, it may not lead to equality of outcomes.
Governments need to be sure that communities with the greatest need for
resources have the appropriate support to access available program funding.
Reliable data will permit governments to assess the barriers that exclude some
Indigenous groups from obtaining program funding.

Agreements and economic development

The Indigenous Land Use Agreements of the native title regime and the
Australian Government’s Shared Responsibility Agreements both provide
opportunity for Indigenous Australians to leverage or enhance economic activity
on Indigenous land.

Indigenous Land Use Agreements

Indigenous Land Use Agreements (hereon referred to as ILUAs) provide one of
the only ways in which the native title regime provides opportunity for economic
development outcomes for traditional owners. An ILUA is an agreement through
which native title holders negotiate and agree to terms and conditions that may
include economic and employment opportunities. ILUAs can be negotiated under the
following subject categories:

• access;
• co-management;
• community living area;
• consultation protocol;
• development;
• extinguishment;
• government;
• infrastructure;
• mining;
• petroleum/gas; and
• pipeline.
  

When registered, Indigenous Land Use Agreements bind all parties
including the native title claimants or holders to the terms of the agreement.
Some of the economic development provisions contained in ILUAs include provision
for education and training, scholarship positions, compensation payments to
Indigenous trusts, employment opportunities and quotas, and freehold land in
exchange for extinguishment of native title rights. Each ILUA contains different
provisions depending on the nature of the agreements and the resources,
interests and capacity of the signatory parties. During the 2005 – 2006
financial year, a total of 68 ILUAs were registered in Australia. This
represents a significant escalation in the overall number of ILUAs. By June 2006
there were a grand total of 250 registered ILUAs since they were first
introduced in 1998.^[154]

ILUAs are usually initiated when governments, industry or other interests
require access to the land or use of the land to progress economic and
development plans. This means that the land either holds precious subsurface
resources or it is located in an area where governments or industry plan to
develop infrastructure such as gas pipelines. In many areas of Australia,
particularly the desert regions, there are limited opportunities for traditional
owners to leverage economic outcomes through ILUAs. Where there are no mineral
riches and no plans for future development there are very limited opportunities
for ILUA agreements.

In addition, not all ILUAs are lucrative or beneficial for traditional
owners. Recent research by Griffith University has found that although about a
quarter of Indigenous Land Use Agreements are delivering substantial outcomes to
Aboriginal people in Australia's major resource regions, half have little by way
of substantial benefit, and a quarter should never have been signed. Professor
O'faircheallaigh from Griffith University recommended that better negotiated
outcomes could be obtained for Indigenous groups through organised approaches
that identify traditional owner
aspirations.^[155]

Detailed discussion regarding economic development possibilities and
challenges of ILUAs is contained in the case studies of this Report,
specifically the Argyle Participation Agreement and the South Australian
State-wide ILUA framework.

Shared Responsibility Agreements

Shared Responsibility Agreements (hereon referred to as SRAs), are agreements
between governments and Indigenous communities for services and resources in
regional and remote Australia. They are based on the principle of mutual
obligation. The Australian Government provides a service or a resource in
exchange for input or mutual obligation from the community. This might include
the commitment of community funds, or the achievement of certain targets in
improved education, employment or health outcomes. SRAs are increasingly being
used to address service and infrastructure requirements in communities.
According to the Office of Indigenous Policy Coordination, SRAs mean that:

Communities... take responsibility for determining their own priorities for
change and to work out what they can contribute to making things better. This
contribution could involve using community assets, such as a community centre,
upgraded sports facility or tourism business; or it could be a commitment to
invest time and energy towards
outcomes.^[156]

SRAs can be coordinated in a way that enhances or creates the preconditions
for enterprise and economic development on Indigenous land. For example, SRAs
can be used to specify capital improvements or targeted training that supports
economic activity. An SRA can be a small or a large agreement and it can be
initiated by traditional owners or community members. SRAs can also be linked to
other agreements such as ILUAs. It is the view of the President of the National
Native Title Tribunal, that although there are legislative rules about the
criteria for registration and the purpose of an ILUA, there is scope for SRAs
and Regional Partnership Agreements to support mutual
outcomes.^[157]

Land is a significant issue for Indigenous communities, and the Tribunal
strongly supports Indigenous communities making best use of available
agreement-making options, and better integrating agreements about native title
and other forms of Indigenous agreements. The Tribunal can see no reason why
negotiations relating to native title can not be run in parallel with
negotiations of other forms of Indigenous agreements, and would encourage a
situation where all relevant stakeholders are brought to one table to address
issues relevant to the community in a coordinated
approach.^[158]

Currently there is only one SRA that directly complements an Indigenous Land
Use Agreement.^[159] Traditional
owners of the East Kimberley area have entered a Shared Responsibility Agreement
with the Australian Government to develop an education and training fund. The
traditional owners dedicate funds obtained from the ILUA and the government has
matched the funds through an SRA agreement. This is a good example of the use of
one agreement to leverage another for strategic community development.

For more detailed analysis of the Shared Responsibility Agreements please see
Chapter 3 of my Social Justice Report
2006.^[160]

Assessment of the self-access model for Indigenous economic
development

While the self-access model provides for equality of opportunity, it will not
necessarily lead to equality of outcomes where there are glaring disparities
between the capacity and contexts of Indigenous communities. The current
Australian Government strategy of 99 year leases and home ownership will not
assist remote, desert communities where there has been limited history of
development. Businesses and residents are unlikely to move into these areas. In
places where the land is marginal and there is no mining activity and no history
of enterprise development, targeted government assistance will be necessary to
support models of Indigenous governance and the development of entities with
business expertise.

The remote regions we represent essentially have no economic development
whatsoever. Most people accept that economic development and security is
essential for a sustainable
future.^[161]

Governance structures and business experience are essential components of any
business venture. Creating a successful business in the Australian marketplace
is difficult by any measure. The Australian Productivity Commission identified
that between 7 and 8 percent of all small businesses in Australia fail within
their first year of
operation.^[162]

In resource rich regions like Eastern Arnhem Land, the Pilbara and parts of
the Queensland Cape York region, mining activity has involved Indigenous leaders
in business planning, negotiation and enterprise opportunities. The resultant
agreements with mining companies have created governance models and in some
instances, increased financial and business literacy amongst the Indigenous
community. As a result, entities have been developed with a specific mandate to
increase economic development activity on behalf of the Indigenous people of the
region.

The Gurang Land Council (Aboriginal Corporation) GLC(AC) region is a resource
rich area and is seen as a prime area that will be targeted for opportunities by
mining and exploration companies for years to come... Currently, within the
GLC(AC) region, there are approximately 8 more ILUAs in the negotiation or
registration stage. These agreements concern mining, state government tenure
resolution, infrastructure, access and a
pipeline.^[163]

Across remote Australia, there are few established entities with any capacity
or mandate to engage with the Australian Government’s self access model of
economic development. The Australian Government Indigenous Coordination
Centres (hereon referred to as ICCs) have a role to coordinate government
services and negotiate Shared Responsibility Agreements in the 30 Australian
regions where they are located. ICCs accommodate ‘Solution Brokers’
who are personnel with responsibility to implement ‘employment,
participation, training and enterprise opportunities for Indigenous Australians
in their ICC region.’^[164] With such a broad ambit of responsibility over large regions, economic
development outcomes are likely to be some way off, if they are to be possible
at all. Governance and representative structures will be a precondition for ICCs
to support economic development on behalf of the Indigenous people within each
region. To this end, the Australian Government has announced that it is
currently consulting with Indigenous people to decide on local representative
networks.

The networks will be different in each area. They may be set up at a number
of levels—regions, communities, groups of organisations, clans or
families. It depends on what is suitable in any one area, and what local people
want.^[165]

Native title entities are unable to proactively support or initiate economic
development. A lack of funding and prescriptive guidelines limit the capacity of
Prescribed Bodies Corporate and Native Title Representative Bodies respectively.
Neither group is in a position to initiate nor support economic development
because both entities are limited by funding linked to functions of the Native Title Act 1993 (Cth). The Office of Indigenous Policy Coordination
(hereon the OIPC) outlined the following parameters for funding.

Funding to Native Title Representative Bodies (NTRBs) under the Native Title
Program (NTP) is not formula driven. Within the constraints of the funding
available within the NTP ($55.1M in 2006-07 financial year), funding to
individual NTRBs is determined on the basis of Operational Plans developed by
NTRBs that identify and cost prioritised native title activities to be
progressed in the funding year. Funding is also provided to meet the operational
overheads associated with implementing and delivering the funded Operational
Plans. It is open to NTRBs to seek additional funding to meet unforseen native
title matters during the course of the funding year and to seek variations to
Operation Plans to meet emerging and changed
priorities.^[166]

The Operational Plans of NTRBs are based on activity prescribed under
Division 3 s203B of the Native Title Act 1993 (Cth). These activities
include facilitation and assistance, certification, notification, agreement
making and internal review
functions.^[167] NTRBs have reported in numerous forums and submissions that they are under
funded to perform their statutory obligations. This precludes these bodies from
providing support for economic development that is not strictly within
agreements and processes associated with native
title.^[168]

It is difficult to assess the capacity of land councils to engage in economic
development activity. The land council respondents to the 2006 national survey
of traditional owners provided mixed responses about their relative
capacities.^[169] In the Northern
Territory it is likely that land councils will have limited capacity since the
amendments to the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) in 2006. The new provisions under s64 of the Aboriginal Land Rights
(Northern Territory) Act 1976 (Cth) provide a revised funding formula that
will dramatically limit discretionary funds for activity such as enterprise and
economic development.

Ultimately, the capacity for Indigenous Australians to engage in economic
development should not be left to chance. Remote Indigenous communities require
good governance and business expertise to access program funding and to develop
economic development agreements. For communities without independent sources of
capital, the development of representative entities will not be possible without
bilateral assistance from governments. Significant efforts and interventions
will be required to establish governance and economic development capacity in
remote communities.

Conclusion

Good policy is based on trialled and evaluated approaches that provide
assessments of the relative advantages and disadvantages of policy impacts and
outcomes. Good policy benefits the greatest number of the target group for whom
it is intended. The Australian Government reform agenda is not based on an
evaluated approach or from trials within Australia or overseas. In fact the
international experience of individualising land title the United States, New
Zealand and Africa in past decades has led to poor outcomes for Indigenous
people including the loss of land and few economic benefits if any. These
countries are reversing land reform approaches that individualise title.

The Government’s reforms radically recast the meaning and intention of
land rights and the implementation of the reforms during 2005 and 2006 have
individually and collectively reduced the capacity of Indigenous Australians to
have decision-making control over land and administrative affairs. Some of the
reforms will have far reaching implications that will last beyond any political
term and any lifetime of the politicians and the people on whom it will impact.
It is therefore imperative that the Australian Government ensure the highest
threshold of Indigenous participation and consent for any initiative that will
remove the authority of traditional owners to make decisions over traditional
lands and seas.

In accordance with Article 1 of the Declaration on the Right to
Development, Indigenous peoples (like every other person, and all peoples)
are entitled to participate in, contribute to, and enjoy economic, social,
cultural and political development. It is imperative that those most affected by
policy are included as active participants in the process of negotiating and
deciding upon the economic and social policies that will impact on their
communities. Indigenous stakeholders require control of the development goals
and agendas for economic development especially because the ultimate success of
these goals is dependent on our active participation. Crucial to the successful
implementation of the right to development for Indigenous people is the
Government’s obligation to ensure that its policies, legislations and
practices make provision for the following:

• the right to self-determination;
• the right to protection of culture;
• economic, social and cultural rights;
• free, prior and informed consent; and
• equality.
  

Findings

2.1 The Australian Government has begun a process of implementing reforms to
Indigenous communal lands that have the potential to radically change the nature
of Indigenous communities on these lands.

2.2 The Australian Government’s economic reform agenda on Indigenous
land will be evaluated by successive COAG reports.

2.3 The marginal nature of the majority of Indigenous land and the
legislative restrictions on the resources and the rights of Indigenous tenures,
severely limit capacity for economic development.

2.4 The majority of Indigenous communities are located in desert areas where
there is limited or no development potential. A minority of Indigenous
communities are located in resource-rich areas with well-developed governance
structures, experience in negotiating agreements, and capacity to leverage
economic opportunities. This means that Indigenous communities have vastly
different contexts and capacities and therefore require different forms of
support.

2.5 The Australian Government has rejected proposals by Indigenous
communities who have put up alternative models to the Government’s 99 year
headlease model.

2.6 International evidence demonstrates that individualising lease tenures on
communal lands such as those proposed under section 19 of the Aboriginal Land
Rights (Northern Territory) Act 1976 (Cth) [99 year headleases] leads to a
loss of communal lands, and few, if any, economic benefits.

2.7 The Australian Government has signaled an intention to reduce services
to homeland communities.

2.8 The home ownership scheme administered by Indigenous Business Australia
and central to the Australian Government’s economic development strategy
is outside the financial reach of the majority of remote Indigenous households.

2.9 The Australian Government has emphasised ‘cost effectiveness’
as the most important criteria for the provision of homes for purchase under the
home ownership scheme.

2.10 Indigenous houses in remote locations have high maintenance requirements
due to construction problems, poor choice of building materials and extreme
weather conditions.

2.11 Australian housing markets are escalating and investors are increasingly
looking to remote markets for capital growth.

2.12 The private sector is not a reliable, proven employer of Indigenous
Australians.

2.13 There are a wide range of economic development programs that are
targeted to Indigenous people, but there is differential capacity for Indigenous
Australians to obtain any benefit from a self access model.

2.14 The capacity of Indigenous people to leverage opportunities from ILUA
and SRA agreements is largely dependent on the existence of strong local
governance and entities with capacity to progress economic outcomes.

Recommendations

The following recommendations outline approaches to economic development on
Indigenous land that:

• emphasise Indigenous participation in the development of policy;
• provide high thresholds for obtaining Indigenous consent to economic
  development strategies, initiatives and agreements; and
• emphasise policy approaches that are supported by reliable research, trial
  processes and on-going evaluation.
  

Recommendation 2.1:

That the Australian Government support a range of land leasing options on
communal land including options where leases are held by traditional owners
through their elected entities for varying periods of time. That the Community Homes program be extended to communities with alternative lease
schemes where the lease period is commensurate with the maximum loan repayment
period.

Recommendation 2.2:

That all land leasing options on communal land be rigorously and
progressively monitored and evaluated and that evaluative research be utilised
to inform existing and future lease options.

Recommendation 2.3:

That the Australian Government provide evidence of models where individual
tenure rights have led to improved economic outcomes for indigenous peoples
living on communal lands.

Recommendation 2.4:

Governments legislate to ensure that consent and authorisation processes for
99 year leases are consistent with those required by sections 203BE(5) and
251(A) of the Native Title Act 1993 for authorising Indigenous Land Use
Agreements.

Recommendation 2.5:

That the Australian Government remove section 64(4A) from the Aboriginal
Land Rights (Northern Territory) Act 1976 (Cth).

Recommendation 2.6:

That governments ensure employment contingencies or re-deployment training
for Indigenous employees who become unemployed as a result of the transition
from community administration to a shire council model.

Recommendation 2.7:

In recognition of the continuing disadvantage of remote Indigenous
Australians, that governments commit to providing subsidised, quality community
housing and public housing according to need, and that no funds from existing
rental housing schemes be redistributed to home ownership schemes.

Recommendation 2.8:

That houses constructed under the home ownership scheme be of the highest
quality and that regulations be developed to government guarantee liability and
indemnify home owners for agreed periods against structural flaws in the house
and the associated infrastructure.

Recommendation 2.9:

That the Australian Government develop a planned, supervised and strategic
approach to train CDEP employees working on the house building and maintenance
program to ensure adherence to the highest industry construction standards. That
the Government maintain national data on the program and that CDEP employees be
provided with award wage employment once they have completed the training.

Recommendation 2.10:

That the Australian Government direct ICCs to work with Indigenous land
entities (including representative bodies) to strategically link Shared
Responsibility Agreements to land agreements in ways that will increase economic
development projects and opportunities.

Recommendation 2.11:

That governments provide bilateral support to fund and develop regional
Indigenous governance structures that are attached to entities capable of the
following:

• developing and sustaining an economic development strategy for the region;
• applying for funds from governments and other sources; and
• coordinating appropriate training and development to support regional
  economic development.
  

Introduction to the case studies

Some interesting economic development activities are occurring in Indigenous communities across Australia. There are numerous examples of communities working intensely to develop employment, enterprise and housing options for local people. There are also instances where Indigenous and non-Indigenous people are working collaboratively to improve land agreements so that they provide sustainable outcomes for Indigenous Australians.

The following case studies are an extension of the recommendations in this Report and the recommendations of my Native Title Report 2005. They provide examples of economic and social development that emphasise Indigenous involvement and management of all aspects of agreement-making and enterprise development. They demonstrate that when provided with the opportunity and support from government and non government stakeholders, Indigenous Australians can exercise responsible self determination and self management for the benefit of our people.

The case studies provide only a small sample of good practice in agreement
making an enterprise development in Australia. Two of the case studies describe
system-wide approaches to land agreements and enterprise development, based on
government and industry collaboration. Three case studies describe regional
approaches to land and enterprise development.

The case study at Chapter 3 describes a collaborative approach between the
Australian Government and the minerals industry to support Indigenous economic
development in eight trial sites across Australia. Chapter 4 provides another
system-wide approach, outlining South Australia’s State-wide approach to
Indigenous Land Use Agreements. Chapter 5 describes a regional agreement; the
Argyle Indigenous Land Use Agreement in the Kimberley, Western Australia.
Chapter 6 describes the development of an Indigenous owned and managed
enterprise in the Pilbara. Chapter 7 provides an example of a township lease
agreement and a home ownership scheme that has some similarities and some marked
differences with the leasing and home ownership approaches of the Australian
Government.

Case Studies

Chapter 3: The Memorandum of Understanding between the Minerals Council of
Australia and the Australian Government

Chapter 4: South Australia’s State-wide Indigenous Land Use Agreement
Framework

Chapter 5: The Argyle Participation Agreement

Chapter 6: Ngarda Civil and Mining

Chapter 7: The Yarrabah Housing Project

---

Endnotes

• ^[1] Shergold P., (Secretary of the Department of the Prime Minister and Cabinet), Indigenous Economic Opportunity: the Role of the Community and the
  Individual, Speech delivered at the First Nations Economic Opportunities
  Conference, Sydney, 19 July, 2006
• ^[2] Brough M., (Minister for Families, Community Services and Indigenous Affairs
  and
  
  Minister Assisting the Prime Minister for
  Indigenous Affairs), Blueprint for Action in Indigenous Affairs, Address
  to the National Institute of Governance: Indigenous Affairs Governance Series,
  Canberra, delivered 5 December 2006, available online at http://www.facs.gov.au/internet/minister3.nsf/content/051206.htm,
  accessed at 18 December
  2006
• ^[3] Brough, M., (Minister for Families, Community Services and Indigenous Affairs),
  as quoted in ABC Online, The World Today, ‘Government to reform
  Aboriginal land rights’, available online at http://www.abc.net.au/worldtoday/content/2006/s1652229.htm,
  31 May 2006, accessed 8 December
  2006
• ^[4] Brough M., (Minister for Families, Community Services and Indigenous
  Affairs), Blueprint for Action in Indigenous Affairs, Address to the
  National Institute of Governance: Indigenous Affairs Governance Series,
  Canberra, 5 December 2006, available online at http://www.facs.gov.au/internet/minister3.nsf/content/051206.htm,
  accessed at 18 December
  2006
• ^[5] SCRGSP (Steering Committee for the Review of Government Service Provision) 2003, Overcoming Indigenous Disadvantage: Key Indicators 2003, Productivity
  Commission, Canberra,
  s2.4
• ^[6] SCRGSP (Steering Committee for the Review of Government Service Provision) 2003, Overcoming Indigenous Disadvantage :Key Indicators 2003, Productivity
  Commission, Canberra, s2.5
• ^[7] The Australian Government, Achieving Indigenous Economic Independence,
  Indigenous Economic Development Strategy, Targeting jobs, business and
  assets, 2005, available online at: http://www.workplace.gov.au/NR/rdonlyres/B7206570-9BFD-4403-B4A3-6649065FAE5A/0/IEDStrategyBooklet_revised_FINAL.pdf accessed 5 March
  2007
• ^[8] National Native Title Tribunal, Correspondence with Aboriginal and Torres
  Strait Islander Social Justice Commissioner, Email, 7 December 2006, p1
  
  Note: These percentages are approximate as the
  information is based on broad land tenure and some small areas, usually less
  than 50 sq kms, are not necessarily captured
• ^[9] National Native Title Tribunal Correspondence with Aboriginal and Torres
  Strait Islander Social Justice Commissioner, Email, 7 December
  2006
• ^[10] National Native Title Tribunal Correspondence with Aboriginal and Torres
  Strait Islander Social Justice Commissioner, Email, 22 January 2007
• ^[11] National Native Title Tribunal, Correspondence with Aboriginal and Torres
  Strait Islander Social Justice Commissioner, Email, 7 December 2006,
  p1
  
  Note: These percentages are approximate as the
  information is based on broad land tenure and some small areas, usually less
  than 50 sqkm, are not necessarily
  captured.
• ^[12] Office of the Registrar, NSW Aboriginal Land Rights Act, Correspondence with
  Aboriginal and Torres Strait Islander Social Justice Commissioner, Email, 31
  January 2007, p1
  
  Note: Lands granted to Local
  Aboriginal Land Councils in New South Wales are of high commercial value due to
  their development potential for either residential or commercial use. The land
  claimed under the NSW Aboriginal Land Rights Act 1983 is currently valued
  at approximately $800million. This is despite the fact that land parcels claimed
  in NSW are relatively small when compared to jurisdictions like the Northern
  Territory.
• ^[13] Indigenous Land Corporation, The ILC and Land Acquisition, Website, available
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• ^[14]Indigenous
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• ^[18] Australia Bureau of Statistics, Housing and Infrastructure in Aboriginal and
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• ^[19]Linkhorn
  C., Maori Land and Development Finance, Discussion Paper 284/2006, Centre
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  p25
• ^[20] Western Australia v Ward & Ors (2002) 191 ALR
  1
• ^[21] Gordon, S., (Chairperson, National Indigenous Council, Office of Indigenous
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  accessed on 14 January
  2007
• ^[22] Brough M., (Minister for Families, Community Services and Indigenous Affairs),
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  accessed 28 November
  2006
• ^[23]Aboriginal
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• ^[24] Aboriginal Land Rights (Northern Territory) Act 1976 (Cth),
  s77A(a)(b)
• ^[25] Native Title Act 1993 (Cth)
  s203BE(5)
• ^[26] Native Title Act 1993 (Cth)
  s251A
• ^[27] [1999] FCA
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• ^[28] [2002] FCA
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• ^[29] National Native Title Tribunal, Correspondence with Aboriginal and Torres
  Strait Islander Social Justice Commissioner, Email, 28 February 2006
• ^[30]Aboriginal
  Land Rights (Northern Territory) Act 1976 (Cth), s3, "qualifying area" means
  an area that: (a) is wholly included in the area of a Land Council; or (b) is
  partly included in the area of one Land Council and partly included in the area
  of one or more other Land Councils.
• ^[31] Aboriginal Land Rights (Northern Territory) Act 1976, Act Compilation
  (superseded), 24 March 2005 - 4 September 2006,
  ID:C2005C00223
• ^[32]Taylor
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• ^[33] National Indigenous Times, Wadeye says it will fight against government lease
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• ^[34] National Indigenous Times, Wadeye says it will fight against government lease
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  Thamurrur Council's acting chief executive
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• ^[38] See generally, Aboriginal and Torres Strait Islander Social Justice
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• ^[39] Aboriginal and Torres Strait Islander Social Justice Commissioner, Native
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• ^[40] Nyami-Musembi, C., Breathing Life into Dead Theories of Property Rights: De
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• ^[41] Nyami-Musembi, C., Breathing Life into Dead Theories of Property Rights: De
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  available online at: http://www.gsdrc.org/go/display&type=Document&id=2580 accessed 25 February 2007
• ^[42] Linkhorn, C., Maori Land and Development Finance, Discussion Paper no.
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  2006
• ^[43] de Soto, H., The Mystery of Capital: Why Capitalism Triumphs in the West and
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  p178
• ^[44] ‘Unused Capital is Dead Capital-Doctor’, Post Courier, 25/08/05, pg
  4 as cited in Rusanen, L., Customary Landowners rights Under Threat in Papua
  New Guinea: An update on the land debate and amendments to forestry and mining
  legislation, Background Paper No. 10, Aid Watch, p1, December 2005,
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• ^[151] Note: Data on number of unsuccessful applicants was not
  provided
• ^[152] Note: Data on number of unsuccessful applicants was not
  provided
• ^[153] Note: Data on number of unsuccessful applicants was not
  provided
• ^[154] National Native Title Tribunal, Annual Report 2005-2006, Commonwealth of
  Australia 2006, p72, available online at: http://www.nntt.gov.au/publications/data/files/AnnualReport20052006.pdf accessed 27 February
  2007
• ^[155]Corbett
  T., O’faircheallaigh C., Unmasking the Politics of Native Title: The
  National Native Title Tribunal’s Application of the NTA’s, Arbitration Provisions, Department of Politics and Public Policy,
  Griffith University, Brisbane,
  2006
• ^[156] Office of Indigenous Policy Coordination, Correspondence with Aboriginal and
  Torres Strait Islander Social Justice Commissioner - Request for information in
  preparation of Social Justice Report 2005, p2
• ^[157] National Native Title Tribunal, Correspondence with Aboriginal and Torres
  Strait Islander Social Justice Commissioner – Request for Information in
  preparation of Native Title Report 2006, 22 February 2007, p2
• ^[158] National Native Title Tribunal, Correspondence with Aboriginal and Torres
  Strait Islander Social Justice Commissioner – Request for Information in
  preparation of Native Title Report 2006, 22 February 2007,
  p4
• ^[159] Agreements, Treaties and Negotiated Settlements Project, Gelganyem Education
  and Training Shared Responsibility Agreement, 2005, available online at: http://www.atns.net.au/biogs/A002885b.htm accessed 5 March
  2007
• ^[160] See generally, Aboriginal and Torres Strait Islander Social Justice
  Commissioner, Social Justice Report 2006, Human Rights and Equal
  Opportunity Commission, Sydney,
  2007
• ^[161] Ngaanyatjarra Council Aboriginal Corporation, Survey Comment, HREOC National
  Survey on Land, Sea and Economic Development
  2006
• ^[162] Bickerdyke I, Lattimore R and Madge A, Business Failures and Change: An
  Australian Perspective, Productivity Commission Staff Research Paper,
  AusInfo, Canberra, 2000, p184
• ^[163] The Gurang Land Council (Aboriginal Corporation), Survey Comment, HREOC
  National Survey on Land, Sea and Economic Development
  2006
• ^[164] Australian Government, Office of Indigenous Policy Coordination, Secretaries'
  Group Annual Report 2005, Website, available online at: http://oipc.gov.au/performance_reporting/sec_group/ar2005/section1_1.asp accessed 28 February
  2007
• ^[165]Australian
  Government, Office of Indigenous Policy Coordination, Indigenous
  Coordination Centres, Website, available online at: http://www.indigenous.gov.au/icc/sra.html#anchor2,
  accessed at 28 February
  2007
• ^[166] Office of Indigenous Policy Coordination, Correspondence with Aboriginal and
  Torres Strait Islander Social Justice Commissioner – Request for
  information in preparation of Native Title Report 2006, Email, 3 July 2006
• ^[167] Native Title Act 1993 (Cth), Division 3,
  s203B
• ^[168] Note: Chapter 1 of this Report provides further evidence of the relative
  capacity of NTRBs to engage in economic and develop activity beyond the
  requirements of the Native Title Act 1993 (Cth)
• ^[169] Human Rights and Equal Opportunity Commission, National Survey of Traditional
  Land Owners Australia, 2006, See Chapter 1 of this Report