Minister Wyatt and the NT Land Councils: a policy rapprochement?

 

So may the outward shows be least themselves:

The world is still deceived with ornament.

The Merchant of Venice, Act 3, scene 2.

 

Recently there have been signs of improved relations between the Northern Territory Land Councils and the Commonwealth. This post sets out to document some of the public milestones in that process, examines the possible motivations of the respective parties, and asks what this means for remote policy generally.

 

But first, some context. The NT land councils are established under Commonwealth legislation and constitute hybrid statutory corporations. Their members selected by Aboriginal communities, their funding guaranteed (subject to ministerially approved budgets) outside the budget process, their expenditures audited by the ANAO.

 

The key financial mechanism within the NT Land Rights Act is the Aboriginals Benefit Account (ABA). It is funded by automatic appropriations by the Commonwealth equivalent to the royalty revenues accrued by the Commonwealth and the Northern Territory from mines on Aboriginal land; thus the term ‘royalty equivalents’. The ABA is used for three broad purposes (I am ignoring some minor technicalities here). First, section 64(3) requires 30 percent of all ABA revenues be paid to land councils for distribution to corporations whose members are affected by the resource project that generates the royalty equivalent appropriation.  Second, section 64(1) provides for an amount determined by the Minister to be paid from the ABA to fund the administrative costs of the Land Councils. Third, the Minister can determine further amounts to be paid ‘to or for the benefit of Aboriginals living in the Northern Territory’ (s.64(4)). An advisory committee is established to assist the Minister in this latter function.

 

The four land councils (NLC, CLC, Tiwi LC, and Anindilyakwa LC) operate as key institutions and gatekeepers in relation to Aboriginal land extending over more than fifty percent of the NT. Moreover, their significant budgets and employment, their influence over royalty distributions, and their networks into the broader Indigenous domain means that they exercise significant political power within the NT. As early as 1988, they were described as ‘para-governmental’ in nature (in an article I co-authored with Jon Altman). Consequently, the land councils have multiple points of interaction with all three levels of government in the Northern Territory and these extend from cooperative to conflictual modes of engagement.

 

Recent Developments

 

I want to point to six seemingly independent data points, and argue that they are elements in the separate, but overlapping, larger political and policy strategies on the part of both the Commonwealth and by implication the Land Councils.

 

Data point one: the 2019-2020 Annual Report of the NIAA (link here), which includes the financial statements for the ABA, includes the following salient information. As at 30 June 2020, the net assets (excluding future commitments) of the ABA were $1,266 million (let’s call it $1.26bn), a 19 per cent increase over the $1.06bn at 30 June 2019 (p.173 NIAA Annual Report). This increase was the result of higher mining royalty revenue collections by the NT Government, largely originating from manganese mining at Groote Eylandt.

 

Data point two: the Minister approved $10m in emergency support payments to the four land councils as part of the larger $123m COVID-19 support package approved in April 2020. This is mentioned in the ABA Annual Report at page 173. In addition, but not explicitly mentioned except in the financial statements, the Minister approved an increase in administrative support funding to the four land councils of $24.2m, up from $61.4m to $85.6m. The two larger land councils were the major beneficiaries. This represents an unannounced and unexplained increase in funding of 39.4 percent over the previous year’s funding (refer p.162 NIAA Annual Report).

 

Data point three: In both a speech to the NLC (‘Connecting and activating the Northern Territory’) and in a media release, Minister Wyatt announced on 25 November 2020 what he termed a ‘$100m stimulus package for Indigenous businesses and jobs in the NT’ (link here and here). In the speech, he asserted that he was signing off on a Land Council proposal.  In the media release, he states:

“Working with the NT Land Councils, we are releasing $100 million from the Aboriginals Benefit Account (ABA) for Aboriginal people to create and sustain jobs through capital injections in ‘shovel-ready’ economic, social and infrastructure projects.” (emphasis added).

 

Data point four: In the speech to the NLC, the Minister attacked the NT Government for their failure to make adequate progress on housing upgrades funded by the Commonwealth.

It is unacceptable that so many Indigenous Australians in the Northern Territory live in over-crowded and inadequate housing. This is despite the Commonwealth committing to providing the Northern Territory with $550 million over five years to deliver 1,950 new bedrooms, equivalent to 650 houses, in remote NT communities.

The Northern Territory Government’s roll out of these houses is slow – and it is unacceptable.

The NT Government is responsible for housing and essential services. People in remote communities should expect their housing services to be provided – just as they would in any other location in Australia.

The fact that this is not happening is a disgrace – and in the year 2020 – and looking ahead to 2021 - something that neither I nor the Northern Territory Government should allow to happen.

 

Data point five: In the same speech, the Minister stated:

I am serious when I say – where we have failings – we must explore new ways of working. To this end, I note that the Land Councils are continuing to develop a proposal which would see a direct partnership established with the Commonwealth for the provision of housing services in the NT – led by the Central Land Council. We don’t need to accept the current situation as the only option.

 

Data point six: Notwithstanding the Minister’s visit focussing on a major funding announcement directed to job creation, there was no mention of advice from the Northern Australia Indigenous Reference Group established by Ministers Canavan and Scullion to assist in the implementation of the Government’s 2015 White Paper on Northern Development: ‘Our North, Our Future’. The Department of Industry , Science Energy and Resources website lists the most recent meeting of the IRG as December 2019 (link here). There appears to be a major hiatus of the IRG’s work since the changeover in ministers from Canavan to Pitt and from Scullion to Wyatt. This parallels the Government’s decision to discard (without announcement) the Prime Minister’s Advisory Group on Indigenous Affairs (link here).

 

Implications

 

So what are we to make of these events, individually and together?

 

Over the years I have worked in proximity to Ministers, I have observed a tendency for Ministers to adopt a transactional mindset when making decisions that bestow favours or benefits on particular interests. For this reason, in relation to the Minister’s unannounced decision to increase Land Councils’ funding, it is a reasonable to assume that he made the decision with an expectation of a quid pro quo of some kind. He may or may not have had a discussion with key Land Council players regarding his expectations, and I am certainly not suggesting that any such expectation is necessarily inappropriate let alone illegal.

 

The most plausible reason for the Minister to seek to woo the NT Land Councils are to obtain a political advantage or benefit of some kind. An outcome that created a disincentive on the Land Councils to support the Labor Party either in the NT or federally, or to not criticise the Liberal/National Party aligns with the political agenda of the Liberal/National Party Government federally and of the CLP in the Territory.

 

There was a Territory election in August 2020 just two months after the end of the year where the increased funding occurred. There may well be a Federal election in the second half off next year. Indigenous voters in the NT are no longer rusted on Labor voters and have shown in recent elections that they are prepared to vote for either party and/or Independents. There are also indications that many Indigenous voters have tuned out and do not vote despite the existence of compulsory voting (link here).  While Labor has won both House of Representatives seats in the NT in the last election and won a return to Government in the Territory in August, the margins are not so wide, particularly in some electorates, that it would not be worth investing in raising political support for non-Labor parties and candidates.

 

An essential element in pursuing a successful political strategy such as appears to be in place here would be to promulgate a pro LNP / CLP narrative amongst key Indigenous thought leaders and interests and/or to negate pro-Labor or Green support from key organisations and leaders. Some version of this strategy is likely behind the motivations of Minister Wyatt in going out of his way to improve relations with the Land Councils while promulgating an anti-NT government narrative on housing. Whether such a strategy will work is unclear.

 

Of course, the Indigenous leadership of organisations such as the Land Councils understand these motivations, and the risks of governments effectively buying their silence. These issues go with the territory.

 

While the description above might accurately be characterised as a statement of the obvious:  ‘politicians indulge in political behaviour’, my concern is to focus on the associated implications for policy when institutional domains become politicised.

 

One of the risks with the overt politicisation of an institution such as the ABA is that it can inhibit the emergence of good long-term policy outcomes.

 

A key challenge for engaged citizens, including Indigenous citizens, seeking to understand what is occurring in relating to policy development in particular sectors are the extraordinarily poor levels of transparency and the absence of well presented and basic information to underpin announcements and ongoing government decisions.

 

In the present case, for example, there is no information on the public record about the nature of the Land Councils’ proposals to which the Minister is responding in announcing his $100m ‘stimulus package’. The policy effectiveness of this initiative in creating and sustaining jobs (the Minister’s objective) will depend in large measure on the quality of the grants made from the ABA. Given that last year the ABA only spent around $20m in general grants, it is not clear that there exists a pool of high quality ‘shovel ready’ projects to fund. In the absence of a comprehensive evaluation, it is unlikely we will ever find out how that goes however, as neither the Minister nor his predecessor publish in an accessible place information on grants made under section 64(4), nor any information on the outcomes of the grants made. I was critical of this in a 2017 post (link here), and note that previous Governments up to and including the Rudd/Gillard/ Rudd Government did make such information accessible and available. The last major evaluation of the operations and effectiveness of the ABA, undertaken by Jon Altman, was published in December 1984.

 

Similarly, in relation to remote housing, the lack of transparency is overwhelming. Minister Wyatt’s critique of the NTG is data free although he clearly has access to detailed performance data as it is standard in funding agreements. The NIAA website does not provide basic data on the progress of expenditure in relation to the Commonwealth’s $550m investment in the NT. The NT Housing and Local Government Department website does provide some quite basic information but has a range of shortcomings including a lack of clarity on timeframes being reported upon (link here). That data shows that while the NTG has spent or contracted some 40% of its own allocation, it has only spent or contracted 28 % of the Commonwealth’s allocation. What is unclear from the table is whether the Commonwealth allocation began after the NT allocation. Also unclear is what action has been taken by Commonwealth officials to ensure that the Commonwealth contribution was being prioritised, a matter that ultimately is Minister Wyatt’s responsibility.

 

While the NT Government’s performance in recent years in constructing remote housing and maintaining the existing housing asset base has been underwhelming at best, and in many respects unacceptable, the hypocrisy that suffuses Minister Wyatt’s narrative is breathtaking. His Government walked away from funding responsibility for remote Indigenous housing nationally notwithstanding the Commonwealth’s prior involvement over more than fifty years. His Government refused to renew the ten-year $5.5bn National Partnership put in place in 2008, and walked away from a ten-year allocation of $1.6bn or $160m per annum in the NT. In the NT alone, it was replaced by a five-year offer of $550m (or $110m per annum) only when the Commonwealth realised it was exposed. Some ten years ago, the Land Councils decided to insist that in relation to many (but not all) communities in the NT, they would only agree to Commonwealth held leases to secure the NPARIH investments in those communities. The Commonwealth assented. This meant that a total Commonwealth retreat from funding would leave it with landlord responsibilities in relation to many hundreds of houses in remote communities that it would have to deliver itself.

 

The suggestion by the Minister that he is considering a CLC sponsored proposal for a partnership with the Commonwealth to deliver remote housing in the NT is tantalising. It may be a positive sign. Or it may be merely a ploy to justify inaction. Again, there is limited information available on the public record; a media release from the Land Councils in July 2020 appears to be the only public record available (link here). More importantly, the issue of the establishment of a Territory wide community housing provider is not something that should be seen only through the single prism of the existing public housing asset base, and nor should it be seen as a way of bypassing the NTG (which was the implicit narrative deployed in the Minister’s speech).

 

Given the substantial and potentially growing demand for remote housing, there is a cogent argument for a large-scale community housing provider across the NT, supported by governments and established with the capacity to source private sector borrowings. The existence of a new and alternative source of housing in remote communities would create significant incentives for Government public housing providers to lift their game and offer more choice to remote residents. The absence of a private housing market in these locations, and the significant levels of poverty and formal unemployment suggest that innovative policy solutions such as this idea should be explored.

 

Finally, the absence of the IRG from the Minister’s public narrative is intriguing, and throws light on broader approaches by governments to the use of appointed advisory bodies. I previously posted on the lack of ambition of the Government’s policy agenda in the White Paper on Northern Australia and the role of the IREG in that process (link here). In particular, it aligns with a hypothesis that such bodies are used as a means of internalising policy debate; as a means of managing down community expectations; and slowing down policy development. Once the political and policy agenda moves on, and/or the Advisory body membership refuses to adhere to the implicit expectations of Ministers, the advisory body can be quietly sidelined and eventually disbanded. This was the fate of the Prime Minister’s Indigenous Advisory Council and appears to be the likely fate of the IRG.

 

To sum up, I would make three general points. They share a simple assumption: that good policy is good politics; however good politics is not always good policy.

 

First, it is past time that governments had a close look at making better use of the ABA and the associated royalty flows into many communities. An obvious way forward would be to initiate a forward looking evaluation/review process in conjunction with Indigenous interests designed to identify opportunities for better use of the existing royalty and royalty equivalent flows in remote Australia. The risk Indigenous interests face is that as the overarching governance of the current system becomes tired and degraded, and in the absence of a culture of transparency, there will emerge higher levels of politicisation, poor accountability, and perhaps even corruption in the ways governments deal with these institutions. This would undermine trust in the system, and could lead to significant reductions in financial resources to Indigenous communities into the future.

 

Second, governments at all levels must lift their game in terms of transparency and the presentation of clear and accessible information to citizens. While this is relevant across the whole span of government activity, it is particularly important in the Indigenous policy domain as it operates to inhibit building the case for the necessary policy reforms to allow Indigenous interests to achieve their political and policy aspirations. In the absence of such transparency, citizens are within their rights to assume the worst. Trust in governments is declining. If governments and politicians value our democratic systems, they should demonstrate that by being much more transparent about their decisions, the processes they use and the outcomes they achieve. Statutory corporations in the Indigenous policy domain are not exempt from these same dynamics, and indeed it is incumbent on the Minister to ensure that they too meet normal accountability requirements.

 

Third, while the NT is a special case insofar as the Commonwealth has specific responsibilities derived from the NT’s status as a territory and the existence of Commonwealth land rights legislation, the policy issues at play in the NT pertaining to remote communities are also present in other jurisdictions. The Commonwealth should use its more direct policy involvement in the NT to inform a new national policy approach responding to the very specific needs of remote communities. In particular, while it espouses the rhetoric of economic development, the current Commonwealth Government has failed to pursue any substantive policy reforms that would deliver sustained improvements in economic status. One obvious starting point would be remote housing policy; a second would be to ensure that the financial provisions related to land rights legislation in the NT and native title across the board are fit for purpose. A third not discussed in this post would be to reverse course on the punitive welfare policies applicable to remote Australia (link here).

 

The challenge for the Government and its Minister for Indigenous Australians is to ensure that the ‘outward shows’ of working with Indigenous interests is more than politics, more than mere ornament, and delivers substantive and sustained policy reform. The challenge for Indigenous leaders and interests and mainstream citizens alike is not to be ‘deceived with ornament’. Unfortunately, the fact that Shakespeare’s words still ring true 400 years after they were written is cause for pessimism rather than optimism.