FOI updates on the ALC and Groote Eylandt

In natures infinite book of secrecy

A little I can read.

Antony and Cleopatra, Act one, Scene two.

 

FOI revelations. The NIAA FOI log contains two recently released documents that expand the information available in the public domain albeit only at the margin. I have also had access to documents released in response to a third FOI but not yet made available on the Disclosure Log. In this post, bolded text has been added by me to emphasise matters of particular salience to the arguments made here. The highlights below were highlighted in the documents provided by NIAA.

Request One FOI/2425/039 dated 30 January 2025 (link here).    This request sought the NIAA’s proposed response to a series of questions on notice from Senator Pocock in late 2024 (which had presumably been delayed in the Minister’s Office and not seen the light of day when the request was made). Once made available, it revealed that the NIAA’s Group Manager Integrity had attended the ALC Board meeting on 16 October 2024 ‘to support Board discussion regarding Mr Hewitt’s employment arrangements.’  The ALC terminated the CEO’s employment at that meeting. NIAA failed to respond substantively to the Senator’s request for information on what legal or policy advice had been provided to the ALC Board by the NIAA attendee.

Request Two FOI/2425/065 dated 14 April 2025 (link here).  This request relating to the February 2025 Senate Estimates hearings (link here) sought All briefs prepared by the agency for the Minister, her staff, senior staff of NIAA, and other Ministers or portfolio agencies which relate to the governance and operations of the Anindilyakwa Land Council, associated corporations in receipt of royalty equivalent payments, the proposed Winchelsea mine, the 2023 ANAO Audit of the ALC; the National Anti-Corruption Commission investigations in relation to Groote Eylandt matters; and/or Groote Eylandt generally."

The response comprised two documents prepared in February 2025. The first document included the following dot points under Key Talking Points:

·       The Ministerial response to the petition was tabled on 29 February 2024. The response states that the Minister has referred the issues raised in the petition and media articles to the NIAA’s Integrity Group for review and referral to relevant Commonwealth and Territory agencies if required.

·       The NIAA received some information that was subsequently referred to the National Anti-Corruption Commission (NACC).

·       As part of NIAA’s response, the NIAA commissioned an independent review of the ALC’s responses to the issues and recommendations of the ANAO audit.

In a section headed ‘If asked: What is NIAA doing to address the concerns in relation to ALC governance?’, the brief discussed the Bellchambers Barrett Review, referring to it as ‘independent’, and confirming that that the Group Manager Integrity had determined the scope and composition the review. 

The brief then states:

• The ALC CEO and Board fully cooperated with this independent review….

• In my capacity as NIAA Integrity Group Manager, I accompanied the independent reviewer to Groote Eylandt on 27 and 28 May 2024 to gather additional evidence and meet with the ALC Board and management.

• On 24 Sepember [sic] 2024, I also attended Groote Eylandt to provide the newly elected ALC board members a walkthrough of the issues review report.

• On 15 and 16 October 2024, I attended Groote Eylandt to work with the board members to support their next steps in progressing the governance arrangements of the ALC board.

A second document was the brief prepared for the NIAA CEO.

The CEO brief confirms that the ALC has engaged Yamagigu Consulting to act as Independent Adviser to the ALC Board and to develop a governance framework in consultation with the NIAA. Yamagigu is associated with Deloitte Australia.

The CEO Brief states:

·       The August 2024 Bellchambers Barrett review concluded that while significant progress has been made by ALC since May 2023 across the ANAO’s 15 recommendations, none had been fully implemented.

·       The Minister wrote to the ALC Board on 29 August 2024 to advise she was extremely disappointed to read the review’s conclusion.

In a section headed Former Chief Executive Officer Mark Hewitt, the Brief notes:

• The ALC Board terminated the employment of Chief Executive Officer (CEO) Mark Hewitt on 16 October 2024 ….  

• The termination payment made to Mr Hewit [sic] was in accordance with his contract of employment and provisions of the Fair Work Act 2009.

o If asked: Did the Minister approve the termination payment?

o [placeholder - brief was provided to the Minister for approval in February 2025].

• The CEO’s tenure had been a matter for the ALC’s Board.

• The NIAA is aware of public concerns that Mr Hewitt allegedly misused royalties and directed funds into a mining company in which he is a director.

• The NIAA referred the former CEO to the National Anti-Corruption Commission (NACC) in July May* 2024. [*Correction made by NIAA FOI Team]

Request Three FOI 2425/066 dated 19 May 2025. This request sought briefing notes and associated file notes and records related to the attendance by NIAA officers at the ALC Board meeting in mid-October 2024 and all records of communications with the Minister or her Office in relation to the attendance at the ALC meeting or in relation to discussions with Mr Hewitt. Six documents were identified as being within the scope of the request. Access to three (documents 1, 2 and 4) was refused in full on the basis that they were legal advice that was subject to legal professional privilege. The remaining documents were released in part. Extensive sections were redacted on the basis of personal privacy exemptions.

Document 3 was an email to either the Minister’s Office or senior NIAA officers dated 18 October 2024 advising inter alia that the ALC had terminated the CEO and had appointed the ALC’s Chief Financial Officer Colin Wakefield as interim CEO.

Document 5 is an email trail dated 5 November 2024 beginning with a request for a brief to support a meeting between the Minister and the ALC the following day. NIAA’s Group Manager Integrity provided a series of talking points under the heading Update on ALC CEO status. After listing the date of the termination, the appointment of an interim CEO and the ALCs intention to appoint a recruitment firm, the brief stated:

·       As part of the termination process, Mark has resigned from the positions of Executive Director Groote Holdings Aboriginal Corporation (GHAC) and CEO of Winchelsea Mining

·       The Boards of GHAC and Winchelsea are considering next steps following Mark Hewitt’s termination, including engagement of an independent advisor to assess current operations and the required way forward.

Document 6 is a NIAA brief to the Minister dated 25 October 2024 responding to the ALC Chair’s correspondence dated 16 October advising that the Board had terminated their CEO. Under a heading Key Points, the NIAA noted that the Chair had advised that the CEO had been terminated ‘on notice’ by the ALC and that the ALC Board had been considering Mr Hewitt’s position for some time. The brief then stated:

5. It is understood ALC will be submitting a supplementary budget request shortly to cover Mr Hewitt’s final entitlements.

 

Commentary on FOI documents released:

What jumps off the page in the documents provided in response to Request One is the determined effort by both the Minister and NIAA to keep the Minister at arm’s length from whatever is going on. This signals, in turn, either prior knowledge of misfeasance within the ALC, a statutory corporation in the Minister’s portfolio for which she is responsible, or an appreciation that the events unravelling on Groote and within the ALC were in some way potential political time bombs.

At least two other issues arise from the Request One documents. First, the close involvement of the NIAA in the Bellchambers Barrett Review – which as I have pointed out previously was focussed solely on the ANAO recommendations and not on the detailed issues identified - (including collecting evidence) and the ‘cooperation of the ALC CEO and Board’ raise serious questions regarding the Review’s independence.

The second issue concerns the reason for the Group Manager’s attendance at the Board meeting. In the response to Senator Pocock’s questions, it was stated that it was ‘to support Board discussion regarding Mr Hewitt’s employment arrangements.’ In the Estimates brief, it was ‘to work with the board members to support their next steps in progressing the governance arrangements of the ALC board’.

The visit took place in the context of a series of previous events: the prior visits to Groote by the Group Manager; a letter from the Minister to the ALC expressing her ‘extreme disappointment’ in relation to the poor ALC response to the Review that her agency had been involved in developing for months; the referral by the NIAA of the former CEO to the NACC four months previously. The visit coincided with the NACC attendance at the ALC Office on Groote to obtain evidence. Given NACC protocols to allow it to work with Commonwealth agencies on investigations, it is possible that the NIAA had been provided with progress reports by the NACC. The differences in the explanations set down in the two documents, although nuanced and not definitive, point to something more than NIAA engaging in a purely passive support role. Why else would legal advice have been necessary (bearing in mind that the ALC employs its own legal advisers)?

The complete absence of any preparatory briefing (except perhaps the emailed legal advice), as well as the absence of any file notes recording the ‘support’ offered by the NIAA officer suggests a deliberate effort to avoid future scrutiny and serves to reinforce the sensitivity (and potential irregularity) of the discussions. This is the bureaucratic equivalent of a police officer turning off his/her bodycam prior to engaging with a person of interest.

The Request One CEO Brief (document two) confirms that notwithstanding NIAA’s awareness of allegations that ‘Mr Hewitt allegedly misused royalties and directed funds into a mining company in which he is a director’, and their decision to refer the CEO to the NACC presumably in relation to at least these allegations, the ALC decided to pay Mr Hewitt an unspecified termination payment and the Minister appears to have been asked to approve that payment in February 2025. This strikes me as unusual insofar as if it was entirely consistent with the CEO’s land council employment contract and assuming that the contract which has never been made public adheres to standard employment practice), there would have been no need to obtain the Minister’s approval. On the other hand, if the ALC proposed to pay any amount related to his termination as CEO of GHAC and/or Co-CEO of Winchelsea Mining, the ALC may well have found it necessary or convenient to seek ministerial approval for an expansion of its section 64(1) operational budget approval or for an approval under section 36 of the ALRA (link here). I have previously argued that the former CEO’s simultaneous roles constituted misfeasance insofar as the ALC CEO salary set by the Remuneration Tribunal is for a full-time position, and it seems unlikely that the Tribunal’s approval was sought and granted for the CEO to engage in additional paid employment.

The fact that the document 5 of Request Three makes clear that the Mr Hewitt resigned from his roles on Winchelsea and GHAC ‘as part of the termination process’ adds to the likelihood that the Minister was made aware of and agreed to termination payments for Mr Hewitt linked to a notice period for these roles. Importantly, the apparent willingness of the ALC to intrude financially into the internal affairs of GHAC and AAAC/Winchelsea Mining (apparently with the tacit assent of the NIAA)  also reinforces the argument I have made on numerous occasions that the ALC exercises effective control over these corporations through the allocation of section 64(3) payments and is thus in effect allocating royalty equivalent funds to itself in contravention of the intent of the ALRA.

The CEO Brief also confirms that NIAA’s referral to the NACC was in May 2024, a year after the ANAO report was issued. The allegations mentioned above that likely formed the basis for the NIAA referral of the then CEO to the NACC were two of numerous concerns described in the ANAO performance audit over a year before the referral. Why then did it take a year for the Minister and NIAA to make the referral? And what changed to persuade them to act in May 2024?

As I have long argued in my posts on this blog, there appears to have been a deliberate and sustained attempt by NIAA and the last two Ministers to ignore and downplay the concerns raised by the hundreds of signatories to the February 2024 petition to Parliament and the numerous serious issues raised by the ANAO report. Whether intentional or not, it amounts to complicit behaviour with respect to these issues. As mentioned above the tactic adopted was to establish a review that focussed solely on the ANAO recommendations, and to ignore the myriad concerns and red flags raised in the detail of the 2023 ANAO report. What is less clear is why this policy of regulatory neglect was pursued.

I have long taken the view that not only were there shortcomings in the ALC’s management processes, but that the NIAA and its ministers have failed in their role as the ‘regulator’ oversighting the operations of the ALC and particularly its royalty and royalty equivalent distributions.

The unexplained termination of the ALC’s CEO in October 2024, the determined efforts of all involved to downplay those events, the complete absence of any justification or rationale form the ALC, and the secrecy imposed until now on the termination payments made to him notwithstanding the concerns that were significant enough to underpin a yearlong investigation by the NACC, suggests that there is much more to this than is currently available on the public record.

One hypothesis that is consistent with the facts as we know them is that the Government decided (utterly belatedly) that the ALC should terminate the CEO to set up a situation where a potentially adverse NACC report could be defended with the blithe response that the individual responsible for whatever egregious flaws are determined to have existed has already been dealt with. Persuading the ALC would be simple: the Minister had the leverage of only partially approving the ALC’s budget for 2024/25 as well as numerous ways in which to make the land council’s ongoing operations difficult. Persuading the former CEO (and his spouse) to depart quietly would be trickier. The offer of generous termination payments would assist, but other inducements are also conceivable. In this scenario, the ongoing silence of the terminated CEO would be more securely achieved if the termination payments were accompanied by a formal non-disclosure agreement.

Concluding comment

In my view, the pervasive veil of secrecy that has been thrown over this whole episode would be necessary only if the decisions taken were not able to be justified according to law and were not able to meet the so-called ‘pub test’. The fact that questions from Senator David Pocock have been ignored or answered with misleading diversions serves to emphasise the determination of the Commonwealth to avoid public scrutiny. The fact that the veil of secrecy remains substantially in place merely reinforces doubts regarding the appropriateness and propriety of the actions (and inactions) of ministers and the NIAA related to the oversight of the ALC over the past decade.

The issues and concerns raised by the ANAO and by the concerned community members who signed the 2024 petition to Parliament are yet to be addressed in any rigorous and comprehensive way. The fact that the NACC is investigating unspecified matters without any transparency in relation to the focus of its investigation is no substitute for an open, transparent and rigorous examination of what has transpired.

Unfortunately, the reluctance to initiate such a forensic and strategic review appears to be an essential element of the Commonwealth’s approach to the operations of the ALC (and also reinforces the likelihood that the hypothesis outlined above is in play). This means that we are reliant on the efficacy of the various accountability institutions with a role on Groote to ensure that the systemic issues that allowed the imbroglio on Groote to emerge and to flourish are identified, and curtailed. I don’t see the NACC as the institution best placed to address these systemic issues (though I hope they at least go some of the way to doing so).

The ANAO in my view should step up. It could undertake a follow up report to its 2023 performance audit. It might also take a long close look at the issue of the effective control by the ALC over the corporations involved in the Winchelsea mine and the Little Paradise infrastructure hub, and which are in receipt of ongoing and significant flows of royalty equivalents. A decision to qualify the annual financial statements of the ALC (and the concomitant ramifications of such a decision) would go a long way to addressing the systemic defects in the current sector wide administration of the ABA and ALRA.

 

25 June 2025

June 2025 Update on Groote Eylandt Issues

 

'twere a concealment
Worse than a theft, no less than a traducement,
To hide your doings; and to silence that,
Which, to the spire and top of praises vouch'd,
Would seem but modest.

Coriolanus Act one, Scene nine.

 

I have not published any posts on Groote or the Anindilyakwa Land Council (ALC) since February, when I published two posts on the inadequacies of the NIAA’s responses to previous Senate Estimates Questions on Notice (link here and link here) and a more general post explaining why pursuing an understanding of what has transpired on Groote, and how it has been allowed to occur, is important (link here).

Since then, several noteworthy developments have occurred or come to my attention.

Manganese sales. Perhaps of most significance in economic terms has been the resumption of sales of manganese ore by South32 subsidiary GEMCO (link here and link here) following the considerable cyclone damage to the Alyangula wharf last year. That damage disrupted sales and export of manganese ore from the GEMCO mine and led to a temporary halt to the flow of royalty payments to the Groote Eylandt Aboriginals Trust (GEAT), to the Anindilyakwa Mining Trust (AMT) and a halt in section 64(3) royalty equivalent payments from the Aboriginals Benefit Account (ABA) to the ALC for onward distribution to local corporations.

GEMCO legal action. In October 2024, the Supreme Court of the NT published a decision on a largely procedural matter relating to a longstanding dispute between GEAT and the ALC regarding rights to be paid royalties over yet to be developed mineral leases held by GEMCO on Groote Eylandt (link here). As an aside, that decision lays out a very useful account of the history of mining on Groote, including the prescient taking up of exploration permits by the Church Missionary Society which were then used to leverage a royalty payment from BHP and led to the establishment of GEAT and the payments of royalties based on that commercial agreement (and not Indigenous rights per se).

According to GEAT’s website (link here), GEMCO took legal action to clarify the required allocation of royalty payments to GEAT and the ALC derived from the new South and East mineral leases on Groote. The dispute has been ongoing since 2016. The GEAT website reports that following a mediation in February 2025, the parties to the litigation signed a Heads of Agreement, and that subject to the finalisation of some technical legal conditions, the dispute between GEAT and the ALC will be resolved. The terms of the mediation were to remain confidential. I am yet to see any confirmation that the resolution has occurred and on what terms. The GEAT Management Committee notes that the resolution of the dispute will be ‘a big step forward’ for GEAT and its beneficiaries and ‘a great outcome for the community’.

ALC staff changes. Following the termination for unspecified reasons of the former CEO, Mark Hewitt by the ALC in October 2024 (link here), the ALC appointed its Chief Financial Officer, Colin Wakefield, as Acting CEO. In April the ALC announced (link here) the appointment of Matthew Bonson, a former ALP member of the NT Parliament from 2001 to 2008. He served in several ministerial roles during that period (link here).

Winchelsea and Little Paradise EPA updates. The EPA website includes a detailed web page with a chronological listing of the initial application and all subsequent EPA decisions and proponent variations.

 Winchelsea Mining lodged its initial application with the NT Environmental Protection Authority in 2020, signed by Winchelsea CEO Mark Hewitt (link here). The initial proposal was accepted for consideration by the EPA in 2021 (link here and link here) where the EPA advised that an Environmental Impact Statement would be required. The proposal described the mine on Winchelsea Island and the supporting infrastructure:

To develop and operate an open cut manganese mine at Winchelsea Island (Akwamburkba) and Groote Eylandt, East Arnhem, about 600 km southeast of Darwin. Strip mining using free digging and rock breaking would be undertaken to extract ore and overburden. Mine infrastructure would include run-of-mine and ore stockpiling areas, a processing plant, workshops, haul and access roads, a product conveyor from the processing area to the wharf, a jetty and a boat ramp. Product would be direct loaded from the conveyor onto ships for export. Supporting infrastructure would be located at Little Paradise Bay on Groote Eylandt, approximately 6 km southwest of the mine site, and include a barge landing ramp and jetty, access roads, a logistics hub and a 100-person accommodation camp. The disturbance footprint is 659 hectares, and the mine life would be approximately 14 years (emphasis added).

Subsequently there were two significant variations made by the proponents (in 2021 and 2023) and subsequent consultation processes undertaken by the EPA. In October 22023, the EPA issued terms of reference outlining the required content of the necessary EIS. The proponent’s EIS was finalised in December 2023 (link here). It is an extensive document (the Executive Summary runs to 89 pages). Section Two of the Executive Summary titled Project Purpose places the proposed mine within its institutional context. This section makes clear that the proposed mine is seen as part of the ALC’s high level strategic objectives:

In response to the need for a self-sufficient and sustainable local economy following cessation of mining by GEMCO, and the desire for greater self-governance, the Anindilyakwa Land Council (ALC) developed the 15-Year Strategic Plan 2012- 2027 (ALC, 2012). In line with its Strategic Plan, the ALC entered into a series of agreed reforms with the NT Government to take over control of core services and functions for the communities and region. As part of the reforms, the NT Government and ALC established Local Decision-Making Agreements (LDMAs), with the aim of transitioning control for services and decision-making to the Anindilyakwa people, as the Traditional Owners of the Groote Archipelago. A key commitment by the NT Government in the LDMAs was the support and advice to Traditional Owners to conduct exploration and mining in the Groote Archipelago, in accordance with recognised rights of Traditional Owners to utilise their natural resources [page 14].

The Winchelsea Funding structure laid out in Figure E-3 [page16] makes no mention of Little Paradise. In section 8 headed Holistic Impacts, the Little Paradise development being progressed by Groote Holding Aboriginal Corporation (GHAC) is cast as ancillary to the mine and not part of it.

Public consultation on the Draft EIS took place in the first half of 2024. In July 2024, the EPA issued a Direction to include Additional Information in relation to an extensive list of matters (link here) and required that a revised EIS be prepared and submitted within two years. Two issues caught my attention: first, the EPA concluded that the draft EIS did not demonstrate how the claimed transformational residual economic benefits the Groote Archipelago and Indigenous residents and directed the proponents to more specific details [item 25]. Second, the EPA also noted that the EIS did not provide adequate information in relation to the proposed 50-person accommodation camp and other supporting infrastructure to be developed by a separate entity [ie GHAC’s Little Paradise development] and directed that it be included in the EIS.

The EPA website also includes details of an application lodged by GHAC in relation to the Little Paradise marine and logistics hub in August 2024 (link here). According to the proposal (page i), the project is designed to support the long-term economic and social future of all Anindilyakwa clans of the Groote Archipelago, and includes a marina facility, associated biosecurity compounds, logistics camp and aquaculture facility. The development is a key component of GHAC’s plan to secure a sustainable long-term economy for the Anindilyakwa. According to GHAC’s Little Paradise Development Report:

GHAC was formed as a commercial entity to support Traditional Owner commercial activity on their land that accords with the governance requirements in section 23 of the Land Rights Act. GHAC was initiated in the 2012 ALC 15-year Strategic Plan — a plan driven by Community Elders to reverse the decisions made over the last 100 years and reassert control over Anindilyakwa destiny. In line with its Strategic Plan, the ALC in 2018 entered a series of agreed reforms with the NT Government to take over control of core services and functions….

…The mandate of GHAC is to support and progress major projects and hold in-trust major infrastructure and assets as well as provide services for social and economic development of all Traditional Owners. ALC and GHAC are actively working to establish projects that deliver a living cultural economy providing inter-generational opportunities to participate in the learning and delivery of both contemporary pursuits and culturally significant traditional practices

The EPA website indicates that on 25 March 2025, the GHAC proposal for a marine infrastructure development at Little Paradise was withdrawn (link here). No reasons were given.

Senate Estimates Committee Hearings. The most recent Hearings were held on 28 February 2025. The transcript (link here) is rather desultory reading; not helped by the fact that the Committee has no effective process in place to efficiently manage what is an extensive agenda spanning the Indigenous policy domain.

The Chair, Senator Pratt, invited the land councils to make extended opening statements which conveniently serve to limit the time available for serious questions. The ALC Chair, Cherelle Wurrawilya limited her pre-prepared comments (at page 39) to good news:  ‘We have made strong changes and will make more changes to continue what is best for the Anindilyakwa people’. She mentioned that recruitment of the new CEO was underway without commenting in any way on why the Council had terminated the former CEO. She mentioned progress in establishing the Groote Archipelago Regional Council: ‘A local council is what we always wanted for our people to ensure we take back control for our local services’. She reported that construction for the boarding school at Milyakburra will commence this year, with the bilingual school system to begin operating in 2026. Finally, she noted ‘It is a new year and the ALC board is committed to look forward, not backwards, to determine our future. We will be getting on with the important functions of the Anindilyakwa Land Council and delivering for the Anindilyakwa people…’ No mention of an ongoing National Anti-Corruption Committee Investigation into the ALC and/or its former CEO. No mention of the GEMCO litigation and the ALC’s dispute with GEAT. No mention of the progress (or lack of progress) of the Winchelsea Mine which the ALC has allocated tens of millions of dollars in section 64(3) payments (see below). No mention of the progress (or lack of progress) of the Little Paradise infrastructure hub which previously had been touted as central to the ALC’s economic strategy for Groote, and which within a month would seemingly be placed on the backburner (see above). Nothing to see here.

The rather lame Committee members were seemingly oblivious to the extent to which they were being taken for a ride, nor of their Panglossian complicity in gaslighting the public at large that all is now well in this best of all possible worlds on Groote Eylandt.

Senator Nampijinpa Price (at page 41) asked about the ANAO’s audit recommendations, and in particular which recommendations remain outstanding, the action taken to implement the recommendations and a timeline for implementation. The acting CEO’s response was a virtuoso display of technical and process-laden verbosity. Senator Price moved on to ask whether Mr Hewitt had been involved in the selection of the ALC Board [a strange question given that no-one to my knowledge has ever suggested that he had been]. The Acting CEO responded: ‘Not to my knowledge, no. It goes through a process as set out in the ILUA [sic: should read ALRA]. The clans nominate their representatives to represent them, the 14 clans on the board, and that process takes place. If there are more than the number of nominees, it goes through the normal NT election process.

In response to a question from ALP Senator Ghosh, seeking information from each land council on their most promising programs, the Acting CALC CEO stated (page 50):

At ALC, we distribute 64-3 royalty money to many corporations. We receive funding applications to be considered by a finance committee based on how the project will benefit our Anindilyakwa people and how it falls in line with local decision-making and aligns with our ALC strategic plan. So we go through that process. Ultimately, funding decisions are made by the ALC board.

Narrowly factual and succinct. No mention however of how the ALC handles the vexed issues of conflicts of interest. No mention of the millions invested in the ALC backed agenda for a mine on Winchelsea. No mention of the governance changes made since the termination of the former CEO.

All in all, the Estimates Hearing was hardly a forensic tour de force by the Senators present. Labor Senators only wanted to hear the good news; the Opposition spokesperson Senator Price, consistent with her previous approaches to the accountability concerns with the ALC (link here and link here), did enough to allow her to claim in the future that she had not ignored the issues being investigated by the NACC while not pursuing anything of substance. The officials present delivered a sophisticated exercise in ensuring the Parliament, the media and the public at large remain in the dark by proactively avoiding any issues of contention or involving defective accountability.  

NACC status. In early 2024, the National Anti-Corruption Commission (NACC) received several complaints, including from the NIAA in May 2024. At some point thereafter they initiated an investigation into unspecified matters involving the ALC and potentially other corporations based on Groote Eylandt. Multiple media outlets reported that they had visited the ALC’s Offices on 16 October (the same day that the ALC terminated the appointment of the former CEO Mark Hewitt). There have been no subsequent statements from the NACC relating to these investigations. While rational assessment would suggest it is a fool’s errand to predict when the investigation might be finalised, the odds of this occurring over the next six months must be increasing.

Concluding comment

This overview of recent developments, most of which have received little or no coverage in the media nor in the public statements emanating from the ALC and the Minister, provide a partial insight into the complexity of the wheels within wheels that are currently revolving on Groote, in the ALC offices in Groote, Cairns and Darwin, in the Board rooms of South32 and GEMCO, in various agencies of the NT Government in Darwin, and in various agencies of the Federal Government in Canberra. What is easily forgotten is that the lives of some 1500 people on Groote, and the opportunities of their descendants, are impacted for better or worse by the decisions reached as those wheels continue to revolve.

Over the past decade, a series of developments have occurred which raise serious questions regarding the quality of regulatory oversight over the actions of the ALC and its staff. The decision of the ALC to in effect engage directly in commercial activities, and particularly mining has been highly problematic. Its involvement was funded largely by the allocation of royalty equivalents to corporations which it appears to effectively control and was based on a ministerially approved agreement which was fundamentally compromised by the fact that the key individuals involved simultaneously sat on both sides of the negotiation. Where was the regulatory oversight as all this was set in train and continued?

It is my considered assessment that the quality of regulatory oversight by successive ministers for Indigenous Australians and the agency that serves them, NIAA, has been an egregious disaster. The case for greater transparency as a counterbalance to the vested interests in play, and as a guarantee that the Minister will ensure public accountability and the ALC will protect the interests of its constituents (which is its fundamental statutory raison d’etre) is inarguable.

In a forthcoming post, I consider the outcomes of some recent FOI decisions in relation to the operations of the ALC and its rather nebulous relationship with the NIAA.

 

 23 June 2025

 

Proactive disengagement: where to next for the ALC and Groote Eylandt?

 

I conjure you by that which you profess—

Howe’er you come to know it—answer me.

Though you untie the winds and let them fight…

… Even till destruction sicken,

answer me to what I ask you.

Macbeth Act four, Scene one.

 

Three weeks ago, on 16 October, the NIAA and NACC visited Groote and according to media reports met with the Anindilyakwa Land Council (ALC). Following the visit, the ALC board decided to dismiss their longstanding CEO, Mark Hewitt (link here). This follows an ABC news article on 10 July (link here) which quoted a spokesman for the NACC as confirming that it had received a referral from the NIAA and was assessing the referral. It appears (but is not certain) that the NIAA referral followed the May Senate Estimates hearings where Senator David Pocock questioned the ALC CEO about his dual roles as ALC CEO and as a Director of Winchelsea Mining, and summed up by commenting that Mr Hewitt’s dual roles were a "pretty egregious conflict of interest". According to the 10 July ABC news article, the Estimates Committee was advised that some $16m in royalty [equivalents] were directed to supporting the proposed Winchelsea mine.

Following the CEO’s dismissal, there appears to have been a conspiracy of silence from all involved. The ALC website has expunged all mention of Mr Hewitt but provides no explanation for the Board’s decision. The NACC continues its policy of complete silence until the results of its investigations are published. Minister Malarndirri McCarthy appears to have issued no media statement apart from her comments to the ABC (link here):

"I received a letter from the ALC chair informing me that at its meeting on October 16, the ALC board resolved to terminate the employment of the ALC CEO," Senator McCarthy said in a statement.

"Without the trust of the Anindilyakwa people and other key stakeholders, the ALC cannot properly achieve its mission of serving and advocating for the interests of the Anindilyakwa people."

All we can take from this is that the ALC Board lost trust in the CEO, but on what basis? The question is important because it goes to the nature of the issues that were of concern to the NACC and perhaps NIAA, and thus to the steps that need to be taken to remedy those issues.

Ever since the ANAO report into the ALC was published on 31 May 2023, the Government, Indigenous Australians Ministers Burney and subsequently McCarthy, and the NIAA have sought to downplay the issues which the ANAO report raised (for example by always focusing on the recommendations of the ANAO report rather than the myriad critical findings embedded throughout the report). They have also sought to slow down any proactive engagement, and thus avoid taking action to ensure the ALC was fulfilling its statutory obligations. In doing so, the Government has allowed the ALC, heavily influenced by its former CEO, to continue to pursue policies which are demonstrably at odds with normal standards of accountability, and which inevitably disadvantage the land council’s constituency, the traditional owners of the Groote archipelago.

To facilitate this proactive disengagement, the Government has adopted a strategy of intentional non-transparency. When interrogated, it invariably resorted to obfuscation, opacity and has hidden behind justifications which do not stack up under close scrutiny.

By deliberately not saying anything except when it has no choice, it has sought to minimise media attention by starving the issue of oxygen notwithstanding the fact that every time an ALC rock is turned over, a scorpion emerges. It has deliberately ignored the multiple concerns raised by numerous individuals including the 235 signatories to the Parliamentary petition tabled in February 2024, the issues raised in the SMH by Nick McKenzie and in the Saturday Paper by Ben Abbatangelo & Rachel Hoffman, and by me in two detailed letters to the ministers. This strategy has only worked because the Opposition has similarly adopted a studied position of policy insouciance. The Opposition Shadow Minister, Senator Jacinta Price has simultaneously argued for greater accountability of the land councils, unsuccessfully moving to establish a parliamentary inquiry into land council accountability, but failing to pursue in any substantive way the egregious issues that have emerged at the ALC (link here).

To date, the Minister appears to be continuing with her strategy of proactive disengagement. Meanwhile, while the NACC is focussed on determining whether there has been corrupt conduct by any individuals (inevitably a highly legalistic and thus narrowly focussed exercise), the potential for significant and ongoing financial losses and/or financial harm to the traditional owners on Groote remains unaddressed. These are two separate issues, and while they might overlap, it is unacceptable in my view for the Minister and NIAA to use the NACC investigation as the reason for doing nothing to mitigate the likely financial harms arising from the convoluted lattice-work of conflicts of interest that the ANAO uncovered in May 2023. Where is the public interest in waiting?  

Of course, the Government might argue that it set up the ‘independent review’ undertaken by BellChambersBarrett. This was sheer diversion to cover up inactivity. Ministers and the NIAA persisted in claiming the review was ‘independent’ notwithstanding that its recommendations were negotiated with and approved by the ALC (and implicitly its CEO Mr Hewitt who is now implicitly not trusted by the ALC and presumably the NIAA), notwithstanding that’s its drafts were commented upon and thus influenced by the NIAA Integrity Unit (and by implication the Minister), and importantly, notwithstanding that its terms of reference were limited to the implementation of the narrowly framed ANAO recommendations, and did not canvass broader or more recent issues. And of course, the ANAO report was itself limited by the ANAO’s remit to the operations of the ALC per se, whereas the complex flows of royalty distribution finance extend beyond the ALC to at least 12 corporations established under the CATSI Act, and over which the ALC exerted considerable influence if not actual control, thereby bypassing the intent of the Land rights Act to place individual distributions and investment decisions outside the purview of the land councils. The CATSI legislation itself falls under the Minister’s responsibilities.

Taking the commentary above as context, I propose to make some high-level observations on likely future developments and the necessary next steps in relation to the ALC.

The first set of observations relate to the case for undertaking a truly independent and transparent forensic audit of the ALC’s distribution of royalties and royalty equivalents. The ALC has leveraged these processes to allocate substantial (but as yet unquantified) financial resources to (a) retail outlets which do not appear to be independent of the ALC and its staff, and which may be shifting significant amounts of money to private individuals; (b) to request the Anindilyakwa Mining Trust (AMT) to transfer $41m to ARAC, a CATSI corporation which appears to have been effectively controlled by the ALC, but whose financial statements do not record the receipt of the payment which the AMT made; and (c) to effectively subsidising the infrastructure and other associated investments necessary to establish the Winchelsea mine which was / is effectively controlled by private investors and the former Chair and former CEO of the ALC (it is not clear if the Directors Winchelsea Mining have changed since the death of the former Chair and the dismissal of the ALC CEO; if they haven’t, then this in itself is a problem). The import of this subsidisation is in effect to grant funds to the interests which control Winchelsea Mining; yet analysis of the ALC’s own submission to the EIS suggests that the proposed mine will not be commercially viable (link here).

Even were these alleged financial misallocations to be found to involve corrupt conduct by the NACC, it would not fix the problem. What is required is a forensic audit to understand where the funds have been allocated and on what basis as the precursor to taking action to methodically unwind the arrangements that have been established to facilitate the misallocations. A forensic audit is thus the essential first step towards both addressing the conflict of interest and other problematic issues that have been allowed to develop within the ALC and to understanding whether it will be possible to recoup any misallocated funds. Moreover, delays will inevitably lead to an increase in the quantum of funds at risk of misallocation.

Perhaps more importantly, a forensic audit is an essential step in redesigning the ALC’s strategic financial strategy for the medium-term future given that the South32 mine is scheduled to close sometime in the early 2030s, with the almost immediate cessation of what is a significant financial flow to the Groote community. The sheer magnitude of these flows — which emanate from Commonwealth appropriations — to what is a relatively small population, which as has been previously pointed out (link here and link here) is paradoxically suffering from extraordinary levels of disadvantage, suggests that the Commonwealth itself has a responsibility to put in place a transition strategy of some kind. Again, the first step in doing so would be to understand just where the royalty and royalty equivalent financial flows have been allocated. It should not need to be said, but I will repeat it: the mere undertaking of a forensic audit is essentially a core regulatory oversight task, and it will not inevitably and adversely impact any ongoing investigations. Indeed, the reverse is more likely to be the case: it is likely to assist the investigation of potential legislative and accountability breaches, and it is possible that new lines of investigation in relation to corruption or criminal behaviours will emerge.

The second observation relates to the potential consequences of the current royalty distribution arrangements on Groote unravelling. There is more at stake here than an issue of whether an individual or group of individuals associated with the ALC have engaged in criminal activities or corrupt conduct. Notwithstanding the rhetorical hype that is often promulgated, the population on Groote are among the most disadvantaged citizens in Australia (link here). The reasons are complex and are not merely a matter of access to income. What is clear however is that the complexity and artificiality of the current financial arrangements on Groote are such as to exacerbate the risks of seriously negative social and cultural impacts from an erratic and haphazard unwinding of the current royalty distribution arrangements. The possibility of violence cannot be discounted. The implementation of any reform process will need to be managed. This is a task that will inevitably require external support. As a coda to this observation, I should emphasise that the risks of an unmanaged unwinding of current financial arrangements are higher if the Commonwealth chooses to remain inactive and disengaged. In my view, the Commonwealth now has no choice but to engage with the complexity its lack of regulatory oversight has unleashed (see below).

The third set of observations relates to the responsibilities of the Minister (and her predecessors) and NIAA to oversight the operations of statutory corporations in her portfolio. The scale and breadth of apparent maladministration; the quantum of the funds that may have been misallocated; the complexity of the financial arrangements involved; the convergence of public investment and private commercial interests, the sensitivity of the social, environmental and economic issues involved, and the extraordinary way in which much of this has developed and taken place in plain view indicates that there has been an extraordinary and substantial regulatory failure by the Commonwealth over a period going back to shortly after the former CEO Mr Hewitt was recruited. To provide just one example, the advice he gave to a previous Estimates Committee Hearing that he had a conversation with former Minister Scullion where he advised him of his dual roles on the ALC and Winchelsea Mining and assured him that there were arrangements in place to manage the conflict is (if true) an extraordinary revelation. Mr Hewitt claimed the subsequent Minister, Mr Wyatt, was also advised of the arrangement. These conversations in themselves appear to be significant watersheds in the development of the current royalty administration crisis, and yet appear to have elicited not one iota of concern within the Ministers’ Offices, nor NIAA (assuming of course that they knew of it; if they didn’t, what did NIAA do when they did become aware of the conflicted roles?).

Fourth, and finally, I make the observation that the current policy of proactive disengagement has meant that there is absolutely no information in the public domain regarding the current state of management of a key statutory corporation within the Minister’s portfolio. There are numerous legitimate questions that remain unasked and thus unanswered. To take some at random: what is the status of Ms Liu, Mr Hewitt’s spouse and a former employee of the ALC, who is /was actively engaged in the Royalty Shoppa scheme, in the ALC Royalty Management Unit (and thus a range of associated CATSI corporations), and in Winchelsea Mining? What is the status of the Chair of the ALC Audit Committee? How is it that the Audit Committee failed comprehensively over many years to identify and recommend the necessary changes to prevent the crisis that has emerged? For that matter, where was the NAIA Audit and Risk Committee in this whole process? Does the minister see these lapses as a problem and if so does she intend to do anything about it?  What is the current status of the proposal for a mine on Winchelsea Island?  Who are the Indigenous members of the Winchelsea Board following the dismissal of Mr Hewitt and death of the former Chair? Why did AAAC, the corporation which owns 70 percent of Winchelsea shares not have a single Director on the Winchelsea Mining Board? Has that been remedied recently?

More fundamentally, why has the current Government pursued a deliberate policy of proactive disengagement in relation to the operations of the ALC? How can the public and the traditional owners of Groote be reassured that the Government itself is not complicit in some way in what has transpired here?

The ALC and its associated recipient CATSI corporations are in a state of crisis. A crisis that no one wants to acknowledge, let alone seeks to fix. An apt metaphor would be a commercial corporation operating while insolvent. The risk is that it will seek to trade its way out of its financial crisis, and in the process, go bankrupt with even greater losses. The solution is for the shareholders to appoint insolvency specialists who can make an independent assessment and address the underlying issues.

In the present case, it is the Minister to whom this responsibility falls. To date, she has given absolutely no indication that she is cognisant of the risks or prepared to take the necessary action. She should immediately take action to appoint a highly experienced independent administrator to the ALC with the authority to oversee an independent forensic audit and to develop a pathway out of the current crisis. This process will require full transparency to minimise the risks of societal conflict on Groote, to ensure that those responsibility for getting the ALC into its current morass are held accountable, and importantly to maximise the chances that those who will be found to have suffered financial losses or disadvantage are recompensed. This responsibility goes beyond one individual and the possibility at some point in the future of a limited finding of corruption or misfeasance in public office.  And it goes beyond the ALC and its employees.

 

5 November 2024