Confusion abounds: the AINT strategy for the coming decade

My thoughts are whirled like a potter’s wheel;

I know not where I am, nor what I do.

1 Henry VI, Act two, Scene four.

Aboriginal Investment NT (AINT) is a corporate Commonwealth entity established in November 2022 under the Aboriginal Land Rights (Northern Territory) Act 1976 (ALRA). Initially named NT Aboriginal Investment Corporation, the operational name was changed by ministerial fiat from Northern Territory Aboriginal Investment Corporation (NTAIC) to Aboriginal Investment NT (AINT) in August 2024.

There are 12 board members: two appointed by each of the four Northern Territory land councils, two appointed by the Australian Government, and two appointed by the board. Board membership is specified in section 65EA of the ALRA. The board appoints a CEO who is responsible for day-to-day administration. Under the PGPA Act, the board is the accountable authority for Aboriginal Investment NT.

AINT was funded from the Aboriginals Benefit Account (ABA), with an initial $680 million over three years to invest and provide grants to Indigenous businesses and communities across the Northern Territory. The ABA is established by the ALRA to receive and distribute funds generated from mining on Aboriginal land in the Northern Territory. Section 64AA of the ALRA sets out funding arrangements for the Northern Territory Aboriginal Corporation, also known as Aboriginal Investment NT. The $680m for investment and grants was allocated under subsection 64AA of the ALRA. AINT’s purpose is:

• To promote the self-management and economic self-sufficiency of Aboriginal people living in the Northern Territory (NT); and

• To promote social and cultural wellbeing of Aboriginal people living in the NT.

The outline above was taken from the 2024 ANAO Performance Audit (paragraphs 1.9 to 1.12). The text has been paraphrased to incorporate some footnotes and improve accessibility:

The ANAO 2024 Performance Audit

In December 2024, the ANAO published a Performance Audit examining the management of conflicts of interest by three portfolio agencies within the Aboriginal Australians portfolio, including for present purposes AINT (link here). The report is useful for a number of reasons, including for the high-level overview of the formal legislative and regulatory approach of the Commonwealth to conflict-of-interest issues in relation to Commonwealth agencies. Paragraphs 1 to 4 of the Summary and Recommendations section of the ANAO Report outline these, and Appendix 3 provides more detail in respect to the relevant legislative provisions.

AINT was established in 2022, and the ANAO audit was clearly designed to provide an early snapshot of the state of compliance.

The ANAO high level conclusions are outlined in paragraphs 13 to 15:

13. … Aboriginal Investment NT …. [was] partly effective in the management of conflicts of interest. While there were frameworks in place to manage conflicts of interest, there were shortcomings with the implementation of those frameworks. There were deficiencies with the documentation of board consideration of conflicts and documentation of conflicts of interest declarations and management actions for procurement, recruitment and grant activity.

14….  Aboriginal Investment NT [has] developed largely appropriate arrangements to manage conflict of interest consistent with legislative requirements of corporate Commonwealth entities …

15. The entities were partly effective in implementing arrangements for managing conflicts of interest. Board assessments of declarations of interest were not sufficient to record whether the board had determined declarations to be material personal interests. Aboriginal Investment NT’s board did not include declarations of interests in three out of session meetings and a workshop and did not always record the nature and extent of declared conflicts. There were instances of Aboriginal Investment NT Grants Committee members with declared conflicts of interest recommending grant applications for board approval ….  Aboriginal Investment NT did not adequately document conflict of interest management for procurement as required by its policy.

Most of these issues appear to have been addressed subsequent to the performance audit, but their early emergence demonstrates both the internal pressures in play in what are cross-cultural organisations, and the risks that continue into the future.

The AINT 2024-25 Annual Report

Under the PGPA Act, the AINT report was due on October 30, 2025. The AINT advised the Minister that the ANAO had experienced delays in finalising the audit, and as a result the Minister initially agreed to an extension to the end of November and then extended it to the end of February (link here). In the event the Annual Report was published on the AINT website in the first week of March 2026. The Chair wrote to the Minister providing a copy of the audited financial statements on 18 February, the accountable authority statement was signed by the AINT Chair, CEO and Chief Operating Officer on 19 February 2026, the unqualified ANAO audit opinion was signed on 20 February 2026. We live in strange times where time appears to move backwards (at least in the NT). The financial statements (without the ANAO audit opinion) are also available on the ACNC web site as the AINT has charitable status. Somewhat bizarrely, the Annual Report has since been removed from the AINT website and is not available on the Department of Finance Transparency Portal. To my knowledge, there has been no explanation provided by either the Minister or AINT for this action.

In addition to the apparent reversal of time, there is an unfortunate error in the heading to the figures in Note 10 to the (original) financial statements page 92 which has the effect of multiplying the relevant management personnel salaries one thousand times. It is not clear if this will be remedied when the Annual Report is finally republished. I do not believe that this is the reason for the withdrawal of the report as this error also occurs in the equivalent section on page 82 of the previous AINT 2023-24 Annual Report.

Given the comparative complexity of the AINT financial statements, and the delayed release of the report, the 2025 ACNC Annual Information Statement (link here) provides the best current snapshot of the AINT’s overall financial status. This shows that in June 2025, the AINT held net assets/liabilities of $693.3m. This comprised current assets of $422.9m (comprising according to the more detailed financial statements $300m in cash and cash equivalents and $100m in ‘other investments’), and non-current assets of $272.5m. Liabilities were only $2.1m. It seems likely that the non-current assets are all invested in the AINT Unit Trust (see below). It is unclear if any of the current assets are also in the Unit Trust.

The AINT Strategic Plan (available on its website) is built around the establishment of two Funds, the Future Fund and the Community Ready Fund. The Future Fund invests the AINT corpus, the Community Ready Fund is utilised for financing AINT operations and ongoing grants. See page 32 of the Strategic Plan for the best description of the Future Fund so far made public. Section 7 of the Strategic Plan describes the approach of the Community Ready Fund including some one-off allocations which allow the project grant profile to continue in the short term above the long-term level available from the Future Fund. See the graph on page 51 displaying the forecast grant spend from the Fund into the next four years.

The Annual Performance Statement in the Annual Report (pages 32-37) reports that both funds delivered above target returns over the past year.. In a section titled Investment Performance, AINT reports that the Future Fund achieved an annualised return of 5.8%, exceeding its benchmark target of CPI plus 3%. (In contrast, on page 36, the report states that the Future Fund achieved a 5.9% return). At 30 June 2025, the Future Fund held $522.5m in assets, comprising $100m in term deposits and $226.3m in cash awaiting investment. This suggests that $182m was invested. The Community Ready Fund delivered 4.9% return against its more modest target of CPI plus 1%. Its balance on 30 June was not stated, but the report notes that the fund ‘was fully invested with $120.6m deployed…’ While the investment returns are useful, without knowing the quantum of the funds invested, readers have little idea of their real significance.

Somewhat confusingly, the section on Financial Results (pages 68-69) refers to the commencement of investment activities through the AINT Unit Trust, a controlled entity established to manage long term investments. The AINT financial statements provide just a single column which consolidates the operations of both the AINT and the Unit Trust. A more transparent approach would be to do as the ILSC did before the recent sale of Voyages and list both the ILSC and the consolidated financials in separate columns. The Notes to the Financial Statements (Note 11) refer to the expenditure of $305m to purchase units in the Unit Trust during 2024-25, but this figure cannot be tracked into the financial statements themselves. The AINT Unit Trust presumably holds the $182m invested in the Future Fund and the $120.6m ‘deployed’ by the Community Ready Fund, which totals $302.6m.

Apart from Note 11 to the Financial Statements which lists fees of $717k in 2024-25 to advisory firms CIML and JANA paid from the Unit Trust, there is no reference in the Annual Report to the management fees and investment advice fees that underpin the Unit Trust arrangements. However the Senate Entity Contracts Listing for 2024-25 published on the AINT website lists contracted management fees for CIML over five years to 2029 as $19.24m and for JANA for investment advice over the five years as $1.9m. Combined, these two contracted firms will cost an average of $4.2m per annum for the next five years to manage the AINT investments within the AINT Unit Trust.

Not only is the Annual Report’s description of the relationship between the AINT Unit Trust and the two Funds operated by AINT opaque and indeed, confusing, but it is also unclear just how the AINT exercises its control over the Trustees as the Trust Deed between AINT and CIML does not appear to have been published or summarised in any public documentation. What is clear is that the AINT Investment Committee and in particular its Chair Peeyush Gupta and member Richard Brandweiner (both of whom come from finance backgrounds) play crucial roles in managing the Future Fund, and the Unit Trust investments. These two were the only Investment Committee members to attend all 7 meetings of the Committee during the financial year (see page 51 of the Annual Report).

Given the potential complexities involved I asked my AI research assistant Claude for its view on the rationale for using such a structure. Given the tax-free status of the AINT, it responded inter alia as follows:

Compliance and reputational signalling arguably becomes the dominant remaining rationale. A [tax free] charitable entity established by Commonwealth legislation faces heightened scrutiny — from the ACNC, from its enabling legislation's oversight mechanisms, and potentially from parliamentary accountability processes. Holding investments through a formally constituted unit trust with a corporate trustee, a trust deed, and defined investment mandates demonstrates structured stewardship of assets in a way that direct holding does not. It creates a paper trail and governance architecture that can withstand external scrutiny.

The candid assessment is that for a sole-owner tax-exempt charitable entity, the unit trust structure offers relatively thin functional advantages compared to direct investment or a subsidiary company. The structure makes most sense if the trust deed itself — through its investment mandate and distribution rules — serves a constraining or accountability function, or if there is a genuine prospect of admitting other investors in future. If neither applies, the administrative overhead of maintaining a separate trustee, trust deed, and unit register may outweigh the residual benefits. [emphasis added]

The question worth asking in this context is whether the structure was chosen for sound governance reasons at the outset, or whether it persists as inherited architecture that has never been critically examined against the entity's actual circumstances.

These are more substantive questions that the AINT has not, so far, envisaged being asked, let alone answering. In my view, the AINT would be well advised to consider reframing future statutory reports to provide clearer and more transparent information about its investment operations.

A critique of the AINT Investment Strategy

 I should begin by noting that I was (amongst many others) a critic of the legislation establishing AINT for several reasons. My post from November 2021 titled Opportunities and Risks (link here) provides a high level critique of the proposed legislation (as it then was) establishing NTAIC (now AINT). For those interested in exploring the issues raised in more detail there is a link to the various submissions to the Legislation Committee considering the Bill and unsurprisingly I recommend reading my submission. It takes a wider lens than just the proposed corporation, and deals with the systemic conflicts that I suggested would inevitably emerge. I don’t propose to focus on this wider picture here but instead will focus on the potential alternative investment strategies available to NTAIC.

In relation to the operations of the Community Ready Fund, I don’t wish to say too much. It is clearly the ‘front of house’ for the AINT, and until recently there has clearly been a legacy of approved grants that had to be processed and finalised. In the discussion in the Strategi Plan of its objectives, there are four separate areas of focus, plus a vague commitment to focus on sector-based activities. The four foci are (i) grants, (ii) collective impact initiatives, (iii) place-based investments, and (iv) strategic investment. Areas (iii) and (iv) together encompass so called nation building investment. This strikes me as on over-engineered attempt to make the grants process look coherent and rational. To my mind it is both too all-encompassing (‘everything is a potential focus and priority’) and thus easily subverted for political or other reasons.

I will make two high level conceptual points that in my view the AINT should consider seriously. First, there is much greater impact in supporting high quality grass roots organisations with positive track records which deliver valuable services on the ground. It would be particularly valuable to identify elements of their activities that governments are not prepared to fund and/or elements that build organisational resilience. Second, for small Indigenous businesses, I would suggest that instead of grants that the AINT consider experimenting with low value interest free loans that are repayable once the business meets particular revenue or profit thresholds and are written off after a set period (say ten years) if those thresholds are not met.

In relation to the Future Fund, I have more serious reservations about the utility of the strategy that has been adopted. The current investment corpus appears to total around $500m to $600m. Taking $500m as the base, if the investment target is met, and there were zero distributions the Future Fund will compound each year and grow to $672m in current dollars over ten years. If the 3% growth ($15m pa) is fully distributed, the fund will continue to be valued at $500m over the decade. If say half of the growth was distributed each year ($7.5m) then the fund would grow to $581m over the decade. It is unclear if the target growth rate is net of management fees, but at $4m per annum that either cuts into the available funds for distribution or adds an effective premium of 0.7% to the target (i.e. it must actually return CPI plus 3.7% to allow $15m pa to be distributed on average). A long-term investment return of around $15m per annum will not sustainably fund the projected level of grant expenditure of $40m. Such a spend rate will either require additional injections of capital or lead to a reduction in the AINT investment corpus over time.

Given the passive nature of the Fund at present, and the current level of advisory fees, there may be merit in considering whether it would be more cost effective to utilise the Commonwealth Future Fund as a fund manager. This is the course adopted by the Commonwealth to manage the Land Fund which provides the annual revenue base for the ILSC.

The bottom line here is that the AINT has established what is effectively an endowment fund and without further injections of capital, and effective and serious constraints on transfers to the Community Ready Fund (which would lead to a loss of political support for AINT within the NT Indigenous community), it is unlikely to grow substantially beyond its current size. Even were a Commonwealth minister to inject further funds into the Future Fund from the ABA, say to double it to $1bn, the annual funds available for distribution would only be around $30m in current dollars. This does have the potential (if targeted and sustained) to make some difference in selected areas or sectors, but it is not going to ‘build intergenerational wealth’ for anywhere near the majority of Indigenous Territorians. This is the objective of the Future Fund as laid out in the AINT Strategic Plan, yet the rhetoric does not match the reality.

What then is the alternative?

My strong suggestion would be to adopt an entirely different approach aimed at leveraging the available capital to invest directly in a select number of sectors and enterprises in the NT that for one reason or another have not attracted either government or private sector investment in the past and which are also of direct relevance and significance to either remote communities and/or the Aboriginal community writ large. Sectors that are crying out for such a ‘social impact investment’ approach include establishing community housing entity to operate across the Territory, building a Territory wide disability coalition or service providing disability services funded by accessing mainstream funds from the NDIS, building an expanded territory wide mobile dental service, taking up an equity position across multiple Aboriginal owned building companies thus allowing them to access more capital both directly and indirectly. There are numerous other opportunities of a similar kind (see the link to the Centrecorp Foundation below). My assumption is that the AINT investments must be commercially based (i.e. designed not to lose money) and should actively seek to leverage their capital and Indigenous access to find commercial partners to take up influential stakes in commercial opportunities which directly provide benefits for Indigenous Territorians. I accept that this approach appears high risk but doing nothing (or a bare minimum) with available capital while persuading yourself that you are building wealth delivers certain failure. It will require sustained and strong governance, a disciplined approach to strategy, and strong commercial acumen, but these are not an unthinkable aspiration for Indigenous interests.

Examples of this broad approach include Indigenous Business Australia in Canberra, and the extraordinarily impressive Centrecorp Foundation in Alice Springs (link here) which manages a portfolio of assets valued at around $250m. Centrecorp has invested in core commercial real estate in the Alice Springs CBD, Darwin, and a number of other regional centres, some residential housing opportunities in Central Australia, and is a substantial owner of the major Toyota supplier in Central Australia and a major hire car business. These businesses operate across the Indigenous / non-Indigenous commercial domains and have been very successful in building credibility for Indigenous interests within the commercial circles in Central Australia. One consequence of such a strategy, if executed successfully, would be to build real political influence for Indigenous interests within the NT.

Confusion abounds

The confusion related to the delayed finalisation of the audited financial statements and the stop/go/stop imbroglio with the 2025 Annual Report are in the scheme of things of minor import. The early missteps over conflict-of-interest processes identified by the ANAO are easily rectified.

The confusion arising from the opaque relationship between the two strategic funds and the AINT Unit Trust is more significant as it reflects a degree of transparency failure which works against clear and rational thinking about the substantive reality and constraints facing AINT and its current investment strategy. The most significant consequence of portraying transparently the limited opportunities built into the AINT are the lost opportunities that nevertheless might be harnessed from the not inconsiderable quantum of financial assets under AINT management.

A major driver of these lost opportunities is the lack of clarity in the AINT’s various governance reports around the serious limitations in the outcomes negotiated by the Commonwealth and the Land Councils in 2021, which in turn arise from the systemic and structural conflicts of interest between the land councils and the wider Indigenous community in the NT, and the separate desire of the Commonwealth to respond to the longstanding demand from Indigenous interests for greater control over the ABA, while off-loading admin costs for grant management yet retaining substantive control. For an explanation of these in more detail, I refer readers (again) to my submission (#4) to the Legislation Committee in considering the legislation that established AINT in2021 (link here). That lack of clarity around the reality of the limitations of the legislation and thus the AINT, suggests that the confusion which pervades the AINT’s operations is in fact built into its institutional architecture.

For AINT, the most important factor in its ultimate success or failure will be whether it develops the capacity to think strategically about the opportunity matrix it faces and the capacity to act decisively to execute a cogent and considered plan. Confusion is the enemy of both prerequisites. Or as Mark Twain is reputed to have said:

It ain't what you don't know that gets you into trouble. It's what you know for sure that just ain't so.

 

7 April 2026

The Yunupingu High Court Decision: some downstream policy issues

 

When clouds are seen, wise men put on their cloaks;

When great leaves fall, then winter is at hand;

When the sun sets, who doth not look for night?

Untimely storms makes men expect a dearth.

Richard III, Act two, Scene three.

 

The Federal Court decision which led to the appeal to the High Court in this case was handed down in May 2023. I published two posts following that decision (link here and link here). In those posts I contemplated the potential policy implications in the event that the High Court ultimately were to endorse the Federal Court’s decision.

In early March this year, the High Court handed down its decision and upheld the Federal Court decision. I will leave the technical textual analysis to the lawyers, but it seems to me that the analysis I offered in May 2023 continues to hold true in broad terms. I recommend readers re-read those posts as they have continuing relevance. For a good summary of the implications of the High Court decision, I recommend the brief by international law firm Ashurst (link here).

The High Court decision has implications primarily for the NT, but also in theory for the ACT and perhaps other territories (link here).

In terms of the core future policy implications, I would nominate three related (and arguably intertwined) issues which will shape the ultimate outcomes:

1.    The nature of the compensable native title interests that were extinguished;

2.    The quantum of potential compensation likely to flow both to particular native title holding groups and overall; and

3.    How best to manage whatever compensation benefits ultimately flow.

As I pointed out in my previous posts, and as was reiterated by Ashurst, the flow-on effects of this decision will take time to emerge, and there may be an attempt by the Commonwealth to short-circuit future litigation and potential expansion of liability by negotiation of wider agreements along the lines of what occurred in Western Australia following the Mabo decision. Whether these flow-on implications arise from litigation or agreements, one insight which is indisputable is that the compensation funds that flow will essentially be one-offs (even if they flow over some negotiated period). Indigenous interests therefore have an incentive to prepare by building their capability to manage significant compensation flows. The obvious starting point therefore is to consider the feasibility of the development and use of mechanisms and policies which deliver perpetual benefit-flows. There are also strong arguments in favour of Indigenous interests considering the best policy architecture for managing such flows. However, the successful implementation of these types of arrangements are not straightforward.

Perpetual Funds

At present in Australia, we have a spectrum of governance arrangements for managing native title benefits rangeing from the ad hoc arrangements applying to native title payments operating in Western Australia (where there is limited visibility of their effectiveness) through to the more structured arrangements in Victoria where the Victorian Traditional Owners Funds Limited (link here) provides a financial investment service to the various Traditional Owner Trusts which have negotiated agreements with the Victorian Government. The NT of course has its own existing high level governance arrangements for managing royalty flows and native title financial agreements plus a range of subsidiary mechanisms essentially controlled or at least influenced by individual land councils or their constituents. Obviously, the NT’s existing overarching policy architecture will be the starting point for any consideration of necessary future arrangements. However it is clear (at least to me) that these extant structures are sub-optimal and require reconsideration and substantial improvement to meet future circumstances. In the rest of this post, I seek to outline at least in broad terms why I believe the current institutional architecture for managing financial benefits for Traditional owners in the NT are not fit for purpose.

The Aboriginals Benefit Account

The starting point for any consideration of the policy architecture for land rights and native title payments in the NT is the Aboriginals Benefit Account (ABA) established by the Aboriginal Land Rights (Northern Territory) Act 1976 (ALRA). This account is an institutional policy mechanism whose roots can be traced back to Paul Hasluck’s time as Minister for the Interior. It involves the Commonwealth appropriating an equivalent amount to the mineral royalty revenues accruing to the NTG (and the Commonwealth in relation to uranium).

The ABA is effectively controlled by the commonwealth minister for Indigenous Australians and its funds are allocated for various legislatively specified purposes: land council administration, land council distributions to corporations representing those impacted by mining, and various sundry costs such as township leasing. In addition, the ALRA legislation provides for various payments to the recently established NTAIC, now known as Aboriginal Investment NT (AINT), comprising a one-off capital injection of $500m and three annual payments of $60m, as well as annual administration costs. Importantly, there has always been an element set aside for beneficial grants to the wider NT Aboriginal community.

The ABA does not represent the totality mining related payments to Aboriginal Territorians as payments negotiated by land councils are outside the ABA, and so are some older trusts such as the Groote Eylandt Aboriginal Trust established by missionaries before the advent of land rights.

Aboriginal Investment NT

According to the most recent financial statements for the ABA (which can be found in an appendix to the NIAA Annual Report: link here), the ABA currently holds assets valued at $1.47bn offset by liabilities of $566m comprised primarily of the (tautologically described) ‘initial one-off endowment of $500m’ to NTAIC plus a further payment of $60m being the last of three legislated $60m payments designed to provide funding certainty to AINT its establishment phase. Any additional funding for the Future Fund and/or the Community Ready Fund is at the entire discretion of the Minister of the day. The ABA’s residual current net asset base is thus $907m. The annual appropriation to the ABA is based on the quantum of mining royalties levied by the NT Government which in turn is influenced by production levels in the various mines on Aboriginal land in the NT. By far the largest contributor to the NT Government mining royalties is the GEMCO manganese mine on Groote, scheduled for closure in the early 2030s.

According to the AINT financial statements in its annual report (link here), and its Strategic Investment Plan (SIP)(link here), AINT has allocated $500m to its Future Fund which is intended to finance its Community Ready Fund which is used to make community grants, and to invest in sector development and what the Plan terms nation-building investments. The Future Fund is designed to accumulate for at least ten years with the aim of providing a funding source into the medium/longer term. Its target rate of return is CPI +3%. The SIP notes that the AINT Board had allocated $155m to the community ready fund. The 2023-24 financial statements list AINT’s net equity holdings (assets less liabilities) as just under $680m.

There are two implications arising from the legislated framework for AINT. First, while its annual operational costs will be funded from the ABA, the funds available for distribution from its Community Ready Fund over the next decade will essentially be in the hands of the Government. This is the Fund which makes beneficial grants to community organisations across the NT.

Second, and importantly, the idea of a perpetual Future Fund is essentially a chimera. Assuming AINT achieves its target rate of return of CPI + 3%, then by 2035 it will have grown to $672m in 2025-dollar terms. From there on the use of an assumed 3% returns for distribution to the Community Ready Fund would finance a grant of $20m per annum in 2025 dollars in perpetuity. When one considers that previous annual grant levels from the ABA were around $40m per annum, and have recently dropped to around $25m, it becomes apparent that unless investment returns greatly exceed the target, the AINT Future Fund will require further endowments merely to ensure AINT can keep doing what the ‘old’ ABA was doing.

The more general and most important point deriving from this analysis is that the notion of establishing a perpetual fund to finance the economic transformation that is required in the NT (and the rest of remote Australia) is much more difficult than governments and the Indigenous leadership in the NT (which negotiated and agreed to the legislated architecture of the AINT) have been prepared to admit.

Implementation Challenges

The AINT was a signature reform, yet it will not deliver transformational change as presently funded and I would argue as presently designed. I will expand on what I consider will be necessary to drive such transformational change in a later post. While it is possible that a future Government will allocate more capital to the AINT from the ABA and/or that the AINT’s investment performance will be substantially better than its target, there is also a significant downside risk that governments will prefer to retain direct control over the balance of the ABA (and its significant automatic annual accretions) and/or the possibility of either poor or unlucky financial management by AINT. Moreover, the provision of automatic operational funding for the administration of AINT is in my view a potential structural flaw as it removes the crucial incentive that ensures management is financially rigorous and replaces it with an incentive to be politically attuned. Ultimately, this may be to the disadvantage of Indigenous interests in the NT.

Apart from highlighting the challenges of establishing financial Trusts or Future Funds that will maximise the longevity of any compensatory benefits that flow from expanded compensation arrangements due to Yunupingu, I wanted to focus on the ABA and AINT, because they each appear to provide a mechanism that could be used (or arguably misused) to fund compensation payments arising from future litigation in the NT.

When AINT [then referred to as the NT Aboriginal Investment Corporation or NAIC] was first foreshadowed during Minister Ken Wyatt’s term, there was widespread opposition from some quarters to its design. I was amongst those with concerns and published two posts on this blog (link here and link here). One of the concerns I raised then was that the establishment of the AINT was only partial leaving considerable funding in the hands of the minister. Moreover, this funding discretion was unfettered as the establishment of the AINT was the rationale for abolishing the ABA Advisory Committee. It is now crystal clear that the Minister retains considerable leverage over the AINT by virtue of her power to approve or not approve operational funding and the additional endowment top ups which will be necessary merely to maintain current levels of beneficial grants.

In my second post, I pointed to the major increase in funding for the land councils announced by Minister Wyatt and suggested that it was not coincidental in ensuring that the land councils supported the amendments. I thought then, and think now, that this was a short-sighted decision by the land councils. Whether the land council leadership realised it or not, an objective assessment suggests that they and their advisers were outmanoeuvred and collectively co-opted by the Commonwealth.

The most recent ABA financial statements indicate that last financial year the Minister approved over $80m in grants to private sector entities from the ABA (it was $60m in the previous year) [see page 186 of the ABA financial statements (link here)] with minimal transparency while the AINT committed in principle grant funding of $20.6m and $8.7m (see pages 27 and 29 of the annual report) and actually spent only $9m (see page 75 of the Annual Report). The ABA’s revenue growth has slowed over the past year following damage to the wharf at Alyangula, however it can be expected to continue at around $300 to $400 million per annum over the next decade. In other words, the ABA’s financial assets are growing at a faster rate than AINT’s financial assets generally and particularly the AINT Future Fund.

The bottom line was that the Minister retained access to the largest slice of the ABA pie with unconstrainted flexibility to make beneficial grants from the ABA while Aboriginal interests have through AINT gained access to a smaller slice of the pie, with constrained flexibility and high expectations from the communities seeking to overcome economic and social disadvantage.  

Risks

The design architecture of the ABA following the establishment of the AINT creates a significant risk that is considerably heightened by the Yunupingu decision. Given that the ABA is funded by appropriations to be spent for the benefit of Aboriginal people in the NT, it is theoretically possible that the Commonwealth might decide to utilise the ABA funds under the control of the Minister to finance any compensation liabilities it accrues into the future because of the High Court Yunupingu decision. More likely (given that the Commonwealth has form in this respect) the Commonwealth might seek to use its control and the financial heft of the ABA to negotiate a financial settlement of all potential litigation with the land councils and their constituents (either separately or together).

We are already seeing the Commonwealth seeking to constrain the likelihood that the land councils will ‘rock the boat’. It is clear that the political salience of the land councils has increased in recent years as both sides of politics have searched for ways to engage with disenchanted voters across the NT (link here).

The risk for Indigenous interests generally is that the land councils have a limited policy remit and perspective yet effectively operate as proxies for Aboriginal interests generally. The risk for land based Aboriginal interests is that the land council leadership and bureaucracies become increasingly vulnerable to co-option by governments.  The level of payments to the land councils from the ABA has increased considerably over the past five years. In just one year, from 2023 to 2024, ministerially approved administration payments to the four NT land councils rose from $109m to $138m, an increase of $28.9m or 21%. This generosity does not come free; it has an ulterior purpose and also has an opportunity cost in foregone investment by the ABA in pressing Indigenous priorities.

Of course, a new conservative government might revert to the earlier tactics and seek to dismantle what they see as the hegemony of the land councils (link here). Either way, Indigenous interests stand to lose out.

Way forward

In my view it is time for the Indigenous leadership in the NT to reconsider their strategic vulnerabilities and begin to strengthen the ramparts defending their key institutions. A key element in such a reconceptualised strategic approach would be to focus on building stronger governance capabilities, committing to stronger transparency (no matter how uncomfortable it seems) as an insurance against poor governance, and working harder to build a unified advocacy capability. Self determination is never handed to anyone on a plate; it must be argued for and grasped. And once gained it must be defended and used carefully. It is not possible for any group entirely dependent on government funding to exercise real self-determination.

The Yunupingu decision is the latest in a long line of High Court decisions seeking to remediate the incapacity and unwillingness of executive governments through time and across the nation to address deep-seated disadvantage, inequality and discrimination. The decision is important, but transforming newly acquired rights for Indigenous interests into tangible and transformational gains requires building the advocacy capabilities to reform institutions and the political unity to protect the incremental gains made in previous times. In both these arenas, a commitment to high quality governance and maximum transparency will be the friend and not the foe Indigenous interests, not least in undermining the proclivity of governments to co-opt those whose interests they decide to ignore or set aside. There are reasons that governments avoid transparency and seek to operate in the shadows.

Conclusion

The downstream policy implications of the High Court decision in Yunupingu are potentially significant. The expand the footprint of Indigenous rights in the Territories and particularly the Northern Territory. Yet taking advantage of those rights will not be easy and will require not just the preparation of new compensation litigation, but the development of strategically sophisticated political and advocacy capabilities, and a preparedness to resist the propensity of governments to co-opt emerging leaders who might otherwise constrain their attempts to maintain the status quo ante.

 

17 April 2025

 

A counter-intuitive proposal to expand rooftop solar in the bush

 

The self-same sun that shines upon his court

Hides not his visage from our cottage but

Looks on all alike.

The Winter’s Tale Act four, Scene four.

 

My previous post was essentially a high-level review of an excellent book titled Guide to Housing and Infrastructure Standards in Town Camps (link here). I recommend readers peruse that post before reading this post.

In this post, I delve a bit deeper into just one of the thirty essential services issues addressed by the Guide — the under-reliance on rooftop solar power in remote communities — and make a high-level policy proposal to break the current structural deadlock that contributes to energy insecurity, poor health, and the sheer liveability of remote community housing infrastructure.  

The Guide’s analysis of rooftop solar

The Guide (section 2.28 on pp. 148 – 151) identifies solar energy as one of the thirty issues it deals with. The Problem is identified as energy insecurity. The combination of temperature extremes, poor housing design, associated high demand for electricity, in a context of high reliance on prepayment meters amongst town camp residents leads to high levels of energy insecurity. The Guide references academic research to report on extraordinary rates of multiple power disconnection events affecting 91 percent of prepayment meter households across the NT (link here). Under Regulations, the Guide notes inter alia that the payback term for installed rooftop systems is often less than five years, and suggests that the introduction of rooftop solar systems could be the key to climate proofing homes in Aboriginal Town Camps (link here). Under Solutions, the Guide points out that while the upfront costs of incorporating solar energy systems into community and housing infrastructure has often been used as an excuse for not installing them, it calculates for one town camp that the payback period from installation would be four years, and points to the additional benefit of reduced health costs arising from avoiding the adverse implications of temperature extremes.

The Guide backs up this analysis with an aerial photo of a town camp showing nine houses, with no obvious solar alignment, and with no use of solar panels: the heading is Roof-top Solar Panels are not often used in Town Camps. On the facing page is an aerial photo of 23 houses in Alice Springs, of which 16 appear to be utilising solar panels. Furthermore, it is striking that the houses are all solar aligned to maximise the benefits of solar radiation in winter and minimise costs and radiation in summer. The Heading is Roof-top Solar Panels and Solar Oriented Houses in Alice Springs.

Subsequent sections in the Guide deal with the related issues of Passive Cooling and Heating, and the use of Outdoor Rooms and Courtyards.

In a rapidly warming world, the importance of addressing these issues is inarguable. Yet very few people would be aware or conscious of the fact that there are systemic disparities between the way mainstream and Aboriginal communities are designed and operate in relation to these issues. The consequences for communities are both real and deeply unfair. The degree of unfairness is magnified when it is recognised that over the past decade there have been substantial subsidies available to homeowners designed to encourage the take up of rooftop solar infrastructure, but that social housing ‘owners’ (ie governments) have not seen fit to invest in installation of rooftop solar on public housing in the NT — and I suspect elsewhere. The levels of recognition amongst policymakers and the informed public of the degree of inequity and unfairness in solar provision appears to be close to zero.

Again, as pointed out in my previous post, the policy context is complex, but it is not beyond the technical capacity of governments to address. It does however appear to be beyond their political and policy capacity, even in circumstances where addressing the issues would harvest both financial and social benefits for disadvantaged First Nations communities and for society as a whole.

Given the lack of proactivity from governments on the issue of energy insecurity for remote community residents, it struck me that an alternative approach might pay dividends (so to speak).

A strategic reform proposal

The relatively new NT Aboriginal Investment Corporation (NTAIC) which has adopted the name Aboriginal Investment NT: (link here).  I have opted to use the name used in the legislation that establishes the entity. NTAIC is a Commonwealth statutory corporation established to administer a proportion of ABA funds. I was one of a number of critics of the design of this entity when it was first proposed in late 2021 (link here). While I am yet to be persuaded that I was wrong, the establishment of NTAIC provides a degree of Indigenous agency over the allocation of significant ABA funds which are broadly designated as being for the benefit of Aboriginal people across the Northern Territory.

My proposal (for the NT) is that NTAIC should consider initiating negotiations with the NT Government based on an offer to assist in accelerating the take up of roof top solar across remote community housing in the NT. Almost all remote community housing is social housing managed by the NTG. While arguably the responsibility for rolling out roof-top solar across remote communities belongs to the NTG, it is a responsibility that is patently not being implemented. Moreover, due to the systemic incentives in play which shape the allocation of scarce government funding, the NTG is unlikely to unilaterally initiate the roll out of roof top solar over remote community housing anytime soon.

Given this context, the NTAIC might offer to fund a significant proportion (or even all) of the capital costs of a multi-year roof-top solar installation program on the condition that the NTG commits to the ongoing maintenance of the infrastructure along with the associated repairs and maintenance of the social housing assets. A second and crucial component of any such deal would be a commitment that the financial benefits in terms of lower power costs of the installation of rooftop solar would accrue to the householder and the local community. Such an arrangement would appear to fit squarely within the statutory functions of NTAIC as laid out in section 65BB of the Aboriginal Land Rights (Northern Territory) Act 1976 (link here). While it is not entirely clear to me whether this fits within the NTAIC current Strategic Investment Plan (link here), this need not be an absolute barrier to initiating good and common sense ideas.

The same model might be explored across WA, QLD, SA, and indeed the NT by Indigenous Business Australia (IBA), or in the NT potentially by NTAIC and IBA jointly. I acknowledge that the negotiation of a pure funding transfer with state and territory jurisdictions may not fall directly within the remit of IBA (see sections 147/148 of the Aboriginal and Torres Strait Islander Act 2005: link here). However, if developed along with arrangements for the utilisation of Indigenous firms to install and maintain infrastructure on behalf of these jurisdictions, the proposal could be easily brought within he IBA remit. This constraint would not apply to NTAIC in the NT, but would nevertheless be worth considering in any case.

I understand that this idea is counterintuitive insofar as it lacks a commercial rationale and may also appear to undermine the responsibilities of the relevant governments to provide and pay for social housing. However, when governments are not delivering on their responsibilities, and thus failing in their raison d’etre, and as a consequence Indigenous people are worse off than they should be, it seems to me that there is a case for Indigenous leaders appointed to roles on boards such as NTAIC and IBA to take action. While there is not a commercial return to the potential funders under my proposal (ie NTAIC and/or IBA), there is clearly a strong economic rationale.

The findings of the Guide discussed above that roof-top solar effectively pays for itself within 3 to 5 years (let’s say five years for simplicity) in effect tells us that there is a rate of return on the investment of at least 20 percent. I venture to say that NTAIC and IBA would struggle to identify any other broad scale placed base initiative across remote Australia that could match this return on investment.

The sticking point will be the definition of ‘investment’. It turns upon the difference between a commercial return (where the financial returns accrue to the investor) and an economic return where the financial returns accrue to the householder. Bearing in mind that both NTAIC and IBA are Commonwealth corporations utilising what are effectively public funds to operate, it strikes me that they should decide whether they exist merely  to beef up their own bottom lines, or to address the financial exclusion of a swathe of disadvantaged Indigenous communities. My point is strengthened when we take into account the positive externalities of addressing energy insecurity earlier rather than later, in terms of improved health, improved food security, and poverty mitigation.  

The proposal I have made has the potential to drive tangible increases in real incomes for remote families and thus deliver myriad financial and health benefits for thousands of Aboriginal and Torres Strait Islander residents of the north. Moreover, the adoption of my proposal by NTAIC and/or IBA would mean that action is initiated much sooner on what would necessarily be a multiyear effort and would ensure that governments would eventually accept that they had the responsibility to replace roof top solar infrastructure as it reached its end of life as a normal part of social housing provision.

Of course, a potential argument against my proposal is that it implicitly means that other opportunities will not be funded. If so, I suggest that the responsibility falls to NTAIC and IBA to identify just what those higher priorities are. One way of mitigating this consequence, and simultaneously driving further strategic change aimed at underming structural inequity, would be for the NTAIC and/or IBA to seek to have the NAIF provide concessional finance to assist in financing their contributions. See my recnt post on the NAIF (link here).

Conclusion

We hear a lot about self-determination, and Indigenous leadership as the prerequisite for effective policy outcomes. It strikes me that the opportunity to drive a major upgrade of rooftop solar across remote communities presents the boards of NTAIC and of the IBA with a once in a generation fork in the road: they either take the initiative to drive strategic change or they accept that failing governments should be left to continue to fail remote Indigenous communities.

The evidence of egregious and myriad policy exclusion by governments is inexorably accumulating. It is incontrovertible that remote communities have unequal access to essential services and are at greater risk arising from energy insecurity in a warming world. Governments, and our system of politics and policy development, have failed because they design and implement exclusionary policy frameworks which treat remote community and town camp residents worse than the residents of major urban centres. In these circumstances, the NTAIC and the IBA should step up and use their undoubted financial leverage to drive strategic policy reform.

 

Further reading:

Longden, T., Quilty, S., Riley, B. et al. Energy insecurity during temperature extremes in remote Australia. Nat Energy 7, 43–54 (2022). https://doi.org/10.1038/s41560-021-00942-  (link here).

 

Solar solutions could be the key to climate-proofing homes in Aboriginal town camps By Stephanie Boltje, The Drum  (link here).

 

18 December 2024

 

ANAO 2024/25 draft work program

 

And how his audit stands who knows save heaven?

Hamlet Act three, Scene three.

 

The ANAO has released its draft work program for next financial year’s performance audits (link here). Dan Holmes from the Mandarin provides a succinct whole of government overview (link here).

 

This post focusses on the Indigenous policy related performance audits, which fall under the Prime Minister and Cabinet (PMC) portfolio. OF course, many of the proposed mainstream performance audits will have a bearing on services delivered to Indigenous citizens. These include (to a greater or lesser extent) proposed performance audits of DSS’s programs Assisting the Long term Unemployed; a follow-on performance audit of the Management of funding of projects by the Northern Australia Infrastructure Facility (NAIF) in the Infrastructure, Transport, Regional Development, Communications and the Arts portfolio; and perhaps even Board Governance at the National Disability Insurance Agency.

 

For ease of access, I have included slightly edited summary extracts of proposed Indigenous specific performance audits from the PMC portfolio below:

Delivery of community-led justice reinvestment initiatives

This audit would assess the design and governance underpinning the National Indigenous Australians Agency and the Attorney-General’s Department’s joint establishment of an independent National Justice Reinvestment Unit and examine the effectiveness of the early delivery of up to 30 community-led justice reinvestment initiatives.

Around $100m was announced for investments in community-led justice reinvestment initiatives and First Nations-led legal assistance services in the October 2022 budget…

Indigenous Land and Sea Corporation’s management of non-financial assets

This audit would assess the effectiveness of the Indigenous Land and Sea Corporation’s (ILSC’s) management of non-financial assets.

The ILSC is a corporate Commonwealth entity established under the Aboriginal and Torres Strait Islander Act 2005 (the Act). One function of the ILSC is to acquire land to grant to Indigenous corporations. Under section 191D of the Act, the ILSC must make a grant for an interest in land acquired for that purpose within a reasonable time after its acquisition. At 30 June 2023, the ILSC and subsidiary corporations held the Ayers Rock Resort valued at $435 million, other properties valued at $66 million, and livestock on properties valued at $6 million. While the ILSC holds properties, it is responsible for maintenance, statutory costs and the operation of related businesses. The audit would examine the ILSC’s asset management strategy and practices, including those related to the divestment of properties…

Management of the regional network - Follow on

The audit would assess the effectiveness of the National Indigenous Australians Agency’s (NIAA’s) management of the regional network, including whether the regional network is achieving its objectives…

…Auditor-General Report No. 7 of 2018-19 Management of the Regional Network found that management of the regional network was mixed, with the full potential of the network to facilitate the design and delivery of local solutions to local problems not being maximized.

Office of the Registrar of Indigenous Corporations’ management of non-compliance

This audit would assess the effectiveness of the Office of the Registrar of Indigenous Corporations’ (ORIC’s) management of non-compliance with the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (CATSI Act)…

…In 2021, the NIAA released a final report of a review into the CATSI Act that recommended enhancements to the regulatory powers available to the Registrar under the Act. An amendment bill to the CATSI Act passed the House of Representatives in 2021 but lapsed at the end of the 46th Parliament. This audit would examine the use of the Registrar’s powers and functions to manage non-compliance with the CATSI Act.

The effectiveness of coordination of Closing the Gap target implementation

The audit would examine the effectiveness of the National Indigenous Australians Agency (NIAA’s) coordination activities.

The 2020 National Agreement on Closing the Gap (National Agreement) is a strategy that aims to improve the life outcomes of Aboriginal and Torres Strait Islander people. The National Agreement marks a shift in the approach to the Closing the Gap Strategy, with Aboriginal and Torres Strait Islander people determining what is important to them. The Closing the Gap Implementation Plan includes actions, the responsible minister and the delivery timeframe. The NIAA is responsible for leading and coordinating the development and implementation of Australia’s Closing the Gap targets in partnership with Indigenous Australians.

The Northern Territory Aboriginal Investment Corporation (NTAIC)’s administration of grants

This audit would assess the effectiveness of the governance of the NT Aboriginal Investment Corporation (NTAIC) and its governance and decision-making processes for allocating grants funding.

NTAIC was established as a corporate Commonwealth entity in November 2022. NTAIC’s purpose is to work with Aboriginal Territorians to achieve economic, social and cultural impact through innovative approaches to investments, beneficial payments and other financial assistance. It has initial grant funding of $180 million and an investment corpus of $500 million. Its Aboriginal-controlled board makes decisions to invest Aboriginals Benefit Account (ABA) funding, which was previously administered through the National Indigenous Australians Agency. The ABA receives monies from the Commonwealth based on the value of royalties generated from mining on Aboriginal land in the Northern Territory…

 

Commentary

The ANAO is an important, and in my view under-rated element in the array of checks and balances that comprise the architecture for government initiatives and actions. It is the financial auditor for all major government agencies, certifying that agencies financial accounts are compliant with the applicable accounting standards and fairly present the financial position of the entity at the audit date. Its performance audits are separate to its financial audits and in effect focus on the performance of agencies in delivering specific initiatives and programs. The span of performance audits is not comprehensive, and thus the selection of audit subjects is inherently a strategic choice.

 

In 1985, I published an article (link here) arguing that the shift to embracing what were then termed ‘efficiency audits’  — the equivalent of the ANAO’s performance audits —  should be extended to embrace effectiveness audits. ‘Efficiency’ refers to the ability to accomplish something competently with the minimum level of resources and effort. ‘Effectiveness’ refers to the degree to which desired or positive outcomes are achieved. In my view the argument I made then still has merit.

 

In its wisdom, the ANAO has preferred the safe harbour of focussing on efficiency (effectiveness risks straying into the realm of politics) leaving issues of effectiveness to ad hoc evaluations. For their part, successive governments have avoided reforms that would ensure evaluations are undertaken independently, are always published, and are pitched at a level that ensures they are strategically relevant. Proposals for an evaluator general (link here and link here) have been studiously ignored. The point of this brief foray into history is to highlight that notwithstanding their considerable usefulness and benefits in opening a window onto the activities of government, ANAO performance audits are invariably limited and focussed more on process than outcomes. Perhaps it is time that that the ANAO commissioned an independent evaluation of its own operations!

 

Turning to the proposed audits listed above, I propose to make a series of brief comments aimed at highlighting specific issues of potential significance or salience. Due to limitations on length, I don’t propose to comment on the proposed performance audit of the NIAA regional network, nor the proposed audit of the Office of the Registrar of Aboriginal Corporations. I note however that both organisational units are crucial elements in the architecture of Indigenous policy and deserve constructive scrutiny.

 

Delivery of community-led justice reinvestment initiatives: While this program is jointly shared between NIAA and the Attorney Generals Department, there is no information on the NIAA website. The AG’s website lists a basic description of the program (link here) and includes a program design document drafted by Jumbunna Institute ‘to inform the design of the grants process and grant opportunity guidelines’ (link here). The design document is well constructed but is itself strongly focussed on process (particularly community control) rather than providing a targeted conceptual framework for reducing incarceration and interactions with the justice system.  While this is deliberate, the very flexibility of the program is likely to lead to questions regarding its efficacy and purpose, especially in the context of outbreaks of public violence such as recently occurred in Alise Springs.

 

At a more strategic level, the Commonwealth is essentially investing in a slogan as there appears to be no mechanism for operationalising the ‘reinvestment’ element of the program. To do this would necessarily involve robust engagement with the states and territories to shift resources away from activist policing, aggressive prosecutorial strategies and carceral options, something the Commonwealth is loathe to undertake. Of course, notwithstanding an extra $10m being allocated to Central Australia under this program in the 2023 budget, the reality is that governments’ actions (such as those announced after recent riots in Alice including a curfew and a decision to appoint 200 more police) are not in fact aligned with the justice reinvestment ethos, and they appear unwilling to advocate for such a strategy to the wider population. The bottom line is that even if the investments involved were effective, the investment of $100m nationally is unlikely to be adequate to turn around the worsening incarceration status of First Nations (link here). The fundamental question then for the ANAO is not whether individual grants are making a positive impact, but whether governments are merely engaged in an exercise of signalling concern (and buying political support) rather than aiming to address the substantive issues involved.

 

Indigenous Land and Sea Corporation’s management of non-financial assets: this proposed performance audit is timely and will no doubt raise several important issues. The elephant in the room is the ILSC’s ownership of the Ayers Rock Resort and the implications for its balance sheet of the current efforts (link here) to divest the resort to a new owner. I published a post on this issue some years ago (link here) and note that the issue has been raised in each of the last two estimates hearings. There was a sustained discussion at the February 2024 Hearings (pages 57 to 60) of the significant contingent liability carried by the ILSC in relation to ARR, and the actions being taken by the ILSC to divest the land to an Indigenous corporation and the operation of the resort to a commercial operator. I was particularly struck by Senator Liddle’s statement in the most recent Estimates hearing that ‘we all know that there was far too much paid for that investment at that particular time’ given that this proposition was vehemently rejected by Minister Scullion when the subsequent Dawn Casey led Board sought to unpack what had transpired and have the decision reviewed (link here).

 

The effectiveness of coordination of Closing the Gap target implementation: this proposed performance audit addresses issues that are crucial to the future effectiveness of the closing the gap process. This element of NIAA’s management of the process is in dire need of reform. There are two elements to coordination of the implementation task. The first is across the Commonwealth: my informal understanding is that the NIAA does not see itself as taking the primary role in leading the implementation of the Priority Reforms under the National Agreement, but rather sees itself as a policy influencer. Of course, NIAA requires ministerial support to engage forthrightly, but it is painfully clear that the NIAA is effectively mute on many if not most of the issues that will make a difference to the ultimate success or failure of closing the gap.

 

The second essential element of successful coordination is for the Commonwealth to step up and provide a much greater degree of policy and even administrative leadership vis a vis the states and territories. The previous Government hid behind the convenient fig leaf that the Commonwealth was merely an equal partner in the intergovernmental National Agreement on Closing the Gap, but there was no necessity for the Labor Government to meekly and supinely follow suit. The Minister for Indigenous Australians must bear ultimate responsibility for this positioning, but NIAA and its leadership could have done much more to persuade the Minister to adopt a more robust and proactive stance.

I published a post on this and related issues in early March (link here) which I strongly recommend to readers.

 

The Northern Territory Aboriginal Investment Corporation (NTAIC)’s administration of grants: while this would be a marginally useful exercise given that NTAIC has been operating for less than two years, it strikes me that this proposed performance audit misses a much more strategically important issue, namely the efficacy (and ideally effectiveness) of the overall allocation of royalty equivalents to the Aboriginals Benefit Account (ABA), of which NTAIC grants are just one comparatively minor part. I was a critic of the NTAIC proposal as being a sleight of hand: it professed to shift control to Aboriginal interests in the NT, but in fact ensured that the Minister retained unilateral control over a significant element of royalty equivalents (managed by NIAA) without any Aboriginal oversight and with much less transparency that previously obtained (link here). Of course, the NTAIC is now a reality; I am not suggesting it be unwound. I am merely pointing to the fact that there is much more to the ABA than the slice that the NTAIC controls.

 

The most recent NIAA Annual Report (link here) incorporates the financial statements for the ABA which disclose that in 2023 it held financial assets totalling $1.47 billion, offset by liabilities (including provisions for establishment funds to transfer to NTAIC) of $625 million leaving net assets of $845 million. Annual appropriations to the ABA totalled $378 million. These funds are then allocated in a range of ways, including to fund the operations of the four land councils in the NT ($109 million in 2023), to fund the distribution of payments to corporations representing traditional owners affected by mining ($113 million), to fund the NTAIC (at the discretion of the Minister) and to make grants (usually approved by the Minister) for community purposes to residents of the NT ($62 million).  

 

In my view there is a much stronger case for assessing the performance of the whole ABA system including the grants that are not made by the NTAIC from a performance (and I would argue effectiveness) perspective than for assessing the comparatively small grants program currently operated by NTAIC. My recent posts in relation to Groote (link here and link here) are infused with a swirling whirlwind  of ABA funds. It is well past time that an independent oversight body undertook a close look at the operations of the ABA with the aim of ensuring the funding it distributes is meeting the statutory remit laid down in the Aboriginal Land Rights (Northern Territory) Act 1976.

 

Concluding Comment

The ANAO is to be commended for seeking comment on its proposed work program though I suspect that it may not attract much attention. In thinking about why and how these proposed performance audits were chosen, it struck me that there is no indication of the decision criteria, nor the process involved in setting the program. Further, given the interaction between efficiency (performance) and effectiveness, an ideal decision process would also consider the proposed evaluation program in each portfolio. These decisions are important because they fill a crucial gap in transparency and accountability in the current approach to public sector accountability.

 

Finally, one would have to assume that the ANAO (and perhaps also the Parliament) is beginning to consider how the developments in Artificial Intelligence (AI) might best be applied to assisting the development of more comprehensive and useful performance audit work program. As agencies increasingly adopt AI algorithms to drive their operations, it will be necessary for the ANAO to keep pace. A request to Chat GPT provided ten existing AI driven capabilities that could assist in improving the efficiency effectiveness of the ANAO’s performance audit system including Predictive Analytics for Risk Assessment; Automated Data Extraction and Analysis; Natural Language Processing (NLP) for Document Analysis; and Dynamic Audit Planning and Resource Allocation. It seems like the time is approaching when the ANAO will need to look very hard at how and why it does what it does. More importantly, Governments too will also need to begin consideration of how they might use these new capabilities to improve levels of transparency and accountability across the entire span of public policy.

 

4 April 2024