Indigenous land and economic development in northern Australia

 

I have been long a sleeper; but I trust

My absence doth neglect no great design

Which by my presence might have been concluded.

Richard III, Act 3, scene 4

 

The Parliament’s Joint Standing Committee on Northern Australia has recently released its report: The engagement of traditional owners in the economic development of northern Australia (link here). The inquiry was initiated, at the suggestion of North Qld MP Warren Entsch who chairs the committee, in late 2018, lapsed in April 2019, and restarted in August 2019. It has thus been in preparation for over two years (see paras. 1.43/44). The Terms of Reference were broad and relatively open ended, and cover a lot of ground both literally and metaphorically. The report comes in at over 100 pages, and is clearly written. The report is essential reading for anyone interested in the interplay of native title and economic development.

 

On my first scan of the recommendations, I was pleasantly surprised, as the Committee has focussed on some of the key challenges confronting the native title/land rights policy space in northern Australia (and beyond), and identifies the actions that Governments must take if they wish to see Indigenous communities across northern Australia contribute to and indeed drive the take up of economic opportunities over the coming decades. Implicit in the committee’s thinking (but not stated) is that the failure to grasp these opportunities will not merely be a lost opportunity, but will lead to the development of an Indigenous underclass excluded from economic participation, and will ultimately have an adverse impact on opportunities for mainstream economic development of the north.

 

In particular, the Committee recognises the crucial importance of effective Indigenous organisations in managing the Indigenous land estate in northern Australia.  Recommendation one which recommends increased funding for PBCs and native title Representative bodies, and to a lesser extent, recommendation two, which recommends increased support for capacity building of PBCs and NTRBs, are crucial to the future viability of the native title system nationally. The importance of the effectiveness of the native title system is made crystal clear if we consider that almost 80 percent of northern Australia is held under some form of Indigenous tenure or subject to an unresolved native title claim (para 1.42). Yet the report also notes that the Government was advised in a report conducted by Deloitte Access Economics in 2014 that the native title system required greater financial support (para 2.14). Paras 2.13 to 2.35 in the report lay out the case for increased funding in detail, but notwithstanding the unequivocal recommendation, the committee fails in my view to effectively portray the extent of systemic underfunding, and says nothing about why Government has ignored the issue for the past seven years.

 

Upon closer reading, the following eight recommendations usefully point the way forward on a series of issues that require attention, but each of them is framed in an equivocal fashion, that simultaneously would allow a government to accept the recommendation without necessarily committing it to action. So, recommendation three recommends a review of systems for appointment of PBC directors rather than recommending specific changes; recommendation four recommends that the Commonwealth should give consideration to crating an Indigenous strategy for northern Australia and a northern Australia Indigenous economic development body, recommendation five recommends the Commonwealth should support (unspecified) initiatives to make innovative use of land tenure systems to make land management effective (whatever that actually means)…and so on....Only recommendation ten is unequivocal. It recommends that the NT Aboriginal Land Rights Act be amended to reinstate separate vetos at exploration and mining stages, a policy change I support, but which I suspect has zero chance of being implemented.

 

The Committee’s report follows the standard model for these reviews: an introductory chapter describes the lay of the land (so to speak), then a series of chapters on the key issues. Each chapter sets out a high level narrative supported by extensive quotation from stakeholder submissions, and concludes with a Committee comment. The three substantive chapters in the report are titled: ‘strengthening representative bodies’; ‘role and performance of government entities’, and ‘pathways to economic development’, with a concluding chapter summarising the overall analysis.

 

The concluding chapter tells a coherent and valuable story, but it is a story that is far from new, and which doesn’t really break new ground. The Committee identifies the longstanding power imbalance between traditional owners and development proponents, argues that it can only be ‘redressed with resources and institutional capacity’ (para 5.3), which leads into the rationale for recommendations one and two. What the recommendations ignore however is the potential for governments to take seriously their role of representing the public and national interest (rather than particular corporate interests) and adopt and implement policies and legislative change that rebalances the playing field. In other words, we need to acknowledge and address structural exclusion and systemic power imbalances.

 

The report argues for increasing the transparency of decision making in representative bodies, (para 5.9) which I strongly support, but makes no mention of the reciprocal and arguably more important need for governments to increase their transparency.

 

The Committee’s analysis is somewhat confused and arguably one-sided when it seeks to address the tensions arising from the inalienability of both statutory and common law Indigenous tenures. At para 5.10/11, the Committee states, somewhat tautologically, that

 ‘A major barrier to the productive use of title to land under native title or land rights is land tenure….One of the key problems is the limited fungibility of land, especially that held under native title legislation, and the consequent problems of using land for investment…’.

 The Committee goes on to espouse the benefits of township leasing in the NT, making specific reference to the recent amendments that provide for community owned corporations to hold the headlease, which likely reduces the likelihood that banks and corporate lenders will take a mortgage and provide finance. I dealt briefly with this issue in a June 2021 post relating to the proposed changes to the NT Land Rights Act (link here). See also the Parliamentary Library’s Bills Digest on those amendments (link here)

 

The Committee discussion of these tenure issues extends from para 2.64 to para 2.106, essentially setting out the problem, and canvassing various solutions, but failing to alight on any specific solution. The core of the problem is that there are multiple factors mitigating against the ability of Indigenous land owners to raise capital using their land as collateral. The problem is best described as multi-faceted market failure. See the AIG submission for some case studies (link here). Leases (linked to ILUAs) are part of the solution, but while necessary, they are not sufficient. The way forward is for Government to establish an institution or mechanism to provide an underlying guarantee for loans which are utilising Indigenous land as collateral. Yet after two years of hearings, the Committee failed to explicitly identify the required policy action. Para 2.106 makes it clear that PMC (now NIAA) and AGD intuitively understand this, however they won’t take the final step as they understand too that there is no political will at the Government level to do so. As a result, the Committee is left lamely suggesting (para 5.13) that:

The financial challenges that prevent more effective leveraging of Aboriginal and Torres Strait Islander land assets should be seriously considered, including by financial institutions and banks.

 

Finally, it is worth considering what is missing from this report.

I will nominate three high level issues.

 

First, while there are multiple reference regarding the desirability of greater accountability within PBCs and NTRBs, there is virtually no recognition that Governments too need to be accountable for their policy actions and inaction, and that the best way for this to occur is via greater transparency.

 

Second, there is a desperate need for greater (not less) proactive policy engagement by government with a focus on the policy opportunities that exist within the native title /land rights space. The longstanding decision to place the administration of the bulk of the native title Act with AGD (and not with NIAA) is a recipe for adding ever more legal complexity at the cost of policy coherence and policy vision. In my view, it is major oversight that the Committee says nothing about the overarching portfolio responsibilities and what the means for the outcomes on the ground.

 

Third, given the focus on the intersection between Indigenous landowners in northern Australia, and economic development, it seems extraordinary that there is no mention in the Committee report of the operation of the North Australia Investment Facility, the Government’s $7 billion flagship for its northern development policy framework. The mention of the NIAF in the Office of Northern Australia submission (link here) is underwhelming. I don’t propose to go into detail here (I have previously discussed this issue here), but the fact that Indigenous interests have accessed only a miniscule proportion of the funds committed to date is clearly worth some attention.

 

While this appears somewhat negative, there are some positives. The Committee clearly put a lot of effort into building a consensus position, something that is probably necessary to gradually shift mindsets among the political elites who will determine the pace and nature of policy reform into the future. And the Committee inquiry created the opportunity for some substantive policy contributions from stakeholders and academics, including from the Indigenous Reference Group for Northern Australia (who promoted the idea of a northern Australia Indigenous economic development body supported in recommendation four. The submissions (amongst others) by Altman and Markham, by the ANU, by the Aboriginal Investment Group and of course by the Department of Prime Minister and Cabinet and the Attorney Generals Department are all worth reading (link here) and add to the quantum of accessible and policy relevant information in the public domain.

 

The bottom line arising from a closer reading of the Joint Standing Committee on Northern Australia’s report, both in what it recommends, and what if fails to deal with, is to reinforce how little the government has done since coming to office in 2013 to encourage the inclusion of Indigenous landowners and communities in economic activity. The Committee’s report deserves to be widely read with a critical eye. It identifies some positive directions, but falls short of providing a clear roadmap or policy agenda for taking Indigenous participation in the northern Australia economy to the next level. Unfortunately, there is also a risk that if there were to be a change of Government in May this year, then the new Government might be tempted to use this report as a partial policy roadmap. Such a result would be disastrous in my view for Indigenous interests, and a lost opportunity for a new Government, and would signal a lack of real engagement at systemic levels by the new Government.

 

The Committee is correct in highlighting the economic opportunities for Aboriginal and Torres Strait Islander interests in northern Australia, but fails in my view to lay out an effective pathway to ensure those opportunities will be grasped anytime soon. The responsibility to act however falls upon governments. It is time they roused themselves from their drowsiness, and woke up to the opportunities available from pursuing policy reform designed to reverse the ongoing exclusion of Indigenous interests in northern Australia, and beyond.

The native title briar patch

 

O how full of briars is this working-day world

As You Like It, Act 1, Scene 3

 

A recent procedural decision by Justice Mortimer of the Federal Court shines a light on some of the more difficult issues which continue to challenge the ‘on the ground’ operations of the Native Title Act.

 

The case name is Sturt on behalf of the Jaru People v State of Western Australia [2021] FCA (link here). The decision deals with a number of recent determinations and claims in the Halls Creek region of Western Australia, and in particular, the failure of claimants to reach agreement on the establishment of relevant Prescribed Bodies Corporate (PBCs), and in particular, agreement on their membership. PBCs are the corporate entities established in accordance with the NTA to hold title to areas that are the subject of successfully determined native title claims.

 

For those interested in the legal technicalities, I refer you to the judgment which is admirably concise and succinct. The focus of this post is on the ancillary policy issues that support and underpin the implementation of the processes outlined in the Native Title Act. While this judgment relates to only a handful of claims, the policy issues that flow form these cases apply more generally across Australia, and affect scores if not hundreds of native title determinations and claims.

 

The fundamental issue that the Court is grappling with is the inability of the native title holders and claimants to agree amongst themselves in relation to the translation of traditional rights and responsibilities for country into modern legal forms stipulated by the NTA and its subsequent interpretation by the courts. Or to state it most bluntly, which individuals are members of the PBC, and thus entitled to participate in decisions relating to hte relevant country. These are fundamentally anthropological issues, shaped by internal community politics, the history of colonisation and the advent of modernity in all its forms. I do not suggest that there are easy answers, and indeed, as a non-legal reader, I was impressed by the Courts sensible, sensitive and yet robust approach to handling the reality of these disagreements. My own view is that over and above the exigencies of local politics, the reality and ongoing impacts of colonisation and the avalanche of modernisation in technology and communications, social mores, global perspectives, and rapid mainstream culture change inevitably creates serious challenges for today’s native title holders in working simultaneously within a system of traditional rights and responsibilities regulated by a mainstream statute and legal system.

 

Where I am most critical is in the failure of governments over decades to establish the robust and effective support systems that would facilitate building Indigenous capabilities to begin solving these inevitable challenges. These are systemic policy failures, and receive very little attention in public discourse and debate.

 

The present case points to a number — but not all — of these systemic issues, albeit without highlighting them; indeed, it is almost as if the Court sees these policy constraints as part of the furniture, to be accepted as a reality and worked around.

 

Issue one: The ILSC as a default PBC

The Court addressed the fact that in relation to two determined claims (Ngarrawanji #1 and Ngarrawanji #2 determined in May 2019 and July 2020 respectively) there was as yet no PBC nominated. The Judge noted:

16    There was no sign that a PBC was likely to be nominated because of the conflicts in the group. So the Court asked Judicial Registrar McGregor to contact the Indigenous Land and Sea Corporation (ILSC) to give the Court an affidavit about whether the ILSC could be nominated under the Native Title Act 1993 (Cth), as the PBC. Everyone accepts, including the ISLC, that the law gives the ILSC this job – to be a PBC where native title holders do not nominate one themselves. But in the 10 years since it has had this job, the ILSC has never been appointed as a PBC.

 

17    The Court held a case management hearing on 16 February 2021. Some of the members of the Ngarrawanji #1 and #2 applicant spoke at that hearing. The ILSC briefed a barrister to appear and he spoke on behalf of the ILSC. He told the Court the ILSC felt it needed more time to prepare to perform its role as a PBC, but it was willing to do so if the Court decided that was what should happen.

 

As a former CEO of the ILSC, I am incredulous that a Commonwealth statutory corporation briefed a barrister to request more time to prepare to undertake a role that has been within their remit for close on a decade. Of course, the ILSC is currently facing a crisis of governance as documented in this post (link here) and the Minister appears incapable of resolving the issues that have clearly bedevilled the organisation for at least ten months (link here). These issues may have played a role in the ILSC’s apparent reticence. So too may the more practical issues of finding qualified staff with the skills to engage on the ground, funding the required administrative processes including convening meetings, consulting geographically disparate members, and preparing agenda papers and implementing PBC decisions. Standing up a PBC from scratch is expensive!

 

Issue Two: funding for Native Title Representative Bodies.

The Court noted (without commenting one way or another) on the fact that many Aboriginal people in the region were not happy with the Kimberley Land Council (KLC), the Native Title Representative Body for the Kimberley region. Its functions in relation to native title are listed on its web site (link here). The KLC works in the liminal space between traditional conceptions of land ownership, rights and responsibilities on the one hand, and the mainstream system of native title on the other. It inevitably has to span and ultimately make decisions regarding competing contentions of claimants for title. It is thus not surprising that it is the subject of criticism by people on the ground.

 

The Court made a number of comments regarding the resources available to the KLC. In relation to the option of mediation over establishing a PBC, the Court stated:

24    The mediation may not happen until June 2021 because of limits on the funding available to the Kimberley Land Council to support native title holders participating in the mediation (and also using the services of Dr Redmond [an anthropologist]).

 

In its conclusion, the Court stated:

44    The Kimberley Land Council has attempted to assist in a number of ways, but it is clear that many people in the East Kimberley are frustrated with the Kimberley Land Council’s role in native title applications. Again, the Court accepts those frustrations exist, but reminds people it is not its job to take sides about that issue. The challenges the Kimberley Land Council faces with its native title funding are real obstacles, and the annual funding cycles from the Commonwealth are responsible at least in part for the delays and restrictions on funding. To change that requires political action, not legal action. [emphasis added]

 

Clearly, there is an issue here. It is one thing when an interest group makes an argument for increased funding from Government. It is quite another thing when the Courts are identifying funding shortfalls as contributing to poor policy outcomes.

 

It is my view that there is systemic underfunding of native title processes by the Commonwealth. NTRBs are asked to work in an incredibly complex cross-cultural environment, to standards that require them to meet both governance and accountability standards expected in mainstream corporations, while simultaneously meeting the cultural expectations of constituents whose daily lives are embedded in a very different cultural milieu, with different expectations of their leaders and representatives. Yet the Australian Government in both its funding arrangements nd its policy approaches appears to make little provision for these challenges, and indeed turns a blind eye to the on the ground realities. Not least of the flaws in Commonwealth policy is the split responsibility between funding of Indigenous groups (NIAA) and broader policy and funding of third parties (Attorney Generals Department).

 

The NIAA website includes the following text:

Native title

Native Title includes rights and interests that relate to land and waters held by Indigenous people under traditional laws and customs, recognised by the common law in accordance with the Native Title Act 1993 (Cth).

We fund a network of Native Title Representative Bodies and Service Providers to assist native title groups across Australia. Further information and contact details are available on the Native Title Representative Bodies and Service Providers page.

Native title corporations (known as ‘Prescribed Bodies Corporates’) hold, manage and protect native title on behalf of traditional owners. The Australian Government assists these bodies through grant funding (see Grants below).

The Attorney-General’s Department is responsible for legal and legal-policy advice on the sections of the Native Title Act 1993 (Cth) which are the responsibility of the Attorney-General and assistance to respondents involved in native title claims. More information is available at the Attorney-General's Department website.

 

In relation to PBC funding, the Grants section of the web page states:

PBC capacity building funding

The Department is now inviting eligible applicants to apply for PBC capacity building grant funding under the Indigenous Advancement Strategy.

 

PBCs are eligible for ‘capacity building’ grants, but not core funding. This in itself is a major structural hole in the system. It is way beyond time that the Commonwealth stepped up and provided core funding for the corporate entities that in effect have taken over from the Crown the management of at least fifty percent of the Australian land mass. See these two academic papers on the native title system for further analysis on these issues (link here and link here).

 

There is no information provided on the level of funding to the NTRBs or PBCs. It is beyond the scope of this post to identify each of the NTRBs funded by Government, and track their funding through the Government’s grants web page. The fact that the Government does not list this funding on its web page in an accessible form is deliberate opacity and prima facie an indicator that it does not wish to even defend its funding allocations and decisions in relation to financial support for the system established under the NTA. It is worth remembering that this system was a response to the High Court decision in Mabo that determined that Indigenous property rights survived the imposition of British sovereignty. In a very real sense, the current administration of the NTA continues and refreshes the stain of colonisation.

 

The reluctance and ill-preparedness of the ILSC — a Commonwealth statutory corporation — to take on the role of a default PBC in large measure because of the logistical cost and complexity of doing so contrasts with the expectation, yes, the expectation, by the Commonwealth that either the underfunded NTRB or the native title holders themselves can somehow pull themselves up by their bootstraps and stand up a fully functioning PBC able to manage the full suite of legally enforceable land management responsibilities and the associated decisions facing any Australian landowner. The irony is palpable; the more one thinks about it, the more disgraceful it is.

 

Conclusion

The recent Federal Court decision in Sturt v WA by Mortimer J in relation to the management and progression of native title determinations provides a window into the intricacies and systemic challenges facing native title holders across Australia generally. From a policy perspective, I have been impressed with the way the Federal Court has sought to progress these issues, step by step, case by case, decision by decision.

 

The executive arm of our governmental system has been far less impressive. Indeed, it has set up and operates an administrative and funding system that one would be forgiven for characterising as designed to fail.

 

One of the downsides with the wall to wall focus on important and essential big picture issues such as constitutional recognition, Closing the Gap, an Indigenous Voice, treaties, and a Makarrata is that the ongoing everyday challenges of Indigenous citizens on the ground obtain less attention and virtually zero policy traction. The traditional owners and custodians of the Ngarrawanji native title determinations are certainly victims of our incapacity as a nation to see, let alone address, the challenges they face.

 

The Commonwealth Government seems content to leave the native title system in the briars. It is fearful to step in. Close inspection is discouraged. Indigenous aspirations are thwarted and ignored. As a nation, we can and should do better.