Assessing Aboriginal wellbeing in the Pilbara: national policy implications

Are these things then necessities?

Then let us meet them like necessities.

2 Henry IV, Act 3, scene 1.

This post focusses on a recent report on Aboriginal wellbeing in the Pilbara (full report link here; key findings link here). John Taylor, a distinguished demographer of Indigenous Australia, authored the report.

The report was commissioned by a body known as the (Pilbara) Regional Implementation Committee, established as part of Ro Tinto’s engagement with Aboriginal interests following a series of native title agreements over the past few decades (link here and link here).

The report’s full title is ‘Change in wellbeing indicators of Pilbara Aboriginal people: 2001-2016’. It was designed to assess changes in wellbeing since 2001 amongst Aboriginal residents of the Pilbara based on a baseline study authored by Taylor and Scambary in 2005 (link here).

The approach adopted in this post is not aimed at a providing a comprehensive summary of the report. Instead, I aim to do two things: first, to select and highlight a number of the more salient points from the report (often via direct quotation), and mainly drawn from chapter nine which focusses on key findings. Second, to use those points to draw out a number of policy implications. My use of selective quotation may mean that important caveats and nuance is omitted, so I recommend readers consult the full report. It will be apparent to close readers of the report that I am standing on the shoulders of a giant, and in most respects, am wholly indebted to John Taylor’s work. Nevertheless, there seems to be value in seeking to give the report a higher profile, not least because it raises issues that extend well beyond the Pilbara.

In the Executive summary, Taylor identifies what he considers to be the core messages:

The basic message from the baseline study was that little had been achieved up to 2001 in terms of enhancing Aboriginal socioeconomic status over decades of mining activity in the Pilbara. This can no longer be claimed, at least not at a whole-of-population level. What we see instead, is a very mixed set of outcomes whereby some individuals, families and communities have clearly benefited while for others little has changed, indeed, relatively-speaking, they are now invariably worse off. If pressed to allocate an approximate ratio to this observation, the general impression would be that a third of people are now economically better off and two-thirds are not. The difference between the two is determined largely by employment, especially in mining…

… More importantly, gaps have widened within the Aboriginal population, especially in regard to income and opportunity.(p.2).

On population change, Taylor notes:

…it appears that Aboriginal people more than shared equally in the demographic wave that swept over the Pilbara in recent years such that their proportion of the regional population has risen from 16% to 19% in 2016. This growth in resident numbers reflects a decade of net migration into the region…(pp.140-41)

He then focusses on the issue of structural ageing, and concludes:

the fastest rate of population growth is actually among those at advanced ages. Given the prevalence of out-migration at retirement ages among the Pilbara population more generally, the idea of a growing resident group in need of aged care is perhaps novel for the Pilbara but it is emerging in the Aboriginal population. (p.141).

On the labour force, Taylor points to the potential risk of over-dependence on the resources industry for employment:

By 2016, fully one-third of the Aboriginal workforce was from elsewhere, mostly from Perth but also from other parts of WA as well as from across Australia…

…In 2001, barely 20% of Aboriginal males in employment were working in the mining industry and less than 5% of females. Today, mining accounts for almost two-thirds of all Aboriginal male employment and one-third of all female employment – levels that far exceed those of other resident workers. This represents a major structural shift in the composition of Aboriginal employment…(p.142).

In relation to income, Taylor points to significant absolute and relative increases over the past 15 years in Aboriginal incomes, but notes an associated downside:

…an even greater share is also now found at the lower end. In short, there is increasing income disparity within the Aboriginal population with the key difference being whether one is employed (especially in mining) or on income support…

…One reason for growing income disparity is a rise in the proportion of Aboriginal people with no income. We can see from census data that more than half of these are neither employed nor in education or training. What is less clear is whether individuals have dropped out of the income support system as well. The likelihood that substantial compliance breaching off the Community Development Program (CDP) involving no pay penalties cannot be discounted, although regional data on this are difficult to access…(p.143).

In relation to education and training, Taylor notes:

While 44% of young adults aged 15-34 years are fully engaged in employment, education or training and a further 15% are partially engaged, this means that as much as 41% of this age group are disengaged…

…A key contributor to this disengagement, at least in terms of employment participation, also includes persistently low levels of school attendance….Even average attendance rates are low at 70% in primary schools and 60% at secondary. More to the point these rates have remained fairly constant since 2008. Of more concern, however, are the very low attendance levels that indicate the proportion of students attending for more than 90% of available school days. These have also remained constant but at the much lower levels of 30% in primary schools and 20% in secondary (p.144).

On housing, Taylor concludes that the most salient observation is the lack of substantive change over the past fifteen years in the levels of disadvantage and overcrowding:

As for overcrowding, the percentage of dwellings deemed to be overcrowded has reduced but the absolute number has increased (p.145).

In relation to health status, Taylor reports:

there are signs that Aboriginal health status has improved, although across many measures this remains way behind that of the general population and all too often it detracts from the capacity of people to participate economically (p.146).

Across virtually every health indicator, while there has been improvement, Indigenous health status lags nonIndigenous rates. To take just one of the areas analysed, disability rates, Taylor reports:

Aboriginal people have consistently accounted for almost half of those in the Pilbara with a disability despite comprising only 16% of the population. This refers only to those with profound or severe core activity limitation and so should be considered a conservative metric (p.146).

Taylor’s summing up on health states:

Clearly, the collective social and economic impacts of diminished health status have been little altered by the mining boom and they present an ongoing and substantial challenge for the RIC in its quest to improve Aboriginal wellbeing (p.147).

Finally, on crime and justice, Taylor reports that:

Almost all criminal cases brought to the Children’s Court in the Pilbara refer to Aboriginal defendants and while the Aboriginal share of Magistrates Court cases is lower, this has steadily risen over recent years and is now at almost 80%. Feeding into this are rates of arrest that, while lower than they have been, still account for 19% of the Aboriginal population aged 10 years and over and reach up to 33% among males aged between 18 and 29 years. Given empirical evidence of a negative association between arrest and employability these levels are a cause for concern…

… Clearly, any notion that an economic dividend might emerge from the demographic shifts underway in the Pilbara, would have to address the scale of social and economic disengagement implied by these figures (pp.147-8).

Policy Implications

Clearly, even a cursory reading of this summary points to extremely deep-seated levels of disadvantage amongst Pilbara communities. There are glimmers of light, but also swathes of deep shade.

In terms of the impact on individual lives, it will be apparent that the levels of disadvantage identified by Taylor are such that virtually no Indigenous family in the Pilbara will be insulated from the direct impact of disadvantage of one form or another. From time to time Taylor also hints at the indirect impacts of this disadvantage on individuals and families. So for example he notes that while there are some 460 disabled Aboriginal people in the Pilbara identified in the 2016 Census, there are some 1100 carers identified (p.147).  If one were to reflect on the consequences and implications for life opportunities on those beyond the individuals directly affected by these statistics, the true levels of family and community harm begin to become apparent. Imagine the impact for families of illnesses such as renal failure, or of high levels of engagement with the justice system, or of poor educational outcomes, and so on. The consequences of deep-seated disadvantage have real life consequences which extend well beyond those included in the bare statistics.

A consistent theme throughout Taylor’s report are issues related to Government commitment to effective data collection. He points to the extraordinary levels of undercount of Indigenous citizens in the Pilbara:

Remarkably, the undercount of the Pilbara Aboriginal population at the 2016 census has been estimated by the ABS to have been as much as 41% - a rate that has increased at each census since 2001. Unfortunately, estimates of the population that are constructed to compensate for this undercount are provided without any accompanying measures of confidence…

 (p.140).

He points out the cessation of the data surveys which measured housing need, noting:

Perhaps no other area of public policy epitomises the decline in public access data on the circumstances of Aboriginal people in the Pilbara (and generally in remote areas of Australia) more than that of housing and infrastructure. From the early 1990s ATSIC lobbied for and financially supported the Community Housing and Infrastructure Needs Survey (CHINS) up to the last of four surveys in 2006. The Western Australian Government also conducted three rounds of an Environmental Health Needs Survey (EHNS) up to 2008. Since that time, the very detailed data on Aboriginal housing and infrastructure available from those sources has evaporated under the influence of the post-ATSIC new public management regime (p.144).

These issues, while relevant to the Pilbara, are national in scope and thus in consequence. It is almost as if governments have decided they would prefer not to know (and thus not understand) what is transpiring on the ground in Indigenous Australia.

One response to the lack of commitment by government to data collection and analysis has been the emergence of a movement amongst Indigenous communities for Indigenous data sovereignty. John Taylor has been a significant advocate in this area (link here). While the aspirations of Indigenous communities to take control of their data deserve support, especially by governments, there will always be a need for national level data collection and analysis, and it is a very poor reflection on governments and policymakers over the past decade that more attention has not been devoted to increasing the quality of national datasets and associated survey instruments that impact on Indigenous Australia. Similarly, it needs to be remembered that Indigenous peoples, whether in remote regions such as the Pilbara, or elsewhere, are not defined by the disadvantages they endure.

A further policy implication of this report is national in its scope and emerges from the implicit reliance of policymakers on the rising tide of private sector driven economic development to lift Indigenous people out of poverty and disadvantage. The Pilbara has been the locus of intense economic and commercial activity. It has led to many Indigenous people gaining employment (much of it going to Indigenous Fly In Fly Out workers from elsewhere). Yet what emerges from John Taylor’s report is that the levels of deep seated disadvantage are such as to undercut and constrain the potential benefits of employment and commercial activity. A second issue that appears to require further consideration (by academics, policymakers and indeed Indigenous interests) is the contribution of the significant compensatory native title payments to native title holders to broader Indigenous wellbeing.

On current policy settings, positive change, if it occurs, will take time, even generations. To my mind, this is an untenable situation. There is an ongoing need for sustained long term engagement by governments with Indigenous Australia. This also suggests that we need to reverse the failure by policymakers to focus on the underlying structural drivers of disadvantage. For example, policymakers must close the circle in terms of identifying needs, potential policy responses, and the allocation of sufficient resources to have an impact. The must also acknowledge and address the long term consequences of dispossession and discrimination in their policy approaches, if they wish to facilitate and encourage positive change to Indigenous social and economic wellbeing. This will necessarily include allowing Indigenous people a greater voice in policy development, both at regional and national levels.

Remote income support conditionality

 I were better to be eaten to death with a rust than to be scoured to nothing with perpetual motion

Henry IV, Part Two, Act 1, scene 2.

A recent Working Paper[1] by CAEPR Research Scholar Lisa Fowkes (link here) provides a fascinating excoriation of the implementation of the income support arrangements in remote Australia over the five years from 2013 to 2018.

This is a ‘must read’ paper for anyone with a desire to understand the dynamics of remote Australian. It is also a perceptive analysis of the ways in which national policies evolve, are made, adjusted and ultimately expire.

The core of the paper is an analysis of the extraordinary level of penalties and ‘breaches’ handed out to participants in the Community Development Program (CDP). This program operates across around three quarters of the Australian landmass, but has only just over 30,000 participants compared to the 700,000 plus Job Active participants in urban and regional Australia.

I will not attempt to summarise the paper in detail, but instead will highlight a few of its most salient insights.

Fowkes begins by outlining the genesis of the CDP, describing in detail the progressive shift from a relatively anodyne process of unconditional income support (albeit not always made easily available) to the current arrangements of hyper conditionality. These arrangements seek to incentivise – in the jargon of policymakers – ‘job activation’ based on the imposition of extreme forms of conditionality backed up by a graduated selection of penalties.

On the level of penalties, Fowkes states (page 1):

Over five years from 1 July 2013 to 30 June 2018, the small group of unemployed people living in remote areas – comprising fewer than one-twentieth of all unemployment benefit recipients – received more penalties than all of their nonremote counterparts combined.

A strength of the Paper is the clear articulation of the data and the graphs that demonstrate the impacts of policy change and adjustment over time. Figures 5 and 6 sum up the core argument in a glance.

A second key insight is to demonstrate the ways in which hyper-conditionality have perverse outcomes amongst remote communities. Fowkes observes that as the intensity of conditionality and penalisation increased, so too did the number of people who responded by disengaging from the program, voting with their feet to not seek income support. Fowkes demonstrates (page 16) that between 2015 and 2018, the CDP caseload dropped 17 percent from 36,642 people down to 30,380. See Table 3 for an age breakdown. Fowkes notes that this has been a long-term issue, but convincingly argues that CDP has made it worse.

Fowkes conclusion is a highly persuasive argument that hyper-conditionality has not worked to encourage employment (not least because there are constraints on the number of jobs available in remote Australia given the limited financial investments of governments generally).

So what is missing from, or only hinted at, in the Fowkes’ analysis.

First, while Fowkes analysis if focussed entirely on work obligations and penalties, there is a parallel policy intervention that applies to income support payments across the NT, and in a number of other remote locations (Kununurra, Ceduna). I refer of course to the policy of income management (quarantining) and its policy descendant the cashless debit card (which the current Government has recently announced will be rolled out across the NT: link here). While the two policy interventions (CDP and income quarantining) do not exactly overlap, there is a very substantial overlap.

So in thousands of cases across remote Australia, income support comes not only with substantial conditions regarding ‘job activation’, but the payments provided are also quarantined, severely limiting their flexibility. There is a substantial literature on the merits and appropriateness of income quarantining, however there has been very little research or analysis into the combined impact of the two policy approaches. Intuitively, they will each reinforce the impact of the other, increasing the stress on recipients, and strengthening the impetus for disengagement.

Second, Fowkes under-emphasises (at least to my mind) the potential economic, social and cultural impacts of increasing disengagement. Apart from reducing the overall levels of income and cash within remote economies and communities, disengagement places increased and potentially stressful levels of strain on the families of disengaged individuals since it is the families that inevitably end up subsidising the ongoing subsistence of disengaged individuals. Moreover, disengaged individuals are more vulnerable to substance abuse and other anti-social behaviours, which impose costs on families and communities. There is a strong sense in which the policies of hyper-conditionality are leading to perverse policy outcomes, or in plain English, are making things worse rather than better.

Third, Fowkes downplays the issue of political responsibility for policy failure, presumably in the interests of academic reticence. Fowkes’ graphs make crystal clear that the decisions taken by Minister Scullion and the Government in late 2013 to overhaul the newly established Remote Jobs and Communities Program and to establish from July 2015 the CDP led to a huge spike in breaching and penalties (see Figures 5, 6, 7 and 9). According to Figure 9, the penalties imposed on Indigenous people tripled between late 2015 and late 2016. Notwithstanding his political rhetoric regarding job creation, Minister Scullion should be held responsible for the extraordinary policy failure that the CDP policy initiative represents.

Fourth, Fowkes arguably might have done more to point to any academic or policy relevant assessments of the Minister’s claims that the CDP has been successful in creating jobs and of the utility of welfare conditionality generally. In her defence, these would require an entirely new analysis. I am not in a positon to provide a comprehensive assessment, but note that the most recent research based on the 2016 Census does not provide much positive news. In a 2018 research paper titled ‘Employment Outcomes’ (link here), ANU researchers Danielle Venn and Nick Biddle say this:

Indigenous employment rates in remote areas dropped substantially between 2011 and 2016: by 4 percentage points for women and 9 percentage points for men. As discussed above, this was partly due to the phasing out of the CDEP scheme. Employment performance was considerably worse for the Indigenous population than for the non-Indigenous population in remote areas, where the employment rate for the non-Indigenous population increased by 1 percentage point for men and 2 percentage points for women, resulting in a widening of the employment gap in remote areas by 10 percentage points for men and 6 percentage points for women.

This suggests that the Commonwealth’s ‘job activation’ programs in remote Australia, in particular, RJCP and its successor CDP are not making substantive inroads. In terms of international experience, a five-year project on Welfare conditionality in the UK overseen by the Economic & Social Research Council concluded in its Final Findings Overview:

Welfare conditionality within the social security system is largely ineffective in facilitating people’s entry into or progression within the paid labour market over time (link here).

Fifth, while Fowkes analysis makes a convincing case that the CDP (and its policy ancestors) are not fit for purpose, she says very little about what should and will replace it. Various replacement policy models for CDP are conceivable. The most ambitious attempt to lay out such a model was prepared in 2018 by the peak Aboriginal organisations in the NT, known as APONT (link here and here).  

One can discern various reform principles (self-determination, community control, co-design, etc) in Fowkes’ analysis. However, I know from my own experience within the bureaucracy that the current arrangements are embedded within a web of highly complex legislative and administrative arrangements. These reflect a labyrinthine IT infrastructure that is both difficult and expensive to amend, provider contracts for set terms, bureaucratic mindsets and interests that are not necessarily focussed on citizens’ rights and well-being, plus a range of competing external interests with the capability to exert political influence. In addition, the whole issue of Indigenous welfare reform is ideologically fraught with a range of strongly held views in play that do not necessarily align with the standard left/right political spectrum. This complexity ensures stasis and inertia are the default condition, and even minor change is immensely challenging.

In this environment, effective reform requires much more than a decision to close down the existing CDP. It will require vision, extraordinary drive and commitment, plus a mastery of bureaucratic and parliamentary politics. In the event there is a change of Government, reforming CDP will, on its own, represent a huge challenge for the incoming minister and his or her Department. Of course, at this point, it is not clear which portfolio the CDP will come under in a new Government.

Finally, Lisa Fowkes has made an enormous contribution to making the case for reform of remote employment services. She has been instrumental in focussing attention on the implications and consequences of punitive conditionality in our remote welfare system, and deserves plaudits for her intelligent and constructive contributions. Her work generally, and this paper in particular, will be the essential starting point for any serious reform in this area.

Declaration: In my day job, I am a Visiting Fellow at CAEPR at the ANU.

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[1] Fowkes L (2019). “The application of income support obligations and penalties to remote Indigenous Australians, 2013-2018’ CAEPR Working Paper 126/2019, CAEPR,ANU

From every angle, public policy is about interest group influence

Federal court judges in Texas have ruled against two Indian tribes’ efforts to continue running gambling on their lands. This news is reported in an extremely insightful article form The Texas Monthly (link here). It raises issues of federal /state relations, economic development opportunities, gambling policy on and off Indian lands, and the nature of Indian sovereignty in the US.

The case demonstrates clearly how intertwined are the law and public policy, and how public policy is in so many respects ‘path-dependant’ in that is based on what has gone before. In relation to Indian sovereignty, it is also a reminder that notwithstanding the rhetoric of governments (whether national or Indian), all sovereignty is limited, constrained and shared.

The following paragraph from the article is key:

The Tigua and Alabama-Coushatta are caught in a battle over tribal sovereignty that dates to the founding of the United States. While most Native American tribes are allowed to offer gambling on their land, several other tribes across the nation are blocked from doing so by legislation or agreements with state or federal governments. “The short and straightforward answer is that tribal sovereignty is whatever Congress says it is,” said Kathryn Rand, co-director of the Institute for the Study of Tribal Gaming Law and Policy at the University of North Dakota. “I think that that strikes a lot of people, not just tribal folks, as not only unfair but nonsensical in some ways—that you’d have federally recognized tribes, but some of them have this set of rights and others have this other set of rights, just depending on not only what the federal legislation says but the tribe’s political influence in Congress and with their congressional delegations.”

The article is worth reading in full, as it resonates – albeit indirectly -- in many respects with Indigenous policy issues in Australia.

In particular, the key insight I take from the Texas dispute is that public policy is invariably infused with crosscutting value tensions and that policy outcomes are primarily a function of interest group influence (both negative and positive).

In the Australian context, this suggests that for Indigenous interests to influence public policy outcomes, they will increasingly need to develop their capabilities to engage persuasively with the wider community to influence the impact of mainstream policies on Indigenous interests.

Indigenous Employment within the APS: a policy recommendation

 A recent seminar at the ANU on Indigenous employment in the APS by ANU researchers Dr Julie Lahn and Samantha Faulkner managed to shock me. In particular, it mentioned (almost in passing) data on the level of Indigenous representation in the senior levels of the public service, generally known as the Senior Executive Service or SES.

The seminar reported on the findings of a report (link here) commissioned by the Australian Public Service Commission on ‘enablers and barriers which act to support or impede career progression of Aboriginal and Torres Strait Islander employees to senior levels in the Australian Public Service (APS)’.

In laying out the context within which these issues play out, the report presented a snapshot of the relevant data:

The 2018 State of the Service report indicates that representation of Aboriginal and Torres Strait Islander people across the APS has improved in recent years and currently sits at 3.3% (Australian Public Service Commission 2018, p. 58). This is a significant achievement in terms of having met the Commonwealth Aboriginal and Torres Strait Islander Employment Strategy 2015-2018 target of 3% representation.

Despite this achievement, employment of Aboriginal and Torres Strait Islander people within the APS is concentrated at the lower levels. The majority are employed at APS6 and below and the largest proportion (27%) are at APS4 level.

In contrast, employment at senior executive levels is very small, just 1%. Over a ten year period, representation at the Senior Executive Service levels has remained disappointingly small while Executive Level employment has declined.

The proportion of Indigenous APS members mirrors the proportion of the Australian population who identified as Indigenous in the 2016 Census. Recently published analysis by Nick Biddle and Danielle Venn provide some broader context for these figures:

For both men and women, the public sector accounts for a considerable share of employment, either through direct employment in government at Commonwealth, state or local level or in industries where public sector employment is high, such as education, healthcare and public safety. In 2016, just over 20% of Indigenous employment was in the public sector, compared with 15% of non-Indigenous employment. 

The majority of Indigenous employment in the public sector was with state/territory governments. Indigenous women were more likely than Indigenous men to be employed by Commonwealth or state/territory governments, but Indigenous men had higher employment rates in local government than Indigenous women. 

[Biddle & Venn 2018 ‘Recent Trends in Indigenous Employment’ Journal of Australian Political Economy vol 82, summer 18/19,  link here].

In other words, public sector employment is comparatively more important to Indigenous citizens than private sector employment. However, it needs to be remembered that Indigenous employment is much lower than for mainstream citizens, with less than 45% of Indigenous citizens aged 15+ being employed in 2016 (See Biddle & Venn: Figure 2).

The Lahn & Faulkner report sourced their data on SES employment from a submission to the APS Review from the APS Indigenous Steering Committee. This submission is available at the Review’s submissions page (link here).

That submission provided more detailed data on SES employment in the APS:

At the SES level, the discrepancy is larger, with 25 Indigenous SES officers compared to 2,326 non-Indigenous SES officers (1%).  Furthermore, this discrepancy has continued over the last ten years…

The submission also provides data that makes clear that the proportion of Indigenous SES officers has barely moved over the past decade. Moreover, when we consider the data from different perspectives, the magnitude of the issue becomes apparent. There are just over 150,000 Commonwealth public servants (see the appendix to the Lahn & Faulkner report). Of these, just over 5000, or 3.3% are Indigenous. However, of the 5000 Indigenous public servants, only 25, or 0.5%, are Indigenous SES officers.

The Lahn & Faulkner report to the APS was based on interviews with around 50 Aboriginal and Torres Strait Islander staff across the APS, and includes a series of recommendations for policymakers, Indigenous employees and non-Indigenous employees, all of which make intuitive sense.

The Indigenous Steering Committee submission to the APS Review also included a small number of tentative recommendations. I encourage readers to check out both sets of recommendations.

However, my reaction as a former policymaker to both these sets of recommendations was sceptical. Not because they do not have merit, they do. But because they are too fine grained, too detailed, and too amorphous to ensure that policymakers at political and bureaucratic levels focus on them. As a result, notwithstanding their merits, they are unlikely in my view to be implemented and thus are unlikely to be the lever that will make a substantive difference in terms of making the APS an Indigenous friendly environment, and perhaps more importantly, in facilitating policies more attuned to substantive partnerships with First Nations.

Shortly after attending the ANU seminar, the APS Review released their Interim Report titled ‘Priorities for Change’ (link here). I was thus quite interested to see what was proposed in relation to Indigenous employment in the APS, and in particular if they had any ideas for greater Indigenous employment at SES levels.

The report is necessarily very high level, and addresses a range of crucial issues for the future of the nation. I do not propose to summarise or even critique the report more generally, (but see recent reporting in the Mandarin link here) and note that a report such as this will inevitably have little opportunity to deal with Indigenous policy and employment issues in any detail. Nevertheless, it seems useful to summarise what the Review Committee has to say on Indigenous issues.

At page 17 under the heading of partnerships, they note:

Nowhere is the importance of genuine partnerships truer than in supporting the aspirations of, and pursuing outcomes with, Aboriginal and Torres Strait Islander peoples. Now is the time for the APS to reconceptualise how it works with Aboriginal and Torres Strait Islander peoples.

On page 37, a graphic on diversity mentions the key data on Indigenous employment along with that of other specific groups, under a heading that states: ‘The APS struggles to attract and retain diverse employees, particularly at SES levels’. 

On page 49, at the conclusion of a section on Developing stronger internal and external partnerships, the Review included a text box which made a number of points regarding Indigenous issues. I encourage readers to read the whole text. Key paragraphs included:

The panel’s emphasis on the importance of relationships recognises that the APS cannot meet its purpose of serving all Australians unless it works openly and with integrity with partners across the community. Nowhere is this truer than in supporting the outcomes and aspirations of Aboriginal and Torres Strait Islander peoples….

…If pursued, the priorities for change outlined in this report provide an opportunity for the APS to work profoundly differently with Aboriginal and Torres Strait Islander peoples. Creating a genuine partnership would be fundamentally transformative.

Such a partnership needs to operate at different levels. Locally, it will often mean working collectively on community-led or place-based initiatives. This will require the APS to work with much greater humility and to focus on building the strength and impact of Aboriginal and Torres Strait Islander organisations.

Nationally, Aboriginal and Torres Strait Islander peoples must be able to participate meaningfully in matters affecting them. The panel believes this simple proposition should be a guiding principle for the APS. Achieving it will require supporting mechanisms and institutions that provide for national participation and representation…

…It is also critical that the APS supports and develops its Aboriginal and Torres Strait Islander employees, including fostering the development of senior leaders across the service.

These comments are well directed and are intuitively appealing. Again, what they lack is any guarantee or mechanism that will ensure they are implemented. Given this is an interim report, it is incumbent on potential sceptics or critics to wait for the final report. Nevertheless, there appears to be little appreciation that changing the deeply embedded culture of stasis and implicit exclusion will be a major challenge for the APS even if its leadership is fully committed to implementing the new approaches being hinted at by the Review.

Which brings me back to the question I asked myself as I sat in the seminar at the ANU and sought to come to terms with the data on under-representation of Indigenous citizens in the APS, and in particular, what this meant for the capability of the APS to deliver effective policy and programs for Indigenous Australians:

What is the single policy change that might make a difference to Indigenous outcomes and APS employment levels over the medium term?

The answer I came up with is based on my view that it should be a policy change that is easy to implement, that is relatively visible and not easily ignored, and should have ongoing impacts that flow to a broad range of circumstances. My answer is also influenced by the fact that increasingly, it is mainstream policies and programs which impact, for good or bad, on Indigenous citizens, and thus there is a need for mainstream agencies to be sensitised to the issues facing Indigenous Australians.

Accordingly, if I were an incoming Minister for Indigenous Affairs, I would seek an undertaking from the Prime Minister for a commitment to double the number of Indigenous SES officers to 50 within four years, and to double it again to 100 within ten years.

Moreover, such a target should be met by appointments across the breadth of the APS. If the authorising environment at political levels encourages greater Indigenous SES representation, the senior levels of the bureaucracy would do all they could to find ways to meet the commitment. If we had two or three Indigenous SES officers in each of Health, Home Affairs, Finance, Treasury, and so on, they would begin to establish an inclusive environment and context that would encourage the promotion and retention of more junior officers. 

Similarly, more Indigenous friendly working environments would organically and informally encourage and facilitate the sorts of recommendations made in the Lahn/Faulkner report and the submission to the review by the APS Indigenous Steering Committee. These recommendations go to ensuring that the APS retains talented Indigenous entrants and gives them every opportunity to pursue a career to the very top of the APS.

Finally, for those interested in reading more about Indigenous employment in the public sector, the publications listed on this page will be helpful.

Addendum 1 April 2019

I have just seen PMC's Communique Number 10 (link here), which reports on the deliberations of the Secretaries Equality and Diversity Council, and includes a section on Indigenous employment. The bureaucratic formulations are tried and tested, but hardly engender confidence that the Equality and Diversity Council is infused with a reforming zeal:

"The Council will explore further retention and development strategies as part of the next Aboriginal and Torres Strait Islander Strategy....noted the value of the Strategy as a catalyst for change....agreed ....to the APSC exploring opportunities..."

It is worth reading the document inits entirety.

Disclosure: In my ‘day job’, I am a Visiting Fellow at CAEPR.

Remote area tax concessions and payments: a new review is underway

The Productivity Commission has released an Issues Paper on remote area tax concessions and payments (link here) as part of a review into these issues commissioned by the Treasurer.

The APO web site (link here) summarises the review in the following terms:

This study focuses on three long-standing measures that provide support to individuals and businesses in remote areas, namely the:

·         zone tax offset (ZTO)

·         fringe benefits tax (FBT) remote area concessions

·         Remote Area Allowance (RAA).

There have been concerns within the community that these measures have failed to keep pace with demographic, cost of living and infrastructure changes in Australia. In response to these concerns, the Australian Government has asked the Productivity Commission to evaluate these measures’ objectives, design, operation and effects, and to consider alternatives to them.

The issues paper is an early step in the review and identifies a range of potential issues requiring consideration. One of the obvious issues that will require detailed research is the absence of data relating to both the demographic makeup of recipients of each measure, and the costs to the budget of each measure. Other issues at the core of the review will be policy rationale, policy design, and alternative options for meeting existing or new policy objectives.

The three measures under study are each mainstream measures, and are available to any residents of the relevant geographic areas (which span most of remote Australia) who meet the relevant criteria.

One of the potential issues embedded within the Productivity Commissions remit is the impact of the measures in meeting broader Indigenous policy objectives, noting that remote Indigenous citizens remain amongst the most disadvantaged citizens in Australia.

Commendably, the Productivity Commission has acknowledged this, stating in the issues paper at page 7:

Due to this study’s focus on remote areas, we will evaluate the effects of remote area tax concessions and payments on remote Indigenous communities, as well as any interaction with other government policies designed to assist those communities.

I don’t propose to undertake a detailed analysis of the Issues Paper and the issues it raises for Indigenous policy, but note that there is a substantial overlap insofar as remote Indigenous citizens are affected (for better or worse) by each of the three measures. Indigenous employees / taxpayers are recipients of the zone tax offset, Indigenous businesses take advantage of the FBT concessions, and Indigenous citizens make up a substantial proportion of income recipients who are entitled to the RAA.  

There are however a number of obvious issues which will need consideration and attention.

The RAA was originally introduced to provide an equivalent payment to welfare recipients to extend the benefits of the ZTO to non-tax payers in remote Australia. Given the over-representation of Indigenous citizens in the income support cohort, and the under-representation of Indigenous citizens in employment, the disparity in rates between ZTO and RAA impacts disproportionately on Indigenous citizens, and deserves to be reconsidered.

A further potential issue relates to the impact of conditional welfare in remote Australia (ie the CDP program: link here) and the increasing evidence that as a result of punitive penalties (link here), significant numbers of remote Indigenous residents are not accessing their welfare entitlements and thus not accessing RAA.

One of the challenges is assessing the utility of these policy measures, is that they were primarily devised to assist and benefit mainstream interests, particularly mainstream taxpayers and businesses. Consequently, it can be easy to overlook Indigenous perspectives in assessing the changes in underlying rationales over time. As the Commission notes:

A range of justifications have been advanced for special assistance for people living and/or working in remote areas (box 3), although many of these are contentious. For those justifications drawing on the isolation and arduousness of life in the outback, the changes in transport, communications and living conditions over the past seventy years mean that their strength has diminished (at least in many parts of the country). Such arguments have also been challenged on the basis that ‘individuals have a free choice whether or not to live or work in remote areas and to compensate them, if they so choose, would lead to resource misallocation and reduced growth for the country as a whole’ (see Cox et al. 1981, p. 15).

While there have been improvements in the circumstances of remote citizens, the circumstances of remote Indigenous citizens are still highly disadvantaged. Moreover, they may not have the same level of flexibility in their choice of residence as mainstream citizens. These are less obvious factors that the Productivity Commission will need to grapple with as it progresses its review.

I am sure that as the review progresses, a range of new issues of relevance to Indigenous interests will arise. Hopefully the various Indigenous peak bodies will step up and lodge submissions to the review.

Perhaps the substantive take out from the release of this issue paper is to reinforce once again how mainstream programs and policies are increasingly important for any assessment of Indigenous wellbeing and opportunity.

Trade agreements and Indigenous policy: implications

The Government recently (4 March 2019) announced the finalisation of negotiations with Indonesia on a proposed trade agreement (link here and here), the Indonesia – Australia Comprehensive Economic Partnership Agreement (IA-CEPA).

The agreement is highly significant, as the following two paragraphs form the Minister’s statement (link here) indicate:

The deal marks a new chapter in Australia’s partnership with one of our closest friends and neighbours. Indonesia offers significant economic opportunities right on our doorstep. Our neighbour has one of the fastest-growing economies in the world, averaging five per cent growth over the past two decades.

Most predictions have Indonesia on track to be the world’s fifth-largest economy by 2030. With a population of 270 million people – an expanding middle-class – the world’s third-largest democracy and most populous Muslim nation – our agreement with Indonesia helps build economic prosperity for both our nations and the region.

The agreement is yet to come into force, as it requires further ratification steps in both Australia and Indonesia (link here).

The DFAT summary of the agreement (link here) notes, under the heading Services and investment, that:

Australia’s services and investment commitments in IA-CEPA lock in Australia’s existing open policy settings, similar to those in other trade agreements. These commitments include exceptions that preserve policy flexibility in sensitive areas such as: • public health and education • social services • culture and broadcasting • indigenous policy • maritime transport (emphasis added).

The text of the agreement (Annex II: Schedule of Australia) states, inter alia:

Trade in Services and Investment

Australia reserves the right to adopt or maintain any measure according preferences to any Indigenous person or organisation or providing for the favourable treatment of any Indigenous person or organisation in relation to acquisition, establishment or operation of any commercial or industrial undertaking in the service sector.

Australia reserves the right to adopt or maintain any measure with respect to investment that accords preferences to any Indigenous person or organisation or providing for the favourable treatment of any Indigenous person or organisation.

For the purpose of this entry, an Indigenous person means a person of the Aboriginal and Torres Strait Islander peoples.

Existing Measures: Legislation and ministerial statements at all levels of government including Australia's Foreign Investment Framework, and the Native Title Act 1993 (Cth).

Implications

I wanted to make just three broad points regarding these developments.

The first is to acknowledge the preparedness of Australian negotiators involved in the IA-CEPA to carve out an exception that will allow continued policy measures designed to support Indigenous inclusion in economic and commercial development.

Second, and of most policy significance, the negotiation of these provisions by the Australian negotiators is tangible demonstration that mainstream policy settings, and in this case, mainstream international policy settings, have an increasing potential to impact on Indigenous issues.

For example, one of the current Government’s most successful policy initiatives has been the Indigenous Procurement Policy. The Government has recently published new data on the performance of the program and adopted new targets (link here and here). I remain concerned that the IPP may operate in many cases to benefit non-Indigenous firms more than promote Indigenous business engagement (link here and here). The only evaluation of the program so far published by PMC (link here) noted:

It is acknowledged that business structures will continue to vary, and some arrangements will continue to raise questions about alignment with the ‘spirit’ or ‘intent’ of the policy. The qualitative data suggested that the 50 per cent ownership structures may not work in the interests of Indigenous business partners, and due diligence was required by all parties to ensure no disadvantage.

Notwithstanding these concerns, there is little doubt that the IPP has substantial potential and has already taken Indigenous business policy to new levels. In these circumstances, it is extremely important that Australia’s international trade agreements do not constrain the capacity to strengthen the Indigenous economic policy sector further.

Third, it follows on from point two that Indigenous advocacy bodies and peaks will increasingly be required to build their capability to engage with mainstream policymakers, including international trade negotiators, to ensure that Indigenous policy interests are protected. My guess is that the provisions in the IA-CEPA related to excluding Indigenous related policy measures are not the result of lobbying or advocacy from Indigenous interests, but rather have been included at the instigation of Australia’s negotiators to ensure that existing government policies are not adversely affected. This is positive as far as it goes, but provides little guarantee that in the future, Indigenous interests will be prioritised.