How effective is the Commonwealth’s Indigenous Procurement Policy?

My mind misgives

Some consequence yet hanging in the stars.

Romeo and Juliet Act one, Scene four.

 

The ANAO has just released a performance audit (link here) with the unwieldy and somewhat opaque title Targets for Minimum Indigenous Employment or Supply Use in Major Australian Government Procurements — Follow-up. This audit deals with the ongoing management of the Indigenous Procurement Policy, which is invariably cited by Commonwealth Governments as a crucial and successful element in its policy approach in relation to Indigenous Australians.

In this post I focus on NIAA’s management of the Indigenous Procurement Policy (IPP), a central plank in the Government strengthening focus on Indigenous economic empowerment (link here).

I previously published posts on the IPP which assessed its performance in positive terms while warning against over-reliance on the single minded focus on commercial businesses as the core of economic development policy (link here and link here).

Here are some key quotes from the ANAO’s report (paragraph numbers are from the Report; footnotes have been removed; emphasis added):

            Background

2. The Indigenous Procurement Policy (IPP) was established in 2015 with the objective ‘to stimulate Indigenous entrepreneurship, business and economic development, providing Indigenous Australians with more opportunities to participate in the economy’. One of three elements of the IPP are the mandatory minimum requirements (MMRs), which are targets for minimum Indigenous employment and/or supply use for Australian Government contracts valued from $7.5 million in certain specified industries.  The National Indigenous Australians Agency (NIAA) is responsible for administering the IPP, including the MMRs….

Conclusion

… 9. Almost five years after the recommendations were agreed to, entities had partly implemented recommendations from Auditor-General Report No. 25 2019–20 Aboriginal and Torres Strait Islander Participation Targets in Major Procurements. Although the NIAA had improved guidance for entities and sought to increase MMR reporting compliance, a recommendation for the NIAA as the policy owner to implement an evaluation strategy was not completed. The NIAA has not demonstrated whether the MMRs are improving Indigenous economic participation. A risk related to the inappropriate use of exemptions was not managed. Recommendations intended to address the risk that reporting on MMR contracts is incomplete and inaccurate were partly implemented by audited entities. Reforms to the Indigenous Procurement Policy were announced in February 2025 without a clear understanding of the policy’s effectiveness….

…. Exemptions from Mandatory Reporting Requirements

16. Between July 2016 and September 2024, 63 per cent (valued at $69.3 billion) of all contracts recorded in the Indigenous Procurement Policy Reporting Solution (IPPRS) were exempted from the MRRs by relevant entities. The proportion of contracts exempted by entities from the MMRs has increased over time. …. The NIAA does not provide complete guidance on the use of exemptions, or assurance over the legitimacy of exemptions. The NIAA has not considered the strategic implications of exemption usage for the achievement of policy objectives….

In a box headed Effectiveness of the Mandatory Minimum Requirements, the ANAO make the following comments:

While the application of the MMRs is trending upwards, between July 2016 and September 2024, 1,475 contracts valued at $69.3 billion were ‘exempted’ by entities from the MMRs, often for reasons that are unclear. There is a lack of performance information and evaluation data that allows for the impact and outcomes of the IPP to be assessed. The NIAA’s public reporting on the IPP does not provide information on the MMRs’ effectiveness. It is unclear if the IPP’s objectives of stimulating Indigenous entrepreneurship, business and economic development, and providing Indigenous Australians with more opportunities to participate in the economy, are achieved. (emphasis added)

There is much more of interest in the report, albeit it is comparatively technical and thus somewhat inaccessible. While the Minister’s February 2025 media release (link here) announcing an expansion of the IPP’s targets aligns with the Government’s pivot to economic empowerment as its signature Indigenous policy focus, the fine detail in this report suggests that NIAA is a long way from being on top of the policy detail. The ANAO documents in considerable detail how the NIAA dropped the ball comprehensively on commitments made in response to previous Parliamentary Committee and ANAO reports and does not appear to have the internal mechanisms in place to ensure that the IPP will be effective in meeting its stated aims.  While increased ambition for the IPP’s formal targets is creditable, Figure 2.1 in the ANAO report (page 51) suggests that the announced increased headline targets for future years are still well below current actual performance at least in terms of the numbers of contracts, thus suggesting that the targets are not intended to stretch actual performance. Meanwhile, the Minister’s commitment to addressing ‘black cladding’ appears almost nonchalant. As she states in the media release mentioned above:

The Government will also work with regulators to tackle ‘black cladding’ – disingenuous conduct designed to gain access to programs like the IPP – and explore options to make it easier to report the practice.

Let’s be clear; black cladding occurs when non-Indigenous firms engage non-contributing Indigenous partners to front a commercial entity with the aim of winning contracts paid by the taxpayer that they would not necessarily win through a merit-based process. A more accurate definition of black cladding might read: ‘dishonest conduct designed to gain access to taxpayer funded contracts’. It has been an issue of concern for a decade (link here). Working with unnamed ‘regulators’ to ‘explore options’ to report the practice [to who?] reeks of rhetorical flimflam. The NIAA expand on this on their website where they state (link here) that

The NIAA will work with relevant regulators and support services to identify opportunities to make it easier for First Nations people to report black cladding that might amount to unlawful conduct and provide targeted education, guidance and support for First Nations business owners.

The problem here is that, by definition, black cladding involves the co-option of Indigenous individuals, often involving the provision of financial incentives. The suggestion that the regulatory approach to minimising black cladding should rely on or be based primarily on voluntary reporting by Indigenous people strikes me as both naïve and destined to fail.

The combination of black cladding (at unknown levels) and exemptions from the mandatory minimum requirements (perhaps we should just call them ‘optional’ minimum requirements….though even this term is a contradiction in terms!) valued at $69 billion and comprising 63 percent of all contracts under the IPP since 2016 (see Table 3.1 on page 56 of the ANAO report) together have the potential to eviscerate the effectiveness of the IPP program. Yet despite having agreed to an evaluation after the ANAO’s previous audit of the employment programs, and after undertaking preparatory work for the evaluation, NIAA cancelled the evaluation. The ANAO in footnote 92 (page 49) note that NIAA advised it could find no evidence of the decision not to proceed. Presumably no officer within NIAA was prepared to take responsibility for the decision. It just happened! One is tempted to ask where were the members of NIAA’s Indigenous Evaluation Committee (link here) while this non-decision was rolling out? Perhaps the NIAA Audit and Risk Committee (link here) should consider how the non-decision to cancel the evaluation was made and what impact it might have on the effectiveness of the IPP. I guess not proceeding with the former commitment to undertake an evaluation does have the advantage of making it easier for the Minister to state with supreme confidence, as she does in her February media statement:

Given its success so far, the Government is also making the IPP more ambitious…

One final issue worth noting relates to ANAO Recommendation Four (see paras 3.10 to 3.13 in the ANAO report) dealing with exemptions to the minimum requirements. In para 3.11, the ANAO recommended (inter alia) that:

To ensure exemptions are accurately recorded in the Indigenous Procurement Policy Reporting Solution, non-compliance with the Indigenous Procurement Policy can be appropriately identified, all applicable contracts are subject to the mandatory minimum requirements reporting and assessment process, and the Indigenous Procurement Policy is achieving its policy objectives, the National Indigenous Australians Agency:

(d) implement a risk-based assurance process to ensure that reported exemptions or exclusions are legitimate.

In its response to this part of recommendation four, the NIAA stated:

Not Agreed to part d – The National Indigenous Australians Agency does not believe it is appropriate for it to be assuring the implementation of elements of the devolved Commonwealth procurement framework by Commonwealth entities. The National Indigenous Australians Agency maintains that it is the responsibility of each Commonwealth entity to ensure it meets its own obligations under Government legislation and guidance, including the Commonwealth procurement framework

Yet the 2019 Order establishing the NIAA as an Executive Agency, signed by the then Governor General (link here), listed the functions of the NIAA as including:

                             i.        to lead and coordinate Commonwealth policy development, program design and implementation and service delivery for Aboriginal and Torres Strait Islander people; and ….

                            ii.        to analyse and monitor the effectiveness of programs and services for Aboriginal and Torres Strait Islander people, including programs and services delivered by bodies other than the Agency…

 

The IPP is the responsibility of the NIAA, and while it is a fair expectation that other agencies will meet their obligations under the program, it is squarely within the NIAA remit for it to set in place processes that ensure all agencies involved in the program are meeting their obligations. The NIAA should view itself as the key regulator oversighting the effectiveness of the IPP’s implementation across government.

 

Conclusion

 

The takeout from this sorry tale is threefold:

·         it confirms that in relation to Indigenous economic policy, the Government is more concerned with appearance over substance;

·         it demonstrates that NIAA does not have the capability to ensure that it keeps its written commitments to the ANAO and the Parliament; and perhaps most importantly,

·         it reveals that no one inside government (including the Minister who is ultimately accountable), let alone outside government, actually knows whether the Indigenous Procurement Policy is effective or not.

 

The IPP opens a new conduit for rent seeking by businesses across the whole spectrum of government activities, and while its objectives are worthwhile, it ultimately stands or falls on the quality of the overarching regulatory oversight by NIAA as the policy owner and all the mainstream agencies in the Commonwealth responsible for letting contracts. Unfortunately, this is not the only public sector activity where regulatory oversight is in short supply (link here).

 

In relation to the IPP, the Commonwealth clearly prefers to operate in a state of blissful ignorance, a prisoner of its own rhetoric and good intentions ― assuming we give them the benefit of the doubt. If the program is in fact ineffective, or even partially ineffective, and the Government’s assessment of its undoubted success is wrong, the losers are Indigenous Australians, and taxpayers more generally.

 

The Commonwealth, and particularly successive ministers for Indigenous Australians and the NIAA, should do better.

 

 

5 June 2025

 

Regulatory inaction: implications for Indigenous interests

 

We must not make a scarecrow of the law,

Setting it up to fear the birds of prey,

And let it keep one shape till custom make it

Their perch and not their terror.

Measure for Measure Act two, Scene one.

 

A pervasive issue across the Indigenous policy domain is the absence of effective ― or in many cases any — regulation of both private and public sector activities impacting Indigenous citizens.

Conceptual scene setting

This is a much wider issue than just the impacts on Indigenous communities, organisations and citizens, but there are some factors that make it a more serious issue for these Indigenous interests.

First, the poor effectiveness of regulation across mainstream domains is the result of sustained lobbying and advocacy (much of it behind closed doors) by interest groups with a vested interest in loose or non-existent regulation.

To cite just a few examples, sub-standard regulation has received extensive media coverage in the past decade in the banking, financial services, aged care, disability services, out of home care, funeral insurance, alcohol retail, food labelling and gambling industries to mention only those areas that immediately come to mind. There are two elements involved in considering this issue: one is the adequacy of the regulatory oversight of existing regulations; the second is the degree to which the existing regulations are adequate or alternatively not required. Both elements play into the issue of regulatory failure.

In many of these cases of regulatory failure, the persistence of poor social or economic outcomes has led to the commissioning of one or more national or state level reviews, coronial inquiries, or royal commissions. It is rare for the results of such reviews and inquiries to be implemented wholeheartedly and quickly; the normal response of governments is to initiate further consultations or reviews which slow the impetus for reform and are then the subject of further lobbying and pressure from the interest groups with most to lose from substantive reform. In my observation, governments rarely do more than resort to minimal reforms, while leaving the industry interests that would be impacted by substantive reform substantially unaffected. The status quo ante is usually maintained and indeed often reinforced.

The reason these mainstream regulatory failures are more serious for Indigenous interests is that Aboriginal and Torres Strait Islander citizens are more likely to be economically and socially disadvantaged and are thus more vulnerable and at greater risk of being adversely impacted by mainstream commercial activities that avoid proactive regulatory oversight.

Second, Indigenous interests are not (yet?) as well organised as the industry-based interest groups to exert countervailing advocacy pressure, particularly on mainstream policy issues which are nevertheless crucial elements in their social and economic lives.

Third, the cultural and ideological narratives that are ubiquitous across the Indigenous community (e.g. the importance of self-determination, or community control in service provision), and which are crucial elements in building and maintaining notions of Indigenous identity and culture have unintended negative side-effects insofar as they shift the focus of Indigenous organisations and even peak advocacy organisations away from mainstream issues and towards Indigenous specific issues.

Fourth, the reality is that the regulation of many mainstream issues falls to the states and territories, and this means that the challenge of monitoring regulatory failures, proposing solutions, pressuring governments to pursue reform and devising policy solutions spans not just one national policy domain, but an additional eight state and territory policy jurisdictions. The result is that effective monitoring requires the creation of multiple state and territory based Indigenous advocacy organisations with the capacity to follow an expansive portfolio of public and private sector activities within their sectoral remit.  

Of course, regulatory failure is not just an issue in the mainstream. It is endemic in the Indigenous specific policy domain, and in many instances, because of the nature of the composition of the Indigenous policy domain, the activities that are in effect under-regulated are operated by Indigenous controlled corporations serving their Indigenous constituencies. There are at least three factors that contribute to sub-optimal regulation across the indigenous policy domain. First, governments who are loathe to regulate robustly in the mainstream do not wish to regulate to a higher standard in the Indigenous policy domain. Second, government regulators do not wish to be perceived as racist, or to be compromising Indigenous self-determination. And third, increasingly, regulators in the Indigenous policy domain report to Indigenous ministers, or are staffed by Indigenous bureaucrats, who may be reluctant to robustly address governance and service failures by Indigenous controlled entities.

Regulatory failure (or even regulatory weakness) whether in the mainstream or the Indigenous domain is not in the public interest. It disadvantages consumers in private sector markets and contexts, and service delivery constituencies in public sector contexts. Once embedded, it creates the preconditions for future sub-optimal performance with concomitant adverse impacts on intended beneficiaries. It is under-reported by the media with most publicity focussed on the deficiencies of organisations or individuals, and not on the absence or systemic weakness of the regulatory oversight that might have prevented the fraud or corruption or service mismanagement that attracted the media attention. A key reason for under-reporting is that regulatory failure is invariably systemic in its impacts, and it extends beyond the time horizon of most journalist and media reporting. Another is that it is not as susceptible to being framed as a simple narrative.

Another reason it is not in the public interest is that regulatory failure is a form of government failure, and in many cases, it is the result (whether intentionally or unintentionally) of implementation failure by governments. It thus contributes to the much more common elements of government dysfunction, at policy, program and even project levels; failures that inevitably contribute to the decreasing levels of trust in government in Australia (link here). While trust in government in Australia is higher that the rest of the world (link here), a trust level of fifty percent is hardly a ringing endorsement.

Regulatory failure is thus simultaneously endemic and invisible; it has multiple causes and is often both complex and systemic in its impact.

Real world examples

To bring this discussion down to tin tacks, I want to briefly point to two separate sets of media reports that recently caught my attention, both of which involve substantial and serious regulatory failure, and both of which have had, and continue to have, a disproportionate adverse impact on Indigenous citizens. The discussion of each of these cases focusses on the high-level regulatory implications, and I do not attempt to summarise or consider every aspect of each case.

On 9 May 2025, the AFR ran an investigative report headlined How a Sydney billionaire became the pokies king of Alice Springs (link here). This was followed up on 23 May 2025 by a report (link here) based on an interview with former NT Chief Minister (and longstanding backroom political operative) Shane Stone. Headlined Former NT chief’s pokies regret: ‘I wish we never had them’. Taken together, these articles point to extraordinary levels of on-site gambling in the NT’s casinos and other premises, extremely high rates of Aboriginal participation in gambling at these venues, low to non-existent levels of regulation of the use of gambling machines, high levels of revenue to the NT Government and extraordinary levels of influence by gambling industry interests over the NT Government (whichever party is in power),  and non-existent levels of accountability and responsiveness of elected governments for the community harm flowing from widespread gambling addiction. According to the AFR, the NT has the highest per capita expenditure on gambling of any jurisdiction in the nation, and the highest per capita government revenue from gambling:

The Northern Territory is the state with the least scrutiny, the loosest probity and the lowest taxes… “I would argue that the regulators, particularly in the Northern Territory, are not active participants in the regulatory process,” gambling expert Charles Livingstone says. “By and large, it’s left up to the venues to regulate themselves, which is entirely like the fox looking after the hen house.”

The AFR report spends considerable time explaining how little oversight is applied by ASIC to the owners of the major gambling venues in the NT and contrasting the numerous community activists calling for gambling reform with the slow and in-camera legal processes applied to any challenges to even the most minimal expansion of access to gambling in Territory towns. Increasingly, community activists are calling for national intervention.

Shane Stone’s statements to the AFR are simultaneously an apparent mea culpa and change of heart (“If I’d had the courage of my convictions, I would have wound back the [poker machine] numbers, but I didn’t do that,”) and a nuanced and politically astute nudge of the political discussion towards subsidiary issues such as limiting access to cash within gambling premises while making a strident argument against national intervention and in favour of state and territory led reform processes. Yet the states and territories are both part of the problem and less visible to the national constituency necessary to drive national reform. At the risk of being accused of extreme cynicism, I am left wondering whether the former Chief Minister is yet to find the courage his convictions require. The AFR sought and obtained comment from current federal ministers with gambling related responsibilities. Compared to the mountain of regulatory reform required in the NT and beyond, their comments amount to a hill of beans. I recommend interested readers take a close look at both articles.

The bottom line is that mainstream and national regulatory disinterest and failure in relation to on-site gambling has had, and continues to have, seriously adverse impacts on vulnerable Aboriginal citizens in the NT. This impact is not felt just by those who gamble, but by their families and intimate partners. Recent ANU research (link here) suggests that between 5 to 8 percent of the national mainstream population is adversely affected by gambling. Those most at risk are low income and economically disadvantaged. These figures are likely to be higher for Aboriginal residents in the NT.

The second case worth mentioning was published on the front page of the Sydney Morning Herald on 24 May 2025 and in The Age (link here $) under the headline ‘Health bosses rack up $400, 000 travel bill’. The report deals with what appears to be endemic and enduring dysfunction within a major community controlled Aboriginal medical service, CTG Aboriginal Health Services, operating across at least three major western NSW towns and providing a wide range of medical services. CTG’s funding last year exceeded $11m and was sourced from the Commonwealth, the NSW Government, and Medicare rebates according to its annual report (link here). The headline focusses on what numerous complaints allege is unwarranted travel by senior executives while financial constraints limit the provision of health services to its constituency. There is no allegation of fraud, but it is clear that there are serious internal management issues not to mention an extraordinary lack of judgment by the organisation’s leadership. The article cites numerous sources alleging that the provision of health services to Indigenous residents across a large part of western NSW have suffered. Notwithstanding its ongoing funding, its annual report provides no information on its incorporation status, no financial report, and no information on its governance processes including how its Board is appointed and the extent to which it represents the wider Indigenous community across its geographic span.

These shortcomings reflect poor governance practices and, in my view, do not meet the requisite levels of downward accountability to the community let alone upward accountability to the funding agencies and taxpayers generally. It is easy to criticise the organisation, and on the facts described in the SMH article, such criticisms appear warranted. Yet in my view, these shortcomings reflect a deeper level of regulatory failure by the relevant areas within the Commonwealth Department of Health, Disability and Ageing and the NSW Government.

The standard of public accountability provided in CTG’s annual report in my view is far below what a funding body should expect in exchange for its continued funding. There is also a suggestion in the SMH report that the ongoing dysfunction has been going on for some years without being resolved. This raises the further question: if the regulation of this organisation is so lacking, then what is the quality of regulation over other similar organisations? How widespread is this regulatory failure which allows internal management dysfunction to endure for extended periods in key health services delivery organisations utilising government funds, and which adversely impacts the most disadvantaged Australians.

Again, the bottom line is that poor upward and downward accountability for key health services in one of our largest states and across an expansive area of regional communities appears to be tolerated and is likely the default modus operandi for regulatory oversight. This poor regulatory performance is a key driver of sub-optimal management performance by outsourced organisations delivering taxpayer funded programs and leaves the most vulnerable and disadvantaged citizens to ultimately pay the cost.

Conclusion

Mainstream regulatory failures in gambling, and the Indigenous specific regulatory failures in health services are contributors to the systemic drivers of deep-seated disadvantage. To the extent that these regulatory failures are widespread, and the default assumption must be that they are, then they work against closing the gap. It is worth emphasising this point: regulatory failure, which is a matter of technical capability for government, is conceptually a prime contributor to any effort address disadvantage. To the extent that the regulatory failure spans multiple sectors, or even spans the entire breadth of government responsibilities, the prospects of removing Indigenous disadvantage would be fatally undermined.

Closing the Gap (however you wish to frame it, and whatever targets you decide to use) is built upon a near ubiquitous implicit assumption that governments know what they are doing, are focussed on the public interest (and not private interests), and partner with or contract with entities that are fit for purpose. In turn, these assumptions (which take on the form of an ideologically based view of how our democratic system works), are based on a precondition of the effective regulation of entities operating within our economic and social realms to ensure that they are acting consistently with the public interest. If they are not acting in the public interest, then our political system is not fit for purpose.

The key to ensuring that private sector entities (operating behind a corporate veil designed to protect individuals against commercial losses and to encourage the risk taking that market economies rely upon) and public funded entities engaged to deliver outsourced government services are acting in the public interest is to focus on the quality of regulation of their activities. To the extent that regulatory oversight is defective, deficient or non-existent, the public interest will suffer, and in the real world, the victims will likely be disproportionately found amongst the disadvantaged whether in mainstream or Indigenous specific contexts.

Where regulatory failure is endemic, there is no easy fix. Governments will not pull themselves off the ground by their shoelaces. Those who are committed to seeing the public interest protected must find ways to exert strategic political influence, and to pursue, piece by piece, step by step, greater transparency by governments of their use of taxpayer resources and greater public dialogue encompassing the systemic issues that operate to undermine the public interest.

For Indigenous interests, and in particular the Indigenous leadership, there will be considerable benefits in pursuing strategies that build their organisational capabilities to monitor and exert persuasive influence on policy. Risks include the likelihood that governments or other interest groups will seek to co-opt Indigenous advocacy, and that internal dissension and external criticism will undermine the persuasiveness of Indigenous advocacy. The development of internal organisational processes and mechanisms that are both upwardly and downwardly accountable and as transparent as possible will serve to minimise such risks.  

 

27 May 2025

Police/Indigenous relations: the lessons from Laverton

 

It is a damned and bloody work;

The graceless action of a heavy hand.

King John, Act four, Scene three.

 

Marry, sir, they have committed false report; moreover, they have spoken untruths; secondarily, they are slanders; sixth and lastly, they have belied a lady; thirdly, they have verified unjust things; and, to conclude, they are lying knaves.

Much Ado About Nothing, Act five, Scene one.

 

Yesterday I published an article on the 1975-6 Laverton Royal Commission in Inside Story (link here) with the title The Incident at Skull Creek. It concerned a highly publicised event in January 1975 involving a melee between police and some thirty Aboriginal men and boys travelling from Warburton to Wiluna in outback Western Australia for ceremonial business. The article is quite short, so I will leave it to readers to read for themselves. I do recommend you read it before reading further here.

Constraints on length meant I could not include much of interest. I originally focussed on the Royal Commission when I realised that it is fifty years since the events in question and the subsequent Royal Commission which attracted considerable media and political attention at the time.

As I researched the background, I realised that Laverton itself had been a locus of numerous incidents of concerning police/Indigenous interactions. In addition to the Skull Creek affray, I included a description of one of these, the killing of Raymond Watson on the Laverton Reserve in 1969 in the article. Two other incidents caught my attention which I outline below.

Laverton was established in 1896 when gold was discovered and thousands of miners from across Australia and beyond ventured into the region seeking their fortunes. Located some 950 kms east northeast of Perth on the western edge of the Great Victoria Desert, the town continues to service nearby nickel and gold mines. The 2021 Census records the Laverton Local Government Area, which extends from the town across to the state border has a population of around 1300 including some 325 Indigenous people. The population of Laverton itself was just over 400 in 2021, down from some 2500 in the period before World War One.

In 1921, just over a hundred years ago, a group of 15 Aboriginal people were inveigled into entering the Laverton police station yard. As wards of the state, they were subject to the absolute control of the Protector of Aborigines who could determine where they must reside. They were loaded by the police into two freight rail carriages and transported over five days, with one stop, to the notorious government operated Moore River Native Settlement 135 kms north of Perth at Mogumber.

According to Caroline Wadley Dowley who researched and documented these events in her 2001 book Through Silent Country, the reason for the relocation was to send a signal to the Aboriginal groups who had taken up residence around the township, and were considered a nuisance, to return to the bush.

Within a reasonably short period, the group absconded and after splitting into three separate groups, began walking the 1000 kms back to Laverton, navigating by the stars and living off the land. Amazingly, all three groups avoided the search parties sent after them and within months had arrived back on their country near Laverton. While the story of this epic trek back to Laverton entered the folklore of local communities, it is not well known. None of the escapees were re-interned and they resumed their lives while keeping out of sight of local police for some years.

More recently, in January 2008, an Aboriginal man from the Ngaanyatjarra land, Ian Ward, was arrested by police in Laverton for traffic offenses and transported by to Kalgoorlie some 360 kms away by two employees of GSL Custodial Services Pty Ltd (GSL) in the back section of a van modified to carry prisoners. Mr Ward died from heatstroke caused by a combination of the excessive external heat and the even higher temperatures inside the van.

In his subsequent report (link here), Coroner Alistair Hope found (inter alia):

I am satisfied that the Department [of Corrections], GSL, Mr Powell and Ms Stokoe each failed to comply with their duty of care obligations to the deceased and each contributed to the death. I do not repeat those reasons at this stage but comment that there could be no excuse for those failures….

….In summary, therefore, while the deceased suffered a terrible death which was not only preventable but easily foreseeable, issues relating to the involvement of the various individuals and organisations are complicated.

In 1999, an ANU anthropology doctoral thesis, Aboriginal youth and outback justice, by Judy Putt based on extended residence in Laverton documented the complexities cross-cultural relations in the town and the Goldfields more generally. In a nuanced and somewhat equivocal conclusion, she states (inter alia):

In the thesis it is argued that objective unequal social relations existed in the town, which marginalised the young, Wongis and women. The dominant economic activity, mining, was a masculine domain which influenced more general social tastes and practices. Historically and into the present day, a racial divide has existed between Aboriginal and non -Aboriginal residents. Racist beliefs, discriminatory practices, and salient characteristics of the internal Wongi domain perpetuate the contemporary divide. The Wongi domain was not a straightforward product of past exclusionary practices and spatial segregation, shaped as it was by distinctive cultural orientations and historical events.

Whether these conclusions continue into the present is difficult to say. The world is changing rapidly, and the Goldfields and remote Australia is not immune. It is clear however that whatever the situation is in Laverton today, the issues of police/Indigenous relations more widely continue to resonate and be problematic. For policymakers, who don’t have the luxury of academics such as Dr Putt or quasi-academics such as myself to hypothesise and analyse, there is a requirement to respond to ongoing events and circumstances. Yet this does not mean that policy should be simplistic or not thought through.

As an erstwhile policymaker, my considered view is that there is a need for greater transparency and more robust governance of Australian police forces. I note in the article the widespread governance issues facing police forces across the nation. Just today the Canberra Times is running an expose of the hidden legal settlements that are used to hide police misfeasance here in the ACT. In the article published yesterday, I suggest that there may be a need to consider governance changes that constrain the apparent sense of entitlement and impunity that at least some police clearly hold.

Across remote Australia, the unrestrained and unconstrainted access to alcohol is also problematic (as is the access to illegal drugs) and is a proximate cause of anti-social behaviour and excessive violence within Indigenous communities and the nearby towns. Punitive policing doesn’t work but is necessary when access to drugs and comparatively cheap alcohol is widespread and increasingly ubiquitous. Australians and their governments have a choice: access to alcohol and drugs, or secure living environments. Unfortunately, the dumbing down of political debate means that increasingly we do not have the forums that facilitate even a rational discussion of these choices (and other important policy choices that extend beyond the Indigenous policy domain).

In my view the community generally and policymakers in particular need to take greater account of history in considering the shape of the policy choices we are making. This is the reason it is useful to remind ourselves of Laverton’s history of police / Indigenous relations.

 

Regulatory outcomes and the mining sector: implications for Indigenous interests

 

Whiles I am a beggar, I will rail and say there is no sin but to be rich;

and being rich, my virtue then shall be to say there is no vice but beggary.

Henry IV, Part 2, Act one, Scene two.

 

New research published in the Journal Resources Policy (link here) examines the impact of the various elements of the overarching institutional prerequisites for mine approval via a comprehensive analysis of 409 mining applications subject to regulatory approval in Australia between 2000 and 2020.

The authors, Lisa Nicole Mills, Jennifer Stewart and Graeme Auld are resource policy experts based in Carleton University in Ottawa. The Abstract of their paper states (inter alia):

In this paper, we examine the pressures which affect business risk through the multiple dimensions of the “licence to operate,” in the case of federally regulated mines in Australia. Studying 409 mining applications that were under regulatory review, approved, or withdrawn between 2000 and 2020, we use competing risk hazard models and linear regressions to examine how measures of business risk (longer times in review and more conditions) and choices to withdraw are affected by: the attributes of the mine, competing rights claims and land-uses, levels of oppositional mobilization, changes in political parties in power, and market prices. We found that new projects, and those that triggered an independent assessment of their impact on water, were likely to experience longer reviews. Mines where agriculture was the competing land use also faced longer reviews, and mine proponents were more likely to withdraw their proposal. Contrary to our expectations, the mobilization of opposition to a mine was associated with faster time to approval, but also a higher number of conditions.

In section 2.1 of their article, the authors identify three broad elements of the regulatory process governing mine approvals in Australia: the Environment Protection and Biodiversity Conservation Act 1999 (EPBC Act) which applies to nine potential matters of national environmental significance; the processes required to obtain secure mining title which are state based; and the provisions of the Native Title Act which apply to lands with either determined native title, or subject to claim. The empirical analysis undertaken was limited to processes under the EPBC Act.

The analysis considers interactions among licences to operate through the lenses of civil society mobilization, electoral and party politics, and competing land-uses as these combine to affect the business risk experienced by mine project proponents through the EPBC Act regulatory approval process and outcomes. I don’t propose to attempt to summarise the details of the statistical analysis and refer interested readers to the article itself. Not will I focus on the outcomes apart from the one of most interest to readers of this blog, namely in relation to Indigenous claims (emphasis added).

A third insight from the analysis concerns the role of competing rights claims and land-uses. The data indicated that Indigenous land rights claims did not have any bearing on the length of time to approval, withdrawals, or conditions; indeed, proposals to mine on land without any claims tended to take longer to be approved than those on land with claims: but this association was not statistically significant.

Further, the authors found that:

Higher levels of civil society mobilization pushed regulators in apparently different directions. When mobilization was high, more conditions were imposed upon the mine's operation, a finding that is consistent with literature that suggests social pressure may increase regulatory requirements… However, mines that faced mobilization were not subjected to longer approval times; and, in the case where mines faced opposition from actors who would be negatively economically affected by the mine's development, approval times were shorter.

The overarching conclusion of the analysis (references removed) is that

Unlike early work on social licence to operate that conceptualized social pressures as working in synergy with regulatory processes, often leading to higher requirements or even beyond compliance behavior, we provided evidence that regulatory licences can serve as a trump card to advance a project. In this respect, our analysis offers caution for those that view economic licensing [ie investor approval] and social licensing [ie community and social approval] as substitutes for, or at least complements to, regulatory licensing.

For my purposes, this research offers at least preliminary or provisional evidence that longstanding tropes embedded within Australian politics in relation to Indigenous land rights are mistaken and wrong. Those tropes, which underpinned the rationale for denying Indigenous interests a veto over mining on their lands, were that land rights would be anathema to mining development and indeed to the nation’s economic security. The experience of the past two decades is that those fears have not eventuated. That experience strongly suggests that the promulgation of those fears was designed to benefit the minerals industry and to maintain the structural exclusion of Indigenous interests within Australian society.

Having said that, hidden behind these issues, and embedded in the current institutional architecture of native title and land rights, are a set of public policy issues related to the equity of the current financial policy frameworks which

(i)            privilege native title holders of land which lies above mineral deposits over those Indigenous groups who do not have access to native title, or those native title holders whose land does not lie above commercially viable minerals; and

(ii)          with only some exceptions, fail to ensure that the funds which flow to native title holders and Indigenous landowners are disbursed within frameworks which privilege accumulation over consumption (or to put it another way, which fail to ensure that future generations will benefit from the compensatory negotiations undertaken by the current generation). If there is any merit in the arguments of many scholars (and Indigenous activists) that colonialism has ongoing impacts, and that intergenerational trauma is a reality, then any argument against intergenerational benefit provision for beneficial payments arising from mining on Indigenous land disappears.

These are public policy issues because it has been governments that have devised the institutional arrangements that underpin the implementation of native title rights and land rights, and while the issues identified above may not have been intended or even recognised, they are now of very real significance. I use the term ‘hidden’ because these issues have been largely submerged in the public debates over Indigenous land rights over the past five decades. With the turn to economic empowerment as an overarching priority in the Indigenous policy domain (link here and link here) it is time that these issues were given greater profile and attention by policymakers and Indigenous advocates.

 

5 May 2025

The Domestic and Family Violence crisis in the NT: a symptom of wider chaos

 

Confusion now hath made his masterpiece!

Macbeth, Act two, Scene three

Australia’s National Research Organisation for Women’s Safety (ANROWS), a research organisation established by Australian governments, recently published an evaluation report (link here) commissioned (and presumably funded) by the Northern Territory Department of Children and Families into the Territory’s Men’s Behaviour Change Programs (MBCPs). These programs (which to be clear seek to address important issues of individual responsibility) are aimed at reducing the levels of Domestic and Family Violence in some, but not all, regions in the NT. The evaluation focussed on the two MBPCs operating in the NT (link here), one in Darwin and Wadeye run by Catholic Care NT, and the other operating in the Alice Springs Town Camps run by Tangentyere Council. The evaluation was process focussed rather than outcome focussed, and while its recommendations are sensible and, in many respects, predictable, the evaluation was clearly limited in its focus. In setting the scene, the report identifies the broader significance of domestic and family violence (DVF) in the NT (page 18):

The NT arguably faces the greatest challenge of all Australian jurisdictions in addressing domestic and family violence. The rates of DFV in the NT are far higher than any other jurisdiction in the country, with particularly severe consequences for victims and survivors. In 2023, rates of DFV-related assault were almost 6 times that of all other jurisdictions where data is recorded, and 3.5 times the national average. The rate of DFV-related homicide was 4 times that of all other jurisdictions, and 3 times the national average. 2 in 3 (67%) assaults recorded in the NT were related to DFV and over half (55%) of homicides recorded in the NT were DFV related in 2023 [footnotes removed].

The report goes on to state:

While DFV affects people across population groups in the NT, Aboriginal women are disproportionately affected, being over 8 times more likely to be assaulted than nonIndigenous women or men. Aboriginal women in the NT are killed by intimate partners at almost 13 times the rate of non-Indigenous women and men. Over the 20-year period between 2000 and 2021, 70 per cent of intimate partner perpetrated assault deaths in the NT were perpetrated against Aboriginal women…  It is important to emphasise that while DFV is experienced mostly by Aboriginal women in the NT, DFV is perpetrated by both Indigenous and non-Indigenous men [footnotes removed].

The report proceeds to cite research identifying the ongoing impacts of colonialism, the impact of the 2007 NT Emergency Response, and the pervasive impacts of racism as significant contributors to the existence of DFV. While these are undoubtedly ongoing factors in shaping Aboriginal people’s life opportunities, I consider that their significance in driving DFV rates in the NT is both overstated and without rigorous empirical proof. More significant are the wider systemic issues identified in the report on page 19 under the heading Contextual realities of the NT. Unfortunately, the report frames these factors as downstream factors which compound the impact of DFV rather than as drivers or causes of DFV:

The experiences and use of DFV in the NT are compounded by contextual realities that make addressing this violence particularly complex. … alongside structural and system racism, Aboriginal communities in the NT are also disproportionately affected by factors such as poverty, homelessness, inadequate housing, housing insecurity and overcrowding, physical and mental health issues, alcohol and drug use, high rates of unemployment, and socio-economic disadvantage [footnotes removed].

The effect of this framing in the evaluation is to shift attention away from focussing on causation, and towards a focus on remediation. Of course, this ultimately flows through into the framing of the internal and external policy debate. The result is that while the ANROWS report mentions systemic issues, it simultaneously downgrades those that are susceptible to policy action to a category of ancillary or downstream issues that are just unfortunate ‘contextual realities’. The systemic issues that are identified (colonisation; the NT intervention; ongoing racism) are not susceptible to reversal through policy reform. The result in my view is that notwithstanding the reports undoubted merits as a process evaluation, it is simultaneously a contributor (perhaps unintentionally) to the systemic blindness which facilitates the ability of policymakers to avoid dealing with the real issues of causation in relation to domestic and family violence in the NT.

The NT Government’s Families Department website has some very useful information and data on the levels of DFV across the NT (link here) and I particularly recommend interested readers look at the DFV mapping report (link here) which provides a comprehensive analysis of the prevalence rates in the Northern Territory, and purports to identify gaps, opportunities and proposals for reform. Pages 145-147 list a series of potential initiatives under the heading ‘Systemic Reform and enablers opportunities’. Unfortunately, like the ANROWS evaluation, there is no mention of alcohol as a driver of Domestic and Family Violence. Readers are effectively misdirected away from the structural reform and into a labyrinth of myriad potential and desirable administrative changes.

In November last year, I published a post with the title Justice Reinvestment: divert and distract (link here) where I stated:

Importantly, while the costs of Indigenous hyper-incarceration are overwhelmingly borne by First Nations individuals, families and communities, there are wider societal costs that provide a potential platform for future advocacy. I am not referring to the financial costs of our prisons, substantial as they are, but to the less tangible costs that degrade the moral and ethical foundations of our society. How can informed citizens live in a society where the preconditions for social dysfunction have been allowed to develop, largely through neglect rather than deliberate intent, to the point where in some parts of the nation, domestic violence is endemic, employment opportunities are minimal, (government owned) housing is in extraordinary states of overcrowding and disrepair, and where young people are less literate and numerate than their parents. As the NT Coroner Elizabeth Armitage noted in her concluding comments to the recently released Inquest into the deaths of four Indigenous women (link here), ‘94% of the very youngest children in detention (10-13 year olds) have been exposed to family violence’.

In March this year, in a post titled Misdirected focus: the case for institutional policy reforms to alcohol supply (link here) I quoted an NIAA submission to a Parliamentary Committee Inquiry which stated inter alia:

AOD [alcohol and other drugs] are involved in more than half of all police-reported family and domestic violence incidents in Australia, and are likely to be involved in a substantially greater proportion of all family and domestic violence…. For homicides in the period from 1989–90 to 2016–17, 72% of First Nations offenders were under the influence of alcohol at the time of the incident, as were 71% of First Nations victims…

In the conclusion to that post, I wrote inter alia:

If Australia was serious about reducing family violence within Indigenous contexts, we would implement significant policy reforms in relation to alcohol advertising, taxation and retail availability.

A commentator wrote in response:

… your conclusion says it all, really. The work has all been done by WHO [World Health Organisation], which over time has refined and distilled its best practice advice based on solid research gathered by its expert committees over decades. And if you had to choose the three items with the best evidence attaching to them, it is those three you mention: dealing with alcohol advertising; taxation; and seriously attacking the easy and cheap retail availability of alcohol. 

Concluding comment

The tragedy of our nation’s continued propensity to avoid facing up to the issues that are causing immense harm and damage to the life opportunities of tens of thousands of Aboriginal and Torres Strait Islander people across remote Australia (and beyond) is approaching the point where it will spiral out of control and adversely impact mainstream institutions.

The Northern Territory is in a state of perpetual governance crisis, where underfunded schools are no longer fit for purpose, jobs are not within reach of young Aboriginal kids, alcohol and drug abuse is rife, as is domestic and family violence, and where violence and mayhem are increasingly spilling into the major towns and cities. Recently, the organisation representing the traditional owners of the Darwin region called on the four land councils to take some responsibility for the mayhem arising from the misbehaviour of out of town visitors (link here).

The reaction and knee-jerk responses of politicians and the wider Territory community is to blame the victim and seek ever increasing punitive laws and actions by governments. Last week, the Chief Minister announced she would recall Parliament (scheduled to sit tomorrow) specifically to rush through stronger bail laws following the murder of a storekeeper by a young Aboriginal man with a lengthy criminal justice record. On Saturday, the Weekend Australian (26-27 April 2025) published an article by Liam Mendes headlined ‘Same old story in red-flag Territory’ ($ link here $) which recounted numerous instances of shocking and appalling violence perpetrated against innocent citizens by young offenders. The article noted that ‘Territorians have been here before’ recounting how the CLP Government had come to office promising to get ‘tough on crime’, but that the community were increasingly sceptical: ‘The Chief Minister’s declaration …that “nothing is off the table” meant very little to exasperated residents’. Mendes concluded by noting ‘It is clear that the Territory’s justice system is broken. The answer isn’t to lock every defendant into overcrowded, overrun, disgusting watch houses.’ The author is right of course, although his concluding comment that the Government should have acted sooner is arguably misguided insofar as it implies that there are (unspecified) short term solutions.

The problems in the NT have been decades in the making and have their roots in the failures of governments at all levels to adequately support the maintenance of a viable social and economic institutional infrastructure in remote communities. Reversing this longstanding policy neglect is not susceptible to some quick fix. In recent years however the systemic dysfunction in remote communities that governments have been prepared to tolerate for decades because they were metaphorically ‘out of sight’ has begun to colonise mainstream Territory cities and towns.

Simultaneously, quite apart from the justice system challenges, and the associated issues related to Indigenous disadvantage, the quality of governance and public administration within the NT Government more generally has reached a tipping point and is now in a state of rolling crisis. Over the past year major governance failures have emerged in the Police, in the Anti-Corruption Commission, in the Chief Minister’s Department, and in the high-profile Waterfront Corporation. The senior levels of the NT bureaucracy appear to have been seriously compromised without apparent accountability. The concept of ministerial responsibility appears to have been consigned to the deeper depths of Darwin Harbour. The NT Independent recently published an editorial headlined CLP Government’s cover-up of misconduct at Waterfront part of wider dysfunction in the Territory (link here).

The prospect of any government in the NT pursuing the public interest on any significant issue in the near term is, in my view, a chimera. To take the crucial issue of alcohol, both Labor and CLP Government in the NT have consistently been prepared to prioritise the interests of the alcohol industry over the public interest (link here and link here). The risk is that the Territory’s diseased culture of governance has also infected the Commonwealth’s administration of Indigenous affairs. Three of the last five Ministers or Assistant Ministers have been from the NT, and the current Shadow Minister is also from the NT. In these circumstances, it is difficult to see the Commonwealth holding the NT to account on Indigenous policy issues going forward (not least because it has failed to do so to date).

One way or another, remote Australia requires more serious policy attention (as opposed to political froth) from national policymakers. A good first step would be to progressively and incrementally strengthen controls across the board (ie mainstream and Indigenous) over the availability and price of alcohol. But much more than this will be needed to reverse the progressive decline in governance and its silent handmaiden, economic security, that is currently underway and gathering momentum. The alternative to serious reform is progressive decline into systemic chaos not just in remote communities, but across the NT and potentially elsewhere in remote Australia. Unfortunately, it seems things will have to get much worse before the political willpower to reform will emerge either in Canberra or Darwin.

 

29 April 2025

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