The business of Indigenous Affairs then and now

The history of Indigenous affairs in Australia over the past half century is a tale of noble aspirations, enthusiastic efforts, modest successes and significant failures.

Some socio-economic indicators

• According to the 2001 Census, Indigenous unemployment was 20 per cent compared to 7 per cent for the rest of the population;
• Self employment was 5 per cent for Indigenous Australians compared to 16 per cent for the rest of the Australian labour market;
• The rate of home ownership was about 30 per cent compared to 70 per cent of the general Australian population. Among Native Americans and Maoris, by way of comparison, it was more than 50 per cent; and
• Average annual incomes among Indigenous Australians in 2001 were $11,000. For the rest of Australia they were $19,800.

Cradle-to-grave poverty among Indigenous communities remains one of Australia’s most urgent social issues. We need to speak frankly.

How it all started

The kernel of this disaster was the disingenuous conviction that Indigenous Australians should have limited contact with Australia’s capitalist society. This idea took hold after the watershed industrial decision of the 1966 Northern Territory Cattle Industry Case when equal pay was granted to Aboriginal stockmen.

In 1965, the Northern Australian Workers’ Union had applied to the Industrial Arbitration Commission for full blooded Aboriginal station workers to be paid the same as white workers. The Industrial Commissioners, presided over by Sir Richard Kirby, concluded, “… there must be one industrial law, similarly applied to all Australians aboriginal or not”.

They knew that a likely consequence of their decision was “disemployment”: “If therefore, as a result of our decision, substantial numbers of Aborigines move to settlements or missions, it is our view that the policy of assimilation and integration will be assisted rather than hindered …”

Sir John Kerr, representing pastoralists, had argued: “It [is] nonsense to say that men are better off, unemployed in thousands, but maintained in settlement in growing degrees of comfort when they could work in the real world with growing degrees of efficiency and growing economic rewards.” There was real moral hazard in wilfully pricing out of employment Indigenous people who still had both a strong attachment to tribal life and participated in local labour markets.

The consequence of this decision, sure enough, was “disemployment”. The other pernicious consequence of the Commission’s decision was the notion that Indigenous Australians were bound to fail in the labour market and in enterprise. As Dr HC “Nugget” Coombs, that era’s most distinguished supporter of Indigenous Australians, put it, “It is hard to imagine another society whose values were as inappropriate to the demands of an industrial economy”.

A new policy era

Federal leadership on both sides of Parliament knew that after the 1967 referenda Indigenous Affairs was at a crossroads. Paul Hasluck, Minister for Territories between 1951and 1963, had declared that all Aborigines should “attain the same manner of living as other Australians and live as members of a single Australian community …”

It was Prime Minister Sir William McMahon who articulated a new approach in his 1972 Statement on Aboriginal Affairs, “… they should be assisted as individuals … to hold effective and respected places within one Australian society with equal access to the rights and opportunities it provided and acceptance of responsibilities towards it. … They should be encouraged and assisted to preserve and develop their own culture …”

Sir William McMahon shifted Indigenous affairs away from assimilation and social engineering. He raised economic independence and the role of land tenure as part of Aboriginal advancement. He was open to ideas about Indigenous self determination and self management. But he was also quite firm that “separate development” as a long term aim was counterproductive. The core business of Indigenous Affairs was economic development and effective public service delivery.

Meanwhile, the New Left was in its early ascendancy and Indigenous “separate development” became a key component of the movement. The movement argued that since capitalist society had created racism, dispossession and disadvantage, therefore creating the greatest distance between the Aborigines and capitalism was both humane and urgent.

Disastrously, this also meant rejecting the expectations and disciplines entailed in market-based employment. At this time, the Australian “outstation” or “homelands” movement understandably began to crystallise.

The Homelands Movement

As outlined in one of the movement's key documents, A Certain Heritage, the Homelands Movement was essentially restorationist:

Aborigines hoped that smaller, more dispersed groups would find their traditional hunting and gathering more rewarding and their dependence thereby reduced.

There was something wrong, nonetheless, with supporting policies that wilfully diminished standards of living or access to opportunities.

… There is in the homelands little prospect of employment; access to necessities is more difficult; schooling … medical services often unavailable … choice between the lifestyle of homeland and that of the larger settlement or township is inescapable. Aborigines cannot hope to have all or the best of both.

The homelands movement meant accepting low standards of living. As Marcia Langton, a leftwing Aboriginal academic, has pointed out, the New Left failed to notice that as Aboriginal people become more reliant on subsistence activities for survival, their emerging demands for land rights in the 1970s were oblivious to their exclusion from the workforce.

Welfare and employment

Indifference towards Indigenous participation in the workforce then conspired with the morbidity of welfare dependence. Beginning in the 70s, elders and communities became increasingly alarmed at the corrosive effects of easy access to welfare. The incentives to participate either in the labour market or in cultural maintenance were obviously diminishing.

The Fraser Government responded with the Community Development Employment Projects program in 1977. Initially CDEP was set up so that remote communities could forgo unemployment benefits for community obligated projects. This Indigenous work-for-the-dole approach grew exponentially. As the largest single Indigenous specific program, it has 37,000 individual places, many in urban and regional settings, and funding of over half a billion dollars annually. Despite this growth, it has neither linked individuals to local labour markets nor uniformly enforced mutual obligation requirements.

The percentage of Indigenous Australians who rely on government pensions and benefits has decreased - from 55 per cent to 50 per cent - in the eight years to 2002. But the fact that half of a population rely on pensions and benefits has sounded alarm bells in commentators as different as ANU Professor Bob Gregory and Noel Pearson, who calls this “welfare poison”.

In 1999 the Federal Government established the Indigenous Employment Policy (IEP) to give better access to private sector jobs for Aborigines and Torres Strait Islanders. The policy now boasts many success stories.

The basic lessons the Australian Government has learnt are these:

• indigenous job seekers are not hardwired to fail in employment;
• with goodwill, local jobs for local Indigenous people can be found;
• private sector jobs do not take away Indigenous identity and can restore pride in individual and community achievement;
• private sector jobs are a vital component towards building meaningful economic independence; but,
• considerable barriers to employment remain.

The responsibility to fashion a more balanced regime with effective disincentives and incentives is one the Australian Government is tackling with reforms to the welfare system. One model is New Zealand’s very effective “work-first welfare-second” reforms. Unemployment among Maoris has declined from 16 per cent in 1999 to just 8.9 per cent in December 2004.

Emphasising economic development

A greater emphasis on Indigenous economic independence - private jobs, incomes and enterprises - is growing in significance to policy makers as the Indigenous population grows. Thirty years ago, Australia’s small Indigenous population of 106,000 people was principally rural. But in 2001 there were 460,000 Indigenous Australians, only one quarter of them living in remote areas. It is also a very young population, with 70 per cent of Indigenous people under 25.

The Commonwealth has devised successful models in Indigenous Business Australia and the Home Ownership Program. There are also small business financing and skills transfer schemes, like the Business Development Program, the Indigenous Capital Assistance Scheme and Indigenous Community Volunteers. Some successful Indigenous enterprises, ranging from micro business to capital intensive mining operations, are flourishing. Entrepreneurial Indigenous people exist and are supported - but commercial developments, rates of homeownership and self employment are critically low. Indigenous commercial development cannot be examined without a discussion of the development of land rights.

Land rights were given Commonwealth recognition in 1972 by Prime Minister William McMahon, with funds made available for buying properties not on reserves. Today, Indigenous ownership of the Northern Territory is approximately 44 per cent, in South Australia nearly 21 per cent; Western Australia, 14 per cent; for other jurisdictions, less than 3 per cent. The total is around 16 per cent of Australia’s land area.

The vast majority of Australians do not begrudge Indigenous communities being rich in sacred sites and natural resources. Many would like communities to acquire more, which is the general trend anyway. Nevertheless when so many communities are simultaneously asset rich and unacceptably poor, something is wrong.

Following the lead of Canada and the US, Australia created a system of land trusts and land councils to manage inalienable communal title. Of course, commercial development on inalienable land exists but decision making has been slow and complex. For three decades, workability and development were not seen as priorities. The general working principle was to build a system around subsistence from the land and waters. In turn, barriers to investment and involvement by Indigenous individuals and communities were created.

Warren Mundine, a National Indigenous Council member and President-elect of ALP National Executive, has initiated an important debate about homeownership on inalienable land. Mundine proposes to foster a “salt ‘n’ pepper” mixed ownership system. As he points out, many of the barriers to homeownership and commercial development on communal land are non-legal. Worthwhile future directions include fostering financial literacy and capacity building among Indigenous communities so as to make best use of existing programmes. His ideas may well successfully tackle overcrowding and poor sanitation in remote and rural communities.

An innovative, responsive, agile approach

Shared Responsibility Agreements and Indigenous Co-ordination Centres are at the heart of a new more innovative, responsive and agile approach to Indigenous Affairs. Indigenous communities nominate initiatives, programmes and policies that they need and want from the different Federal agencies. This is done through the ICCs, in a systematic, monitored, whole of government approach. In return, Indigenous communities will have to negotiate some mutual obligation requirements.

For Indigenous affairs, this represents an enormous shift in public service practice and delivery. The progress made with “no school, no pool” initiatives is heartening. Witness the rapid decline of trachoma among the young in the Mulan community following its “washing-faces for a new petrol bowser” deal with the government. Communities appear to be enthusiastic. By mid-2005, there should be 50 Shared Responsibility Agreements.

Moving ahead with cautious optimism

Australian policy makers have been slow to realise that private property ownership and workforce participation would be healthy for Indigenous peoples. Deliberate insulation from the job market and enterprise created poverty and welfare dependence. Despite the gains in land rights, the capacity for greater economic independence was diminished.

The Howard Government is committed to an Indigenous Economic Independence Strategy, basing its thinking on two underlying considerations: first, rejecting the notion that Indigenous people are lesser economic beings; second, challenging a welfare culture in favour of an entrepreneurial culture. This is as noble a cause as political equality or addressing dispossession.

The way out of welfare is to build workforce participation and to find the economic and social multipliers that create opportunity and reduce hardship. The way forward needs effective public service delivery of education, health and other essential services. At the same time, we recognise some labour markets are limited. Programs of community development will remain an integral component of the new approach.

More Indigenous Australians must be given hope and opportunities to participate in the market and economy. To gain a job, to own property, to build their own wealth for the next generation, are prerequisites for Indigenous economic independence. If practical reconciliation means anything, it means this.