Indigenous affairs overview

Budget Review 2019–20 Index

James Haughton

Indigenous budget drivers

Over the last decade, the Productivity Commission’s Indigenous Expenditure Reports (IER) have consistently shown that total Commonwealth, state and territory government per capita expenditure on Aboriginal and Torres Strait Islander people is approximately double the per capita expenditure on non-Indigenous Australians. The Australian Government directly spends around 1.5 times as much on Indigenous people on a per-capita basis, or 1.64 times as much if indirect spending (via transfers to the states and territories) is included (calculation based on IER 2017 supplementary data tables). In 2015–16, the Australian Government directly spent $14.7 billion on Indigenous people, of which 77 per cent ($11.3 billion) was through mainstream programs such as Medicare, social security payments, child care benefits and support for university places accessed by Indigenous people. Around 23 per cent ($3.3 billion) was on Indigenous-specific programs such as ABSTUDY, Indigenous-specific health programs, or Indigenous rangers programs. When state and territory government spending is included, mainstream spending climbs to over 80 per cent of the total expenditure on Indigenous people.

The main driver of Indigenous expenditure is thus not Indigenous-specific programs, but higher use of all government programs. Some of this higher use is due to demographic differences—for example, Indigenous people are on average younger and have higher fertility rates than non-Indigenous Australians, leading to more per-capita demand for pre-school, school and university places, and child care services (IER 2017, p. xii). However, much of it is caused by Aboriginal and Torres Strait Islander people’s higher levels of disadvantage, leading to higher use of hospitals, social security, and social housing, as well as higher rates of child protection interventions and imprisonment. These circumstances give rise to demand for Indigenous-specific programs, such as those detailed below, to divert people from these undesirable outcomes. Government per capita spending on Indigenous people and programs can be expected to remain above the per capita average in future budgets until there is real progress on closing the gaps.

In this context, there is currently no provision in the budget to continue the following National Partnerships[1] over the forward estimates period:

  • National Partnership Agreement on Universal Access to Early Childhood Education[2]
  • national partnerships on cross border issues in the Torres Strait, including health issues, mosquito control, and blood borne viruses and sexually transmissible infections
  • National Partnership on Northern Territory remote Aboriginal investment (formerly the National Partnership on Stronger Futures in the NT) and
  • national partnerships on improving trachoma control and the rheumatic fever strategy.

Furthermore, no support will be provided beyond 2018–19 for remote housing outside the Northern Territory. With the possible exception of trachoma, the issues addressed by these National Partnerships are unlikely to radically improve in the near future.

Indigenous-specific and related budget measures

As with previous budgets, the 2019–20 Budget includes both Indigenous-specific measures, listed here, and many mainstream measures that are likely to disproportionately affect Indigenous people, positively or negatively, due to Indigenous people’s level of disadvantage (including higher rates of disability, unemployment, and mental illness) and relative geographical concentration in remote and very remote areas. The extent to which mainstream services have a positive effect depends in large measure on whether their design and delivery is culturally safe and appropriate. For consistency with other reporting frameworks, such as the Overcoming Indigenous Disadvantage report and the Indigenous Expenditure Report, measures are categorised according to the Council of Australian Governments’ (COAG) ‘building blocks’, commencing with those areas the Government regards as key priorities (Portfolio Budget Statements 2019–20: Budget Related Paper No. 1.14: Prime Minister and Cabinet, p. 30).

Since the Mid-Year Economic and Fiscal Outlook 2018–19 (MYEFO) the Government has announced a number of other Indigenous measures which are probably funded from grants programs, departmental funds, or the MYEFO’s ‘decisions taken but not yet announced’ allocation. They are not listed in this brief unless they are directly relevant to a Budget measure.

Unless otherwise stated all page references are to Budget Paper No. 2: Budget Measures 2019–20.

Education and early childhood

  • Closing the Gap refresh—Indigenous Youth Education Package. Announced in the Prime Minister’s Closing the Gap statement, this provides $200.0 million for scholarships and mentoring for Indigenous students, $70.6 million to freeze or waive Higher Education Loan Program debts for teachers in very remote schools, and $5.0 million to promote school attendance. Only $86.7 million is new money, with the remainder being found from ‘existing resources of the Department of the Prime Minister and Cabinet’, possibly referring to the Indigenous Advancement Strategy grant program (p. 153).
  • Extending Family Tax Benefit to ABSTUDY recipients aged 16 or over who study away from home: $36.4 million over five years (p. 159).
  • As well as enabling Indigenous children to access preschool (a Closing the Gap target), the one-year $453.1 million extension of the National Partnership Agreement on Universal Access to Early Childhood Education includes $1.4 million specifically to increase preschool attendance among Indigenous children, 41 per cent of whom do not make full use of the available 15 hours a week (pp. 67–8).
  • An unspecified portion of $62.4 million allocated to the Skills Package—Delivering Skills for Today and Tomorrow measure will go to pilot four Indigenous ‘second chance’ language, literacy, numeracy and digital skills education services in remote communities (p. 69).
  • $15.0 million under the Community Development Grants Programme measure to fund the William Cooper Centre at Punt Road, an educational hub for Indigenous students run by the Richmond Football Club (p. 126).

Employment and economic participation

  • Securing Tourism and Jobs in Kakadu: $216.2 million over ten years on several programs to boost tourism and upgrade and develop facilities in the Jabiru township. Funding has ‘already been provided for’, possibly in the 2018–19 MYEFO (p. 77). After criticism from the Northern Territory (NT) Government over lack of information on the timing of funding, Minister for Indigenous Affairs Nigel Scullion has stated that $150.0 million will be spent over four years, including $20.0 million from the Indigenous Affairs portfolio.
  • The Support for the Australian Music Industry measure includes $2.7 million for a grant program for Indigenous musicians (p. 60).
  • The Barkly Regional Deal ‘redirects’ $8.5 million in funding from the Indigenous Advancement Strategy to support economic development projects in the Barkly region of the NT (p. 125).
  • The Northern Territory Infrastructure Investment Program includes $60.0 million for road upgrades on the Tiwi Islands (p. 133). Other road projects under this program and the Queensland (pp. 134–5) and Western Australia (p. 143) Infrastructure Investment Programs also include roads in remote areas with high Indigenous populations, which may increase economic opportunities, particularly if Indigenous employment and procurement targets are included.
  • The Indigenous Procurement Policy will be extended to introduce a three per cent value target alongside the three per cent number of contracts target.

Community safety

  • $128.8 million to extend the Cashless Debit Card trials and transition people on Income Management to the Cashless Debit Card (pp. 157­–8). This measure includes:
    • funding to extend the trials in the current sites until 30 June 2021
    • changes to the payments system that will enable merchants to automatically decline transactions that involve restricted items, such as alcohol or gambling products, and
    • moving people who currently use the BasicsCard under income management onto the cashless debit card.

Most people subject to these income quarantining measures are Indigenous. This measure will require legislation, and will be covered in more detail in a separate Parliamentary Library publication.

Governance, leadership and culture



The Department of the Prime Minister and Cabinet’s (PM&C) Review of Remote Housing estimates that South Australian remote Aboriginal communities need an additional 300 houses by 2028 to address existing overcrowding and accommodate population growth. The review found that in South Australia (which achieved the highest value for money in remote housing construction) it cost approximately $480,500 to build new houses, plus 6.9 per cent ancillary costs. On these figures, $37.5 million will build approximately 73 new houses, so will not meet the identified demand, although as noted, this item is only ‘part of transition arrangements’. No information is yet available on any longer term programs.

Stakeholder reactions

The croakey health blog provides a summary of pre-budget submissions on Indigenous issues from the health and community sector here.

National Indigenous Television summarised Indigenous peak body reactions to the Budget as ‘lacklustre’ and ‘too little, too late’ despite some ‘glimmers of hope’, such as increased funding for ATSILS and Indigenous health research, although many stakeholders expressed concern at the rolling of the Indigenous Legal Assistance Program into a mainstream funding mechanism.

Many stakeholders expressed concern or outrage that the Budget only allocated $5.0 million in new Budget allocations to preventing Indigenous youth suicide. The Centre of Best Practice in Aboriginal and Torres Strait Islander Suicide Prevention noted the additional $10.0 million announced by the Minister for Indigenous Health (see above) but suggested that if funding were to be in proportion to demand, then Indigenous-specific measures should have been about nine per cent of the total mental health package, or about $70.0 million.

National Aboriginal Community Controlled Health Organisations (NACCHO) provides a round-up and summary of Indigenous peak body responses to the Budget.

[1].          See Budget Paper No. 3: Federal Financial Relations or the Federal Financial Relations website for more information on the National Partnerships.

[2].          The Budget extends this National Partnership by one calendar year, but it still ends within the forward estimates. See the Parliamentary Library’s Education and training budget brief for more details.

[3].          Whether this strategy continues or replaces the National Partnership on addressing blood-borne viruses and sexually transmissible infections in the Torres Strait, which has a cross-border focus, is not clear.


All online articles accessed April 2019

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