Indigenous Affairs—Government priority areas

Budget Review 2017–18 Index

Dr James Haughton

The 2017­–2018 Budget contains a number of small to medium Indigenous-specific measures and many large measures that, while not Indigenous-specific, will significantly impact Indigenous people. This brief examines budget measures relating to the Government’s stated key priorities in Indigenous affairs which include ‘… increased participation in education and work, making communities safer where the ordinary rule of law applies’.[1]


The Government’s proposed new plan for school funding is the most significant measure for Indigenous education in this Budget. (See the Budget Review article, ‘A new plan for school funding’.)

Commonwealth funding for the Indigenous loading, which is part of the Government’s recurrent funding arrangements for schools, is expected to increase from $962.6 million (provided from 2014 to 2017) to $1.4 billion (from 2018 to 2021)—an increase of 46.0 per cent.[2] The Government estimates that the additional funding to be provided in 2018 will benefit ‘around 213,504 students’ who identify as Aboriginal or Torres Strait Islander.[3]  The school funding budget measure also provides additional funding of $35.6 million from 2018 to 2021 for Northern Territory (NT) government schools to ‘accelerate evidence based reforms to improve student outcomes’.[4] The potential impact of the so-called ‘Gonski 2.0’ funding model has been welcomed by the National Congress of Australia’s First Peoples.[5] Improving access and educational outcomes for Indigenous school students will also be a focus of the Review to Achieve Educational Excellence in Australian Schools, to be chaired by David Gonski.[6]

The second most significant education measure is the ‘National Partnership Agreement on Universal Access to Early Childhood Education – extension’. Indigenous pre-schoolers can be expected to benefit from the two-year, $429.4 million measure.[7] Although always universal in scope, this National Partnership began (in an earlier version) with Prime Minister Rudd’s pledge of universal access to early childhood education for Indigenous children in remote communities and increasing Indigenous access, particularly in remote communities, has remained a designated outcome of the National Partnership.[8] Young Indigenous children will also benefit from the ‘Jobs for Families Package – Budget Based Funded Services – continuation’ measure which provides $61.8 million per year for child care in approximately 300 regional, remote, and Indigenous communities; however this is not new money, simply a re-announcement of a continuing measure.[9]

Compared to these measures, the $5.9 million over four years for the ‘Closing the Gap ­– English language learning for Indigenous children trial’ measure in 20 Indigenous preschools is quite small, although potentially well-targeted, given the evidence of good outcomes for Indigenous children from early education.[10] As this measure is a trial, stakeholders will be looking for future evaluation and a potential extension if it is successful.

In other, non-Indigenous-specific but significant education related measures, Indigenous postgraduate students have expressed concern at the cessation of the Commonwealth loading for Enabling programs, which assist disadvantaged students to enter higher education, under the ‘Higher Education Reform – a more sustainable higher education sector’ measure.[11] Conversely, some Indigenous students may benefit from the $24 million ‘Rural and Regional Scholarships – establishment’ measure.[12] Legislation may be required for this new spending measure.

Economic participation

Community Development Program

The 2015–16 MYEFO measure ‘Addressing Welfare Reliance in Remote Communities’, which was to be legislated for in the Government’s Social Security Legislation Amendment (Community Development Program) Bill 2015, has been abandoned as part of the ‘Unlegislated Budget Repair Measures – not proceeding’ measure.[13] Unlike some other so-called ‘zombie’ measures which this measure also ceases, the relevant Bill had never been put to a vote or been extensively debated as it was introduced shortly before the prorogation of Parliament and the subsequent double dissolution election. Whether it would have been opposed in the Senate was not clear. The measure had been intended to create a distinct, remote area welfare system, with a higher income threshold, different work requirements, more administration by local organisations, and a welfare system composed of Ministerial regulatory instruments. However, it had been the subject of significant criticism by Indigenous stakeholders, who argued that there had been insufficient consultation.[14] The Minister for Indigenous Affairs, Nigel Scullion, has announced that ‘the Government will consult with Indigenous communities and stakeholders on a new employment and participation model for remote Australia to deliver better engagement for remote job seekers and a clear pathway to employment.’[15] In the same announcement, the Minister also stated that Community Development Program (CDP) participants (that is, unemployed recipients in remote areas, who are approximately 84% Indigenous) will be exempt from the ‘Better targeting of assistance to support jobseekers’ measure, including the drug testing for welfare recipients trial.[16] This may be due to concerns at the likely impact given the already extremely high rates of welfare penalties in CDP areas, which some researchers say is resulting in rising poverty and hardship, although this has been disputed by the Minister.[17]

Income management

The ‘Extension of Income Management’ measure will spend $145.5 million over two years to continue Income Management in all current locations, including the Northern Territory and 13 other locations in New South Wales, Queensland, South Australia, Victoria and Western Australia.[18] The vast majority of those subject to Income Management are Indigenous. The government’s evaluation of New Income Management in the Northern Territory found no measurable evidence of overall improvement in consumption patterns, crime rates or other desired behaviour among those subject to compulsory income management.[19] Evaluations of Income Management in other areas show that positive results have been largely restricted to voluntary participants.[20] This measure will require new legislation.

The ‘Extension and expansion of Cashless Debit Card’ measure will extend the Cashless Debit Card (CDC), which is currently applied to welfare payment recipients in Ceduna and the East Kimberley (who are predominantly Indigenous), to two other yet-to-be nominated areas.[21] Unemployment payment recipients who test positive for drugs may also be placed on Cashless Debit Cards.[22] The cost of this measure has not been published due to commercial sensitivity. However, freedom of information requests have previously revealed that the current cost of the trial is $18.9 million for an estimated 1850 participants, or about $10,000 per participant.[23] This contrasts with earlier assurances by the Department of Social Services that the CDC would have substantially lower costs than Income Management (currently, about $2,000 per person), although per person costs may decline over time and at higher scale.[24] The blanket application of this measure to predominantly Indigenous recipients in designated regions, when it is elsewhere targeted at users of illegal drugs, may give impetus to concerns expressed by some commentators that the CDC is indirectly racially discriminatory.[25] The existing legislation only allows the CDC to be trialled in three areas, so amending legislation may be required.[26]

Participation in employment

The Budget contains two measures aiming to directly boost employment participation for Indigenous Australians. The ‘ParentsNext – national expansion’ measure provides $113.0 million over four years to support parents in predominantly Indigenous areas to increase their participation in the labour market, including additional pre-employment training and outcome fees.[27] The ‘Closing the Gap – Employment Services – additional funding’ measure provides $55.7 over five years for a number of programs to boost Indigenous employment, including: $33.2 million for pre-employment training, mentoring and transitioning from school; $17.6 million to support Indigenous prisoners transition to employment after release from prison, as part of the Government response to the COAG Prison to Work Report; $5.0 million for a community-designed and delivered employment services in Yarrabah; and an increase in wage subsidies (from $6,500 to $10,000) for Indigenous employees.[28] These measures are all well-supported by evidence on what works to boost Indigenous employment rates, including pre-employment training and mentoring, wage subsidies, and culturally-aware programs.[29] High rates of Indigenous recidivism are linked to unemployment of Indigenous former prisoners and are a strong driver of high Indigenous rates of prison custody.[30]

Indigenous business support

The Budget measure ‘Business Support for Indigenous Entrepreneurs – extension’ takes $146.9 million over four years from Indigenous Business Australia (IBA) for the Department of the Prime Minister and Cabinet to provide support for Indigenous entrepreneurs, for no net change in the broader Indigenous budget.[31] This expands a $23.1 million measure doing the same thing in last year’s Budget. The Government has not fully explained why Indigenous Business Australia, an Indigenous controlled organisation, cannot perform this function.[32]

Community safety and the rule of law

The $55.7 million over three years for the ‘Legal Assistance Services – additional funding’ measure reverses previously planned cuts to the Legal Assistance sector and modestly increases their funding, including providing $16.7 million for Indigenous Legal Assistance Providers.[33] This measure has been consistently advocated for by the legal sector and by campaigners against family violence and Indigenous incarceration. Arguably, this funding may fall short of that necessary to bring about improvements, given the scope of unmet Indigenous need for legal and other dispute resolution services which was revealed by the Productivity Commission’s 2014 inquiry Access to Justice Arrangements.[34]

Possibly also benefiting Indigenous people in contact with the legal system are: the $10.7 million measure over four years for ‘Family Law Courts – improving risk identification and management’ which states it implements the recommendations of the Family Law Council report Families with Complex Needs and the Intersection of the Family Law and Child Protection Systems.[35] These recommendations included that ‘the Australian Government provides funding for further positions for Indigenous Family Consultants and Indigenous Family Liaison Officers (identified positions) to assist the family law courts to improve outcomes for Aboriginal and Torres Strait Islander families’;[36] and the $3.4 million over two years measure ‘Specialist Domestic Violence Units – expansion’ which is likely to assist Indigenous women, if it is targeted as stated to ‘areas of need’, given the high levels of family violence in many Indigenous communities.[37]

Other measures

In the cross-sector measure, ‘Enhanced Research and Evaluation in Indigenous Affairs’, $52.9 million is being taken from the Indigenous Advancement Strategy to fund improved programme evaluation ($40 million), an Indigenous Research Fund ($10 million) and increased Indigenous policy evaluation by the Productivity Commission ($2.9 million), for no net change in Indigenous sector funding.[38] This was the Government’s substantive response to the critical audit of the Indigenous Advancement Strategy (IAS) by the Australian National Audit Office (ANAO).[39] This improved evaluation of programs has been welcomed by stakeholders but, as there is no increase in overall IAS funding, it is not clear from which IAS program the funds will be sourced.


[1].           Australian Government, Portfolio budget statements 2017–18: budget related paper no.1.14: Prime Minister and Cabinet Portfolio, p. 19.

[2].           Department of Education and Training (DET), Supporting Indigenous students, Quality Schools fact sheet, (DET), 2 May 2017.

[3].           Ibid.

[4].           DET, Additional funding for the Northern Territory, Quality Schools fact sheet, DET, 2 May 2017.

[5].           National Congress of Australia’s First Peoples (NCAFP), Good news at last for Aboriginal and Torres Strait Islander education?, media release, 3 May 2017.

[6].           DET, Supporting Indigenous students, op. cit.

[7].           Australian Government, Budget measures: budget paper no. 2: 2017–18, p. 87; also Australian Government, Federal financial relations: budget paper no. 3: 2017–18, p. 33.

[8].           Council of Australian Governments (COAG), National Partnership Agreement on Universal Access to Early Childhood Education 2016 and 17, Federal Financial Relations website, n.d.

[9].           Department of Education (DoE), ‘Budget Based Funding Program’, DoE website.

[10].         Budget measures: budget paper no. 2, op. cit., p. 80; for a summary of the evidence for the effectiveness of early intervention and learning see A Forrest, The Forrest review: creating parity, Chapter 1, ‘Prenatal, early childhood and education’, Department of the Prime Minister and Cabinet, Canberra, 2014.

[11].         Budget measures: budget paper no. 2, op. cit., p. 83; National Aboriginal and Torres Strait Islander Postgraduate Association (NATSIPA), Government widening the gap on higher education, media release, 3 May 2017; see also the Budget Review article, ‘Higher education reform’.

[12].         Budget measures: budget paper no. 2, op. cit., p. 89.

[13].         Budget measures: budget paper no. 2, op. cit., p. 77.

[14].         J Haughton, Social Security Legislation Amendment (Community Development Program) Bill 2015, Bills digest, 93, 2015–16, Parliamentary Library, Canberra, 29 February 2016.

[15].         N Scullion (Minister for Indigenous Affairs), 2017–18 Budget: Community Development Programme, media release, 9 May 2017.

[16].         Ibid.; Indigenous population in CDP in M Gooda, Social justice and native title report 2015, Australian Human Rights Commission, Sydney, 2015, pp. 59–65.

[17].         K Jordan, L Fowkes, J Altman, et al, Job Creation and Income Support in Remote Indigenous Australia: Moving Forward with a Better System, Topical Paper 2, Centre for Aboriginal Economic Policy Research (CAEPR), Australian National University (ANU), 2016; N Scullion (Minister for Indigenous Affairs), Facts don’t back up ANU report on CDP, media release, 2 December 2016.

[18].         Budget measures: budget paper no. 2, op. cit., p. 149. For a full list of locations and other details, see D Arthur, Income management: a quick guide, Research paper series, 2015–16, Parliamentary Library, Canberra, 2015.

[19].         JR Bray, M Gray, K Hand and I Katz, Evaluating new income management in the Northern Territory: final evaluation report, Report 25/2014, Social Policy Research Centre, University of New South Wales, Sydney, 2014.

[20].         Department of Social Security (DSS), ‘Income management evaluations’, DSS website, 24 November 2015; D Arthur, ‘Where to for income management?’, FlagPost, Parliamentary Library blog, 25 June 2015.

[21].         Budget measures: budget paper no. 2, op. cit., p. 149.

[22].         DSS, Welfare reform—2017 Budget, DSS, p. 3; see also Budget Review article ‘Drug testing for welfare recipients’.

[23].         D Conifer, ‘Centrelink cashless welfare card trial costing taxpayers $10,000 per participant’, ABC News website, 2 May 2017.

[24].         Senate Community Affairs Legislation Committee, Social Security Legislation Amendment (Debit Card Trial) Bill 2015 [Provisions], Canberra, October 2015, p. 29.

[25].         D Arthur and P Pyburne, Social Security Legislation Amendment (Debit Card Trial) Bill 2015, Bills digest, 27, 2015–16, Parliamentary Library, Canberra, 2015.

[26].         Ibid.

[27].         See the Budget Review article, ‘New job seeker compliance framework’ for more details on ParentsNext.

[28].         Budget measures: budget paper no. 2, op. cit., p. 92; N Sculllion (Minister for Indigenous Affairs) and I McDonald, Boost for Yarrabah jobs and community leadership, media release, 9 May 2017.

[29].         M Gray, B Hunter and S Lohoar, Increasing Indigenous employment rates, Issues paper, 3, Closing the Gap Clearinghouse, March 2012.

[30].         D Weatherburn, J Fitzgerald, and J Hua, ‘Reducing Aboriginal over‐representation in prison’Australian Journal of Public Administration, 62(3), 2003, pp. 65–73.

[31].         Budget measures: budget paper no. 2, op. cit., p. 138.

[32].         J Haughton, ‘Indigenous Affairs’, Budget Review 2016–17, Parliamentary Library, Canberra, May 2016, p. 68. Last year the Government stated that this was outside IBA’s legislation, however the Aboriginal and Torres Strait Islander Act 2005 makes clear provision for IBA to make loans to Indigenous businesses.

[33].         See the Budget Review article ‘Legal Aid and Legal Assistance Services’ for comprehensive discussion.

[34].         Productivity Commission (PC), Access to justice arrangements, Inquiry report, 72, PC, Canberra, 5 September 2014. Chapter 22 covers provision of legal services and alternative dispute resolution mechanisms to Aboriginal and Torres Strait Islander people, including recommending increased funding for these services.

[35].         Budget measures: budget paper no. 2, op. cit., p. 66.

[36].         Family Law Council, Families with complex needs and the intersection of the family law and child protection systems, Final report, Attorney-General’s Department, Canberra, June 2015, p. 107.

[37].         Budget measures: budget paper no. 2, op. cit., p. 71; Steering Committee for the Review of Government Service Provision, Overcoming indigenous disadvantage: key indicators, 2016 report, Productivity Commission, Canberra, 2016, pp. 4.98–4.109.

[38].         Budget measures: budget paper no. 2, op. cit., p. 139; N Scullion (Minister for Indigenous Affairs), 2017-18 Budget: Strengthening Indigenous research and evaluation, media release, 9 May 2017.

[39].         Australian National Audit Office (ANAO), Indigenous Advancement Strategy, Report, 35,  ANAO, Canberra, 2017; N Scullion (Minister for Indigenous Affairs), $10m a year to strengthen IAS evaluation, media release, 3 February 2017.


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