Introduction
2.1
This chapter discusses the challenges facing representative bodies in the native title and land rights systems and considers the evidence about what is required to strengthen their operation.
2.2
The roles and activities of representative bodies have been undergoing a process of major change in recent years, as expectations about what they can achieve have mounted. The chapter examines the reasons behind these changes and questions whether the financial and institutional support provided by Commonwealth, state and territory governments has been sufficient or provided on a firm, long-term basis.
2.3
The chapter examines issues related to the governance of representative bodies, in the context of the heavy statutory and other responsibilities placed upon them, and the complexity of the sometimes overlapping legislative and administrative systems in which they must operate. Particular attention is given to the challenges created by varying level of rights provided to traditional owners under the different systems of land tenure in each jurisdiction in northern Australia.
Challenges for representative bodies in the
‘post-determination’ era
2.4
A common term used by submitters and witnesses to describe the current period was
‘post-determination’, as native title claims have progressively been determined. For example, Dr Hunt emphasised to the Committee that discussion of current issues should ‘recognise that we are in a post determination era’. Similarly, other submissions talked of the ‘post-determination landscape’, or the ‘post-determination environment’.
2.5
With the growing number of successful determinations, nearly all NTRBs/NTSPs are providing extended services related to future acts and agreements, and relevant to managing and using native title more broadly. These include support for PBCs negotiating Indigenous Land Use Agreements (ILUAs), pursuit of compensation claims, applications for grant-based funding for income-producing activities, and cultural heritage matters.
2.6
Evidence to the Committee emphasised that title to land was, by itself, not enough to enable traditional owners to make use of economic opportunities. In the case of native title, the Australian National University submission pointed out that the Mabo judgement merely recognised that native title rights ‘still exist’. The judgement was not explicitly intended to promote economic development amongst title holders. In a similar vein, Mr Iain Anderson from the Attorney-General’s Department observed that ‘the PBC structure doesn’t facilitate actually making use of the land for economic development’.
2.7
At the same time, native title has created expectations that representative bodies would take on the management of ‘an enduring legal framework’ and a wide range of other long-term roles. Dr Lisa Strelein from the Australian Institute of Aboriginal and Torres Strait Islander Studies (AIATSIS) submitted that PBCs, as representatives of traditional owners in the native title system, bear the burden of many unrecognised responsibilities.
In effect, native title is not just a property right; it’s also a system of property and a system of self-government. ...managing the continuity of the laws and customs that regulate the internal distribution and enjoyment of rights and interests is the responsibility largely of the PBC... It’s not recognised that they are resolving disputes like courts. If they make a decision about who signs off on country, that’s a judicial decision. None of that is recognised, because we have put native title into a sort of private law property realm.
2.8
Mr Michael Dillon from the Centre for Aboriginal Economic Policy told the Committee that the implications of the shift to Aboriginal and Torres Strait Islander title to land had not been properly anticipated:
The reality is that there was a huge amount of Crown land 30 years ago across a swathe of the continent; 60 or 70 per cent of that is now under Aboriginal ownership. …there has been a shift in responsibility from Crown responsibilities to Aboriginal responsibilities, and I don’t think governments at the time of the Native Title Act actually understood that this is what was going to happen. …if the Crown owns the land and there is an erosion issue or a feral animal issue or some sort of an environmental issue, they have the responsibility and they will fund it and they will do it. Now it is a responsibility that is being put onto Aboriginal and Torres Strait Islander people...
2.9
Similarly, the Minerals Council of Australia (MCA) noted the expectations generated amongst all parties:
PBCs are increasingly expected by native title holders, governments and other parties, to engage in and unlock economic and social development opportunities arising from native title rights and interests. This can reflect the desires and aspirations of many Traditional Owners for self-determination and expectations that may have arisen during the claim process.
2.10
The following sections discuss the challenges that Aboriginal and Torres Strait Islander organisations are now faced with as they deal with their increasing responsibilities under the various native title and land rights regimes across northern Australia in the post-determination era. Issues covered include:
The need for funding and other support to empower representative bodies
Complex legislative and administrative arrangements
The need for effective governance systems
Empowering representative bodies to exercise free, prior and informed consent
2.11
Free, Prior and Informed Consent (FPIC) is a core principle of the United Nations Declaration of the Rights of Indigenous People (UNDRIP), which was endorsed by Australia in 2009. FPIC empowers Indigenous peoples to give or withhold consent to any project that may affect them or their lands, and to withdraw consent at any stage. As part of the right of self-determination, FPIC provides Indigenous people the right to negotiate conditions under which projects are designed, implemented, monitored and evaluated.
2.12
But in order to exercise their rights under the FPIC principle, Aboriginal and Torres Strait Islander communities must be well-resourced and equipped, so they can be free from any form of coercion and can make decisions on the basis of good quality information provided with sufficient time for it to be considered. All this requires institutions with sufficient financial resources, human resources and expertise to enable them to operate effectively within the native title and land rights regimes.
Funding for representative bodies
2.13
The Committee was informed that, despite onerous and costly demands, the question of funding for PBCs has been left unresolved since the time of the drafting of the Native Title Act 1993 (NTA) and had been ‘left to drift’ for many years. In 1995, the then Aboriginal and Torres Strait Islander Commission (ATSIC) recognised the problem and urged consideration of the issue.
2.14
The 2007 review of the structures and processes of PBCs led to the provision of some basic support funding through the Department of Families, Housing, Community Spm&cervices and Indigenous Affairs. The 2014 review of native title bodies commissioned by the Department of the Prime Minister and Cabinet (PM&C) highlighted the lack of resources of most PBCs and NTRB/SPs and emphasised the responsibility of government to financially support representative bodies because of their important role in the native title system. The review recommended targeted funding for their establishment, early development and ongoing activities to enable them to ‘meet their core compliance and governance responsibilities’.
2.15
In 2020, the Productivity Commission noted that:
…the lack of funding for PBCs means they struggle to fulfil basic statutory obligations, let alone broader strategic functions essential for achieving meaningful outcomes through native title agreements.
2.16
The Central Land Council drew attention to the long-standing nature of the problem:
…decades of inquiries which have concluded that funding arrangements are a barrier to achieving sustainable outcomes for Aboriginal people due to short funding periods, small amounts, inflexible conditions, onerous reporting requirements, and vulnerability to changing government priorities.
2.17
Currently, PBCs are supported by PBC Basic Support Funding to help them meet their corporate and operational obligations with respect to compliance with the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (CATSI Act). According to the NIAA, a total allocation of $9.8 million p.a. for Basic Support Funding is provided to 62 per cent of PBCs, an average funding of $70 000. The 2021–22 Budget allocated an additional $8.6 million over four years, aiming to bring the proportion of funded PBCs to 75 per cent by
2025-26.
2.18
Other funding comes from the $21 million PBC Capacity Building scheme and $7.1 million over three years to help PBCs implement the legislative reforms to native title. The Capacity Building scheme was established in 2015 and supports a PBC website by AIATSIS, a training program for PBCs undertaken by NNTC, and project funding grants. Only 58 PBC projects have been approved since the program’s inception, with 48 PBCs receiving funding directly, with other approvals going to third parties including NTRB/SPs. As some PBCs have received more than one Capacity Building grant, less than one in five PBCs have ever received a grant under the scheme.
Need for increased support
2.19
The Committee received a large body of evidence emphasising the gap between the responsibilities and expectations placed on Aboriginal and Torres Strait organisations and their financial and institutional capacity to meet increasing demands. There were many calls for increased support.
2.20
As Mr Peter Yu from the Indigenous Reference Group (IRG) told the Committee:
On the one hand, we have this legal interest in the land, but, on the other hand, we’ve got two hands tied behind our backs in terms of the ability to do anything with it, because there just isn’t any funding for it.
2.21
Highlighting the financial and other barriers for native title claimants both during and after the determination process, AIATSIS pointed out that the ‘the adversarial process of litigation is time consuming, unpredictable and involves significant costs’.
2.22
The CLC was one of the wide variety of submitters who made the point that PBCs are the ‘key structure for the management of native title rights’ but their members and directors are in need of basic capacity-building assistance in order to fulfil their responsibilities:
The population is largely transient and faces social, economic and educational disadvantage. English is generally not the first language, and literacy levels are very low. Engagement by native title holders with government and corporate entities is relatively low and the majority of PBC members and directors have very limited understanding of the corporate rules and regulations. Further, many aspects of the corporate rules directly conflict with traditional authority and family structures.
2.23
Amongst others, KLC agreed that funding for the increasing responsibilities of representative bodies–including the costs of conducting negotiations when proponents initiate proposals–is inadequate:
…for the discharge of all statutory functions and certainly inadequate to, in addition [emphasis in original], undertake the extensive work associated with native title compensation applications and future acts management. It should be noted here that future acts are processes triggered by third parties for their own – usually commercial – benefit with costs externalised to native title parties. It is critical that these costs be internalised to the relevant
beneficiary / proponent of the future act, if needs be through appropriate legislative mechanisms, and not externalised to native title groups and, ultimately and unavoidably, NTRBs.
2.24
The National Native Title Tribunal (NNTT) submitted that lack of resources makes traditional owners dependent on proponents when negotiating agreements, jeopardising the potential to exploit economic opportunities:
In circumstances where a proponent declines to provide assistance, the RNTBC must fund any legal, financial, and commercial advice itself in order to be able to adequately participate in negotiations. If the RNTBC is impecunious and cannot otherwise source advice they will be at a disadvantage in negotiations and may miss opportunities that might otherwise contribute to their community and to the region.
NTRB/SPs must be funded adequately to ensure the efficient administration of native title determinations and support PBCs in the management of their post determination native title estate. But this will only work if PBCs are empowered to take their rightful role as managers of their estate and as conduits of cultural authority in their region.
2.26
The Office of Northern Australia submitted:
Implementing an economic development project on Indigenous land or land subject to native title can be complex, time consuming and costly, for Traditional Owners, third party proponents and investors. It is currently a significant achievement to reach agreement on a project. … Increasing the capacity of Indigenous land owners is essential for Indigenous land owners and project proponents to engage in meaningful economic development on Indigenous land.
2.27
The NNTC observed that:
Recent years have seen the effective reduction of the resources available to NTRB/SPs to fulfil their function. However, the call on these resources does not diminish. Native title claim work continues and, in many instances, it is the most difficult claims that remain to be resolved: claims that require intensive research, mediation and negotiation. Further, PBCs need to be supported and the coming onset of compensation claims will create an additional burden on NTRB/SPs.
2.28
There is a huge variation in the income, assets and employees reported by different PBCs across northern Australia. A third of PBCs reported no income at all, a smaller number reported some income, assets and employees, while the ‘large PBCs with reasonably sized income, assets and staff comprised a rather small and exclusive club’. Predictably the PBCs with the least resources tended to be in remote and very remote areas.
2.29
Emphasising the uneven pattern and resourcing and capacity, the IRG stated that:
…the ‘post-determination’ environment is emerging as one that is characterised by a very small number of relatively well-resourced PBCs and a large number of PBCs with very limited capacity… The ongoing resourcing of particularly smaller PBCs will be important in ensuring the integrity of the current native title system.
Proposals for future funding
2.30
Funding for PBCs and NTRB/SPs requires a more systematic approach than the current ad hoc one currently in place. There is an urgent need to increase financial and other support, but funding should be placed on a firmer long term footing that recognises the permanent place of representative bodies in the native title and land rights architecture.
2.31
The Committee received recommendations about improving the funding situation for PBCs and NTRB/SPs over both the medium and long term.
2.32
The NNTC noted that the NTA ‘contemplates that NTRB/SPs will be funded independently of the political cycle’. The Council therefore recommended that they ‘be provided with secure triennial funding as contemplated under NTA’. In addition, the NNTC proposed that PBCs:
…be allocated three-year recurrent funding at a level of $300,000 pa and that this funding be made available six months prior to the expected date of a determination of the existence of native title by the Federal Court.
The NNTC also recommended that NTRB/SPs be:
…appropriately funded annually to support PBCs in community planning and development process to derive from their compensation revenue long term benefits from economic development, cultural maintenance and social outcomes.
2.33
AITSIS stated that short term funding and the discontinuation of successful Aboriginal and Torres Strait Islander programs results in the loss of local capacity, knowledge and experience.
2.34
The Centre for Aboriginal Economic Policy Research (CAEPR) highlighted the fact that PBCs are permanent bodies that need stable resourcing:
…native title is forever. Accordingly, PBCs are established in perpetuity, having no legal or regulatory end date. ... Fundamentally, PBCs will require a stream of operational revenue in perpetuity.
2.35
The Centre noted that Canada, New Zealand and the US all have some form of sovereign wealth fund to support sustainable economic development amongst their First Nations communities. With the sovereign wealth fund model being adopted in Australia in the various Future Funds overseen by the Future Fund Board of Guardians, CAEPR recommended that the Commonwealth Government establish a PBC Future Fund as a perpetual funding model for PBCs.
Complex legislative and administrative regime
2.36
A major challenge for representative bodies and other Aboriginal and Torres Strait organisations seeking to take advantage of economic opportunities is the complexity of legislative and administrative regimes. This includes the overlap between the legislation and policy approaches of the Commonwealth, a territory and two states and, in some instances, local government.
2.37
The Queensland Government highlighted the complexity of the regulatory environment into which PBCs are thrust. It observed that ‘the legislative, administrative and funding environment for native title claimants and native title holders can be complex and can lead to missed opportunities’. It noted that ‘multiple legislative frameworks, administrative and compliance arrangements, funding sources and entities’ can create a ‘high cost for Traditional Owners, including native title claimants and holders, to participate in engagement and agreement making’.
2.38
Mr Peter Yu told the Committee:
We currently have over 70 or 80 different agencies, Commonwealth, state and NGOs, that are supposedly out there providing support not just for Aboriginal businesses but also anybody across-the-board engaging in establishing businesses and involved in the economy. It is a very convoluted, complex and quite inefficient system.
2.39
In a similar vein, the Balkanu Cape York Development Corporation submitted that current arrangements are fragmented and uncoordinated:
The Federal and State Government approach to indigenous economic development is a mess. There is no cohesive cross-Government approach, no comprehensive economic development plan, support is piecemeal, and detailed resources assessments have not been undertaken. IBA [Indigenous Business Australia] acts in isolation. Non-Indigenous organisations with little understanding of the needs of the communities have received significant government funding to provide economic development services, with minimal outcomes. Local government plans on Indigenous lands don’t encourage economic development.
2.40
The GBK Sea and Land Council argued that multilayered systems of government constricts economic activity in their region:
The expansive and sometimes overlapping roles of the TSRA, Torres Strait Island Regional Council, Torres Shire Council, Commonwealth government and Queensland departments crowd out opportunities for new businesses in the Torres Strait region.
2.41
The Aboriginal Investment Group (AIG) highlighted the many governmental processes that have to be engaged with to obtain even low-level support:
AIG’s experience has been that it is often difficult to co-ordinate numerous Government entities or funding bodies around a central proposal. It can be the case, for example, that for one small enterprise in a remote community there will be one body to fund the infrastructure or capital expenses, another body to fund staff and employee training/development, and another that funds the business plan.
2.42
Both the CLC and the NLC put forward proposals for reforming grant arrangements to simplify them and make them more open to local-level input, including:
Systems that enable longer-term funding, local criteria, local assessment, transition and exit plans, and flexible, pooled funding.
Resourced local organisations to develop local grant assessment criteria, transition and exit plan requirements and establish local assessment panels.
Ensuring that grants allocate funding towards capacity-building of local Aboriginal organisations and community members.
2.43
The Cape York Land Council criticised the lack of a specific focus on Indigenous economic needs in the Northern Australia agenda and proposed that it be augmented by an Indigenous Development Strategy which ‘should identify how these land assets and emerging and potential Indigenous businesses could be supported and engaged in northern development’.
2.44
The AIG argued that there was a ‘need for a central agency or a new type of institution that has priority or oversight over Indigenous economic development in Northern Australia’.
2.45
The IRG proposed the establishment of a Northern Australia Indigenous Economic Development Body, which would:
…through a network of business and employment hubs, provide Indigenous business in Northern Australia tailored business support programs based on ‘best-in-class’ support services, enhanced market access for the products and services developed by those businesses, support those businesses in navigating the regulatory environment, commission research that provides those businesses with the knowledge they need to manage risk and make sound commercial decisions, develop and advocate for policy designed to support Indigenous business in Northern Australia and provide Indigenous businesses in Northern Australia with access to capital that is optimally aligned with the risk-profile of those businesses.
Need for effective governance systems
2.46
Submitters and witnesses made frequent reference to the importance of effective and transparent governance in representative bodies. But there cannot be a ‘one size fits all’ approach to governance systems because there is a wide variety of relationships that must be managed in different regions and localities across northern Australia. Getting governance right means different things in different places.
2.47
The CYLC highlighted a problem peculiar to Queensland: if an Aboriginal corporation is both the PBC and the trustee of Aboriginal freehold land for that area it has responsibilities under both the NTA and the Queensland Aboriginal Lands Act 1991. The CYLC also stated that there are over fifty different kinds of Aboriginal corporations in the Cape York region with different governance requirements.
2.48
Similar complexity of roles confronts the four Northern Territory Land Councils that were established for the purposes of the Northern Territory ALRA and have the responsibility for certain statutory roles in that capacity, but since 1993 have also performed the functions of NTRBs under the NTA. In the case of Queensland, Land Councils can sometimes have overlapping relationships with the various PBCs.
2.49
PBCs often have to deal with the fact that there can be multiple traditional owner groups within its jurisdiction. Therefore the PBCs must:
… ensure the correct Traditional Owner group is identified, informed about and engaged in the process, and that the Traditional Owners undertake a valid decision-making process about the proposal. An effective system of governance is therefore also required at the local Traditional Owner group level, and if this does not exist then decision making about land use and development is problematic.
2.50
The NNTT stated that PBCs may have to reconcile or manage disputes between traditional owners, because ‘native title disputes can become arenas where pre-existing disputes are played out’, including ‘where a portion of a determination area is considered by more than one family as “their” country’.
2.51
Challenges may also arise in circumstances where development projects require the approval of the entire group of traditional owners, but some have moved to other areas to live. This situation was mentioned by Mrs Vonda Malone, Mayor of Torres Shire Council:
In a practical sense, having the strict requirement under the current act that applicants speak as a whole does mean we face some difficulties in trying to get that inclusive group together to make decisions as a collective prior to any projects or any activities occurring.
2.52
Even different understandings of the concept of ‘traditional owner’ can cause management issues for representative bodies. Mr Robert Cooper from the Larrakia Nation Aboriginal Corporation mentioned that the Larrakia people are traditional owners of the Darwin region but do not hold native title and ‘wish to engage in the economy as the traditional owners, not as native title holders’. They have been represented by the NLC on native title matters, but they have independently taken the initiative to engage in commercial enterprise through the Larrakia Nation Aboriginal Corporation and the Larrakia Development Corporation without any involvement from the NLC.
2.53
Therefore, since traditional owners’ organisations are involved in decision-making at all levels, the strengthening of governance at each level is imperative, a point emphasised by the CYLC. As discussed below, this also means that training and capacity-building must be tailored to meet the particular needs of organisations and communities to enable them to carry out their respective functions and discharge their statutory governance obligations.
2.54
The Committee received evidence about the scope for improving existing governance structures to facilitate greater transparency in PBC
decision-making, especially with regard to financial management.
2.55
ORIC submitted that ‘there needs to be greater transparency of Trusts and Deed Trusts associated with native title. This could be partially achieved by requiring lodgement’ with ORIC. ORIC proposed that Trusts ‘should be required to report audited financial statements to the Registrar’ and emphasised that state and territory governments have a critical role ‘in the drafting, establishment and ongoing regulation of many trusts dealing with native title monies.’
2.56
The NNTC noted that existing arrangements ‘are complicated, confusing and often lack transparency’ and a ‘positive disincentive [emphasis in original] for native title holders to utilise native title monies for long term economic development’.
2.57
The NNTC and the MCA together proposed amendments to the CATSI Act for the ‘establishment of an optional ‘economic vehicle status’ (EVS) designation available to PBCs’. This would provide PBCs better options for the management of their funds and:
…would enable PBCs to better leverage native title monies to achieve improved outcomes for native title holders, while ensuring greater transparency and accountability in their management.
2.58
In February 2021, the Australian Parliament passed the Native Title Legislation Amendment Act 2021 (the Amendment Act). The Amendment Act changes the NTA and the CATSI Act. According to the NIAA:
The Amendment Act supports the resolution of native title claims and agreement making, and increases the transparency and accountability of Prescribed Bodies Corporate (PBCs) to the native title holders they represent. These improvements to the native title system support economic and investment opportunities for traditional owners by giving native title holders greater flexibility with internal decision-making processes; improved pathways for dispute resolution to resolve issues which may limit organisational performance; and increased transparency and accountability regarding PBC decision making.
2.59
In October 2021, the CATSI Act Review Final Report was presented. The CATSI Amendment Bill 2021 was introduced into the House of Representatives and is currently before the Senate. The Bill seeks to:
make it easier and less costly for Aboriginal and Torres Strait Islander corporations to register and operate under the CATSI Act
provide more flexibility to create business structures and operate more effectively in small communities
increase transparency of corporation operations through improved reporting for members, common law holders and other stakeholders
enhance support for CATSI corporations that are experiencing difficulties to return to health and ultimately, the control of members
streamline the process of winding up defunct corporations
enhance the efficacy of operations by increasing corporations’ access to modern technology, including for managing their membership bases
provide the Registrar with expanded powers to enable a graduated, proportionate response to non-compliance.
Turnover of PBC leadership
2.60
An important issue for the good governance and capacity building of PBCs is that the leadership of some PBCs is subject to frequent turnover, sometimes annually. Mr Maxwell Duncan, from the Torres Shire Council, told the Committee:
One of the difficulties in relation to capacity building, and it wouldn’t matter how much money you threw at it, is where directors change every 12 months, which they do in some of the PBCs... Building capacity, if you’re constantly changing, is a difficulty, and something that the council would like to raise for consideration is amendments to regulations as they relate to rule books.
2.61
Similarly, The Torres Strait Regional Authority identified corporate ‘churning’—the relatively high turnover of board requiring repetitive training of new board members and other corporate officers—as a significant problem.
2.62
The Queensland South Native Title Services also noted that a good way for PBC members to get experience in their role is to become a director, but that most new directors have had ‘no or minimal preparatory training’. The turnover of directors means that 'training must be repeated again and again’.
2.63
The Office of the Registrar of Indigenous Corporations offered a range of solutions to strengthening the leadership capacity of PBCs. Aside from training, which ORIC already provides, these proposals included:
Adopting directors’ terms of two or more years
Staggering the terms of directors to ‘ensure stability and continuity for boards, and avoid a complete board turnover’
Adopting skills or capability based directorships, as distinct from family or clan representation
Use of independent directors
Differing terms for specific roles, for example an independent director might ‘only be appointed for twelve months for a specific purpose’.
Land tenure issues
2.64
The Committee received abundant evidence about land tenure issues and the difficulties traditional owners face when attempting to make productive use of title to land under native title or land rights. Australia’s systems of land tenure are derived from many pieces of Commonwealth and state/territory legislation and there are often multiple and overlapping tenure types for the same area of land. Most state land administration systems were enacted before the Mabo judgement and do not take account of subsequent developments in Aboriginal and Torres Strait Islander land tenure.
2.65
Many submitters and witnesses spoke about the limited fungibility of land and the consequent problems of using land for investment.
2.66
The Commonwealth Government’s White Paper on Developing Northern Australia presented a summary of the complexity of native title and land rights regimes and noted that many Indigenous Australians think these rights ‘do not provide a basis for active participation in the economy’, leaving them ‘’land rich, dirt poor’’.
2.67
PM&C and the Attorney General’s Department (AGD) highlighted the limitations of native title rights to the use of land:
The recognition of native title in accordance with the NTA can give rise to a range of economic opportunities and procedural rights…
However, while native title gives rise to economic opportunities, it is not necessarily sufficient, in and of itself, to enable traditional owners to capitalise on them. There may be tenure or other rights required to undertake a commercial enterprise or venture, such as a tourism license, and there are some limits on what native title can be used for.
2.68
The Departments noted limits such as:
Inability to use rights as security for loans or investments
Non-exclusive rights are subject to third party interests, such as pastoralists
Use of natural resources such as fish is limited to where it is established according to the traditional law and customs of the native title group
Like other tenure, native title rights to minerals, gas or petroleum are generally vested in the Crown.
Title under ALRA is more powerful than native title
2.69
Several stakeholders submitted that the economic opportunities provided by tenure under land rights regimes clearly exceed those created by native title.
2.70
Mr Iain Anderson from the AGD told the Committee that land rights under ALRA was ‘a stronger form of title’ than native title under NTA which he said ‘in many ways, is actually not as useful for a range of purposes’. When asked about tenure under the two regimes, Mr Ryan Bulman from the same Department agreed that even exclusive native title had to be either extinguished or suspended for it to be used commercially, whereas inalienable freehold title under ALRA provided many more opportunities.
2.71
The point was further emphasised by the PM&C and the AGD, which submitted that land rights under ALRA is:
…the strongest form of traditional land title in Australia. The ALRA gives traditional owners in the NT control over what happens on their land and the right to consent to development and lands use proposals from government and investors.
2.72
This view was support by the CYLC:
By far the greatest economic development potential and opportunities for Traditional Owners exist in land rights created by statutory title, such as under the Aboriginal Land Rights (Northern Territory) Act 1976, and Queensland’s Aboriginal Land Act 1991. Land rights are far more prospective for economic development than native title and have the advantage that Traditional Owners, as registered land owners, can proactively decide about uses that land may be put to and initiate economic development projects themselves or enter into joint ventures with others. Native title opportunities are dependent upon a third party making use of land and Traditional Owners negotiating their engagement in, or benefits from, the third party land use.
2.73
The systems of ownership under ALRA and NTA are quite different. Native title is not determined on ALRA land. Section 210 of the NTA provides that native title does not affect the operation of beneficial land rights laws, including the Northern Territory ALRA. Native title claims are made outside Northern Territory ALRA land, in particular over pastoral leases.
2.74
The Northern Territory Government stated that:
Aboriginal freehold (ALRA land) is a communal land title held by a land trust for the benefit of all its traditional owners. Unlike ordinary freehold, ALRA land cannot be sold or mortgaged, only transferred to another land trust or surrendered to the Crown. However, it can leased by a Land Trust (with the involvement of a Land Council), and traditional owners have a high level of control over who can access their land via the permit system established by the Land Rights Act and the Aboriginal Land Act 1978 (NT).
2.75
Traditional owners of land granted under the ALRA hold decision-making powers over access to and use of that land. For an activity to go ahead, the relevant Land Council must be satisfied that the traditional owners of an area of land understand the nature and purpose of a proposed action and, as a group, consent to it. A Land Council must also be satisfied that any Aboriginal community or group that may be affected by the proposed action has been consulted and has had adequate opportunity to express its view.
Fungibility and leases on Aboriginal land
2.76
Amongst the many barriers to economic opportunity for Aboriginal and Torres Strait Islanders in northern Australia, one of the most commonly cited was the barriers to using title to land as an asset for investment.
2.77
From the WA perspective, the KLC stated that:
Due to the commercial perception of native title as being less certain or more risky than non-native title tenure, it is difficult for Traditional Owners to finance development of their assets, as land subject to native title is, currently, not readily collateralisable in traditional loan agreements.
Moreover, current government policy in Western Australia requires native title to be wholly extinguished for a grant of freehold to be made. However, extinguishment is not required as a matter of law required for a grant of valid freehold title to occur. Furthermore, interests in land other than freehold can and do provide sufficient certainty for the commercial use of land. At present, native title holders are therefore faced with the double whammy (based entirely on misperception and policy) that commercial certainty requires freehold and freehold requires extinguishment of native title.
2.78
The Office of Northern Australia noted the complexity of leveraging capital from land and called for initiatives to simplify processes:
Leveraging capital from land and other assets is extremely complex and challenging on land held under native title. However, capitalising on land and other assets is critical to Indigenous economic development in northern Australia. The Office of Northern Australia supports continued focus on initiatives that make it simpler for Indigenous people to achieve economic benefit from their land interests through reducing the complexity in administrative processes relating to economic activity on Indigenous land or land subject to native title.
2.79
Similarly, Dr James Bentley called for a ‘reformed inclusive aboriginal land title ownership system’, in particular to enable land to be a fungible asset:
…the land title system of Australia’s north needs to be remodelled. In particular, pastoral lease reforms, to create a fungible land tenure system that does not extinguish native title, taking for an example the ALRA NT 1976, and transfers ownership of crown land to Traditional Owners and their managers [emphasis in original], creating a solid foundation for indigenous engagement, and on-going certainty in stewardship…under a reformed, uniform and equitable land system [where] land can be leased back to industry and government providing certainty about future potential investments...
2.80
The CYLC submitted that arrangements in Queensland where Aboriginal land ‘may be mortgaged and thereby used as collateral for commercial loans’ provided an example of what can be done to provide greater flexibility in the use of land tenure for economic purposes:
Since 1991 Aboriginal freehold land-owning corporations in Queensland have had powers to create secure and tradeable interests for third parties through the grant of leases using provisions of the Aboriginal Land Act 1991 (Qld) (ALA), and registration of leases on the Queensland Land Title Register. … Aboriginal freehold does not extinguish native title, and a lease of Aboriginal freehold provides an ideal platform for investment and development because leases can be for periods of up to 99 years, to any person, for any purpose, may be renewed, may be mortgaged, and may be traded through transfer to another party.
The granting of Aboriginal freehold tenure, given its leasing potential, is therefore one of the keys to unlocking the potential of Cape York.
2.81
Another approach to enabling land to be used for commercial purposes has been the use of section 19 of the ALRA.
2.82
The PM&C and the AGD noted that under section 19 of the ALRA ‘traditional owners can grant a right or interest in land to private businesses, Governments, community members and other land users’.
Using this process, traditional owners are given the opportunity to make an informed land use decision in accordance with their traditional decision making processes. ... Where informed consent is given, the Land Councils can direct the appropriate Land Trust to enter into a section 19 Land Use Agreement with the proponent.
2.83
The importance of section 19 of ALRA for economic development in the Northern Territory was emphasised by the AIG:
The processes governing licences and leases on Aboriginal land are contained within section 19 of the Land Rights Act. Section 19 is therefore vital to economic development. For nearly all Aboriginal communities in the north of the Territory, other than those communities administered pursuant to Land Rights Act township leases or head-leases, the section 19 process is the administrative and legal gateway to economic development for their community.
2.84
Township leasing is also available under the ALRA, which is a lease on Aboriginal freehold land in the Northern Territory under section 19A. Township leases can support ‘bankable interests in land and positive economic development outcomes by providing long-term tradeable tenure’:
Township leases provide security of tenure for private sector investment and create land administration arrangements which give confidence to businesses and financial institutions while maintaining traditional ownership of the land.
2.85
Mr Mark Coffey, Head of the Office of Northern Australia, told the Committee that township leasing is a model which should be investigated for its potential for wider application because it:
…encourages local decision-making, supports Indigenous landowners to leverage the land assets for economic development, allows home ownership and allows small business to take place in those areas. We would suggest that we should look at how those principles could be applied to broader economic activity, thinking about how we continue with land reform projects that support Indigenous land use agreements and thinking about better frameworks for easier agreement making with Indigenous people, jurisdictions and other stakeholders.
2.86
There are two forms of township leasing. Firstly, leases can be held by the Executive Director of Township Leasing (EDTL) ‘manages land on behalf of, and in consultation with, the traditional owners. Secondly, there is the community entity model of township leasing which enables an approved entity in the form of a local Aboriginal corporation to hold and administer a township lease.
2.87
Community entity township leasing provides for a greater direct role by the traditional owner community members, while leases held by the EDTL are managed by a full time salaried Commonwealth Statutory Officer.
2.88
There are five township leases over eight communities in the Territory held by the EDTL.
2.89
The first example of a community-led township lease was in the Gunyangara community in 2017:
Gunyangara traditional owners have already seen the benefits brought about by township leasing. This includes formalising subleasing arrangements with all land users, a nearly threefold increase in rental revenue, and the development of elder housing and a youth centre supported by Narrariyal’s township lease advance payment of rent.
2.90
AIATSIS observed that the Gunyangara example was an:
…important and positive development which demonstrates that there is no reason why desires for greater flexibility and ‘security’ of tenure arrangements in communities on Aboriginal land must come at the expense of the self-determination and property rights of traditional owners.
2.91
The Northern Territory Government noted that:
Township leasing is helping to provide a strong foundation for increased economic activity and inter-generational wealth in towns on Aboriginal land in the Northern Territory. ... A number of communities in the Northern Territory have negotiated township leases and are seeing the benefits of economic activity.
2.92
There is a large number of township leases–with associated subleases to government entities and local traditional owners businesses–in the Tiwi Islands and Groote Eylandt, but use of such leases is still not widespread in the rest of the Northern Territory. Mr Martin-Jard from the CLC told the Committee:
In Central Australia, it's early days because we've really only got a functioning township lease at Mutitjulu, so it's too early to say if that's a really good thing or a bad thing. The evidence isn't in yet.
Making land tenure more effective
2.93
There was disagreement amongst submitters and witnesses about whether, and to what extent, current native title and land rights regimes were an impediment to development. But there was general agreement that current systems of land tenure could be made more effective and beneficial for Aboriginal and Torres Strait Islander peoples.
2.94
Mr Kevin Stephens, a partner in a law firm that frequently acts for development proponents in the Northern Territory, submitted that both land rights and native title tenure systems created barriers to economic opportunities. He emphasised that both regimes caused costly delays, but that the time required to negotiate agreements in Aboriginal land under ALRA, was greater than that compared to land under native title.
2.95
Mr Stephens urged speeding up the process, highlighting the difference between mining applications under the ALRA (‘five years on average’) and the NTA (‘roughly nine months’). He suggested changes to the negotiation process, including having traditional owners as well as Land Councils present at the earliest stages of agreement-making.
2.96
Similar points were made by Mr Ashley Manicaros, CEO of the
Northern Territory Cattlemen’s Association, who called for changes to what he saw as the dual and sometimes competing land tenure systems administered by the Northern Territory Government and the Land Councils that can create time and costs obstacles for investment in the pastoral industry, by both pastoral companies and traditional owners.
2.97
Mr Joe Martin-Jard, CEO of CLC, rejected the idea that land rights and native title were barriers to economic development:
Aboriginal land is the private property of Aboriginal people that’s held in common. This form of tenure reflects Aboriginal custom and law—it is critical to the development of local economies to maintain the rights of traditional owners and native-title holders in negotiating agreements.
2.98
Mr Martin-Jard noted that the CLC had processed and consented to hundreds of leases over the last five years. He highlighted the large-scale Tanami pipeline project, which involved multiple native title groups and several ILUAs and section 19 deeds and yet was completed ahead of time. He saw it as ‘one example of the effectiveness of the CLC, the Aboriginal land rights act and the Native Title Act’. He advocated ‘a diversity of approaches that could be designed and implemented to bring capital to the table’.
2.99
Supporting the principles of Aboriginal title, but also calling for reform, the Balkanu Cape York Development Corporation, observed that:
Experience has shown that the Native Title Act and the Aboriginal Land Act are not fundamental constraints to investment on Cape York, however there is a need to undertake reforms to ensure there are streamlined and better integrated processes for agreement-making. To this end the Cape York Land Council, Balkanu and Cape York Partnerships are undertaking
investment-ready tenure pilot projects on Cape York to address the constraints to development on these lands.
Land tenure reform initiatives
2.100
There is wide scope for the reform of land tenure across northern Australia to provide more opportunities for leveraging title to land for economic development. The Committee noted various initiatives undertaken to reform land tenure and administration arrangements.
2.101
The Commonwealth Government provided funding of $10.6 million for four years (2015-16 to 2018-19) for land tenure reform pilots as part of the White Paper on Developing Northern Australia. The projects:
…focused on how existing native title and statutory land rights arrangements can be reformed to normalise land administration processes to allow commercial development, support innovative land use and drive economic activity.
2.102
An example of the tenure reform projects supported was the Investment Ready Tenure program led by Pama Futures, a comprehensive development initiative created by the Aboriginal peoples of the Cape York region, with the support of the Queensland Government:
The Investment Ready Tenure program is identifying areas of Cape York with development potential … and taking actions to address any remaining land administration issues that are necessary to create an environment where development may progress smoothly. … Cape York is an ideal location for where tenure reforms could be piloted and the benefits of these reforms for Aboriginal and non-Aboriginal investors demonstrated. … [resulting in] areas of Aboriginal freehold tenure being made ready for investment and development.
2.103
The program aims for a ‘comprehensive and integrated land administration system’ to be piloted for Cape York, with the following elements:
Transfer of land in the region to Aboriginal freehold tenure
Removing unnecessary restrictions on pastoral land
Access to secure water as a prerequisite for agricultural development.
2.104
The WA Government described the obstacles created by existing tenure systems and its efforts to overcome them:
An impediment to economic development opportunities for Traditional Owners is tenure options that allow for divestment and resulting economic development opportunities, without extinguishing native title. Appropriate tenure can be an enabler of new opportunities, but many communities hesitate to agree to native title being extinguished to enable the granting of new tenure. The WA Government is exploring innovative ways of minimising the impact of tenure reform on the exercise of native title rights and interests, while enabling economic development opportunities.
2.105
The WA Government stated that it was also undertaking programs to divest land held on behalf of Aboriginal people in the Aboriginal Land Trust (ALT) through:
secure freehold and pastoral tenure under the Land Administration Act 1997 (WA)
Indigenous Land Use Agreements (ILUAs) between the WA Government and native title holders
land tenure reform projects to ensure Aboriginal economic opportunities by negotiating appropriate use with native title holders and ALT lessees.
2.106
The Commonwealth Government has also supported a land tenure reform pilot project in WA examining long term, secure and tradeable land tenure in the north of the state. The project examined ‘different models of land holding and administration on Aboriginal land to develop [a] tenure model to apply in Kimberley communities that would provide opportunities to promote home ownership pathways and Indigenous economic development’. Two options were proposed, both drawing inspiration from models operating in the Northern Territory:
ILUA Model—would require the WA Government to enter into an ILUA with a PBC to grant a general lease over a community (similar to a township head lease in the Northern Territory)
Legislation Model—would require the WA Government to enact legislation granting Aboriginal title (similar to the ALRA).
Committee comment
2.107
With representative bodies operating in a ‘post-determination’ environment, the burden of responsibilities and expectations on Aboriginal and Torres Strait Islander organisations are very high. As well as discharging statutory responsibilities, organisations must resolve tenure issues, manage
decision-making processes, consultations with communities and traditional owners, and agreements with development proponents, while also promoting or directly undertaking economic enterprises.
2.108
The provision of financial and other support is a precondition for meeting the principle of Free, Prior and Informed Consent. Aboriginal and Torres Strait Islander communities must be well-resourced if they are to be free from any form of coercion. The power imbalance between traditional owners and development proponents can only be redressed with resources and institutional capacity. Any changes to legislation, regulation and administration related to land rights and native title should made in accordance with the principle of Free, Prior and Informed Consent.
2.109
The Committee considers that the financial and institutional strengthening support provided by governments to Aboriginal and Torres Strait Islanders bodies at all levels is insufficient. This especially applies to PBCs and NTRB/SPs, many of which struggle to fulfill their functions with minimal or no income. The financial needs of representative bodies were not properly anticipated at the time of inception and the issue has been neglected by successive Commonwealth and state/territory governments since then.
2.110
It is time that governments acknowledge that native title and land rights bodies are permanent institutions with structural roles in the legal and land administration systems. They are bodies that will speak for traditional owners long into the future. As organisations with a place in the native title and land rights architecture, they need a firmer basis for their funding. They should be freed from the uncertainties of the budget cycle, changes in policy and the time-consuming and complex processes of finding appropriate grant programs and applying for, and managing those grants.
2.111
The Committee notes the proposal for the establishment of a Future Fund for the funding of representative bodies. In addition to ongoing core funding, provision should be made for institutional development support, such as training in governance, statutory obligations, legislation, land tenure management, agreement-making, financial management and business enterprise.
2.112
Support should be tailored to needs of all relevant bodies at the appropriate stages of their formation and development. For example, during the pre-determination period for native title, traditional owner groups should be offered assessments of economic opportunities in their lands and provided with business planning and development support so that they are equipped to make quick use of economic opportunities once native title status has been determined.
2.113
The Committee notes the importance of ensuring that governance systems in representative bodies are robust, while acknowledging the complexity of roles within different jurisdictions and the varied traditional owner communities. The Committee considers that there is scope for increasing the transparency of decision-making in representative bodies to ensure that the voices of all traditional owners are heard and that financial and other management functions are performed in an accountable manner. A review of the system for the appointment of PBC Directors would reduce the rapid turnover of leadership that occurs in some areas.
2.114
The Committee notes the evidence that complexities in legislative and administrative regimes, including overlap and inconsistency between Commonwealth, state and territory jurisdictions, can be challenging for Aboriginal and Torres Strait Islander organisations as they attempt to leverage the rights available from native title and land rights and seek funding support. The Committee supports the establishment of a Northern Australia Indigenous Economic Development Body to provide tailored business development, legal and research support to Aboriginal and Torres Strait Islander businesses.
2.115
Convoluted land tenure and land administration systems are potentially a major obstacle standing in the way of the use of land as an asset for economic and social development. The most outstanding problem is that some forms of Aboriginal and Torres Strait title are not fungible and therefore cannot be used as collateral for loans. The Committee notes the findings of the 2015 White paper on developing northern Australia about the need for land tenure reform and notes the pilot programs in tenure reform and management supported by the Commonwealth and state/territory governments, but it is evident that the issue needs to be given higher priority.
2.116
The Committee considers that there should be a greater level of inter-jurisdictional communication and information-sharing so that lessons learnt from the various land tenure initiatives and pilot programs can be adapted and applied across the Commonwealth, states and territory systems. This applies to reform initiatives, such as the Investment Ready Tenure program in Queensland, and efforts to encourage more flexible use of existing legislation, such as township leasing in the Northern Territory.
2.117
The Committee notes that fungibility is a challenge for land tenure held by Aboriginal and Torres Strait Islander peoples. However, the existence of these forms of title are of immeasurable cultural significance and pride to First Nations people. While it may cause delays and marginal costs impacts for proponents, care should be taken to preserve and protect the unique nature of Aboriginal and Torres Strait Islander land tenure. Efforts should focus on seeking reform of financial and commercial systems to enable Aboriginal and Torres Strait Islander peoples to leverage their title while retaining its innate characteristics.
2.118
The Committee recommends increased funding for PBCs and other Aboriginal and Torres Strait Islander bodies with a role in the native title and land rights systems. The Committee also reaffirms the recommendation of its Final report into the destruction of Indigenous heritage sites at Juukan Gorge in Western Australia that the Commonwealth Government establish an independent fund to administer funding for prescribed body corporates (PBCs).
As one of the options for the establishment of the fund, the Commonwealth Government should give consideration to the setting up of a Future Fund to provide secure long-term funding for PBCs and NTRB/SPs.
The Committee also reaffirms its recommendation that PBCs and NTRB/SPs should, as part of funding agreements, be required to demonstrate transparency and accountability in their decision-making processes.
2.119
The Committee recommends that, in addition to enhanced and secure funding, the Commonwealth Government should increase the level of capacity building support provided to PBCs and NTRB/SPs.
This should include support to traditional owner groups before the determination of native title status to ensure that they have sufficient capacity to perform their roles, including making use of economic opportunities provided by title to land.
Continued support for tailored governance and management training and resources should be provided, with a focus on enabling personnel to learn from counterpart bodies across jurisdictions and develop peer-to-peer and collaborative networks.
2.120
The Commonwealth Government should support a review of systems for the appointment of PBCs Directors with a view to reduce the turnover of PBC leadership.
This should include consideration of staggering the terms of Directors to ensure stability and continuity for boards and avoid a complete board turnover.
In areas where an annual change of PBC Directors is common, consideration should be given to its replacement with three-year terms.
2.121
To help overcome overlapping legislative regimes, administrative complexity and other barriers to representative bodies attempting to make use of economic opportunity, the Commonwealth Government should give consideration to the creation of an Indigenous Strategy in the Northern Australia Agenda and the establishment of a Northern Australia Indigenous Economic Development Body to provide tailored business development, legal and research support to Aboriginal and Torres Strait Islander businesses.
2.122
The Commonwealth Government should support initiatives to make more innovative use of land tenure systems across northern Australia to make land management more effective and beneficial for Aboriginal and Torres Strait Islander peoples.