Economic development and Indigenous Australia: contestations over property, institutions and ideology

Economic development for remote Indigenous communities cannot be understood unless the relative importance of customary activity, potentially enhanced by native title legal rights in resources, is recognised. The present article uses a three‐sector hybrid economy framework, rather than the usual two‐sector private (or market) and public (or state) model to more accurately depict the Indigenous economy. Examples are provided of the actual and potential significance of the customary sector of the hybrid economy. Focusing on the concepts of property and institutions, it is demonstrated that significant local, regional, and national benefits are generated by the Indigenous hybrid economy. A role is foreshadowed for resource economists and the New Institutional Economics in quantifying these benefits, including positive externalities, so that they might be more actively supported by the state.International Development, Resource /Energy Economics and Policy,

Sustainable development options on Aboriginal land: the hybrid economy in the twenty-first century

This discussion paper is a brief summary of a number of intellectual endeavours undertaken in 2001. First and foremost, it is an attempt to progress a research collaboration between the author-a social scientist based at the Centre for Aboriginal Economic Policy Research-and a number of biological scientists based at the Australian Research Council ARC Key Centre for Tropical Wildlife Management at the Northern Territory University. It is hoped that it also further progresses our joint collaboration with an Indigenous organisation, the Bawinanga Aboriginal Corporation in central Arnhem Land. The broad aim of this wider collaboration is to generate creative ideas about new development futures for Aboriginal people living on Aboriginal land. The paper seeks to broaden the notion of the economy and development to include the customary economy. A number of other issues are discussed in the process, some in a very cursory and exploratory way. These include the debate about Indigenous development encapsulated in extreme ideological positions taken by so-called 'progressives' and 'conservatives', as well as more conventional debates about the shortcomings of notions of development that are embedded in the market mentality and have limited analytical capacity for considering cross-cultural and sustainability issues. There is a linked debate about land rights and native title and whether the restitution of property rights (in land and species) to Indigenous groups will have a positive (or negative) future development impact. The paper begins by outlining the economic development problem that is faced by Indigenous people living on Aboriginal land in remote and regional Australia. It then describes the hybrid economy, made up of market, state and customary components, that is a distinctive feature of such situations, and argues that a big part of the development problem is that this type of economy is poorly understood-by politicians, policy makers and Indigenous people and their representative organisations alike. Consequently, important Indigenous contributions remain unquantified and unrecognised in mainstream calculations of economic worth. This shortcoming is generated in large measure by inadequate analytical approaches that fail to ask how development based on market engagement be delivered to communities that are extremely remote from markets, in both locational and cultural terms. A proper understanding of the hybrid economy requires a hybrid analytical and intellectual framework that combines science, social sciences and Indigenous knowledge systems. The paper argues for such a framework, and concludes by providing a few examples of how this different approach might enhance greater sustainable development on Aboriginal land in the twenty-first century

Policy issues for the Community Development Employment Projects scheme in rural and remote Australia

One of the most important programs for Indigenous community and economic development is the Community Development Employment Projects (CDEP) scheme. CDEP employs around 35,000 Indigenous Australians and accounts for over one-quarter of total Indigenous employment. This paper reviews the evidence on the social and economic impacts of the scheme. The available evidence demonstrates that the scheme has positive economic and community development impacts and that it is cost effective in achieving these outcomes. The paper argues that the CDEP program should continue to be supported and resourced and outlines options for future policy directions in regard to Indigenous economic development and the role of the CDEP scheme.Indigenous; labour market programs; economic development

The Economic Value of Wild Resources to the Indigenous Community of the Wallis Lakes Catchment

There is currently a growing policy interest in the effects of the regulatory environment on the ability of Indigenous people to undertake customary harvesting of wild resources. This Discussion Paper develops and describes a methodology that can be used to estimate the economic benefi ts derived from the use of wild resources. The methodology and the survey instrument that was developed were pilot tested with the Indigenous community of the Wallis Lake catchment. The harvesting of wild resources for consumption makes an important contribution to the livelihoods of Indigenous people living in this area.Indigenous; harvesting of wild resources; natural resource management

Generating finance for Indigenous development: Economic realities and innovative options

This is an exploratory ideas paper that sets out to consider how real development futures might be financed and delivered to Indigenous people, especially those residing in rural and remote regions. These are places where there are limited conventional development opportunities—where development is and is going to be costly—but where demographic projections, cultural imperatives and history indicate Indigenous people will be living in 50 to 100 years time. These are also places where a very high proportion of land is owned by Indigenous people, generally under inalienable title, and often (even if tradable) has a low market value. The issue addressed is how can existing institutions and statutory and nonstatutory policy frameworks be used by Indigenous interests to strategically leverage development capital. This issue is especially critical under current circumstances when governments appear reluctant to recognise communal Indigenous rights and interests and market failure, and instead focus increasingly on the individual and the market, in accord with the dominant ideology of development. Simultaneously, there is evidence of a corporate banking retreat from commercially marginal regions. What strategic pressure might Indigenous interests exert to reverse such a trend

A profit-related investment scheme for the indigenous estate

This paper assesses the state of commercial development and resource management on Indigenous land, particularly in remote Australia. Indigenous landowners control significant assets—over one million square kilometres of land—often with substantial resource rights and income earning potential. The levels of inactivity and missed opportunities on Indigenous land are of such magnitude as to represent a major risk for Indigenous landowning communities in terms of their future economic and social well-being, and also for the national interest in terms of ecological vulnerability and the social and political costs of Indigenous disadvantage. In this paper we explore the role of government as risk manager in such circumstances and outline the principles that must underpin any intervention program targeted to the commercial development of Indigenous land. Using the framework for profit-related loans recently developed by Chapman and Simes (2004) and elements of an existing venture capital support program, the Innovation Investment Fund Program, we outline a new investment scheme to assist development and natural resource management on the growing Indigenous estate. The proposed scheme can be conceptualised as a profit-related loan scheme or as a form of capped public investment. Our proposal addresses key elements of the market failure in the financing of development on Indigenous land and provides incentives for greater private sector investment. It ensures that commercial and social risks are shared equitably between government, private sector investors and Indigenous-owned corporations in order to avoid problems of adverse selection or moral hazard

The allocation and management of royalties under the Aboriginal Land Rights (Northern Territory) Act: options for reform

In response to post-war mining developments on Northern Territory Aboriginal reserves, policy innovations established the principles that a special rate of royalties could be levied on those developments and applied to the benefit of Northern Territory Aborigines, and that a proportion of those royalties should be reserved for the people of the area where mining was taking place. The Woodward Land Rights Commission accepted these two principles and also created Aboriginal land councils as a third class of beneficiary. The Commission thus proposed the 40/30/30 formula to govern the distribution of mining royalty equivalents (MREs) among these Aboriginal interests. From the inception of the Land Rights Act, the application of this formula has been beset by problems of logic, fairness and practicality. While changes to the financial provisions of the Act have been minor, only one element of this formula, the 30 per cent directed to areas affected by mining, has remained unchanged. Provision for supplementary funding of land councils has operated at the expense of general grants to Territory Aborigines. There is now, in the wake of the Reeves Review, an opportunity to re-think and amend the financial framework of the Land Rights Act. With respect to each class of beneficiary of MREs, this paper argues: • Payments to land councils should be fixed at 50 per cent of MREs, in order to provide for an expansion of regionalisation and land management activities in the post-land claims era. That percentage should be calculated on a rolling average of the previous ten years of MREs received by the Aboriginals Benefit Reserve (ABR) in order to make land council income more stable and predictable, and preserve its political independence. Supplementary funding should be allowed only under exceptional circumstances. • Ensuring accountability of royalty associations raises several issues that require critical review. The instrument of negotiated agreements should be more fully exploited to ensure both that associations’ expenditures serve community purposes, and that those services do not substitute for government programs. Financial policies need re-thinking, especially with respect to individual cash distributions and long-term investments. Land councils need to justify any claim, as against other possible agencies, to exercise greater oversight of association affairs. At the same time, the terms and application of s.35(2)(b) require reform in order to provide royalty associations with a more secure niche in the land rights scheme. • The level of grants to Territory Aborigines is too low to justify a separate administrative process and share of MREs. The accumulated capital fund of the ABR will soon be large enough to provide a substitute source of grants, if it is thought necessary to retain a limited pool of funds for general access