Warren Snowdon (Lingiari, Australian Labor Party, Shadow Parliamentary Secretary for Northern Australia and Indigenous Affairs) Share this | Link to this | Hansard source

Firstly, let me say I welcome the opportunity to speak in this cognate debate. I principally want to address the amendments that update the Aboriginal Councils and Associations Act 1976. I do intend to move an amendment, and I will move it now whilst my colleague is in the chamber. I move:

That all words after “That” be omitted with a view to substituting the following words: “whilst welcoming many positive measures contained in this Bill and the related Bills, the House is of the opinion that:

(1)

the Government should respond immediately and comprehensively to a recent report commissioned by the Office of Indigenous Policy Co-ordination, which found red tape and short-term, ad hoc funding arrangements were severely debilitating the Indigenous corporate sector. This legislative reform will not address these external causes of instability to corporate governance;

(2)

the Government must ensure adequate funding for training and assistance for the Indigenous corporate sector to build their governance capacity and facilitate a smooth transition to the new regime – particularly as many Indigenous corporations deliver essential services. This was a unanimous recommendation of the Senate Inquiry into the Bill;

(3)

there are significant outstanding concerns in relation to the level of regulation and extent of the Registrar’s powers in the Bill, particularly given the lack of full independence of the Registrar from Ministerial and political interference;

(4)

for the next three financial years ORAC should include in its annual report a review of the operation of the new legislation and results of a statistical survey of stakeholder satisfaction to ensure that the impact of the legislation is closely monitored and with appropriate transparency; and

(5)

the Government should ensure a review of the operation of the Corporations (Aboriginal and Torres Strait Islander) Act by parliamentary committee within three years having with particular regard to:

(a)

the effective and proper use of the Registrar’s powers under the Act; and

(b)

the effectiveness and appropriateness of the Act as a regime of corporate law for Aboriginal and Torres Strait Islander people”.

Mrs Bronwyn Bishop (Mackellar, Liberal Party) Share this | Link to this | Hansard source

I will take the seconding at the end of the honourable member for Lingiari’s speech.

Warren Snowdon (Lingiari, Australian Labor Party, Shadow Parliamentary Secretary for Northern Australia and Indigenous Affairs) Share this | Link to this | Hansard source

Is there any problem with the member for Lilley seconding the amendment now?

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

The ordinary course of action is to do it at the completion of your speech.

Warren Snowdon (Lingiari, Australian Labor Party, Shadow Parliamentary Secretary for Northern Australia and Indigenous Affairs) Share this | Link to this | Hansard source

But, if I want to move it now, I am surely entitled to move it and he can second it.

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

I dare say that is possible. Is the amendment seconded?

Wayne Swan (Lilley, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source

I second the amendment.

Warren Snowdon (Lingiari, Australian Labor Party, Shadow Parliamentary Secretary for Northern Australia and Indigenous Affairs) Share this | Link to this | Hansard source

Now we can go and have lunch.

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

There are still supposed to be two of you here. I would point that out to you.

Warren Snowdon (Lingiari, Australian Labor Party, Shadow Parliamentary Secretary for Northern Australia and Indigenous Affairs) Share this | Link to this | Hansard source

Thank you, Madam Deputy Speaker, for your forbearance. This cognate debate emanates from a long process of review and consultation which, as the Bills Digest points out, began in the late 1960s considering how Indigenous corporate governance should be managed. It was decided then that there was a need for a simple, inexpensive and culturally appropriate method for legal recognition of Indigenous groups and communities and it was identified in the late 1960s by the Council for Aboriginal Affairs which had been established by the Holt government.

Subsequently, there was a review of the Gibb committee of the pastoral lease in the Northern Territory and recommended legislation. Then Prime Minister McMahon announced in January 1972 that the federal government proposed to investigate ways of finding a simple, flexible form of incorporation of Aboriginal communities. The issue was raised again in 1973 by Justice Woodward—and I will refer to his recommendations in a short while. A bill was introduced into the federal parliament in the latter half of 1975 but lapsed as a result of the double dissolution. It was then passed in the subsequent parliament with Ian Viner as the minister.

The Aboriginal Councils and Associations Act was assented to on 15 December 1976 and came into operation on 14 July 1978 following amendments assented to on 22 June 1978. Since then there have been a number of reviews and a number of amendments made to the legislation. Firstly, in 1989 Graham Neat made a number of recommendations in his report to the Registrar of Aboriginal Corporations on the review of Aboriginal Councils and Associations Act 1976. Then in 1992 in response to his report, the government made changes to the ACA Act in the Aboriginal Councils and Associations Amendment Act 1992. Then in 1994 the government, as a second stage in their response to the Neat report, tabled further amendments which would have established an Australian Indigenous corporations commission which could prosecute people for contravening the act and other laws relating to fraud and dishonesty. In October 1995 the then Minister for Aboriginal and Torres Strait Islander Affairs, the honourable Robert Tickner, announced that he was commissioning the Australian Institute of Aboriginal and Torres Strait Islander Studies to conduct a review of the act. That was carried out by a review team headed by Dr Jim Fingleton—and I will come to a discussion about those issues a little later.

In November 2000 the acting registrar commissioned an internal review of the act to determine, firstly, its capacity to meet the contemporary corporate governance needs of Aboriginal and Torres Strait Islander people and, secondly, to identify areas for possible legislative reform and possible changes to the regulations. In January 2002 the review issued a summary consultation paper with a full consultation paper outlining the major issues, suggesting changes to the act and offering examples of new structure models. The final report and recommendations were released in December 2002.

What we have before us is ultimately the consideration by this government of the proposals in those recommendations. The preamble states that the law is intended to be a ‘special law for the descendants of original inhabitants in Australia’. That means it is enacted under the race power section of section 51(xxvi) of the Constitution. The law is not settled on whether the race power has to be used beneficially.

There are a range of issues which emanate from this legislation. The legislative package we have before us comprises three bills: the Corporations Amendment (Aboriginal and Torres Strait Islander Corporations) Bill 2006; the Corporations (Aboriginal and Torres Strait Islander) Consequential, Transitional and Other Measures Bill 2006, the transitional bill; and the Corporations (Aboriginal and Torres Strait Islander) Bill 2005, the amendment bill.

Whilst we understand the intention of this legislation to introduce modern corporate governance standards and Corporations Law while maintaining a special statute of incorporation for Aboriginal and Torres Strait Islander peoples to take account of the special risks and requirement of the Indigenous corporate sector, the transition bill seeks to facilitate a transition for Indigenous incorporations from the old to the new regime. The amendment bill proposes several amendments that address cross-jurisdictional issues and the intention is for these amendments to be endorsed by a later ministerial council meeting.

I am encouraged that around 2,800 Aboriginal and Torres Strait Islander corporations, or ATSIC corporations, are currently registered under the Aboriginal Councils and Associations Act. These corporations represent the diversity of activity taking place in Indigenous communities, and I can appreciate that regulating the activities of these corporations whilst at the same time respecting Indigenous cultural objectives and the expertise of these corporations is a challenge.

However, I am not encouraged by what I believed to be a failure of the Aboriginal Councils and Associations Act to deliver for Indigenous Australians in a way that the original drafters of the legislation intended. I fear that the reforms of the Corporations (Aboriginal and Torres Strait Islander) Bill may also not deliver for Indigenous Australians. There have been, as I have pointed out, regular reviews and changes to the act both under Labor and coalition governments, and it is very important of course that there is accountability. I believe that accountability should go hand in hand with Indigenous self-determination and confidence to deliver better services and more opportunities. Ten years ago the Fingleton report on the review of Aboriginal Councils and Associations Act recommended many administrative and legislative changes that were not acted upon by the coalition government after it came to power. In my view it is a shame that 10 years ago the government failed to act. It is worth quoting Dr Fingleton’s concluding comments in his report in the light of the current debate and the failure of service delivery in Indigenous communities. He said:

... the Aboriginal Councils and Associations Act 1976 is too prescriptive to allow bodies to incorporate in a culturally appropriate way—in particular with respect to the key matters of a group’s structure and decision making processes. Much of the Act’s present inflexibility can be attributed to requirements aimed at making groups more accountable, but indigenous groups are usually faced with a range of different accountability requirements, not all necessarily compatible with each other. The approach currently taken under the Act confuses financial and procedural accountability with the achievement of program objectives, and this has led to undue emphasis on the enforcement on compliance with statutory requirements. Outcomes in delivery of essential services have not been improved under this approach, often leading to the ‘proliferation’ phenomenon where communities respond to poor service delivery by setting up new corporations.

As an observer of these corporations over a number of decades, I can only say ‘Hear, hear!’ to that.

In the case of the Northern Territory, a large number of corporations were set up to avoid the possibility of prescriptive treatment being taken upon those organisations or communities by a previous Country Liberal Party administration in the Northern Territory. That led to a relatively large number of Indigenous communities incorporating under this act as a way of avoiding being incorporated under Northern Territory law and having to comply with elements of the Northern Territory local government legislation. They were fearful of the takeover that was being represented by that legislation by the CLP. I note that the CLP sought to get the Commonwealth to remove the possibility of the Aboriginal Councils and Associations Act having an effect in the Northern Territory.

I would like to draw members’ attention to an article published in the Indigenous Law Bulletin in May of this year entitled, ‘The Corporations Aboriginal and Torres Strait Islander Bill 2005 coming soon to a community organisation near you.’ The article was authored by Nicole Watson, a research fellow employed by the Jumbunna Indigenous House of Learning in Queensland. It is Ms Watson’s conclusion that the new legislation is more likely to frustrate Indigenous organisations and it introduces a complex regime that has the potential to usurp Indigenous self-determination.

I will come back to Ms Watson’s article in a moment, but now it is timely to remind the House of the findings of the Woodward report of the Aboriginal Land Commission in 1974. Justice Woodward in his second report set out the following important principles to be observed in formulating legislation for Aboriginal corporations:

(a)

the legislation must be simple, so that those who are working under it can readily understand it;

(b)

it must be flexible, so as to cover as wide a range of situations and requirements as possible;

(c)

it should, as far as possible, make provision for Aboriginal methods of decision-making by achieving consensus rather than by majority vote;

(d)

it must contain simple provisions for control of the situation if things go wrong within an organisation through corruption, inefficiency, outside influences or for other reasons; and

(e)

it should be so framed as to avoid taxation of any income that has to be devoted to community purposes.

Unfortunately, the Aboriginal Councils and Associations Act has failed to achieve these objectives. The Fingleton review 10 years ago came to the conclusion that under the act there was:

... an ever-increasing gap between people’s attempts to incorporate in a culturally appropriate way and the Registrars pre-occupation with matters of statutory compliance.

Secondly, it said:

An emphasis on procedural compliance overlooked important factors such as representative membership and equitable service delivery.

Arguably, such factors would be more effectively measured by shifting emphasis away from compliance with the ACAA to service agreements with funding bodies.

Nicole Watson, in her article that I mentioned earlier, has also analysed the key provisions of the new legislation. The only advantage she can see is that small corporations may be relieved of inappropriate and onerous reporting requirements. I stress the word ‘may’ because the decision of exemption rests with the registrar. As Nicole Watson rightly points out:

Indigenous Corporations are still beholden to the Registrar’s discretion, and despite review rights reviewable by the Administrative Appeals Tribunal it remains to be seen if this will be effective and appropriate for Indigenous organisations or whether it creates another web of entanglement.

Other people support her view. The Central Land Council in their submission to the Senate Standing Committee on Legal and Constitutional Affairs inquiry into the provisions of the Corporations (Aboriginal and Torres Strait Islander) Bill had this to say:

The “special incorporation needs of Indigenous people” are not being met by the main provisions of the Bill. The Bill is drafted from a reverse perspective.

Instead of being a simple incorporation statute tailored to the special needs of the Indigenous population it is a complex statute designed to regulate large corporations.

…            …            …

... the needs of the majority of Aboriginal corporations, at least in Central Australia, are not met by the main provisions of the Bill but rather by the provisions providing for exemption from obligations created by the Bill.

But to make an application for exemption will require a complete understanding of the provisions of the Bill and an understanding of the implications of non-compliance and the capacity to make an exemption application.

As the Central Land Council further added:

Clearly in Central Australia ... the Aboriginal members of corporations are not, without assistance, going to be able to deal with the complexity of the Bill if it becomes law.

This bill does not address the very basic flaw that any administrative arrangements require skills in and access to a range of governance services. If these are the advantages of new legislation, what are the disadvantages?

Nicole Watson is a member of the Birri Gubba people of Central Queensland and has a Master of Laws from the Queensland University of Technology. Her conclusions are that there are many disadvantages to the act. Having worked with and in Indigenous organisations for many years and representing the electorate with the greatest number of Indigenous Australians, I agree with what she has to say. First and not surprising, given this government’s record on other pieces of legislation dealing with Indigenous Australians, is the lack of consultation. Secondly, for a piece of legislation which is to be used to govern Indigenous Australians, it spans over 500 pages. There is the question of whether the new legislation will make it easier for Indigenous organisations to comply or ever more difficult. Thirdly, as Nicole Watson points out:

In an attempt to achieve alignment with modern corporations law, the CATSIB contains over 100 strict liability offences. Although most are based on equivalent provisions in the Corporations Act, some are unique to Indigenous corporations.

She adds:

A punitive approach overlooks the circumstances of the vast majority of Indigenous corporations. As distinct from those formed for profit, many are incorporated in order to deliver essential services to indigenous communities. Directors of such corporations are often elected on the basis of skills in community development as opposed to business acumen. Increased liability for non-compliance in the absence of a mass education campaign may result in Indigenous people carrying most of the burden of the Commonwealth’s reforms.

It is now nearly four years since the final report of the independent review of the Aboriginal Councils and Associations Act was presented. Ms Watson also expressed concern about the departure from the Corrs review, which looked at the original legislation. The new legislation allows non-Indigenous people to become directors of Indigenous corporations and corporate membership. Despite provisions requiring an Indigenous majority on boards, these proposals may be a wedge that has the potential to take control out of Indigenous hands.

Ms Watson is quite right when she highlights the comments of Michael Prowse—then of the Central Land Council; now, I think, of the justice department in Queensland—when giving evidence at the Senate hearings. In part, Mr Prowse said:

Quite often people are not comfortable using the kind of processes that other people with corporations in other parts of Australia might use. Voting is quite often not used but a process of consensus decision making is used. We would suggest that to permit non-Indigenous membership of Indigenous corporations would quite often lead to a chaotic situation with Aboriginal people being overwhelmed by non-Aboriginal people, who may have better capacities to read and write and to use techniques and instruments of non-Aboriginal law. We suggest that that provision is one that should be struck out of the bill.

I wish to further stress the concerns of Indigenous corporations to the proposed bill—in particular, the issue of powers of the registrar. It should be noted, as the Bills Digest pointed out, that:

The Registrar’s greater enforcement powers means that the Registrar now appears to more closely resemble a regulator rather than a body whose primary purpose is to assist the capacity of ASTI corporations.

The Corrs review recommended that particular regulatory powers under the current act should not be retained. The review suggested that, instead of the registrar being able to appoint an administrator, the registrar should apply to a court for appointment of a receiver under the court’s equitable jurisdiction. The recommendation has not been implemented. I will come a little later to some comments about a particular case which I have spoken to the registrar about. I think it reflects some of those issues.

The appointment of a special administrator and the grounds for such an appointment give considerable power to the registrar. The proactive regulatory assistance is quite different to the Corporations Act. The grounds for placing a corporation under special administration are much broader than the grounds for appointing a receiver. The registrar also has considerable power to issue compliance notices that allow the registrar the power to appoint an authorised person to a corporation to assist in the compliance. As I understand it, and it could well be the case, the intention of these provisions is to nip problems in the bud or to provide expertise of an accounting or management nature, but they are options that are open to abuse that could see Indigenous control and processes ignored. Rather than Indigenous people having their say and moving forward over time to improved corporate practices, the improved corporate practices may come from Indigenous people being pushed back while some other expert takes control and plays the role of the ‘big boss’. Unfortunately, for Indigenous people this happens all too often.

Once decisions are made by the registrar, what is the process for review? The bill proposes that when a person makes a reviewable decision then notice of the decision, together with advice of the person’s right to have a decision reviewed, must be given to each person affected by the decision. This makes sense and is, of course, quite reasonable. However, the bill makes an exception that is very worrying: the decision maker is released from the requirement to ‘give notice where the decision maker determines that giving notice to the person or persons is not warranted’, having regard to the cost of giving notice and ‘the way in which the person or persons are affected by the decision’. This is very concerning as, in my view, it essentially gives the decision maker an unfettered right to decide not to give an affected person or persons notice of the decision and the right to have it reviewed. It is also very disturbing when one considers Peter McCarran’s comments in the Indigenous Law Bulletin in November last year: ‘The bill assumes a high degree of literacy and legal and financial sophistication.’

Key questions in all this need to be asked. Does the bill offer simplicity, which has been the repeated recommendation of reports over the last 30 years? I have to say that I do not think it does. Are the procedural and documentary requirements of the bill more onerous than under the current act? If they are then where is there recognition of the needs of Indigenous organisations’ access to training, education and other services for good governance, especially given that the minimum membership age has been set at 15, and yet, as we all know, there is limited access for Indigenous students to secondary education, particularly in remote parts of Australia?

I have grave concerns over the question of the independence of the registrar. Given that this bill grants greater powers of enforcement to the Registrar for Aboriginal and Torres Strait Islander Corporations than are currently provided, we should be concerned about the possible lack of independence. This bill provides that the Office of the Registrar of Aboriginal and Torres Strait Islander Corporations will be part of the government bureaucracy, not an independent body at arm’s length from the minister. Section 1-30 of the bill proposes that:

There is to be, within the Department, the Office of the Registrar of Aboriginal and Torres Strait Islander Corporations.

The bill also proposes in section 653-1(2) that:

The Registrar is to be appointed by the Minister and has such duties, functions and powers as are provided for by this Act or another law of the Commonwealth.

Contrast this position with that of the Australian Securities and Investment Commission, which is the organisation that administers the Corporations Act 2001. Members of ASIC are appointed by the Governor-General on the nomination of the Treasurer. However, ASIC is established by section 8 of the ASIC Act as a body corporate with perpetual succession. It has a common seal. It may acquire, hold and dispose of real and personal property and may sue and be sued in its corporate name. In short, ASIC is its own legal entity, established under statute, and is independent from the government.

It is a real concern to me that the Aboriginal and Torres Strait Islander people wishing to establish new corporations or incorporate existing associations will not be expected to seek the same level of independence from the Registrar as other Australians can expect from ASIC.

I said I wanted to refer quickly to a particular case. I know the Registrar is in the parliament. I spoke to the Registrar recently about Mutitjulu. What we have seen in this particular case is the danger that the Registrar’s powers may be used by the government creditors to control corporations, and that is precisely what has happened in the case of Mutitjulu. What we also know in the case of Mutitjulu are the spurious reasons put on behalf of the government for requesting that the Registrar be involved. There are documents which are available, but I understand they are currently the subject of a court hearing, so I am not able to use them. But let me point this out very clearly: I think that the way in which the Commonwealth has rorted the use of the Registrar at Mutitjulu is unwarranted. I know that there have been proposals to settle the dispute between—

Bob Baldwin (Paterson, Liberal Party, Parliamentary Secretary to the Minister for Industry, Tourism and Resources) Share this | Link to this | Hansard source

Madam Deputy Speaker, I rise on a point of order. I think claims that public officials have been rorting should be withdrawn, and I think reflecting against officials in that way is not appropriate.

Mrs Bronwyn Bishop (Mackellar, Liberal Party) Share this | Link to this | Hansard source

I think the parliamentary secretary makes a valid point. I would ask the member to withdraw.

Warren Snowdon (Lingiari, Australian Labor Party, Shadow Parliamentary Secretary for Northern Australia and Indigenous Affairs) Share this | Link to this | Hansard source

The government has rorted it.

Bob Baldwin (Paterson, Liberal Party, Parliamentary Secretary to the Minister for Industry, Tourism and Resources) Share this | Link to this | Hansard source

Mr Baldwin interjecting

Warren Snowdon (Lingiari, Australian Labor Party, Shadow Parliamentary Secretary for Northern Australia and Indigenous Affairs) Share this | Link to this | Hansard source

If the government rorts something, it rorts something.

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

I think the point the parliamentary secretary is making is that you are making a substantial allegation and, accordingly, that can only be done by way of substantive motion, and therefore I would ask you to withdraw.

Warren Snowdon (Lingiari, Australian Labor Party, Shadow Parliamentary Secretary for Northern Australia and Indigenous Affairs) Share this | Link to this | Hansard source

I will table the documents, if you wish.

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

Is leave granted?

Leave granted.

Warren Snowdon (Lingiari, Australian Labor Party, Shadow Parliamentary Secretary for Northern Australia and Indigenous Affairs) Share this | Link to this | Hansard source

I table a series of documents between the Mutitjulu community, the Office of the Registrar of Aboriginal Corporations and Mr Wayne Gibbons, Associate Secretary of Office of Indigenous Policy Coordination, and other documents. What these documents show people is that the Office of the Registrar of Aboriginal Corporations has been compromised by this government. Unfortunately, whilst the people of Mutitjulu—and, I am sure, in other cases—would like to seek an agreement or negotiate settlement with the Office of the Registrar of Aboriginal Corporations, they have been prevented from doing so effectively by actions of the government. That tells me there is a real problem with independence. There is absolutely no doubt about the need to overhaul the legislation.

Many of the proposals that have been put forward within the package of legislation that we are discussing today give effect to some very important reforms. There is no question about that. But there are some legitimate concerns which we have and which have been articulated within the amendment which I have moved on behalf of the opposition. It is very important that, when we contemplate these issues, we understand what in fact has taken place. In this instance, we have legislation which started off in the 1970s and is clearly out of date, and clearly should have been appropriately amended a lot earlier. The package of legislation seeks to do a lot of good things, but at the same time there are things which it fails to do. The things which it fails to do are the things that concern me.

I am significantly concerned about the complexity of the legislation. It is evident enough to me that for most Indigenous organisations across Australia it will be far too difficult to adhere to and comply with the regulations being imposed upon them. Nevertheless, under advice, I am sure there is a possibility that they can do it. But the question remains: who will pay for that advice? It is clear to me what the government is doing: by using the Registrar to control corporations in the way that it is, the government is effectively misusing those responsibilities. I commend the opposition’s amendments to the House.

Wilson Tuckey (O'Connor, Liberal Party) Share this | Link to this | Hansard source

This package of legislation is nearly 50 millimetres thick—or an old-fashioned two inches. It is a response by the government to problems that have arisen in corporate governance involving very substantial amounts of taxpayers’ money over many years. It is typically a bureaucratic response and, unfortunately, that is what governments do. In introducing the Corporations (Aboriginal and Torres Strait Islander) Consequential, Transitional and Other Measures Bill 2006, the minister’s second reading speech drew to our attention that there are over 8,000 Indigenous community organisations registered with the various corporate regulators and about 3,000 are registered under the Aboriginal Councils and Associations Act. The purpose of this legislation is to, in some way, consolidate those arrangements and set down what might be called a body of whitefella law to address the problems that have arisen in the past.

It has long been my opinion, which was supported by others, that the processes by which government, particularly the Australian government, administers Aboriginal financial affairs was always going to fail in a top-down situation. This legislation is an addition to a top-down approach, and it is not surprising because it has been put together by a centralised bureaucracy, assisted in some regard by certain members of the Aboriginal elite—people whose personal fortune today can be measured in millions of dollars and who have done very well out of the concern of the Australian community to assist the Indigenous people of Australia.

The thought that I had, surprisingly, along with others who represent and have had a long-term association with Indigenous people, was to recognise some of the cultural aspects that continue to control their lives very significantly and to find solutions to them. We thought that 300 Aboriginal organisations acting primarily in an authoritative but otherwise advisory capacity would be sufficient and best equipped to address the problems to which the Australian government now delivers about $3 billion a year. The idea was quite simple. Instead of having large numbers of people being given very large sums of money to administer—and I will come back to that in a moment—when culturally that created huge personal problems for those, as honest as they probably were, we suggested having advisory groups. The remuneration of the advisory groups was to be similar to that of people who attend council meetings and things of that nature. It would not have included the provision of vehicles. The groups would have come under the heading of an Aboriginal board of trust. As an Aboriginal board of trust they would have been responsible for the administration of, or advice to government on, the expenditure of funds that were allocated from that $3 billion by the Commonwealth Grants Commission, based on formulas that are well established, in principle at least, for local government funding.

The Australian government places a one-line item in the budget for local government assistance and it relies upon the Grants Commission and a formula to distribute that money. As it happens, in that case alone it is distributed on a state by state basis. The state governments have their own grants commission type body—of which I was once a member in my state—and they make the individual distributions to each local government authority. Naturally, since 1967 and the constitutional amendment, the Australian government would not have had to take that secondary approach. The Grants Commission could have decided on the amounts of money that each community received, taking into account their special needs.

However, that having been done, a board of trust requires a trustee. I and others recommended that, wherever practical, the trustee be the nearest local government authority—a body that is already subject to law as thick as this legislation and that could have been answerable therefore, under present-day law, for the actual administration of the money. The purpose of the board of trust would have been to have considerable power to identify where best that money might be spent.

It was suggested on many occasions that they should deliberately purchase services. For instance, if truancy inspectors were needed to raise the attendance level of Aboriginal children at some schools from 10 per cent then the state education department or the administrator of the school would be asked to provide these truancy officers and they would be funded from the resources. One could give a similar definition for public health nursing. In my state it might have been Silver Chain, which is a stand-alone charitable organisation of long standing that has provided nursing services and things of that nature. It might also have been the state public health department. The idea was that a deal would be struck. Hopefully, in those circumstances, training provisions would have been created as part of that process. In other words, other people would make the employment decisions; the board of trust would make the funding decisions.

That might seem rather strange except that it resolves the biggest problem that, unfortunately, all this legislation cannot. Yes, we are saying that if you want to be part of an Indigenous corporation you will be subject to the rules that apply to other corporate entities. That is right and proper for this place. But what it overlooks is a society that above all has one cultural imperative: ‘What I have, you, brother, also have.’ That is not a criticism. Of course, it was an absolute necessity of life. If the hunting parties in a hunter-gatherer society were to catch a kangaroo, did the spearman and his immediate family eat it all or did all members of their tribal group participate? Of course they did. It is probably very difficult for people in this House to realise how strongly that culture applies and how little Aboriginal blood is required in terms of that imposition.

It might sound a silly example, but when I moved to a town called Carnarvon in 1958 and ran a hotel, amongst other things, we cashed the workers’ cheques because that was the way they were paid in those days. A huge percentage of the Aboriginal population that made up a third of that community had what I would term good jobs. They worked with the main roads department, the council and all sorts of other people. They did not work as labourers; they were competent machine operators. One whom I recollect was third in charge of the main roads, which at that time had the job of building about 500 kilometres of highway north and south of Carnarvon.

However, when they came to cash their cheques, it was imperative that they walked out with a significant number of dollar bills because outside the hotel—and these people had their own homes; some owned their own trucks—there was an obligation to gift certain family members from their largesse: the wages from the job they had. They could get away with giving a dollar—they were responsible people who had a family at home, a house and probably a mortgage or rent to pay—but if a $20 bill was the smallest denomination note given, there was an equal obligation to give that.

That is not a criticism; that was ingrained in their lifestyle. But, if we suddenly say to some of those people, ‘Here is the administration of $1 million, $10 million, and here are the rules,’ it will not work. Okay, we are getting smart and we are going to appoint people to the board who are probably not Aboriginal—or Indigenous, according to the second reading speech. But I am not sure, as the directors of the AWB have recently discovered, that that will be enough. I mentioned the town of Carnarvon. I have long departed from it but I am aware that some of those people who used to have employment of a productive nature now work within the Aboriginal industry, as it is known, and they thought they needed an interpretive centre in Carnarvon.

The last I heard it was under construction. It is a very significant building. I understand that some $4 million of taxpayers’ money has been expended to date, but it is not open. No-one can decide which family gets the reward of operating it, so it stays closed. It is not going to open because they cannot resolve that matter. They cannot say that a person of family A gets one job and a person of family B gets another. The dominant family gets the lot. Is that corrupt? It is not, in my mind, because that is their culture. We have such a focus in Australia on the things that are not their culture: a flag, an Akubra hat—which I have seen worn in the Great Hall of this place; I think it is glued on. But we have ignored in the administration of Aboriginal funding who has the best ideas compared to those.

Typically the stolen generation have had enough education to become the Aboriginal elite, and it has to be addressed. This is an attempt to impose further power from the top and to make it better than what was there before. But the reality is that the outcomes will not be sufficient. There will be a continuance, through the various land councils and all the others that we seek to regulate, of a very well-paid elite—a typical salary in a regional office is $150,000 plus car et cetera. That will not work, because those people will still feel obliged to create jobs and things for their families and their immediate associates. It is quite a difficult calculation. There are some relatives whom they are not obliged to look after and others whom they cannot avoid looking after.

Why are we not looking at those principles? The argument we brought forward with bottom-up funding was to not cream the funding off to all the people who will have to be running around doing the regulating. Why do we not have all the money turn up, with just 300 organisations—which happens to equate to the number of language areas throughout Australia—utilising local government and the laws that govern their management of public funds to be both assistant and trustee? They would not make all the decisions on expenditure but would certainly see that the moneys were administered in a manner satisfactory to this parliament.

I wish that were the solution. I have never been able to get past the higher echelons of our party to understand these fundamental principles, so I come along to support their solution simply because it is better than what was there before. But it is not appropriate to try and throw people in jail because we asked them to do a job that, in many cases, is beyond their cultural responsibility. These are the issues that we must understand. We have huge amounts of money being spent and far too much of it to no good purpose. We have people who have done extremely well.

With respect to the issue of land rights, I see that the Native Title Act is one of the issues that get attention in the amendments and changes. It is an act that gives people, according to the High Court, not an estate in land but a right of access: a right of access to conduct ceremonies and a right of access to hunt and gather—notwithstanding that most hunting and gathering today is done in the corridors of a supermarket. But the act gives those rights. The act that was introduced in this parliament—ostensibly to give some administrative arrangements associated with that decision of the High Court—went as far as to say that we recognise that native title may not be proven under this act but anybody who believes that they have a claim but has not proved it should be able to negotiate with some other party who is applying to develop or use that land in some way.

That in itself was not unreasonable, except that it required the person applying to use the land to negotiate with self-identified parties in good faith and then particularly excluded the Aboriginal people from that good faith requirement. You do not have to prove anything; you just refuse to negotiate or forget to turn up and the application goes on and on and it is eventually decided that a payment of some magnitude will be made to get negotiations going. They are quite quickly concluded thereafter. Okay, these people give of their time to go and point out that that is sacred and you should use it this way and walk softly or whatever. I guess that our community has decided that that is appropriate.

But nobody ever tells us where those payments go. Are they carefully distributed for the good of all people who are recognised culturally within a certain land claim? No, they are not. You just have to be in the right family and the right place and be identified thereafter and you are able to go around and claim fees. I do not find that appropriate. But unless there is a bottom up funding/administrative arrangement put in place that minimises the draw down of the bureaucracy—and this legislation does not do that—then we have a problem. Anyway, I am prepared to give anything a try. The place is full of lawyers, and most of them have had little or no contact with Aboriginal people, and I guess that they will go on in this fashion.

Peter Garrett (Kingsford Smith, Australian Labor Party, Shadow Parliamentary Secretary for Reconciliation and the Arts) Share this | Link to this | Hansard source

I want to follow on from the comments that my colleague the member for Lingiari made when he spoke to the Corporations (Aboriginal and Torres Strait Islander) Consequential, Transitional and Other Measures Bill 2006 and the related bills previously. Mr Snowdon moved a second reading amendment. I want to particularly make note of the things that Labor thinks would greatly improve what the government has brought forward in these bills. In particular, the government should respond immediately and comprehensively to a recent report commissioned by the Office of Indigenous Policy Coordination, which found that red tape and short-term, ad hoc funding arrangements were severely debilitating the Indigenous corporate sector. This legislative reform will not address these external causes of instability to corporate governance in Indigenous communities.

Additionally, the government must ensure adequate funding for training and assistance for the Indigenous corporate sector so that it can build its governance capacities to facilitate a smooth transition to the new regime that is contemplated under the Corporations (Aboriginal and Torres Strait Islander) Bill 2005. We note that this was a unanimous recommendation of the Senate Standing Committee on Legal and Constitutional Affairs inquiry into the bills. I very much hope that the minister is mindful of that recommendation and of the fact that it was unanimous. Labor also has significant concerns in relation to the level of regulation and the extent of the registrar’s powers in the bills, particularly given that the registrar does not have full independence from ministerial and political interference. Aboriginal affairs still continues to be a highly charged area in which ministerial involvement and interference quite often take place.

Labor believes that for the next three financial years ORAC should include in its annual report a review of the operation of the new legislation and the results of a statistical survey of stakeholder satisfaction to ensure that the impact of the legislation is closely monitored, with appropriate transparency. This is clearly very important when changes of this kind come into effect. Finally, the government should ensure a review of the operation of the Corporations (Aboriginal and Torres Strait Islander) Act by a parliamentary committee within three years, having particular regard to the effective and proper use of the registrar’s powers under the act and the effectiveness and appropriateness of the act as a regime of corporate law for Aboriginal and Torres Strait Islander people.

The Corporations (Aboriginal and Torres Strait Islander) Bill 2005 replaces the Aboriginal Councils and Associations Act 1976 and seeks to modernise corporate governance arrangements and accountability standards, acknowledging the specific circumstances that Indigenous communities operate under. The legislative package before the House comprises three bills, the abovementioned Corporations (Aboriginal and Torres Strait Islander) Bill 2005; the Corporations (Aboriginal and Torres Strait Islander) Consequential, Transitional and Other Measures Bill 2005, which seeks to offer support for Indigenous corporations to adapt to the new regime; and the Corporations Amendment (Aboriginal and Torres Strait Islander Corporations) Bill 2006, which is designed to allow for a smooth interaction between the bill and other corporation law instruments, including the Corporations Act.

It is broadly recognised, including by Labor, that there is a need to update the Aboriginal Councils and Associations Act 1976, which in fact has not been amended since 1992. The current bills’ genesis can be tracked back to the late 1960s. The Council for Aboriginal Affairs, for instance, recognised the need for a simple, inexpensive and culturally appropriate corporate governance system for Indigenous communities. And in 1972 Prime Minister McMahon—so that is some time ago, it has to be said—announced that his government would ‘investigate ways of finding a simple, flexible form of incorporation of Aboriginal communities’. So it has been recognised for a very long time—and was recognised in this parliament by a Prime Minister from the Liberal Party—that there need to be simple and flexible forms of incorporation for Aboriginal communities.

In the recommendations made by Justice Woodward to the Whitlam government on land rights policy—which the member for O’Connor alluded to in an interesting fashion—he also considered the need for a specific system involving Indigenous corporations incorporating the principles of simplicity, flexibility and self-determination. I think the need for and importance of those principles is self-evident.

The first Indigenous corporations mainly dealt with landholding trusts, community stores and housing associations. That is a reflection of the fact that, in the first instance, it was a question of gaining access to, and some rights over, land that had hitherto been theirs, which was indeed the first goal, and one of the primary goals, of Aboriginal communities. Additionally, the need to get stores set up, particularly in remote communities, and to make provision for suitable housing for people, many of whom had been dispossessed and taken off their country, was clearly a priority. So the first Indigenous corporations mainly dealt with entities of that kind but later branched out into medical and legal services, outstation resource centres and community development employment projects. By 1998 the Australian Local Government Association, working with the Aboriginal and Torres Strait Islander Commission, had produced a study which found Indigenous corporations were in fact the main providers of local government services in Indigenous communities. So their role was an important one.

Labor recognises that important role that Indigenous corporations have played historically and continue to play in supporting Indigenous people living in remote communities. For this reason Labor believes that there is a need to update the bill and the legislative framework governing Indigenous corporations. The number of reviews, studies and reports into Indigenous corporations and their governance standards highlights that it is difficult to find the right mix between modern, mainstream corporate governance issues and suitable flexibility arrangements for these organisations working in remote and sometimes contained and constrained circumstances. Labor recognises this challenge.

In 1996 the Final Report—review of the Aboriginal Councils and Associations Act 1976 concluded:

... the Aboriginal Councils and Associations Act 1976 is too prescriptive to allow bodies to incorporate in a culturally appropriate way ... The approach currently taken under the Act confuses ... procedural accountability with the achievement of program objectives, and this has led to undue emphasis on the enforcement of compliance with statutory requirements.

An independent review of the Aboriginal Councils and Associations Act 1976, chaired by Pat Dodson and finalised in 2002, made a number of recommendations, including the establishment of a new act. I note that many of the recommendations from this review have been implemented by the Office of the Registrar of Aboriginal Corporations already, and this new legislation now seeks to implement some of those other recommendations.

Additionally we take note that the recommendations made by this review which are not being implemented include that the Office of the Registrar of Aboriginal Corporations seek a court order prior to the appointment of an administrator. Labor believes that such a recommendation is important because it would provide for the necessary separation of responsibilities when an action as important as the appointment of an administrator takes place. It would mean that there was fairness and transparency when such appointments were made. Finally, and I think most importantly, given that Aboriginal issues are sometimes highly charged in this country, it would also mean that the appointment of an administrator would be free from suspicions of political interference.

While the introduction of a right of appeal to the Administrative Appeals Tribunal against the appointment of an administrator is a positive move, Labor believes that it does not provide the added protection offered by the review’s recommendation. I think it is worth while emphasising this point: sometimes the scrutiny of the media is quick and direct, focusing on a particular hot button issue of one kind or another, so it is absolutely critical, particularly if the scrutiny goes to the question of whether or not there should be an appointment of an administrator, that such an appointment is accompanied by the necessary court order. This would make sure that the due process of law that usually applies in these matters applies in cases of this kind as contemplated under this legislation. It is very important that, when decisions and actions of this kind are taken, there is no question whatsoever there has been political interference or involvement.

The recent Senate inquiry report into the provisions of the Corporations (Aboriginal and Torres Strait Islander) Bill and associated bills, which was tabled earlier this week, outlined a number of the concerns many interested parties had regarding the Aboriginal Councils and Associations Act 1976. In fact there were a number of concerns that were identified and raised by those parties and institutions that have some experience of the way these acts tend to operate on the ground. I note that the Australian Institute of Aboriginal and Torres Strait Islander Studies remarked in their submission:

Many Indigenous organisations have sought incorporation under the Corporations Act 1991 to overcome the onerous and arguably discriminatory aspects of the current ACA Act, as well as technical shortcomings, for example in relation to corporate membership, non Indigenous membership and directors, and the like.

The Senate inquiry also raised questions over the transitional bill, stating:

It is clear, however, that many Indigenous corporations are poorly resourced and will require significant support in order to make this transition.

I cannot stress how important we on this side of the House feel it is that arrangements of this kind, which are intended to better improve capacity for governance within Indigenous communities, particularly remote and regional communities, are given the means to affect those transitions so that they are not simply being set up for failure.

The Senate committee noted its concerns that the existing budget allocation for the Office of the Registrar for Aboriginal Corporations for education and training may not be sufficient to meet the needs of the 2,600 existing Indigenous corporations. Labor shares these concerns. These corporations are not simply commercial entities in the way in which we understand the word ‘corporations’ doing the job, producing goods and employing people in the ordinary course of business in and around Australia; they are corporations whose activities are central to the life and the vitality of the communities that they operate within.

Labor acknowledges that the Office of the Registrar for Aboriginal Corporations has a critical role in ensuring Indigenous corporations are adequately prepared for the transition to the new regime. This means the government must properly fund the ORAC to provide effective education programs during the transition period. A report from the Corporate Governance Forum in June 2004, a joint effort between the Office of the Registrar of Aboriginal Corporations and Reconciliation Australia—which considered this issue in some depth—found:

Good Indigenous corporate governance training is about community capacity building and sustainable organisations, not just compliance.

I think that summarises very well the public policy challenge in legislation of this kind, particularly when you consider some of the challenges that Indigenous communities find themselves facing.

There are rafts of different changes that are being proposed for them in terms of native title rights and shared responsibility agreements, and some of them are going through some extremely intense periods of interaction with COAG trials. It is absolutely critical that the necessary resources for training for people who work in these corporations is made available to enable not only the corporations to comply but also, in the process, capacity building and the building of an organisation that is not so shaken and challenged and under such great demand by those requirements that it then falls over a year or two later. The report went on to say:

Providers must be given the time and funding to develop programs and materials that are customised to fit the culture and priorities of the community.

Labor concurs with this finding. Recommendation 1 of the Senate inquiry also supports this view. It reads:

The committee recommends that the government should monitor funding to assist corporations with the transition to the new regime and make provision in the 2007/08 Budget to increase this funding if necessary.

Indigenous corporations cover a vast range of services that are vital to remote Indigenous communities. That Senate inquiry recommendation for the provision of funding and to ensure that corporations are able to make the transition to the new regime strikes me as being extremely important, and I hope that the minister will take note of it.

Amongst the Indigenous corporations that play a really vital and important role in the community are the Aboriginal art centres. The Indigenous art industry provides important economic benefits to many Indigenous communities. It is often the Aboriginal art centres, many of which are listed as Indigenous corporations, that provide, undertake and fulfil a number of important roles. They provide advocacy, advice and support to Indigenous artists, and their services are crucial in that respect. Aboriginal art centres are professionally run organisations, and 100 per cent of the returns are directed into Indigenous families and communities. Additionally, they provide support for marketing and distribution of Indigenous art as well as ensuring authenticity for the buyer. Aboriginal art centres not only contribute significant economic benefits to Indigenous communities but also act as a hub for social and cultural activities.

The Indigenous art industry is estimated to be worth between $100 million and $300 million. I think it would be closer to $300 million. I should point out to the House that there is a Senate inquiry underway into the industry, examining the size and scale of the industry; the economic, social and cultural benefits of the sector; the future infrastructure needs of the industry; and the continued evidence of carpetbaggers, frauds and fakes—something which Labor has been speaking about for some time, and we welcome this long overdue inquiry.

The Association of Northern, Kimberley and Arnhem Aboriginal Artists, ANKAAA, the peak advocacy and support agency for Indigenous artists and art centres in Arnhem Land, Darwin, Katherine, the Kimberley and the Tiwi Islands, is an example of a corporation that fulfils a valuable role. The services it offers include: advocacy, provision of information for artists and importantly—and I think significantly—protection of artists’ interests. The recent reports that we have had of carpetbagging, the importation of fakes and other unethical behaviour within the industry means that the role of Aboriginal art centres such as ANKAAA has become more important than ever. The federal government provided some needed additional funding for Aboriginal art centres in the last budget, and I welcomed this move. But, unfortunately, this funding came in the face of the government’s rejection of a resale royalty scheme for visual artists which would have provided significant economic benefits for Indigenous artists and their communities.

Overall, this package of bills will go some way towards improving the existing and outdated Aboriginal Councils and Associations Act 1976. However, as members here have noted and as foreshadowed in the amendments moved by the member for Lingiari, there are a number of unresolved concerns which these bills do not address. It is critical in this House that we get the balance right between accountability and recognition of the unique role Indigenous corporations have in remote communities. It is critical that the Senate inquiry recommendations, particularly those recommendations that relate to providing for proper education, monitoring the funding for education for people working on the transition within these corporations, are accepted by this government. (Time expired)

Peter Lindsay (Herbert, Liberal Party) Share this | Link to this | Hansard source

I welcome the support that the member for Kingsford Smith has given to the Corporations (Aboriginal and Torres Strait Islander) Consequential, Transitional and Other Measures Bill 2006, the Corporations Amendment (Aboriginal and Torres Strait Islander Corporations) Bill 2006 and the Corporations (Aboriginal and Torres Strait Islander) Bill 2005, a very sensible suite of bills. It is refreshing to see that support being given to the government.

I come to this debate from an electorate—Herbert, in North Queensland—that has 8,000 Indigenous Australians living within its boundaries. In my home city of Townsville we have the largest Torres Strait Islander population outside the Torres Strait. But we also have an Indigenous community that is known for the wrong reasons. Those who are listening to this debate today will know what I am talking about when I mention Palm Island. Palm Island has certainly very much been in the news of late, for the wrong reasons. I intend to say a few more words about the problems on Palm Island related to this legislation later in my contribution.

The Aboriginal Councils and Associations Act is not adequate today, given the high numbers of Indigenous corporations and their diversity, and also given developments in corporate law and other areas, such as native title. The broad objectives of the reforms are to align the CATSI legislation as much as possible with the Corporations Act 2001 to provide improved corporate governance standards while at the same time allowing for the special requirements and risks of Aboriginal and Torres Strait Islander corporations.

The legislation package that we have before the parliament this afternoon implements the majority of the recommendations of an independent two-year review. The report was publicly released in December 2002. Extensive consultations occurred during this process, and further research and consultation were done by the Registrar of Aboriginal Corporations in the lead-up to the development and the introduction of the CATSI bills.

Transitional provisions have been drafted, and this is sensible, to minimise the administrative burden on corporations as far as possible. For example, the corporations registered under the old act automatically become corporations under the new act. The legal status, office bearers, assets and liabilities of corporations are all preserved in the new act for the transitional period. There will be a period of up to two years for corporations to make the necessary changes to their constitutions and come into compliance with the new arrangements. The transitional periods are sensible and welcome.

This legislation responds to the present-day problems faced by Indigenous corporations. It aligns corporate governance requirements with modern standards of corporate accountability while allowing flexibility for Indigenous corporations to tailor their arrangements to suit their own special circumstances.

It is interesting that there are many Australians who do not have contact with Indigenous Australians. People in the southern part of the country, in particular, have no contact with Indigenous Australians and do not understand the very special issues that arise in regional or remote communities. In fact, the special issues in regional communities are often different to the special issues in remote communities.

I was very privileged some weeks ago to visit Warburton in Western Australia, which is a model Indigenous community. It was just so refreshing to see a community that knew how to conduct itself, a community that ran its own services—water supply, sewerage, electricity, airport, airline, local store and so on—all at a profit and all under good governance arrangements. It was a community that was tidy. There were not holes in houses. The people were proud to live in the community. That is what we want to see in Indigenous Australia, and Indigenous Australians are capable of achieving that. Warburton, on the Great Victoria Desert, adequately demonstrates how Indigenous Australians can be proud of their history and their heritage and can live well and properly.

This is very practical legislation that empowers Indigenous people to structure their corporations to create the best outcomes for their communities. It also allows for a range of assistance, from training to a rolling program of good governance audits.

I have often said, loudly and at length, that there are three or four things that really need to be addressed first and foremost to help Indigenous communities. They are: governance, law and order, and landownership. Until they are addressed adequately, the other major issues, of health, education and employment, will not follow. When you look at Palm Island in my electorate, you find a lack of governance, a lack of law and order and you certainly do not find any landownership. In fact, there is virtually a Soviet style system that exists on Palm Island, where the central proletariat owns and runs everything. But I can tell you, Mr Speaker, that Indigenous Australians want to embrace landownership and they want to have good governance. They do not want to see the disregard for law and order that occurs in their communities. They want their children and their women to be safe. This legislation before the parliament today is part of that. I commend the Minister for Families, Community Services and Indigenous Affairs for his foresight and work in Indigenous communities in Australia. He has been a breath of fresh air after so many years. The minister certainly deserves the support of this parliament, from both sides of the parliament.

David Hawker (Speaker) Share this | Link to this | Hansard source

Order! It being 2.15 pm, the debate is interrupted in accordance with the resolution agreed to yesterday. The debate may be resumed at a later hour. The member will have leave to continue speaking when the debate is resumed.