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Grassroots capitalism is a must for remote Indigenous communities

By Tony Abbott - posted Monday, 11 November 2002

In less than 100 years, remote-area Aborigines have passed from a subsistence hunter gatherer economy, to a subsistence mission economy (sometimes associated with low-paid work in mines and cattle stations), to a subsistence welfare economy. In the less settled parts of Australia, the organising principle of an economy, the notion of accumulating surpluses, has seldom taken root. Concepts central to contemporary civil society such as exclusively personal property and individual rights and responsibilities have rarely been taken for granted, except, perhaps, grafted-on in mission times. These are settlements where individuals have a strong sense of family and clan but little sense of the day-to-day economic co-operation with others that constitutes so much of the social fabric. They are communities whose inhabitants generally have a stronger sense of identification but a lesser sense of daily purpose than the residents of the most anonymous city suburb.

Since the mission times ended, federal and state governments, and more recently ATSIC and community councils, have tried hard to create local economies and to ensure that local jobs are filled by local people. In many places, Aboriginal residents now work in home maintenance teams and road gangs. Many communities have successful galleries with some outback artists commanding thousands of dollars for their work. Some communities have established carpentry, mechanical and sewing shops to provide locals with marketable skills as well as affordable furniture, clothing and car repairs. A handful own and run their own airlines. Even so, without the Community Development Employment Programme (an Aboriginal work for the dole scheme started by the Fraser Government), the unemployment rate in many remote Aboriginal communities would approach 90 per cent.

Many Aborigines are understandably reluctant to enter a materialistic "rat race". On the other hand, substance abuse, crime, domestic violence and suicide are pandemic in communities where people have nothing much to do and little hope for a better future. Unless a significant part of most days is filled with purposeful, co-operative activity, individuals tend to feel unfulfilled and antagonistic toward each other. Communities whose members don’t have a sense of meaning in their lives (whether generated by looking after children, tending gardens, creating art or playing sport as much as working for wages) tend to become no-go zones – regardless of the race or culture of their inhabitants. Australian society is far from prejudice-free (and still has a strong tendency to typecast people) but the problems of Aboriginal communities owe at least as much to welfarism as racism.


Two years ago, Noel Pearson opened a new debate on the importance of economic participation if Aboriginal people are to regain their self-respect and autonomy. This is vital to the reconciliation process, less, perhaps, because Aboriginal people will continue to resent lower incomes, on average, than other Australians than because the general public will find it hard to see past an "Aboriginal problem" as long as too few Aboriginal people have "real" jobs. A sure sign that reconciliation has been achieved will be the presence of Aboriginal people as leaders of non-Aboriginal organisations. Reconciliation will have occurred when outstanding Indigenous lawyers, doctors and business executives are no more surprising than Indigenous artists and sports stars.

This aspect of reconciliation is more important than gestures such as treaties, apologies and constitutional acknowledgements. Symbolism should reflect what people hold in their hearts. Australians naturally warm to people who are doing it tough but having a go. That’s why Pearson’s message has struck such a chord. Pearson has stressed Aboriginal distinctiveness but not Aboriginal separateness. He’s not happy about the past but he’s not bitter either and wants to ensure that Aborigines are fully Aboriginal and fully Australian with the ability to be at home in the bush or the boardroom or both.

The 2001 ABS figures put Aboriginal unemployment at 24 per cent, or nearly four times the national average. This suggests significant improvement since 1994 (when measured Indigenous unemployment was 28 per cent) but significant deterioration since 2000 (when measured Indigenous unemployment was 18 per cent). These statistics need to be treated with caution: first, because of the comparatively small survey sample used; second, because of the problems associated with surveys based on self-identification: and third, because too much Aboriginal employment has an element of "make work".

Any way it’s examined, Aboriginal unemployment is disastrously high even after three decades of well-funded, well-meaning attempts to give Aboriginal people more participation in a modern economy. More so than with general unemployment, bringing Aboriginal unemployment down involves new attitudes as well as new jobs. It’s too common to find very high unemployment in remote Aboriginal communities even when there’s a mine with high staff turn-over just down the road. Boosting Aboriginal employment means persuading employers to abandon old prejudices. It also means persuading Aboriginal people to leave what’s sometimes the comfort zone of working with Indigenous organisations.

In cities and larger towns, the Job Network is helping Aboriginal people to find work. Aboriginal job seekers usually have access to Intensive Assistance which means that Job Network members have up to $10,000 to invest in each individual. In 1999, the Government introduced an additional $4000 wage subsidy for new, previously unemployed Aboriginal workers. As part of the Australians Working Together policy, Aboriginal people in Job Search Training or Intensive Assistance have access to an additional $800 training credit. Aboriginal people comprise six per cent of Australia’s unemployed and (after a slow start) now comprise eight per cent of Intensive Assistance commencements but only five per cent of Intensive Assistance outcomes. In addition, Indigenous Employment Centres are now being set up to help CDEP workers find mainstream jobs.

By contrast, in many remote areas, the challenge is to create an economy rather than place Aboriginal people into existing jobs. The Indigenous Employment Programme is designed for labour markets with a handful of employers where the Job Network can’t effectively operate on its own. By far its biggest component is the Structured Training and Employment Programme which provides tailored training packages worth up to $10,000 a year for remote-area businesses prepared to employ and mentor previously unemployed Aboriginal people. Other components of the programme are designed to help CDEP to become a transition to mainstream employment, provide expert professional and volunteer advice to Aboriginal business ventures, and develop Aboriginal managerial ability. More than 50 per cent of STEP participants are still working three months after STEP assistance finishes and, since 1996, the percentage of STEP participants in the private sector has increased from less than 50 to more than 80 per cent.


Still, very few residents have unsubsidised jobs while there is usually no shortage of think-big schemes for local business development. As well as the perennial question about the existence of a sustainable long-term market, Aboriginal entrepreneurs have to overcome two further hurdles: first, finding a dependable workforce (which is not easy in communities where few people have recent experience of sustained work); and second, obtaining capital (which is almost impossible in communities where hardly anyone has significant private property or accumulated assets).

Some communities have a "no work, no pay" policy for CDEP. This is an important step in developing a work culture but is dauntingly difficult to enforce against kinship obligations and the welfare system’s entitlement mindset. Even in the best-run Aboriginal communities, everything seems to revolve around "funding": the seemingly limitless but often capricious capacity of government to pay. "We’d like to do this, but can’t get the funding"; "we were doing that but then the funding ran out" is the standard response to self-help suggestions in communities that rely on government the way feudal villages depended on the lord of the manor.

Probably the most encouraging sign in years is the willingness of significant Aboriginal leaders to expect more of their own people at the same time as they ask more of government. Noel Pearson’s analysis of the impact of sit-down money on the people of Cape York and his critique of welfare-dependent communities and the polices that create them has been an object lesson in national leadership. Richie Ahmat (his successor at the Cape York Land Council) has courageously supported him and many other Aboriginal leaders are now thinking beyond pieties and truisms. At one level, the Pearson analysis confirms long-held scepticism about government programmes hence the challenge for government is to respond creatively to this new thinking rather than just say "I told you so".

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This is an edited version of a speech given to the Corporate Leaders for Indigenous Employment Conference on 25 September, 2002. Full text of the speech can be found here.

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About the Author

Tony Abbott is a former prime minister of Australia.

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