Central Land Council response to the ALRA amendments package

- 8 June 2006 -

This briefing paper is designed to highlight the major concerns that the Central Land Council has with the amendments that have been proposed to the Aboriginal Land Rights Act (NT) 1976 in the Aboriginal Land Rights (NT) Amendment Bill 2006 which was introduced into the House of Representatives on 31 May 2006.

The Aboriginal Land Rights (NT) Amendment Bill 2006 is the Australian government’s response to the nine year process of review of the Aboriginal Land Rights Act (NT) 1976 (termed the ALRA). The ALRA during that time was the subject of three separate review processes. In this context, the four Land Councils and the Northern Territory government, in August 2003, made a joint submission to the Australian government of a package of amendments designed to improve the workability of the Act. Thus, while this paper is designed to inform interested persons about the concerns that the CLC has with the amendments proposed it should be understood that elements of the Bill, and in particular the amendments to the Mining provisions (Part IV), are supported by the CLC and will greatly enhance the workability of the Act.

The major areas of concern to the CLC are as follows:

The amendment that allows for the delegation of decision-making powers from the Land Councils (section 28).
The amendment to allow for changes to the process of the creation of new Land Councils (section 21).
The amendment that allows for the leasing of communities on Aboriginal land to an NT entity for 99 years (section 19A).
The proposal to remove the statutory guarantee of funding for the four Land Councils out of the Aboriginal Benefits Account (section 64(1)).

Delegation of Land Council powers
The Land Councils, in the proposed package of amendments that they and the Northern Territory government put to the Australian government, asked for the capacity to delegate certain Land Council functions to regional committees of the Land Council. This would have allowed for certain functions to be performed at a regional level, rather than at Land Council meetings.

The Amendments Bill [section 61] amends section 28 of the Act to extend the capacity to delegate, to permit a Land Council to delegate certain core functions to a body incorporated under the Aboriginal Councils and Associations Act 1976 (‘an Association’) which applies to it pursuant to the new section 28A. This provision by itself does not raise a concern.

Section 62 of the Bill will insert the new section 28A into the Act. Section 28A provides that an Association, the majority of whose members are either traditional owners of part of an area for which a delegation is sought, or residents of that part, may apply to a Land Council to have certain powers delegated to it. A Land Council may refuse to delegate the requested functions or powers and must provide reasons for its decision. While there is clearly scope for increased disputation over issues of traditional ownership in connection with the ‘majority’ provision, and maintaining that ‘majority’ over time to ensure that membership does not become dominated by persons from outside of the relevant area, overall that particular aspect would not be objectionable were it not for the proposed new section 28B.

The CLC is very concerned at the radical departure from understood rules relating to delegation of powers contained in the proposed sections 28B and 28C. The two highly objectionable features of 28B are:

it provides that a delegation once made by a Land Council can not be varied or revoked except at either the request of the delegate or with the Minister’s approval; and
the Minister may (effectively) grant a variation or revocation by written direction to a Land Council.

Section 28C takes the matter even further and provides that the Minister may delegate the delegable powers, if a Land Council refuses to do so.

The Land Council’s functions and powers that can be delegated to another body include decisions with respect to mining on Aboriginal land and decisions about leasing on Aboriginal land (amendment 28(3)). These are core Land Council functions.

The amendment allows for the possibility the powers of the Land Council could be delegated to a body that could include non-Aboriginal people, provided that the majority of members are Aboriginal residents in the area. This is unacceptable in that it works to disenfranchise Traditional Landowners of the rights accorded to them through extensive Land Claims processes.

The 28B amendments permit the Commonwealth Minister to make the decisions to delegate even if the Land Council does not agree (amendment 28(C)). This means that the Minister can make a decision to delegate without the consent of Traditional Landowners in the region, or the Land Council.

Power to create new land councils
The Aboriginal Land Rights Act (NT) 1976 already allows for the creation of new land councils provided that a ‘substantial majority’ of Aboriginal adults living in the area agree to the creation of a new Land Council. The Land Councils, in the proposed package of amendments that they and the Northern Territory government put to the Australian government, asked the Government to amend this section to ensure that traditional landowners would have to consent to any proposed new Land Council, in line with the HORSCATSIA ‘Unlocking the Future’ Report recommendations.

The Australian Government did not agree to this proposal. The new amendments to the Act state that a single Aboriginal person who is a resident in the area can apply for the establishment of a new Council (amendment 21 A (a)). Other bodies that are also able to apply are a Council or Association or a company, the majority of whose members are Aboriginal (amendment 21 A (b-d)).

The Minister may approve a new Land Council if there is a majority of 55% of Aboriginal people entitled to vote are in favour of it (amendment 21 C (5)). A person is entitled to vote if they are an adult Aboriginal and they live in the area (amendment 21 C (3)). The Land Council position is that Traditional landowners have fought Land Claims to be accorded the rights they have under the Land Rights Act and so only Traditional Landowners should be involved in deciding whether to create a new Land Council. This amendment has the potential to be particularly problematic in townships and communities where are a large proportion of the Aboriginal population are not Traditional Landowners.

Whole of community leasing arrangements
The Central Land Council remains particularly concerned about the proposed new whole-of-community leasing arrangements (amendment to insert section 19 A). Under these new lease arrangements, a community [“township”] on Aboriginal Land could be leased by a Land Trust to a Northern Territory Government body [“NT entity”] for 99 years (19 A(4)). This would mean that:

A lease would be entered into with the Land Trust that would cover the whole of the community. This would be called a head lease. These head leases would be held by a Northern Territory entity which would be controlled by the Northern Territory Government (amendment 19 A(1)) .
In return for the lease the Entity would pay rent to the Land Trust fixed at 5% of the improved capital value of the land (as assessed by the NT valuer general) (amendment 19 A(6)).
Once a community is leased anyone who wants to apply for a house on the community, or run a business on the community, would need to apply for a sub-lease from the NT entity. The rent from these sub-leases would be retained by the NT entity.

The Central Land Council has a number of concerns with this new whole-of-community leasing arrangement. First, the reasons given for the Australian and NTG for putting in place the new leasing arrangements are that they claim that it is difficult to own a house or run a business on Aboriginal land. However, it is clear that these things can be done now using the Land Rights Act (see, for example the Alice-to-Darwin railway development) and that changing the leasing arrangement over communities, by itself, will not result in more businesses being started nor will it increase home ownership. Moreover, if the Australian government’s rationale is to be accepted and head leases do create sub-leases for businesses on Aboriginal land none of these benefits will flow to the Traditional Landowners on whose land the townships are situated, they will all go to the Northern Territory government.

The capacity to negotiate over head-lease arrangements is extremely abridged, when compared with the rights a headlessor would normally have under Australian law. Under the head-lease arrangements Traditional Landowners would have no say over the granting of sub-leases in townships. These decisions would be made instead by the NT entity. This means that Traditional Landowners would have no say about sub-leases that are granted for enterprises which are not wanted by a community such as alcohol outlets or gambling establishments.

Another problem with the new community leasing arrangements is that they are targeted at communities on Aboriginal land. Northern Territory has taken no action whatsoever to permit leases which would permit economic development of Aboriginal communities located on NT freehold land.

The Australian government has also said that community leasing agreements are voluntary agreements. However the CLC remains concerned that communities will be placed in a position where in order to access essential services or funding they will be told they need to sign up to these new arrangements. Moreover, the CLC is concerned that some communities may already have been given this ultimatum.

Other problems with the new leasing arrangement are:

In deciding to enter into a head-lease the whole community, traditional landowners may lose all their control over the decisions over the development of their community, for 99 years.

All money for putting this new arrangement in place on Aboriginal land will come out of the Aboriginal Benefit Account (ABA) which is unacceptable. It is unclear how much this would be but the Australia government estimates that it may cost $15 million over the next 5 years. This money will be needed to cover the costs of surveying land, valuations and any rental payments made to Traditional Landowners. By using money from the ABA Traditional Landowners are being asked to pay for renting their own land. The CLC is also concerned that the cost of surveying, valuation and rental may be far in excess of the estimates made by the Australian government, meaning that substantial ABA funds that could be used for economic development and land management projects on Aboriginal land will be diverted into the leasing scheme.

The benefits that accrue from leasing are restricted to a maximum rental payment of 5% of the improved value of the land as assessed by the NT Valuer-General. It is extraordinary that the Land Trust can not choose to forego rent in order to obtain broader benefits such as Aboriginal employment, housing schemes etc that are of greater value to Traditional landowners and the broader community [sub-section 19A(7)].

The CLC is also concerned about the independence of the NT Valuer General, given that the lease will be held by a NT entity. Regardless of assertions of the independence of the Valuer-General it seems that the Lessee will be doing its own valuation. At the very least there should be a clearly independent valuation, preferably the AVO. The amendment does not provide for review of valuation determinations, once made.

The composition of the NT entity is not addressed. It is important that this is clarified, as well as the issue of what the body would actually do.

At the moment Land Trusts own buildings and other fixtures that are on Aboriginal Land because government departments have often not applied for leases. This means that many of the buildings (or fixed assets) in communities belong to a Land Trust. If Traditional Landowners decide to lease communities to the Northern Territory Government body they will lose control of these assets and will need to be adequately compensated. It is arguable that a 5% rental cap will not provide adequate compensation for the economic value of these assets.

In response to these concerns the Central Land Council has approached the Northern Territory and Australian governments with our own alternative model of how arrangements over large scale housing developments, government infrastructure provision and commercial development can be facilitated in communities situated on Aboriginal land under current s19 provisions. This model has been largely ignored by both governments.

Funding of Land Councils
The amendments make significant changes to the Land Councils funding. In particular they remove the guaranteed 40% of the Aboriginal Benefits Account (ABA) which is set aside to fund the administration of all the four NT Land Councils (amendment 64(1)). The Central Land Council, while supportive of the move to performance based budgets, is concerned that the Minister has though it necessary to remove the guaranteed funding base from the Land Councils.

See the Corporations(Aboriginal and Torres Strait Islander) Bill 2005Note: under this Bill the minimum number of members is only 5, or less if the Registrar grants an exemption, [s.77-5]and the indigeneity requirement [29-5] is opaque because it is to be prescribed by regulations. This leaves open the potential for a corporation with a small membership being dominated by non-indigenous persons even though it may technically meet the 28A majority requirement. After the delegation has been made, there is no simple way to revoke it should it become apparent that the association no longer has either of the requisite majorities.

See previous footnote.

The HORSCATSIA Report, Unlocking the Future, Recommendation 7 states that a substantial majority should be defined as at least 60% of the Aboriginal people living in the area. Recommendation 7 also states that the appropriate traditional Aboriginal owners need to give their informed consent to the setting up of a new Land Council. Recommendation 8 sets out a detailed process that should be undertaken before the establishment of a new Land Council takes place.

By contrast, it is a long established principle in Australian law that the headlessor may withhold consent with respect to the issuing of sub-leases on certain grounds. See Halsbury’s Laws of Australia, Leases and Tenancies, paragraphs 245-1780 and 245-3685.