THE HOUSE THAT MAL BUILT

Originally published in the National Indigenous Times, March 2007.

NATIONAL: The federal government is stepping up its campaign to ‘reform’ government service delivery to Indigenous Australia. At the top of the chopping block is Indigenous housing in urban areas. But the Minister’s argument in favour of the plan is hardly compelling. CHRIS GRAHAM reports.

Mal Brough's house of cards.

Mal Brough’s house of cards.

Mal Brough has a well-earned reputation for his rather ‘creative’ approach to facts when dealing with the media on Indigenous affairs. Who could forget his claim in 2005 that $1 million in cash – the proceeds of the sale of drugs – had been found by police in one remote Aboriginal community.

”That… million dollars… could have fed kids, built houses, all sorts of things,” Brough told the John Laws breakfast radio program.

It certainly could have… if it had ever existed.

The $1 million in cash turned out to be about $200,000. And it was found in the Darwin home of a white man with no links whatsoever to Aboriginal people or communities.

Oops.

Then there was Brough’s claim, also last year, that a man who blew the whistle on alleged sexual violence in remote Aboriginal communities had to be given police protection after his identity was ‘almost revealed’ by NT police.

The ‘whistleblower’ turned out to be a senior official in Brough’s department who – with Brough’s full knowledge – had adopted a fake identity to appear on the ABC’s Lateline program to back Brough’s contentious claims about paedophile rings in Central Australia.

Brough has since abandoned those claims. And the ‘whistleblower’, Gregory Andrews, has never received any police protection.

Oops again.

Or what about the time (just six weeks ago) Mal Brough told media that Aboriginal mining royalties were being misused.

The problem for Brough, of course, is that mining royalties are private monies. You can no more argue the rightful owners of mining royalties are misusing them than you could have directed the late Kerry Packer not to gamble away tens of millions of dollars at the Star City Casino.

But that didn’t deter Mal Brough. He told ABC radio late in January: “Let me give you an example that was reported to me in the last fortnight. There was one particular gentleman being paid $250,000 in royalties [and] the whole lot was gone within a week, with a number of vehicles bought and the rest spent on gambling and other activities.”

NIT did what the ABC didn’t, and suggested to the Minister that a little more detail might not only help advance public debate, but prove whether or not his story was actually true.

The Minister declined.

But that’s his modus operandi – make baseless claims about faceless Aboriginal people, then stand back and watch the media circus.

But even by Brough’s standards, a story that appeared in The Australian newspaper late last month took to new heights unaccountable ministerial chicanery.

It contains an argument built, expuse the pun, on a house of cards.

A fortnight ago, on the John Laws breakfast program, Mal Brough outlined his plan to halt funding to Aboriginal housing organisations in major urban areas.

The reason, Brough said, was because the “overwhelming majority” were misusing taxpayer’s funds.

Brough told Laws that his plan would go to federal cabinet soon. It would enable money to be re-diverted from corrupt city groups to dirt poor communities in remote Australia.

It was, Brough argued, about addressing need, not providing city housing on the basis of the colour of skin.

His claims drew a rebuff from shadow Indigenous affairs minister, Jenny Macklin who said the federal government had had two-and-a-half years since the death of ATSIC to stamp out this “alleged corruption”.

Despite Brough’s history, no-one apparently thought to check whether the “overwhelming majority” of Indigenous housing companies were failing.

The debate sparked a story in The Australian on February 23, headlined ‘Brough defends housing move’.

It was written from a press release issued by Brough the previous day.

The Oz wrote:

“More than $100 million a year would be slashed from Aboriginal housing in urban areas under a Howard Government plan aimed at ending corruption by Indigenous land councils and forcing city Aborigines to join the mainstream housing market,” The Australian reported.

“Indigenous Affairs Minister Mal Brough said yesterday that 600 Indigenous housing bodies were mismanaging taxpayer money, but his proposal to divert the funds from major urban centres to remote communities would only affect a small proportion of urban Aborigines.

“The overwhelming majority of Indigenous Australians in cities live in state public housing, private rental properties or either own or are buying their own home,” he said.

Mr Brough said while Aborigines in cities had access to housing through a variety of sources, only 40 percent of the $240 million spent on new Indigenous housing and maintenance reached remote communities.

“This imbalance needs to be addressed if we are serious about tackling housing issues in remote communities,” Mr Brough said.

A fact check of Mr Brough’s claims would have revealed some alarming disparities between fiction and reality. So here they are.

Fact number 1: Most people would accept that some Indigenous housing bodies have mismanaged money, just as some white housing bodies have mismanaged money (state public housing corporations are notorious for it). Indeed, nepotism in small Indigenous housing companies is well known. But are 600 of the estimated 660 Indigenous housing bodies all misusing taxpayer money?

It’s a remarkable claim when you consider that many Indigenous community housing organisations (ICHOs) receive no government funding.

In the 2000-01 financial year, for example, 258 of the 616 register ICHOs received no grant funding.

But the claim is even more far-fetched when you look at other available evidence.

A study by the Australian Housing and Urban Research Institute released last year revealed that many ICHOs operated at a smaller deficit than state-managed Indigenous housing organisations.

The study, entitled ‘The cost of housing in diverse Indigenous communities in Australia’ noted that ICHOs were in some cases poorly managed and that housing stock was generally in a state of disrepair.

But it also noted that state-managed Indigenous housing groups lost about $2,415 per dwelling each year.

ICHOs in remote regions alone had a deficit of around $2,400 per dwelling per year.

Average figures on urban IHOs were not available, but they would undoubtedly be better than those for remote regions – the rents are higher in line with urban incomes.

The public housing sector is notoriously difficult. But pointing the finger just at Indigenous run housing companies is clearly ridiculous in the face of the real facts.

Fact number 2: According to the National Aboriginal and Torres Strait Islander Social Survey reports, there were 165,700 Indigenous households in Australia in 2002.

Just 29,200 – or less than 18 percent – were situated in remote areas.

That means that more than 82 percent of the nation’s Indigenous households (136,500) were in regional or urban centres. Despite this – and contrary to Brough’s claims – the overwhelming majority of expenditure on housing is in remote areas.

The $240 million funding pool Brough is referring to comes from the Community Housing and Infrastructure Program (CHIP). Annual CHIP funding for 2006-07 was almost $300 million, not $240 million.

Under ATSIC’s control, the overwhelming majority of CHIP funding was directed to remote regions – between 85 to 90 percent. If the federal government has since changed the formula, that’s hardly the fault of small Indigenous housing companies.

NIT wrote to the Minister earlier this week and asked him to qualify his claims with facts and figures.

The Minister refused.

The federal government has been trying since at least the late 1990s to mainstream ‘urban blackfellas’ and concentrate bureaucratic efforts on remote regions.

The reason is simple.

The Liberals know that throwing more money at Indigenous affairs is not going to help it win an election. Rather it would help them lose one.

It may be politically cynical – and morally bankrupt – but it’s a political necessity.

Labor is hardly lining up to demand adequate resourcing in Indigenous Australia either.

So the trick is to appear to be trying to overcome Aboriginal disadvantage, while not actually spending any more money.

It’s something at which this government – and many before it – have proved very adept.

In 1997-98, federal treasurer Peter Costello allocated 1.41 percent of the total federal budget to Indigenous affairs.

He has delivered almost the same percentage ever since, with the current federal budget delivering just 1.5 percent.

That’s despite report after report after report showing substantial government underspending in Indigenous affairs.

In 1999, ATSIC commissioned a study into unmet need in Indigenous housing.

The result of the study dropped jaws all over the nation.

It identified a national shortfall in Indigenous housing worth about $2.3 billion in capital works – that is, $2.3 billion was needed for purchasing and construction of homes and related infrastructure.

In addition to this, an unpublished ATSIC study around the same time estimated that annual shortfalls in recurrent housing funding (ie. money to maintain the existing stock of houses) was about $60 million.

That $60 million figure was based on the existing shortfall in housing.

Had the $2.3 billion shortfall been met, the $60 million figure would probably increase 10 fold.

And bear in mind, the figures are from 1999. It’s anyone guess what the shortfalls would be worth today.

And the reports haven’t just come from left-leaning bureaucracies and lobby groups.

The Commonwealth Grants Commission (CGC) – a commonwealth agency established by John Howard to ensure the equitable distribution of government funding – has been one of the government’s biggest critics.

In 2001, the CGC was asked by the government to investigate Indigenous spending.

Then Minister for Indigenous Affairs, John Herron wanted the CGC to conduct the study based on “relative need” rather than “absolute need” – in other words, we know the blackfellas in the city are buggered, but the blackfellas in the bush are ‘more buggered’ and we’re not prepared to spend the sort of money needed to fix both.

The CGC was forced to acquiesce to Herron’s request, but only because the government set the terms of reference of the inquiry.

But it didn’t entirely come to heel.

Professor Jon Altman from the Centre for Aboriginal Economic Policy Research remembers the time well.

“The debate was about whether or not the Indigenous specific pie was being equitably distributed between remote and metropolitan areas,” Prof Altman recalls.

“The government wanted [the CGC] to say it should be spent more in remote areas. What the CGC came back and said is the pie is not big enough.

“The CGC said ‘What we say is that there is underspending. We’re not going to say how that underspending should be allocated.’”

The CGC report was quite the rebuff. Herron’s attempt to find a magical needs-based funding formula exposed his (and the government’s) naivety on Indigenous issues.

The CGC also said that funding had to be considered on a case-by-case basis. The government has been doing precisely the opposite ever since because while it may have lost the battle, the war was far from over.

In early 2004, new Indigenous minister Amanda Vanstone decided to have a crack, by announcing a review into the distribution of housing funding between remote and urban areas.

Vanstone invited submissions from state and territory governments, and from ATSIC, which was yet to be abolished.
Unfortunately for the government, the figures provided by state and territory officials showed the vast majority of Indigenous housing expenditure was already directed to remote areas.

Vanstone was forced to capitulate. Despite calling the review, Vanstone made no changes to the funding distribution, but instead boosted funding marginally into Western Australia and the Northern Territory.

A few months later, the federal government won not only an election, but control of the federal Senate.

And everything changed.

With unfettered power, the government launched its ‘mainstreaming agenda’.

The black bureaucracy was the first to go – ATSIC was abolished.

A compliant National Indigenous Council was appointed. The black work-for-the-dole program – CDEP – was axed.

Reforms to Aboriginal land rights in the Northern Territory were rammed through, despite widespread opposition from stakeholders.

At the same time, the federal government actually began cutting the percentage of the national budget allocated to Indigenous affairs.

In 2003-04, prior to the abolition of ATSIC, Costello directed a record 1.57 percent of national spending to Indigenous-specific programs.

In 2004-05 that was slashed to 1.49 percent.

Meanwhile, Australians were delivered combined budget surpluses of $45 billion from 2002 to 2006, not to mention several tax cuts. And in the face of the underfunding, in 2005-06 the Department of Science, Education and Training oversaw a $181 million underspend of its Indigenous budget.

A greater example of Nero fiddling while Rome burns is hard to imagine.

But there were still more cuts to make and money to save or redivert.

In May last year, current Indigenous affairs minister Mal Brough announced yet another review into how CHIP funds would be distributed.

This time, there would be nothing to stand in the way. Except, of course, the facts.

Through a discussion paper, Brough invited submissions from stakeholders and the public, but made clear the government’s intention.

“CHIP should be targeted to areas of greatest need, especially those without ready access to the private housing market and public housing,” Brough wrote. In other words, CHIP should be targeted to regional areas.

Brough commissioned PricewaterhouseCoopers to look closely into the distribution of CHIP funding. The report was delivered in November last year, but government sources have told NIT that it essentially came to the same conclusion as all the reports before it.

NIT understands that officials within FaCSIA have been re-writing the report for the past few months.

While Brough told the John Laws breakfast program last month he was “about to release” the report, NIT understands it’s likely to be delayed a few more months.

Whether or not it ever actually makes it into the public domain remains to be seen – you’d hope it would, given Australian taxpayers reportedly paid $750,000 for it.

There’s less confidence among those working in the Indigenous housing sector that the latest Community Housing Indigenous Needs Survey (CHINS) – a crucial document based on the 2006 Census – will ever make its way into a public forum.

The figures aren’t yet available, but there’s growing suspicion the federal government will take the unprecedented step of suppressing the CHINS data.

ATSIC commissioned the first CHINS study in 1999 and then again two years later. The report in 2001 showed impressive gains from 1999.

It was a fact not lost on the CGC, which reported that the National Aboriginal Health Strategy (NAHS) – a smaller component of the CHIP program – was the best needs-based government program in the entire Commonwealth. Quite a coup for ATSIC, a fact also not lost on Wayne Gibbons, the then incoming CEO of ATSIC.

In the 2001-02 Annual Report, Gibbons noted: “There is no doubt ATSIC programs are generally well administered and some are very well administered. The CHIP program for example has pioneered the cooperative needs-based approaches that are now regarded as the way forward in Indigenous affairs.”

Wayne Gibbons is the bureaucrat who just two years later began pulling apart ATSIC on behalf of the federal government. Maybe he just changed his mind?

As with so many things Brough, there is one more twist. In the foreword of the CHIP Review – the precursor to the report Brough will rely on to mount a case for moving housing money from the city to the bush – Brough notes: “CHIP and its predecessor programs have over many years funded Indigenous Community Housing Organisations. These organisations provide housing for a relatively small proportion of Indigenous households overall, but a much higher proportion in remote parts of Australia.”

Even worse, Brough notes in his media: “Only a small proportion of Indigenous Australians rely on Indigenous-specific housing in urban areas. The overwhelming majority of Indigenous Australians in cities live in state public housing, private rental properties or either own or are buying their own home.”

Well if so few people actually use the service, how much benefit will be derived from shutting it down and moving the money out to remote communities?

And if we’re already spending most of the money in the bush, why the misinformation, and why all the fuss?

Geoff Scott, an Adjunct Professor with the University of Technology, Sydney believes he knows the answer.

“With an election looming, doing something positive in Aboriginal affairs doesn’t gain you a vote,” Prof Scott says.

“They have to be seen to be tough on Aboriginal people.

“It’s a sad but true symptom of this government and it’s abrogation of responsibility.”

Prof Scott is the CEO of the NSW Aboriginal Land Council (NSWALC) and a board member of the state-owned NSW Aboriginal Housing Office, so he’s well placed to comment.

What many may realise is that Brough’s plan is not just to defund Indigenous-controlled housing organisations in urban areas, but to also provide no federal funding for state-owned Indigenous housing organisations.

Prof Scott says the plan is hopelessly flawed.

“There’s about 2,800 [Indigenous] houses in the land council system and another 2,000 at least in non land council community housing.

“We don’t know what’s going to happen to them.

“It will probably result in a massive degradation of the housing stock and lower the standard of living for a sector of the community that is already subject to low standards.

“A substantial asset base exists in those Indigenous communities and their long term viability is now under serious threat.”

Prof Scott said Brough’s plan will increase pressure on mainstream urban housing programs and ultimately, will exacerbate the Indigenous housing crisis.

“Mainstream social housing programs are already under enormous strain.

“I suspect these ‘initiatives’ are going to make matters worse. And in that context the silence of the [state governments] is deafening.

“Social housing is not something that is going to provide economic independence.

“It’s part of government’s responsibility to provide adequate shelter and accommodation for people in need. That’s not to say the needs in the north aren’t great, but it needs additional effort, not a redirection of effort. But you don’t fix a problem by making it worse in another area.”

Prof Scott said there was a need for mature discussion about Indigenous housing and NSWALC was more than ready to contribute.

“We’d be urging people to get behind us and try and get some rational, logical debate about these issues.”

You can’t help but get the feeling that with Mal Brough calling the shots in Canberra, that’s going to be no simple feat.

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