Aboriginal Employment and the CDEP

Among Kevin Rudd’s numerous promises during his February 13 “Apology” was one concerning Aboriginal and Torres Strait Islander (ATSI) employment. “Within a decade”, he said, the government undertook “to halve the widening gap in literacy, numeracy and employment outcomes”. It is appropriate that his employment undertaking was given in the same sentence as his literacy and numeracy ones; as suggested below, without major progress on these latter there will be no hope of accomplishing the former.

In a Quadrant article, “Time to Stop the Dreaming” (April 2008), I canvassed some definitional and statistical questions that bedevil discussion of matters concerning Australia’s ATSIs (and also explained my refusal to use the term “Indigenous”). Without repeating those points, note merely that:

• Because of the “self-identification” phenomenon in censuses since at least 1996, the ATSI population as enumerated today consists of people of widely different ethnic backgrounds and educational and employment attainments.

• The Prime Minister’s promise seems to relate to this admixture of “real” ATSIs and “pseudo” ones—by whom I mean those people of widely mixed genetic origin, having little (or in many cases no) connection with their distant Aboriginal forebears, who have chosen to claim Aboriginality for essentially other, including pecuniary, purposes. His promised scorecard will therefore mean little as a measure of success or failure in addressing “real” Aboriginal problems.

Aboriginal unemployment is not new. In researching this article, and a Bennelong Society paper on which it is partly based, I noted numerous earlier references, for example, to the adverse effects of Australia’s then rigidly centralised wage system on Aborigines (among others). Today, thanks to the Keating and Howard governments, Australia’s wage determination system is much less rigidly centralised. Nevertheless, if Aboriginal unemployment was a problem twenty years ago, it remains an even greater problem today among the “real” Aboriginal population.

This article considers our experience with one Commonwealth government scheme—the Community Development Employment Projects (CDEP) program—which, over the past thirty years, has ostensibly addressed that problem.

First, however, a personal note is in order. I have never visited an Aboriginal community with a CDEP program, so that what follows is based on the research of others rather than face-to-face experience. For this I can only give thanks. The late Ernie (later Sir Ernest) Coates, who was Under Treasurer for Victoria when, as a young Commonwealth Treasury officer, I first met him in 1956, used to say that he made a point of never visiting Victoria’s irrigation settlements. Everyone who did so, he said, seemed to lose all capacity for objective judgment about their true costs and general economic inefficiency. To be charitable, perhaps a similar problem has afflicted the many anthropologists and other academic Aboriginal industry dwellers who have made careers out of making excuses for the CDEP program.

The History of the CDEP

Of all the good intentions with which, it is said, the road to Hell is paved, the CDEP program must rank among the highest. After thirty years, it is fair to describe it as a failure by any other name. Introduced by the then Department of Aboriginal Affairs in 1977, it was originally confined to remote Northern Territory communities where, it was (correctly) argued, there were few or no real job opportunities. Rather than paying unemployment benefits—or “sit down money”, as their recipients soon accurately termed them—to Aborigines in these communities, some would be offered “jobs” to perform “town management” activities (servicing such public facilities as existed, collecting garbage and so on). Such people thereby became officially classified as “employed”.

The scheme began at one remote Northern Territory location. However, as the Aboriginal industry (bureaucrats, service providers, non-Aboriginal hangers-on and assorted Aboriginal “leaders”) became better established and more inventive, it expanded. From initially funding activities bearing some relationship to real jobs, it morphed into funding more diverse and less real-job-like activities. From at least purporting to provide on-the-job training that might equip recipients to find real jobs in the wider labour market, it began financing a wide variety of other bewilderingly diverse activities, mostly bearing little or no relationship to future employability. These included so-called cultural activities, such as attendance at boozy funerals—often for a week or more—and domestic housework that one might expect to be undertaken normally.

To state the obvious, such a scheme has to be administered. Participants in it need to be selected, and then monitored to ensure they are actually carrying out their duties. Appropriate payment arrangements must be made. Are these responsibilities to be entrusted to “locals”, or to non-Aboriginal administrators from outside? It is worth dwelling on this for a moment, because of its importance for the program’s evolution over the years, and for any attempt now to revive it.

Superficially, administration by “locals” seems attractive. With some training in elementary book-keeping (and time-keeping), supervising CDEP participants—once chosen—should be simple enough. In practice, in a large majority of cases the supervisor seems to have become a source of local patronage. This was doubly likely where, on cultural grounds, he (and it has almost always been a man) was already a community “Big Man”. This man could now dispense favours. However CDEP participants were selected initially (and he may also have had a hand in that), he could now recommend that X or Y also be included. He would then need to devise tasks for them to perform for their CDEP payments, which in turn would lead to pressure (as noted earlier) to expand the eligible “employment” activities.

Patronage possibilities are not confined to participant selection. Once “employed”, a participant may, or may not, faithfully perform his (or less frequently, her) duties. If he chooses not to do so, he may still be paid if the administrator turns a blind eye.

However, patronage is rarely a one-way transaction. While much of what occurs results from “skin” relationships, they also are not free of coercive aspects. On pay-day, a CDEP participant may be expected to proffer suitable tokens of gratitude to his benefactor, whether in cash or, more often, other forms such as grog. Worse still are those forms of requital that involve either the bestowal of sexual services more or less voluntarily, or the taking of them, involuntarily but without fear of effective protest. In short, when “locals” became CDEP administrators, we had all the ingredients for corrupt practices, ranging from mere monetary peculation (serious enough though that is) to the worst forms of sexual predation.

The alternative is to appoint non-Aboriginal administrators from elsewhere. This might seem an appropriate option where no suitably qualified “local” could be found. Yet, as with so much else in Aboriginal affairs, appearances are one thing, realities are another.

The problem lies in the kind of non-Aborigines offering for these jobs. Bear in mind that such appointments originally involved residing in remote localities, often in extremely unhygienic surroundings, where personal security could become a concern, perhaps even cut off (before mobile phones) from outside telephone contact. People prepared to endure such conditions seem to have fallen into three categories:

• A small number of truly dedicated non-Aboriginal persons having a genuine vocation for improving the dreadful lot of Aborigines in these communities, and prepared to make the personal sacrifices involved.

• Non-Aboriginal hangers-on forming part of the growing Aboriginal industry, glad to be paid for these administrative responsibilities, but whose conscientiousness in discharging them was, in many cases, questionable.

• A third element of non-Aboriginal persons, much smaller but also much more dangerous, seeking legitimate “cover” for residing in these communities for reasons that would not bear closer scrutiny—ranging from power-seeking at best through paedophilia at worst, with all the unlovely gradations in between.

Of these, we may set aside the first. Persons in the third category have some characteristics in common with “Big Man” locals. Deploying corrupt practices of the kind noted earlier, they could exact in return those favours, the search for which had brought them into these jobs. The second, most numerous category of persons was most likely to see the jobs as simply collaborating with local power-brokers and enjoying the vicarious prestige and other remuneration derived from doing so.

By the time of the Hawke government, “CDEP organisations” numbered eighteen, with roughly 1300 participants and annual expenditure of $7.4 million, all in remote settlements. However, with an Aboriginal industry growing in both numbers and privileged access to decision-making, things were about to change. In 1986 the scheme was expanded to ATSI communities in regional and urban areas. Virtually overnight, CDEP organisations almost doubled in number, and participants “employed” by them grew by leaps and bounds—as did the expenditure involved. By 1987–88—by which time Gerry Hand had become Minister for Aboriginal Affairs (1987–90)—CDEP organisations had risen five-fold to ninety-two. Participant numbers had grown almost six-fold, to around 7600, while expenditure had jumped to $65.5 million.

Meanwhile the activities undertaken by participants had also been expanding. Their growing numbers quickly outstripped the capacity of “town management” activities to provide even a semblance of employment, despite limitation of the “jobs” involved to (usually) fifteen to sixteen hours per week. Soon CDEP participants were purporting to provide many services generally associated with local government (maintenance of water and sewerage services, road maintenance—and sometimes road construction—and so on).

By 1989 relations between the minister and his departmental head (the late Charlie Perkins) had become, to use a kindly word, fraught. More generally, Gerry Hand had become, to use another kindly word, disenchanted with having to answer questions in parliament about this or that corrupt practice, or this or that aspect of social dysfunction, in the Aboriginal institutions within his portfolio. Thus emerged the concept of the Aboriginal and Torres Strait Islander Commission (ATSIC), to which he proposed to devolve these responsibilities. I was then in the Senate, where the Opposition waged a lengthy battle to block the ATSIC legislation, or at least improve it. Some improvements were made, but after many months the Australian Democrats performed their usual feat of rolling over while Labor tickled their tummies. In 1990 ATSIC came into being.

Pressures from ATSIC commissioners bent on expanding their patronage potential soon led to further expansion in both numbers and forms of eligible CDEP activity. In particular, so-called “cultural maintenance” activities became more prominent. Apart from the extensive (and extended!) attendance at funerals mentioned earlier, these included “maintenance” of Aboriginal languages and widespread engagement in Aboriginal arts and crafts. In 1994–95, after responsibility for CDEP had been formally transferred to ATSIC Regional Councils—which, with few exceptions, were even more corrupt than ATSIC itself—some 252 CDEP organisations covered roughly 27,000 participants and spent $278 million.

This is not the place to catalogue ATSIC’s failures. Suffice to say that, while the CDEP program had already gone steadily downhill beforehand, its transfer to ATSIC Regional Councils marked the end of any coherent policy. While CDEP organisation numbers broadly stabilised (around 270) after the Howard government’s election in 1996, participant numbers continued to grow. By 2003–04 they had reached roughly 35,000, with expenditure of around $500 million. Some 5000 “artists” in the Northern Territory alone were being supported by Australia’s working families (to employ a term now much in vogue).

Enough, one might have thought, was enough. From July 2004, ATSIC was abolished—on the initiative, it should be noted, of the Labor Party, then led by Mark Latham. Responsibility for administering the CDEP program was bestowed on the Department of Employment and Workplace Relations; policy, however, rested with the Office of Indigenous Policy Coordination within Senator Amanda Vanstone’s portfolio. In January 2006, that Office was removed from the ineffable Vanstone and transferred to the Family and Community Services portfolio under Mal Brough. At last, decisions began to be taken—most importantly, to terminate all CDEP programs in urban and major regional areas from July 1, 2007.

The Results

Surveying these thirty years of failure, some conclusions stand out:

• Almost from the outset, and clearly since the 1986 decision to extend it to urban and regional areas, the CDEP program lost its way.

• Increasingly, it fell into the hands of the Aboriginal industry (including that significant part of it located within the Canberra bureaucracy), and the “self-determination” or “cultural autonomy” crowd in particular. Assorted hangers-on, such as the Centre for Aboriginal Economic Policy Research (CAEPR), also located in Canberra in the Australian National University, pursued these latter objectives while dining well from the associated gravy train.

• Some jurisdictions, particularly the Northern Territory and local governments, came to see the scheme as a means of cost-shifting (from themselves to the Commonwealth) in the provision of local government services, education services, health services and so on.

In its early years it was possible to portray the scheme as an extremely naive but well-intentioned program to provide “real” Aborigines, living in communities where no or few job opportunities were available, with training and skills to equip them to leave these anthropological museums and find real jobs in the wider labour market. Thirty years on, it had become just another in the plethora of programs providing incomes for members—both Aboriginal and non-Aboriginal—of the Aboriginal industry by treating Aboriginal Australians as inferior beings incapable of existing in the modern world.

As to the program’s ineffectiveness, the evidence is overwhelming. Even such ideologically committed bodies as the CAEPR now clearly struggle to find rationalisations to continue justifying it. (See, for instance, a March 2008 paper in its Seminar Series, “A Half-Hearted Defence of the CDEP Scheme”.) A few facts may help:

• In 1997 the Office of Evaluation and Audit (then part of ATSIC) found that, of 430 CDEP participants whom it interviewed (six to 30 months after leaving CDEP), only 28 per cent had jobs, and half of these were employer-subsidised. Of the 72 per cent not working, two-thirds were unemployed, and the rest had dropped out of the labour force. This was despite the fact that the report “focused mainly on urban-based CDEPs”, where job opportunities would have been greatest. The OEA also concluded that “62 per cent of CDEPs paid a CDEP wage to ‘participants’ who stay at home” performing home duties and mowing their own lawns.

• In 2001, Dr Peter Shergold, then Secretary of the Department of Employment, Workplace Relations and Small Business, and who had earlier served as Chief Executive Officer of ATSIC (1991–94), said flatly that the program “had been an abysmal failure” in reducing Aboriginal welfare dependency and “progressing [CDEP participants] to mainstream employment”. Moreover, “very few of those Indigenous people who are employed are at work in the private sector. The great majority are on CDEP, or have jobs in Commonwealth, State or Territory public services, or have jobs in local government or are working for community controlled Indigenous organisations which are largely publicly funded. Private sector employment remains the great challenge.” I shall return to that observation below.

• In 2006 Cathy Duncan, a director of the highly successful Aboriginal Employment Strategy originating in Moree and herself an Aboriginal woman, strongly criticised the scheme, saying that “CDEP is not an employment option”, that it has “entrenched the idea of welfare”, and that it “makes the transition … to full-time employment more of a challenge to Aboriginal people”.

• According to the Australian Bureau of Statistics, only 34 per cent of the total ATSI population aged fifteen to sixty-four was in (non-CDEP) employment at the 2006 Census, compared with 67 per cent of the non-ATSI population. However, Sara Hudson, of the Centre for Independent Studies (to whose work, incidentally, I am indebted for some of the earlier historical section of this article), puts the corresponding figure for ATSIs residing outside the mainstream at only 17 per cent.

• In her book Lands of Shame (2007), Professor Helen Hughes said that the CDEP scheme has made it “difficult for men and women to contemplate mainstream work standards when they know they will receive ‘sit-down’ CDEP money for doing very little or nothing at all”.

• More recently, such prominent Aboriginal leaders as Warren Mundine, Noel Pearson and “Tracker” Tilmouth have all condemned the scheme as conducing to welfare dependency rather than to escaping from it.

In sum, not only has the CDEP scheme failed in almost every respect, but it has also become a positive obstacle to ATSIs acquiring mainstream jobs, and the independence and personal self-respect that go with them.

The Macklin “Strategy”

In her April 30, 2008, media release the Minister for Families, Housing, Community Services and Indigenous Affairs, Jenny Macklin said:

• The government “will shortly begin consultations on Indigenous employment services reforms”, including “substantial reform of the Community Development Employment Program”.

• Meanwhile, “up to a further 12 months of funding will be available from 1 July 2008” for all current CDEP providers.

• The government’s new measures are “to be in place by 1 July 2009”.

• “The government will, as an interim measure, introduce [she means ‘re-introduce’] CDEP from 1 July, 2008, in the 30 prescribed Northern Territory communities where CDEP was abolished” by her predecessor.

• “The government is strongly committed to reforming CDEP and will be taking an evidence-based approach” to producing a new system “that requires people to take up job opportunities available in their local area”.

That “evidence-based approach” notwithstanding, the minister’s statement suggests that she has already made up her mind on several issues. Noting “the previous government’s rushed decision to abolish CDEP in the Northern Territory”, she said that its “system of transitional payments … until 30 June, 2008 is not working”. While making appropriate bows towards “stopping further decline into passive welfare”, and requiring CDEP recipients “to work to receive their pay”, the words between the lines have about them the familiar whiff of the Aboriginal industry bureaucracy and the academic “cultural autonomy” crowd by whom Labor’s Left has long been swayed.

The minister’s statement, plus her accompanying Discussion Paper, Increasing Indigenous Economic Opportunity, suggest yet another move forward to the past. While requiring ATSIs “to take up job opportunities available in their local area”, the statement is silent on what is to be done where no or few such job opportunities exist. Similarly, the Discussion Paper speaks of addressing “the foundations of sustainable economic development across Australia” (my italics). Yet it gives no indication as to how such a dream is to be fulfilled where Aboriginal unemployment is most desperate, or what is to be done when it is seen to be nothing more than the same old nightmare.

I hope I am wrong, but the “evidence-based” assessment to date suggests that the minister is preparing the ground for lapsing back into the failed policies of the past. Any new arrangements will doubtless have snappy titles devised by the hollowmen from Hawker Britton, with new logos, attractive video clips and all the other razzmatazz with which we are now familiar. However, at the time of writing there are few signs of effective measures. So, what really needs to be done?

What is Really Needed?

This boils down to two questions. What is the problem to be addressed? And once defined, how would you design a scheme to address it, over time, effectively?

Defining the Problem. The essence is clear:

• As Noel Pearson and others have correctly pointed out, continuing welfare dependency is poison (his word), and the first essential for remedying it—the sine qua non—is employment.

• Moreover, the jobs must be real ones—not subsidised jobs (welfare by another name), not government jobs (welfare, mostly, by yet another name), not charity-provided jobs (welfare again), but jobs where a profit-seeking employer wants you to work and will pay you according to your output. To quote Dr Shergold again, “private sector employment remains the great challenge”.

• According to the Commonwealth Statistician, in 2007 some 89,000 ATSIs aged fifteen and over were living in remote areas. However, as Helen Hughes pointed out in a recent Bennelong Society paper, Location and Jobs—The Real Story, the Statistician classifies as “remote” substantial towns such as Mount Isa, Broome and Alice Springs. While Aborigines residing in, or in the vicinity of, these towns are classified as living in “remote” localities, their access to job opportunities is very different from those living in truly remote locations, whose numbers Professor Hughes puts at less than 30,000.

• While a large proportion of ATSIs residing in regional or urban areas has already been absorbed into the wider community mainstream, a significant element of this component also has yet to make that transition.

If we leave aside those identifying as ATSIs who are already living and working in mainstream Australia, it therefore follows that providing jobs for those outside the mainstream is a tripartite problem involving:

(1) Those living in genuinely remote areas, who with very few exceptions have few real job opportunities, and virtually no non-subsidised private sector ones.

(2) Those living in, or in the vicinity of, places which, although statistically “remote”, are actually thriving centres with significant job opportunities.

(3) Those others who, although located in urban and regional areas, have not (for whatever reason) yet entered the mainstream.

So far as category (1) is concerned, unless real jobs can be created in these areas—and I don’t mean the trumped-up “economic development” schemes for which the Aboriginal industry has been notorious ever since “Nugget” Coombs’s turtle farms—the people in them will have to move out. If some don’t wish to move (despite inducements), they could not be forced to do so. In the end, the choice must be theirs. But—and this is the key point—notice must be served that, over time, all government aid to maintain these remote settlements will cease, and a timetable for that run-down must be promulgated. While those concerned must have a choice, they can’t have it both ways.

Those in categories (2) and (3) have already moved. In their cases the question is, why are their employment records so abysmal? There seem to be three reasons:

• To a greater or lesser degree, they do not possess the educational or other skills needed for the jobs available.

• Even those with some genuine qualifications are insufficiently qualified to be worth employing if they have to be paid at rates legally required by our wage determination regulators.

• Even those who could undertake jobs at legally required wage rates are seriously discouraged from doing so by their existing ready access to welfare benefits (a particular problem with CDEP participants, whose “wages”, unlike welfare payments, cannot legally be sequestered to prevent misspending).

Addressing the Problem. Most of those we are talking about lack the numeracy, literacy, even in many cases the English-speaking capacity to function in the mainstream labour market. Before they can become job-ready, therefore, they will need to go back (or go) to school, for years in many cases.

Even if this major hurdle can be overcome, the marginal product of many of these people will, at least initially, be rather low. While the situation will vary from case to case, it will therefore be essential to exempt ATSIs (for example, by special legislation under the Constitution’s “race power”—s.51(xxvi)) from the barrier to employment that our workplace relations system now constitutes. If the government and trade unions and welfare agencies are to insist on payment of award wages for such people, very few real jobs will be offered them. If any solution to Aboriginal unemployment is to be found, this Rubicon must be crossed.

The foregoing also implies that pursuit of the “cultural autonomy” mirage must be abandoned. It will be hard enough for these people to move into mainstream jobs, without having their progress blocked by anthropologists and other ideologues still bent on fighting that particular “culture war”.

The way in which welfare benefits discourage people from looking for jobs is a problem not confined to ATSIs. The Howard government made some tentative moves to address it over the years, most recently in the design of its tax cuts for lower-income taxpayers—including those announced in its 2007 election policies and since adopted by the Rudd government. While removing Australians generally from the welfare teat goes far beyond the scope of this article, removing ATSIs from the fiction of CDEP “wages” would be a step in the right direction.

Two organisational changes would assist. First, dealing with Aboriginal unemployment needs the full-time attention of a senior minister, who needs to be sufficiently hard-headed and public-spirited to be willing to appear hard-hearted. The job will require tough decisions, including measures providing rich fields for the critics. Frankly, I doubt whether the present minister fills this bill, or that she would do so even if relieved of her other major responsibilities.

Second, a major clean-out of the present Aboriginal bureaucracy is essential. Its increasingly numerous denizens have grown fat over the years. I in no way absolve successive ministers from their ultimate responsibility. Nevertheless, the problem now to be confronted is, in large part, also of these bureaucrats’ creation. If the task of remedying it is to be left to them (even under a strong, full-time minister) it will be undertaken half-heartedly at best. Change of this kind cannot be made overnight, and it must start at the top, with a new department and a new, top-flight Secretary. He or she must have power to offer salaries well above those presently obtaining, to attract people from the private sector as well as from more respected departments, and with a remit to change (say) 90 per cent of the existing faces within (say) three years.

It follows from everything that has been said that the CDEP program should be abandoned. So far from “reforming” it, it should be terminated without further delay—thereby, incidentally, removing the many opportunities for corruption it presently provides.

Since people cannot get real jobs unless they can speak and comprehend English (up to a reasonable standard), read and write (up to a reasonable standard), perform at least simple numerical tasks, and perhaps make some use of a computer, resources need to be concentrated on basic educational training.

Teaching resources need to be both strongly expanded and focused on elementary remedial instruction. It would be appropriate to establish specific-purpose centres for such instruction in major regional towns such as Alice Springs, Katherine, Mount Isa and Moree. Such centres should be strictly focused on these remedial tasks. They should not be allowed to be diverted into so-called “cultural” instruction, all teaching should be in English, and any resulting “certificates” or other paper accreditations must be trustworthy by employers. Most of those now handed out in the ATSI “educational” system are not worth the paper they are written on.

Such a program would take different times to produce results for different individuals. Some entering it could attain appropriate levels of proficiency within twelve months. For many, it might take three years, or in some cases even longer. But just as there was supposed to be a “no work, no pay” rule under the CDEP program (honoured more in the breach than the observance), so there must be a “no study, no pay” rule—and a strictly enforced one—under the program proposed.

Conclusion. As a result of thirty years of wrong-headed policies flowing out of Canberra, Aboriginal unemployment (and everything going with it) is now a serious blot on Australia’s name. The CDEP scheme has been a powerful force locking its participants into partaking of welfare dependency poison. It should be abandoned. Effective measures to deal with our current situation are now required, and that (rather than CDEP’s retention) is where debate should now be focused.

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