The Denial of Private Property Rights to Aborigines

In 1788, European settlers started taking land from Aborigines. By the 1960s, governments, leaseholders and private owners had taken control and ownership of all of Australia. Even Aborigines and Torres Strait Islanders still living on indigenous reserves did not control their land.

Over the last fifty years, however, ownership and control of about 20 per cent of Australia has been returned to indigenous people. These land returns might have been expected to deliver prosperous communities rich in indigenous culture. Instead, as a direct result of government policy, the 75,000 Aborigines and Torres Strait Islanders (15 per cent of a total 545,000 indigenous Australians) living on traditional lands remain poverty stricken and dysfunctional. Governments returned land but withheld the individual property rights, democratic voting rights and civil society rules that make the rest of Australia one of the world’s most liveable countries.

It is understandable that governments do not highlight their failure to deliver equal rights on indigenous land. It is surprising, however, that the many organisations which claim to support Aborigines and Torres Strait Islanders go along with withholding fundamental rights without protest. It is as though they still do not believe that indigenous people should really own land. 

“With the wisdom of hindsight, I might not have made the same recommendations” — Justice Woodward, 2008[1] 

With the Yirrkala bark petition (1963) and the Wave Hill walk-off (1966), indigenous land rights emerged as a major issue. South Australia created the Aboriginal Lands Trust in 1966. A decade later, after the Woodward Royal Commission, the Commonwealth returned large areas of the Northern Territory to indigenous ownership under the Aboriginal Land Rights Act (NT). Over the next twenty years lands were returned to indigenous owners under land rights legislation in all states and territories.

A second process for returning lands to indigenous owners started twenty years ago when the High Court overturned the 1971 Northern Territory Supreme Court ruling that Native Title—if it had existed at all—no longer existed. The 1996 Wik decision further extended Native Title. In December 2011, the Gunggandji people of Yarrabah in Queensland were recognised as Native Title holders—the 176th such determination.

Buying land on the open market became the third major process for returning land to indigenous owners. In 1995 the Indigenous Land Corporation, generously funded by the Commonwealth, began to buy land for management and transfer to indigenous owners. In 2010-11 it purchased five properties totalling 336,913 hectares, including the Ayers Rock Resort at Uluru.

Unlike non-indigenous landowners, on much of the returned indigenous land the traditional owners receive royalty payments from mining, resulting in large income flows. For example, the Aboriginals Benefit Account receives most of the royalties for Northern Territory indigenous landowners. In 2010-11 the Aboriginals Benefit Account received $155 million in royalties and had over $400 million deposited in Australian banks.[2]

Government spending on indigenous Australians has increased substantially—about $100,000 per person per year is now spent by governments on each indigenous person living on indigenous lands.[3]

Indigenous lands have been returned to groups of traditional owners, without identifying individuals and without providing for individual property rights. Indigenous groups “own” land communally, but are denied the right to secure title over their own land for a private house or private business premises.

Our high living standards—as in every prosperous economy—are built on private ownership side-by-side with communal ownership. When we drive from home, we drive on public roads. Our town halls and most schools, hospitals and libraries are built on public lands. We play sport on public ovals, swim on public beaches, fish in public rivers and hike and picnic in public parks. Throughout Australia we work in the public sector as well as the private sector. Although Australia has one of the highest proportions of home owners in the world, there is a public housing safety net for struggling families. We look at privately owned US beaches and say, “We don’t want that in Australia.” Australian voters understand that a mixed economy, with private as well as communal property rights, is essential to their prosperity.

Communities on indigenous lands lack a private sector because there are no individual property rights. There are no shops, cafes, hairdressers, motels, caravan parks, farms, plantations, real estate agents or accountants.

As you drive from Sydney or Melbourne to remote Australia, the unemployment rate falls to almost zero. Many remote towns on non-indigenous lands are desperate for workers. The exception to this outback job surplus and employee shortage is on indigenous lands, where the lack of a private economy means that there are no jobs. In November 2011 the Woolworths supermarket in Nhulunbuy, one of the most remote towns in Australia with no road access in the wet season, had five job vacancies posted on its front windows, while fourteen kilometres away on indigenous land in Yirrkala, unemployment is the norm. 

The difference between a black man and a white man is this, when a white man dies his family gets his house. When a black man dies the government gets it. — Palm Island resident[4] 

Denying indigenous Australians the right to own their own home also denies them the opportunity to accumulate assets. Australian governments support home owners financially through a substantial range of benefits that include direct grants, such as federal, state and territory first-home-owner grants, stamp duty concessions and other state and territory tax subsidies and rebates. These can add up to a $20,000 subsidy for a first home. In addition, there is no capital gains tax on family homes. Aboriginal and Torres Strait Islander landowners can only access these benefits if they leave their traditional lands.

The absence of private property rights also has indirect costs. Even where welfare is supplemented by royalties, communities on indigenous lands have low savings. Because families are crowded into sub-standard public housing, they cannot save for household appliances and home improvements, so money is spent on gambling and alcohol. Home ownership stimulates labour force participation. Working families are not footloose, so their kids go to school.

By the mid-2000s it became evident that public housing could not provide decent housing for everyone on indigenous lands. The Howard Coalition government introduced Housing on Indigenous Lands funding to assist private mortgages on indigenous land and amended the Aboriginal Land Rights Act (NT) to facilitate ninety-nine-year leases for home owners.

When the Northern Territory government took no action to follow up these changes, Mal Brough, the Coalition Minister for Indigenous Affairs, created the Office of Township Leasing, which in 2007 negotiated a head lease with the Tiwi Land Council over Nguiu township. Under this lease, the Office of Township Leasing manages the town and issues sub-leases. Covenants ensure the non-indigenous population is limited to 15 per cent. Sixteen private housing leases were consequently issued in Nguiu. They remain the high point of private housing on indigenous land.

Following Brough, in 2008 Jenny Macklin, the Labor Minister for Indigenous Affairs, negotiated Office of Township Leasing head leases with the Aninildilyakwa (Groote and Bickerton Islands) Land Council, but reduced the head lease term to forty-plus-forty years. Sub-leases for homes expire with the head lease. If a Groote Eylandt family were to take out a home lease today and build a house with a thirty-year mortgage, six years after paying off the mortgage, the ownership of its house would transfer to the Commonwealth for payment of $1. Not surprisingly, no housing lease has been taken up. Jenny Macklin has killed off Brough’s initiative.

Without secure ninety-nine-year leases, indigenous landowners could not apply for Home Ownership on Indigenous Land mortgages. In the 2010-11 Budget, the Commonwealth government therefore released $56 million lying unused in the Home Ownership on Indigenous Lands program.

Commonwealth, state and territory governments continue to be concerned only with public housing (misleadingly renamed “social” housing despite the well known anti-social character of public housing enclaves). Derelict houses in communities on indigenous lands are continually in the news although the Labor government in 2008 initiated a Commonwealth/state/territory Remote Indigenous Housing Program with a projected expenditure of $5.5 billion over ten years. The program includes refurbishments as well as new houses which cost an average of $600,000 each instead of the $250,000-to-$300,000 cost of houses of equivalent quality delivered to remote locations. New houses are only being built in large townships. If the Indigenous Housing Program completes the houses planned, at its end in 2018 there will still be 10,000 families on indigenous lands sharing houses.[5]

In May 2010, Jenny Macklin issued an Indigenous Home Ownership Issues paper. It did not deal with the absence of secure title for homes on indigenous lands and included incorrect information about indigenous home ownership in mainstream Australia. Submissions from the public were requested by September 2010, later extended to December 2010. It is now 2012. The submissions received have not yet been posted on the Department of Families, Housing, Community Services and Indigenous Affairs website and no policy paper has been released.

Since no new public housing is to be built in the hundreds of outstations and homelands, private housing is the only option. This makes sense. Governments would not build public houses in small non-indigenous settlements. But non-indigenous families have an alternative—building their own homes. Traditional landowners on indigenous lands do not, even though studies since the 1990s have shown that they would like to own homes rather than rent public housing and that some families have incomes that will support mortgages. The barrier to private housing is the absence of secure title, that is, of ninety-nine-year leases.

In 2007, Mal Brough discussed leases with Galarrwuy Yunupingu for the Gunyangara community in East Arnhem Land. In Baniyala, an East Arnhem homeland of about 150 people, families crowded into derelict public housing dwellings with no kitchens or bathrooms decided that they would apply for ninety-nine-year leases and build their own houses.

Having built several buildings including a three-bedroom house for visiting teachers, Baniyala families began to explore long-term lease and construction options. Learning of the Commonwealth’s Indigenous Home Ownership Issues Paper, in February 2011 they approached Jenny Macklin’s Department of Families, Housing, Community Services and Indigenous Affairs in Canberra for support with ninety-nine-year lease negotiations with the Northern Land Council. Baniyala families planned to start building homes in May 2011 when the dry season set in. The Canberra Indigenous Affairs staff advised that they could provide no assistance.

In the Australian Capital Territory all private homes are built on ninety-nine-year renewable leases. Canberra public servants have devised efficient and secure leasehold titles for their houses.

In March 2011 Baniyala families began negotiations with the Northern Land Council, asking for ninety-nine-year leases based on the Australian Capital Territory model. They pointed out that such leases in Baniyala could serve to free up private home building on indigenous land (50 per cent of the Northern Territory), particularly on outstations where no new public housing was to be built.

The Baniyala model leases differ from the Australian Capital Territory leases in one important aspect. Leases would include covenants ensuring that ownership and control remained with the Baniyala community so that land could not be alienated from the indigenous community.

After months of discussions, Baniyala families were told by the Northern Land Council that leases would not be issued and that Baniyala families should build private houses without leases. Although advised that without leases the Northern Territory government will not pay first-home-owner grants or other benefits, the Northern Land Council continues to refuse to issue housing leases to Baniyala families on their traditional land. Without leases, Baniyala families are not only denied the government grants that are available to all other Australians, but cannot access mortgages, insure their houses or leave them securely in their wills to their children.

In March 2012, Baniyala families petitioned the Senate to have the minister, under the Aboriginal Land Rights Act, direct the Northern Land Council to issue ninety-nine-year leases. If 75,000 residents of Sydney or Melbourne were not allowed to build houses on their own land, there would be political uproar. But 75,000 Aboriginal residents on their own land are ignored. (Details of correspondence with the minister and the Northern Land Council and the Senate petition are at www.baniyala.com.)

Bob Katter, when he was Minister for Aboriginal Affairs in Queensland, introduced long-term leases for individual title on indigenous lands. These leases did not transfer the ownership of homes on leased lands to the lessees and left open lease transfer and inheritance issues. Two hundred “Katter leases” were negotiated and a further 200 leases were initiated. The leases became the subject of lengthy court proceedings, with 200 settled in the leaseholders’ favour and a further 200 still in dispute.[6] In 1991 further issues of Katter leases were stopped.

In 2008 the Queensland Labor government amended legislation to enable trustees of indigenous lands to grant ninety-nine-year private residential (home ownership) and thirty-year commercial leases on Aboriginal and Torres Strait Islander “reserves” and on Deed of Grant in Trust lands. The legislation set out the procedure for initiating ninety-nine-year leases, but the Department of Natural Resources, Mines, Energy and Trade, after budgeting $1.5 million to resolve survey issues, did not proceed further. The Bligh government focused on creating wild river reserves on Cape York and on public housing rather than facilitating home ownership.

South Australian legislation forbids mortgages for homes on indigenous lands. There are no private homes or businesses in the Anangu Pitjantjatjara Yankunytjatjara communities, which are constantly in the news because of their derelict dwellings, child malnutrition and low school attendance.

Russia and China now accept private housing as a human right. Only in North Korea and on Australian indigenous lands do governments deny the right to a private home. 

They have stolen our responsibilities. — Lajamanu elder 

The absence of individual land rights goes hand in hand with the absence of democratic governance. In mainstream Australia, ownership such as strata title enables property owners to manage land they own communally and individually. Owners maintain their own property and are also a member of a body corporate with responsibility for communal areas such as gardens, tennis courts and swimming pools. There is a list of owners, rules backed by law cover committee decisions, and members democratically elect their corporate bodies.

In contrast, much of indigenous land has no list of traditional owners and therefore no democratic elections or management. The Northern Land Council, for example, is the landowner association for 40,000 people living on an area twice the size of Tasmania. It does not have a list of traditional land owners or hold democratic elections. Every three years, the nine-member executive selects from nominations from more than 100 communities the eighty-four people who will be the members of the full Northern Land Council.[7] Having been selected, these members then elect the new nine-member executive. This process is approved by the Commonwealth Minister for Indigenous Affairs.[8]

As well as being denied the right to private title side-by-side with communal title and democratic governance, indigenous lands do not have effective local government. In mainstream Australia, local government was introduced by area as population grew. Local government is an integral part of ensuring the existence of civil society standards.

For many years, there was no local government on indigenous lands. Large areas of remote Australia were (and still are) “unincorporated land” without local government. Over the last forty years, various indigenous groups were co-opted to act as the local government. Some were landowner groups, so that a conflict of interest ensued. Many were not democratically elected. They operated under separate laws from mainstream councils.

Over the last decade, states and territories have made some progress in creating robust local governments covering indigenous land. The Northern Territory created shire councils, while in Queensland, Aboriginal shire councils were brought under the same laws as mainstream councils. Some, however, retain a dual role. They act as landowners’ representatives and as local government for all residents, although non-indigenous residents, such as nurses and teachers, are not entitled to vote.

Even where local governments have been created, they do not have funds to operate effectively. Without private houses or business, councils have no rateable base. They are expected to introduce mainstream services and controls while being starved of revenue.

Despite some progress, civil society norms still do not apply in many communities on indigenous lands. Alcohol consumption is a good example. Without viable local government, alcohol controls deemed necessary in mainstream Australia did not exist or were not enforced. This entrenched alcohol abuse in remote indigenous communities. Separate civil society rules reached a peak when the Northern Territory government gave an indigenous association an exclusive licence to import and sell kava in East Arnhem Land. Imported at $15 a kilogram and retailed at $15 per 100 grams, this kava monopoly kept communities catatonic, with more money being spent on kava than food. In 2007, Tony Abbott, then Commonwealth Minister for Health, shut the kava sales down.[9] Government-supported drug retailing would never have been tolerated in mainstream Australia. Other civil society problems on indigenous land such as loud music and lack of dog controls are also the result of decades without effective and resourced local government. Building construction controls do not apply: if you build a house for a white family in Darwin it must meet cyclone standards; in Northern Territory indigenous communities no standards apply.

Most (85 per cent) Aborigines and Torres Strait Islanders live in major cities and regional towns, side-by-side with other Australians. Most—more than 60 per cent (330,000)—work in a range of occupations from low skills through trades to professions and management. About 68 per cent own or are buying their homes. Their children attend mainstream private and public schools where they perform like other students with more than 90 per cent passing national minimum literacy and numeracy standards. More than 70,000 Aboriginal and Torres Strait Islander students are enrolled in vocational courses and more than 11,000 in universities, including a substantial graduate enrolment. More than 25,000 have graduated in law, medicine and other professions. There is no “gap” between these Aborigines and Torres Strait Islanders and other Australians. They vote like other Australians and otherwise participate in civil society without losing “a sense of difference and pride in their Indigenous background: Their ancestors will forever be Indigenous and their ancestral places will always be Indigenous.”[10]

Despite the success of indigenous Australians in mainstream society, on indigenous lands governments persist in denying residents the rights to private housing, to be responsible for their property and to have local government with resources and probity. Reconciliation, “partnerships”, “engagement”, “consultation” and wasteful public expenditures are the smokescreens behind which discrimination hides.

With secure title, in twenty years we could look forward to vibrant innovative communities on indigenous lands where people would live in comfortable private housing while most land, including sacred sites, rivers and beaches, remains in communal ownership. The residents would hunt, fish, create art, and work in the local shops and cafes, on farms and plantations, in tourism and other business. Many would have good wages in mining. The children would attend schools with quality education and go on to vocational courses and to university. Overseas tourists would flock to these communities to experience the world’s oldest culture where everyone is bilingual and all signage is in the local indigenous language as well as English.

Not all remote indigenous communities may develop, just as not all remote non-indigenous communities prosper. But appalling living standards on indigenous lands are not the result of indigenous failure but of government failure.


Helen Hughes is Senior Fellow, Economics and Foreign Affairs Program, with the Centre for Independent Studies. She and Mark Hughes have written several monographs for the CIS on indigenous housing and education. They wrote “Rivers of Money Flow into the Sand” in the June 2011 issue of Quadrant.

[1]           S Rintoul, Interview with Justice Woodward,, The Australian, February 22 2008.

[2]           Department of Families, Housing, Community Services and Indigenous Affairs, 2010-2011 Annual Report, Appendix J

[3]           Helen Hughes and Mark Hughes, ‘Rivers of Aboriginal money flow into the sand’, Quadrant, June 2011

[4]           Palm Island Housing Report, http://www.kalkadoon.org/index.php/palm-island-housing-report/, accessed 3 August 2010.

[5] Helen Hughes, Mark Hughes and Sara Hudson, Private Housing on Indigenous Lands, Policy Monograph 113, Centre for Independent Studies, 2010

[6] Mark Moran, Paul Memmott, Stephen long, Rachel Stacey and John Holt, ‘Indigenous Home Ownership and Community Title Land – A Preliminary Survey’ Urban Policy and Research, 20:4 (2002), 357-370

[7]           The ‘Governance’ section of the Northern Land Council 2009-2010 Annual Report is inconsistent about the number of full council members. Page 122 states there are 83 full council members while page 124 lists 84 members by region.

[8]           “The method of choice of members, including the list of communities who can nominate a member and the allocation of representatives from each community, are determined by the Council and subject to approval by the Minister, Northern Land Council, Annual Report, 2009-2010, (101).

[9] Helen Hughes, Kava and After in the Nhulunbuy (Gulf of Carpentaria) Hinterland, Issue Analysis 88, Centre for Independent Studies, Sydney, 2007

[10]          Mark Moran, Paul Memmott, Stephen long, Rachel Stacey and John Holt, ‘Indigenous Home Ownership and Community Title Land – A Preliminary Survey’ Urban Policy and Research, 20:4 (2002), 357-370

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