Reforming financial aspects of the Native Title Act 1993: An economics perspective

Author/editor: Altman, JC
Year published: 1996
Issue no.: 105


This paper was delivered at a conference, 'Doing Business with Aboriginal Communities', organised by AIC Conferences and held at the Beaufort Hotel, Darwin during the week before the March 1996 federal election. The session in which the paper was presented was about effective negotiation between Indigenous groups and industry, inside and outside the Native Title Act framework. The paper identifies elements of the legislative framework that arguably result in suboptimal outcomes for both Indigenous parties and industry. These include: the lack of statutory clarity (income sharing,compensatory or incentives regimes) about financial provisions; the provision for a right to negotiate future acts at both exploration and production (that is, a disjunctive right to negotiate); and the potential for payments to be made to Indigenous parties at exploration, operating as a disincentive to industry. Some contrasts are made between the native title and statutory land rights frameworks. Two cases of agreements made outside the native title framework are assessed in the context of these identified shortcomings. A number of possible reforms are then considered, including options to allow Indigenous parties access to statutory royalties paid to government from mines on land where native title has been determined; trading off a right to negotiate at exploration for guaranteed payments, if production occurs; and the potential to include such possibilities in regional or local agreements. The paper concludes that the existence of a right to negotiate at both the time of exploration and mining stages needs to be reassessed as its existence will be of limited benefit to Indigenous parties and a disincentive to industry. It is also argued in conclusion that a statutory framework for negotiation would be beneficial and that governments should consider the advantages of sharing royalties with all native title parties affected by a resource development project, not just land owners.

ISBN: 0 7315 1779 2

ISSN:1036 1774

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