Out of nearly 1000 successful applicants for its new Indigenous funding model, fewer than 500 organisations are actually Indigenous, according to a report from the Department of Prime Minister and Cabinet.
Myles Morgan

4 May 2015 - 6:11 PM  UPDATED 29 Jun 2015 - 8:28 PM

The report, which was submitted to an official Senate inquiry into how the Indigenous Advancement Strategy has been rolled out since May last year, says that, "the Department estimates that 45 per cent of all recommended applicants are Indigenous organisations."

It also revealed that most of the new funding will go to eastern New South Wales and greater Western Australia, with north Queensland getting the least funding in region-by-region terms.

The Department of Prime Minister and Cabinet took control of the Indigenous Affairs portfolio in 2013 after the Abbott-led Coalition took government.

In the Federal Budget the following year, the Abbott Government unveiled its Indigenous Advancement Strategy – a controversial policy that saw a $534 million dollar cut to the Indigenous sector and which the Government argued was a saving through a "rationalisation" of the portfolio.

The strategy forced hundreds of organisations to apply for new IAS funding through a controversial process which saw a huge public backlash. Many politicians and organisations said the IAS was confusing and unfair.

Dozens of submissions made to inquiry

Fifty-six submissions were made to the Senate inquiry into the IAS process, some of which were positive. Save the Children, which was successful in its funding application, called the Federal Government's radical overhaul of the way money is handed out in the Indigenous portfolio "ambitious".

Many other submissions however were critical of the process, labelling it inefficient, detrimental and disempowering for First Nations peoples.

"It is likely that the confusion, delays and uncertainties created by the implementation of the IAS will have destroyed significant value in Indigenous organisations..."

Fred Chaney, a former Federal Indigenous Affairs Minister and founding co-chair of Reconciliation Australia, said the IAS could be "innovative" and beneficial for Indigenous people, but it is bogged down in bureaucracy.

"It is likely that the confusion, delays and uncertainties created by the implementation of the IAS will have destroyed significant value in Indigenous organisations, and in particular human capital, through delays imposed on functioning organisations, defunding of local organisations and resulting loss of employment," Mr Chaney said in his submission.

With much criticism labelling the IAS a top-down, big stick approach from Canberra, and fewer than half the organisations getting money being Indigenous, the Government took care to note that it is trying to ensure no Indigenous people suffer.

"Every effort has been made through the funding round to ensure effective frontline services are maintained"

"Every effort has been made through the funding round to ensure effective frontline services are maintained", it said.

"The Government has clearly indicated that, where service delivery gaps are identified, the Department will work with organisations to ensure services are maintained".

Adding to the administrative burden on Indigenous organisations, the Federal Government also noted 56 organisations will have to legally incorporate in order to receive funding in excess of $500,000 in a single financial year.

In something that may point to the backlash against the Strategy, the Federal Government submission said the Department has received over 6,000 email inquiries about the IAS - nearly half of them in March when the funding results were announced. It has also received over 2,000 phone calls to a dedicated IAS hotline.

Funding breakdown

The IAS is divided into five funding streams:

  • Jobs, Land and Economy
  • Children and Schooling
  • Safety and Wellbeing
  • Culture and Capability
  • Remote Australia Strategies

A detailed breakdown of the funding provided by the Government in its submission showed much of the money has been committed to the Jobs, Land and Economy stream. About $500 million, or nearly half the total funding, has been committed for the next four years to that stream, with the Children and Schooling stream getting the next largest portion of money. Only $80 million has been committed to Culture and Capability over the next four years, with a significant drop off from 2015-16.

"The Department aims to finalise the negotiation of agreements by the end of May to facilitate execution by 30 June 2015," it said in its submission.

The Government will then have 14 days to publish details and a dollar figure for each individual agreement.

Nearly 20 per cent of the IAS funding will go to organisations in eastern New South Wales according to the regional breakdown provided by the Government, although areas with a higher relative Indigenous population did get proportionately more funding.

"PM&C regions in more remote areas attracted a greater share of the IAS funding than their share of the Indigenous population reflecting relative need," the Government submission said.

"While eastern NSW attracted more funding than any other region, its share of funding is lower than any other region than its population share."

The Senate Committee on Finance and Public Administration will report on its inquiry in mid-June.