$2bn diverted from aid for Aborigines and welfare

Lex Hall | The Australian | November 28, 2009

NT Government steal from Indigenous disadvantagedThe Northern Territory Labor government has for the past five years diverted $2 billion earmarked for indigenous disadvantage and other key services to mainstream spending in marginal Darwin seats.

Detailed figures obtained by The Weekend Australian reveal that hundreds of millions of taxpayers' dollars provided by the commonwealth and intended for indigenous health, homelessness, delivery of services and families have been used to service debt and bolster superannuation payments.

The figures come as the Territory government continues to defend its handling of the $672 million Strategic Indigenous Housing and Infrastructure Project, which has so far failed to result in one new house being built, despite $45m being spent in the first 15 months of the project.

The new figures, revealed in 2009 Commonwealth Grants Commission papers and raised this week by conservative indigenous politician Adam Giles, show the Territory government has consistently failed to spend its allocation of GST money from Canberra as intended.

The report on assessed revenues and expenditure shows the Territory government has underspent by $2.17bn on key social services over the past five years: in 2003-04, by $275m; in 2004-05 by $319m; in 2005-06 by $448m; in 2006-07 by $507m; and in 2007-08 by $625m.

In services to indigenous communities alone, the Territory government has on average underspent by 54 per cent.

In 2007-08, the commission assessed the amount needing to be spent on services to indigenous communities as $253.4m, but the CGC report found the Territory spent only $139m.

In the same period, the Territory spent just $71m in the critical areas of families and community services, less than a third of the recommended spending of $216m.

For homelessness, the government had $66.7m available but spent only $17m, almost a quarter.

Conversely, the figures show that the NT government was overspending on superannuation, debt, and culture and recreation.

In 2007-08, the commonwealth assessed the Territory's superannuation costs at $256m but the government spent $358m, a jump of 40 per cent.

The CGC found $13.7m had to be spent on debt. Instead, the Territory government spent $103.4m - almost eight times the assessed amount.

The amount overspent on culture and recreation was $39m.

Mr Giles, the Country Liberals' indigenous policy spokesman, used parliamentary sittings in Alice Springs this week to call the government to account. "Where did the money go?" he said. "It went to pay back excessive debt of $90m. It went to pay back $358m of superannuation in one year.

"What sort of a government can spend $358m on superannuation of its 17,000 public servants, but only spend $98m on roads and $1m on transporting rural school children to school?"

Mr Giles accused the government of overspending on urban infrastructure projects in Darwin's northern suburbs to win voter support. "They're spending money on pork-barrelling rather than delivering services to rural and remote areas," he said.

A former president of the Northern Territory Council of Social Services, Barry Hansen, has told the Territory government about the pattern of underspending since 2001.

Mr Hansen said underspending in child protection and other crucial social welfare areas needed to be remedied.

"One thing that needs to be looked at is whether the tragic death of a child in foster care in 2007 was a consequence of under-resourcing of child protection services," Mr Hansen said.

He also cited corrective services and roads as areas overlooked by the government.

Former indigenous policy minister Alison Anderson said it was a "national disgrace" that the Territory government was still underspending on indigenous disadvantage two years after Kevin Rudd's apology to the Stolen Generations.

Ms Anderson, the independent member for the central Australian seat of MacDonnell, said that unless the grants were tied, the Territory government "will never ever close the gap on indigenous disadvantage".

"If they were dead serious, the Labor government would be tying the grants allocated to the Territory government because they will always misuse it," she said.

"They will continue to build wave pools and convention centres, and the funding will continue to be diverted into marginal seats in Darwin where the government is in trouble."

Housing Minister Rob Knight said the CGC report data had been misinterpreted and was "two years out of date".

"Under this reporting method used by the CGC, while the Territory's actual expenditure is less than its assessed amount, it is sometimes misinterpreted as underspending on this category of service delivery," Mr Knight said. "That is simply incorrect."

A spokeswoman for Treasurer Delia Lawrie said a review last year found 52 per cent of revenue went on indigenous services.

"The report shows that the Territory receives 44.4 per cent of revenue for indigenous-related reasons and indigenous Territorians receive 2.5 times more government spending per person compared to non-indigenous Territorians," the spokeswoman said. A Senate inquiry last year found "no evidence of underspending in indigenous affairs", she added.

A spokeswoman for federal Indigenous Affairs Minister Jenny Macklin said all governments had agreed to a Closing the Gap strategy at the Council of Australian Governments meeting in July.