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Wednesday, 15 December 1993
Page: 4725

Senator GIBSON (7.13 p.m) —The Native Title Bill 1993 is very important legislation but I believe that there has been insufficient examination of its implications for all Australians. There has been no mention from the government of the costs and the benefits associated with the legislation. The bill proposes to greatly increase land options for a small proportion of the Aboriginal population. Land is important for the Aborigines, but it is also important for the economic and social wellbeing of all Australians. In that regard, let me quote the words of an 18th century American Red Indian chief:

Land belongs to the people, of whom many are dead, a few are living and countless millions still to come.

All Australians, whether their ancestors arrived 40,000 years ago from Asia, whether they arrived 200 years ago from Europe, or whether they arrived yesterday, should feel proud and privileged to have their ancient links with the past in our land.

  As something so important for Aborigines and for all Australians, and when the constitution clearly leaves land management to the states in our federal system, the bill before us should have the agreement of the states. As one of the state premiers said following the breakup of the heads of government meeting, negotiations should have continued over a complete weekend in order to get resolution on this matter. However, our Prime Minister (Mr Keating) presented the states with a take it or leave it position. As a result, cooperation went out the window.

  Many months ago the government made a political decision to go along the path of dealing with the Australian Democrats and the Greens. Basically, it said, `To hell with the states and to hell with industry'. Today we have a bill which most of the states agree has major problems attached to it. We should remember again that it is the states who have to manage the land. Our most important export and development industry—the mining and mineral processing industry—has been ignored.

  Today I will concentrate on the implications of this bill for the Australian economy, and hence for all Australians. We need strong economic growth to give hope to the unemployed and to offer material help to disadvantaged Australians. To achieve this we need increased investment and increased exports. Whilst all our industry sectors are important, I would like to concentrate on the mining industry, which I believe will be the industry most seriously affected by this legislation. This industry currently contributes seven per cent of our nation's GDP. It contributes 25 per cent of our nation's exports. Last year it contributed 24 per cent of all the investment by the private sector in the economy. This is investment which we are trying to build to get this economy going again. This bill puts that quarter at risk.

  For continued economic growth of our resource based industries and for continuing mining investment for these industries, we need appropriate property rights and economic incentives. Property rights must be clearly defined and stable. Uncertainty about property rights leads to economic losses. Contrary to the traditional views of economists who have always relied upon interest rates, incentives, tax rates, et cetera, to provide a major explanation of the investment cycle, there is now a strong view that the major determinant for investment is confidence and security. The greater the uncertainty, the lower the investment. I have stressed in this place many times that the level of private sector investment in this country is the lowest it has been since World War II. We need to boost investment to create sustained economic growth.

  The view of the business community is that the most urgent task post-Mabo is the removal of uncertainty in relation to property rights. In addition, economic incentives are needed to encourage people to respond. The Industry Commission, in its report in 1991 on the mining and mineral processing industry, said that following the Aboriginal land rights experience in the Northern Territory—a matter about which I will comment more later—the most appropriate system was one in which either Aborigines had full property rights to minerals as well as land or they had no rights to minerals at all. A half-way house destroys all incentive to make the most economic use of those resources.

  The Northern Territory situation provides some sort of example of what could happen with a prohibitive mining policy, such as is possible under this bill. In the Northern Territory the traditional system of crown ownership of mineral resources was replaced in 1976 with a system of Aboriginal rights under the Aboriginal Land Rights (Northern Territory) Act. The act initially gave the Aboriginal owners a two-stage veto over exploration and subsequent mining. Because of the difficulties involved in such a system, the act was amended in 1987 to permit the veto only at the exploration stage. The evidence suggests that the implications of this system have been devastating for the mining industry in the Northern Territory.

  Even following the 1987 amendments, there was an average of only five exploration licences per year processed on Aboriginal land compared with 150 received, processed and granted on non-Aboriginal land in the territory. By comparing mining licence outcomes on Aboriginal and non-Aboriginal land, it can be estimated that some 3,000 exploration licences that would otherwise have been taken out over the past 20 years have not been pursued in that region. On the basis of average success rates, this has probably meant that three mines have failed to come to fruition in the Northern Territory.

  The 1991 Industry Commission report on that industry that I referred to earlier found that there was a general dissatisfaction with the aboriginal land rights act in the Northern Territory. In spite of the findings of that inquiry, no substantial changes have been made to that act and many of its features are evident in the Native Title Bill. As one respected commentator put it:

The history of land rights in the Northern Territory has been that of 20 years of lost opportunity. The mining companies, the Australian community in general, and the Aboriginals in particular, are clear losers from unnecessary impediments and delays. The lessons from the Northern Territory experience are clear. Where unwieldy negotiation and veto processes are allowed to overlay a system of tradeable property rights, the impact on costs and consequent investment is stifling.

The attitude of prospective mineral exploration companies is just as important as the actual physical barriers they face in gaining security of mineral rights and access to land. In Tasmania, for example, a succession of attempts by the radical conservation movement in the early 1980s resulted in significant downturns in prospective mineral exploration investment. This phenomenon verifies much of the earlier argument about economic certainty being a very important determinant of investment decisions.

  In my home state of Tasmania, exploration investment expenditure fell from $18 million in 1983-84 to only $8 million in 1992-93—a decline of 56 per cent. That decline, started by the creation of uncertainty about access to or tenure of potential mining areas that were the subject of argument as to usage, was further exacerbated by the election of a Labor-Green government in the latter part of the 1980s. The ongoing uncertainty and insecurity in the business community, particularly in the mining sector, virtually brought to a halt investment in exploration in my state.

  Mining rights in the Northern Territory are currently based on a system with a negotiation phase, followed by a land council phase, with the land council having a yes or no say on each application. There is also an arbitration system which exists to determine the necessary terms and conditions if land council approval is given. This arbitration system has never been used. The current Native Title Bill also provides for a negotiation phase. But in this case it is the appropriate tribunal which will have the yes or no say and which will also establish the terms and conditions. Thus, the outcome in each of the cases brought before it will depend on the workings of the tribunal.

  Let us look around as to what experience there has been in Australia to gain some insight as to how tribunals are likely to work. One good example is the case of Coronation Hill. This development was considered contentious on environmental grounds at the time, largely because there was a federal election coming up. The matter was passed to the Resource Assessment Commission, headed by a judge with appropriate experts. We should note the similarities that are proposed in this bill. It carried out a 12-month study.

  The subsequent report found that there was no environmental problem with the mining of Coronation Hill. However, issues relating to Aboriginals' spiritual matters were raised with the Resource Assessment Commission, which recommended against mining at this site. It is no wonder the mining industry is worried about this bill. Such an approval process could, in effect, turn out to be a de facto veto process. Furthermore, the economic incentives are wrong. The Commonwealth has set a limit on compensation for disturbance on the basis of state compensation schemes. There is little incentive for native titleholders to negotiate. In reality, therefore, it would probably pay them to push for a veto of mining.

  The attitudes, arguments and concerns of the mining industry have been clearly put to the recent hearings of the Senate Standing Committee on Legal and Constitutional Affairs. Mr Jerry Ellis from BHP Minerals argued, firstly, that the question of the validity of existing mining leases has not been totally clarified and, secondly, that the major issue is that the procedures put in place by the bill would be:

. . . time consuming—unnecessarily so in our view—and sometimes so time consuming that we believe market opportunities will be lost.

Again, Mr de Crespigney from Normandy Poseidon argued that the bill is too complex, it is unworkable, and the tribunal procedures are neither fair nor practical. I quote two important passages from Mr de Crespigney's submission to the Senate committee. First, he says:

Having fulfilled that urgent need—

that is, to tackle the Mabo challenge—

except in relation to the validation of existing titles, urgency ceases to be a requirement, and the point I cannot stress enough is that we are in a marathon, not a sprint, and all parties interested in reconciliation should now carefully, diligently, dispassionately and not hurriedly, review and address the whole reconciliation challenge, of which land is but one.

Finally, he goes on to say:

The Bill in its present form, particularly because of the significant delays it will create, will completely fetter our ability to provide wealth for our shareholders, taxes for the nation and employment opportunities generally, but in particular for Aborigines. Obviously, if it will have that effect on Normandy Poseidon, just imagine the impact on national wealth and national job opportunities if the BHPs and CRAs and the Western Minings are all having the same problems. Remember, lost opportunities means lost jobs.

The Senate will be aware that CRA announced on Monday of this week that it is reducing its level of exploration in Australia by a further 10 per cent and will be investing overseas instead.

  In conclusion, there is no hurry with this bill—it is a marathon. This is a very serious matter for all Australians, and it is imperative that we, as parliamentarians, get it right for all Australians, for all Aborigines. I oppose the bill.