Indigenous Australians and the mining industry need each other

Indigenous people and the minerals industry actually want the same thing. We can sharpen our engagement model to achieve it.

The minerals industry isn’t going anywhere. It will only get bigger. The human appetite for resources shows no signs of abating. Technology and innovation, population and economic growth will only make that appetite stronger.

Indigenous people aren’t going anywhere either and our population is also getting bigger. Minerals extraction means engaging with Indigenous people. Indigenous Australians have ownership or other rights over 20% of the continent, including most areas where mining occurs. And there’s still native title claims to be concluded and compensatory funds to be invested.

Socio-economically, there’s a big gap between Indigenous and non-Indigenous Australians. Demographically, Indigenous and non-Indigenous Australia are like two different countries – the demographics of Australia are typical of developed economies; the demographics of Indigenous Australia resemble developing economies.

In 10 years there’ll be nearly a million Indigenous Australians. Our population is growing at over 2% per year compared to Australia’s population at closer to 1.5% per year. To put that in perspective, India’s population growth over that period will be around 1.2% per year and Nigeria’s 2.6%. The median age of Indigenous people is around 22 years, compared to around 37 for the non-Indigenous population. The population pyramid for Indigenous Australians looks like those of developing economies, wide at the bottom and narrow at the top.

Population distribution is also different. Indigenous people are disproportionately represented in the sparsely populated areas where most mining occurs, and increasingly so. By 2040, Indigenous Australians will make up half the population of northern Australia, for example.

And the country is having two completely opposite discussions about opportunities in remote areas. On the one hand politicians talk about developing northern Australia and the need to get bigger populations there to realise these opportunities. Then they question the future of remote Indigenous communities; say there are no jobs or opportunities, the communities should be closed and Aboriginal people should move south. How can there be a shortage of labour on the one hand and a shortage of jobs on the other?

Over the coming decades the minerals industry will need job-ready and educated local populations – which means job-ready and educated Indigenous people.

For Indigenous communities the future presents a different challenge. We need our people in remote areas to get educated and into jobs so those communities can have economic development.

Indigenous people and the minerals industry actually want the same thing. We can sharpen our engagement model to achieve it.

The early engagement model was royalty agreements for access to land. We all know how messed up some of those arrangements became. Today the preferred model is payments into trusts for the benefit of communities at large and with a focus on preservation of funds. But mining companies often retain control or veto of the money which is another form of paternalism.

Asset management and investing is a specialist skill. Most community based groups – whether it’s an Aboriginal group or your local football club – don’t have the capabilities. A model we could look at adapting is the one family businesses use when their businesses grow and they come into wealth – a combination of family members gaining skills and experience as well as engaging external advisers and confidants who are trustworthy and capable and can supplement the skills they need.

Traditional owners have the right to build sovereign wealth and use their asset base and it must be effectively managed. But it isn’t a panacea for delivering economic development. If Indigenous people remain asset rich and skills poor, the status quo won’t change.

What we need is individuals gaining skills, getting educated, finding eployment, getting independence and being able to generate their own quid.

In joint ventures between mining companies and traditional owner groups the biggest opportunities aren’t from the contributions to community assets but actually from locals getting jobs where they gain skills and business experience which they can use in their own communities.

Here are two questions the minerals industry should be thinking about.

First, what’s it doing about securing an educated local talent pool in remote Australia in 10 to 20 years? The people it will need in its future workforce and supply chains aren’t going to school or getting the education it needs. Work with local communities to address that.

Second, what’s it doing to help people in remote communities identify jobs, set up small businesses and generate commerce? The minerals industry is one of the most influential and well connected industries in the country and is built on entrepreneurship. There’s a lot it can do to help Indigenous people gain these skills. In helping create real economies in these areas it also helps secure its future workforce.

If we address these challenges, the outlook for Indigenous Australians and the future minerals industry workforce is bright.

Nyunggai Warren Mundine AO chairs the Yaabubiin Institute for Disruptive Thinking. This article is an extract from his speech to the Minerals Council of Australia Workforce of the Future Forum on 12 October 2016. This article was first published in the Australian Financial Review on 11 January 2017.

Comments

  1. Joy Holbrook says:

    A wonderful initiative with no losers, provided it’s implemented properly.

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