Anindilyakwa Land Council’s funds frozen amid stalled progress on audit recommendations

The Commonwealth has put the Anindilyakwa Land Council on notice for failing to implement key audit recommendations, as chief executive Mark Hewitt flags resignation.

The ALC’s funds have been frozen amid ongoing governance red flags.

The Commonwealth has frozen funding to a Northern Territory Aboriginal land council after an independent review found “unacceptable” progress reforming governance red flags that brought into question how millions in mining royalties were being used.

Indigenous Australians Minister Malarndirri McCarthy also put the Anindilyakwa Land Council board on notice, laying out her expectations it would “sufficiently prioritise and implement” recommendations from both the independent review and the auditor general.

The ALC has meanwhile revealed in principal plans for chief executive Mark Hewitt to resign, moving into a consultant role for Winchelsea Mining – a venture the council hopes can help plug the royalties gap faced by the impending closure of manganese mine Gemco on the Groote Archipelago.

Mr Hewitt – who has consistently denied any wrongdoing – was referred to the national anti-corruption watchdog in July by the National Indigenous Australians Agency over a plan to take a 10 per cent personal stake in Winchelsea Mining.

Anindilyakwa Land Council chief executive Mark Hewitt. Picture: Supplied

The NIAA also commissioned a report to check on the ALC’s progress implementing recommendations from an Australian National Audit Office (ANAO) audit last year.

The independent report, made public last week, found none of the 15 recommendations had been fully implemented and only two “largely implemented”, despite the ALC’s own reporting that 13 had been completed and closed.

It also found issues with governance, operations, and managing conflicts of interest remained, including in relation to royalty payments.

ALC chief executive Mark Hewitt came under fire after the auditor general last year revealed $24m – half of the ALC’s 2021-22 royalties – was invested into entities supporting Winchelsea Mining, a venture jointly established and directed by Mr Hewitt and now-deceased council chair T Wurramarrba.

Figures subsequently provided to senate estimates also showed the Groote Holding Aboriginal Corporation, of which Mr Hewitt is an unpaid director, received $64m from the ALC over the past four years – many of its projects directly or indirectly supporting Winchelsea Mining.

The Groote Archipelago has some of the richest manganese deposits in the world.

In its response to last week’s independent review, the ALC said all conflicts of interest had been carefully managed, including Mr Hewitt leaving the room when Winchelsea was discussed in Board meetings.

The ALC backed Mr Hewitt’s “active interest” in helping develop Groote’s economic future in line with the ALC’s strategic plan.

“The ALC is a forward-looking land council committed to reflecting the wishes of the traditional owners and proactively supporting Anindilyakwa self-determination for a prosperous, culturally informed future in the Groote Archipelago,” it said.

“This vision is aligned with the values and aspirations of the TOs, particularly as we prepare for the transition from mining operations over the next seven – 10 years.

“In recent years, the ALC has undergone significant changes to support the TOs’ wishes, demonstrating leadership in self-determination.

“The ALC has been strongly committed to implementing the ANAO performance report recommendations and identifying further opportunities to enhance our governance.

“We have proactively addressed the ANAO’s recommendations and committed to an additional 33 improvement initiatives identified in the report.”

Indigenous Australians Minister Malarndirri McCarthy has frozen funding to the ALC and put its Board on notice. Picture: Brendan Radke

Minister McCarthy said she took governance at land councils seriously and the lack of progress implementing audit recommendations was unacceptable.

“Good governance is the cornerstone of trust and needs to be based on transparency, fairness, and accountability,” she said.

“Without the trust of the Anindilyakwa people and other key stakeholders, the ALC cannot properly represent its people and achieve its mission.

“Poor governance and decision making can have a significant and detrimental impact on social, cultural and economic wellbeing.

“The (ALC Board’s) failure to sufficiently respond to the recommendations of the independent review and ANAO must not continue, and they need to demonstrate their progress to the NIAA.”

Minister McCarthy withheld the ALC’s 2024/25 budget, approving an operational budget until December.

She said a full budget would only be considered when her department was satisfied the ALC was sufficiently implementing reforms.

The ALC is conducting Board elections this week, and the new Board is expected to meet with the NIAA’s integrity group in the coming weeks to discuss its progress.

Originally published as Anindilyakwa Land Council’s funds frozen amid stalled progress on audit recommendations