Millions in mining royalties ‘fail to deliver’ basics to Groote Aborigines

Groote Eylandt Aborigines lack food, housing and personal safety despite their land generating tens of millions yearly in ­mining royalties.

Two Groote ­Eylandt bodies historically have received more than $20m in royalties a year from South32’s GEMCO mine.

Groote Eylandt Aborigines lack food, housing and personal safety despite their land generating tens of millions of dollars a year in ­mining royalties and contributing the lion’s share to the Aboriginals Benefit Account.

Internal documents reveal ­Anindilyakwa Land Council has launched a radical overhaul of its finances after conceding “core community wellbeing needs are still not being met”.

The Groote archipelago supported a “very substantial” drug trade and the majority of royalty income left the community.

The organisation for years “poorly understood” the millions of dollars in payments it handled and its chief financial officer until 2011 was not a qualified accountant and was unable to provide new managers with “any systematic overview of how monies were received, for what purpose, and how they were being distributed”, the internal reports show.

The ALC, a commonwealth agency, is one of two Groote ­Eylandt bodies that historically have received more than $20 million in royalties a year from South32’s GEMCO mine.

Almost 100 pages of internal rep­orts, summaries and sample corre­spondence — marked “private and confidential communication, not for distribution” — show the ALC believes that its business arm, Groote Eylandt and Bickerton Island Enterprises, achieved outcomes “not propor­tional to the vol­ume of royalty money ­received”.

“Core community wellbeing needs are still not being met,” one document states.

“This includes a substantial and continued lack of housing, recreational facilities for youth, healthy and adequate food supply, sustainable access to country and the ­cre­ation of safe communities. The very substantial local economy of cannabis is part of a ­response to much of the above. The majority of rent and royalty incomes are leaving the community.”

The document calls for a distribution framework that delivers on basic needs and to stimulate local enterprise and jobs.

GEBIE was established in the early 2000s as the ALC’s eco­nomic arm and main royalty recip­ient. The land council relinquished control in March last year, after a 2012 report that criticised governance arrangements.

“It is also the reality that prior to commencement of the current administration of the ALC, the complexity of these payments was poorly understood by the ALC, by the Australian government and auditors, and it has taken a great deal of time and enquiry by the current staff of the ALC to accurately understand this complexity and to begin to communicate this to the relevant reportable authorities,” the ALC report states.

The ALC board had now made a “conscious and deliberate decision” to stop relying upon one entity to “create the future” and instead exercise its legal requirement to oversee and support other organisations to develop.

The framework was developed after an alleged multi-million-dollar rort of Groote’s other big royalties fund emerged in 2012.

The Groote Eylandt Aboriginal Trust is registered under Northern Territory legislation des­igned for sporting clubs, des­pite being worth several tens of millions of dollars.

Accounting firms Deloitte and KPMG and corporate law firm Minter Ellison face civil action, brought by GEAT’s new managers, over alleged failure to detect evidence that GEAT’s money was being wasted on cars, boats and trips to the casino over a three-year period. Former GEAT public officer Rosalie Lalara, the only person criminally charged in ­relation to the scandal, recently pleaded guilty to misappropriating about $500,000.

The Australian revealed last week that three Groote Eylandt Aboriginal corporations, including GEBIE, had allegedly misspent hundreds of thousands of dollars as regulators sought to clean up the GEAT scandal.

Indigenous Affairs Minister Nigel Scullion said Groote had “zero” to show for the revenue mining generated. “White people stealing money from Aboriginal organisations is high on my ­agenda,” he said. “They seem to know they can take advantage.”

An ALC representative confirmed the documents were authentic, but declined to comment.