The economic and social impacts of the CDEP scheme in remote Australia.
Altman, Jon ; Gray, Matthew
1. Introduction
While there is a general concern about the high level of economic
disadvantage experienced by Indigenous Australians, there is an emphasis
in public policy, and in debates about public policy, on remote
Indigenous communities. According to conventional economic and social
indicators, the disparity between Indigenous people living in remote
areas and both Indigenous and non-Indigenous Australians living in
non-remote areas is growing (ABS 2004a, 2004b). There is evidence that
some discrete Indigenous communities in remote Australia are in economic
and social crisis.
The number of Indigenous people living in remote areas of Australia
is substantial. According to data from the 2001 Census and the Community
Housing and Infrastructure Needs Survey there are 120,000 Indigenous
people, about 26 per cent of the total Indigenous population of 460,000,
living in L200 discrete communities in remote regions. While only around
one-quarter of Indigenous people live in remote areas of Australia, this
is much higher than for the Australian population as a whole, of whom
only 3 per cent live in these areas.
There are features of these remote indigenous communities that make
them fundamentally different from other Australian, and many
international, economic development contexts. First, these communities
are in sparsely populated regions of Australia that are extremely
distant, both geographically and culturally, from markets. Second, many
are located on land that is owned by Indigenous people. The forms of
land ownership are different: land is inalienable and held under various
land rights and native title legal regimes. Third, these regions were
colonised relatively late, with some parts of Arnhem Land and central
Australia as recently as during the last 50 years. This has meant that
customary (kin-based) systems and practices are robust and there is
ongoing contestation between mainstream Australian and Indigenous
worldviews. The very different economic context is perhaps most starkly
illustrated by the fact that the Indigenous population in these areas
have a non-CDEP employment (hereafter termed 'mainstream
employment') rate of just 20 per cent and receipt of income support
payments is correspondingly high.
One of the most important programs in remote areas for Indigenous
community and economic development is the Community Development
Employment Projects (CDEP) scheme. CDEP employs around 36,000 Indigenous
Australians and accounts for over one-quarter of total Indigenous
employment and 63 per cent of Indigenous employment in remote areas.
Almost 60,000 people participate in the scheme each year. The fact that
the number of participants over a twelve-month period is approaching
double the point in time number of places highlights the relatively high
rate of movement through the scheme.
The CDEP scheme was first introduced in May 1977 in a small number
of remote Aboriginal communities in response to concerns that the
introduction of unemployment payments would result in social problems.
The scheme proved immediately popular, which led to concerted pressure
for expansion to other Aboriginal communities. The scheme was initially
established in remote areas and while it has expanded into regional and
urban areas it remains the case that the majority, of participants are
in remote areas (73 per cent). Unless otherwise stated the figures used
in this article are drawn from the National Aboriginal and Torres Strait Islander Survey (NATSISS) conducted in August 2002.
The scheme has undergone a number of expansionary phases, but
remains fundamentally unchanged. Funding is allocated to CDEP
organisations for wages for participants at a level similar to or a
little higher than income support payments, enhanced with administrative
and capital support. CDEP organizations provide employment, training,
activity, enterprise support, or income support to Indigenous
participants. (1) The scheme currently aims to achieve two broad
outcomes: building and maintaining a strong, functional, and sustainable
socio-cultural and economic base for individuals and communities; and
increasing individual access to, and participation in, the mainstream
labour market.
In remote Australia the CDEP scheme performs five main roles.
First, it provides flexible employment opportunities, often in contexts
where there are no, or limited, mainstream employment opportunities,
particularly for Indigenous people. Second, it provides income security,
and the opportunity to earn additional income from employment and
enterprise as well as imputed income from participation in customary
(non-market) work. Third, it provides opportunity for education and
training. Fourth, it can assist participants to move into mainstream
(unsubsidised) employment. Fifth, and most innovatively, it acts as an
instrument for economic and community development.
Despite the significance of the CDEP scheme, in recent times,
research on its social impact has been severely restricted by data
limitations. Often discussions of the scheme dismiss it as an
'Aboriginal work for the dole scheme' which does nothing to
improve the well-being of Indigenous Australians. In the 2002 Dr Charles
Perkins Memorial Lecture, Langton (2002) argued that CDEP was 'the
principal poverty, trap for Indigenous families and communities and that
it was a form of "legal apartheid" when it was introduced in
the 1970s and has since entrenched passive welfare'. In a recent
paper on development issues in remote Australia, Hughes and Warin (2005:
15) write 'CDEP "sit down money'" is a barrier to
the creation of real employment opportunities'. The former Minister
for Aboriginal Affairs, Peter Howson, in a paper discussing reasons for
continuing Indigenous economic disadvantage similarly dismisses CDEP as
'sit-down' money (Howson 2004).
Rowse (2002) provides a sophisticated examination of some tensions
within the scheme. In particular he notes that in many contexts the
scheme operates as a 'substitution funding' mechanism that
allows poorly resourced public services in indigenous communities to be
propped up with CDEP-funded labour. The scheme has also facilitated cost
shifting from State governments to the federally-funded scheme. Rowse
(2002: 65-72) highlights the difficulties in measuring outcomes from the
scheme owing to its multiple objectives: not only is there a tension
between the employment and community development (social) goals of the
scheme, but it also has the capacity, to have political outcomes thought
its capacity to sustain robust Indigenous organizations.
However, the position of the Commonwealth department responsible
for administering the CDEP program since 2004, the Department of
Employment and Workplace Relations (DEWR), is that the scheme is
successful. The Minister for Employment and Workplace Relations Minister
released a Discussion Paper in February 2005 entitled 'Building on
Success' which outlines possible changes to the scheme. The DEWR
report expresses the view that 'The CDEP Programme has become an
important part of many Indigenous communities over the last 28 years. We
need to build on this success and ensure that CDEP meets the needs of
Indigenous people in 2005 and into the future' (DEWR 2005: iii).
Although the DEWR CDEP Discussion paper does recognize the multiple
objectives of the CDEP scheme, it places a heavy emphasis on the labour
market functions of the scheme and pays relatively little attention to
its other roles.
This article focuses on the CDEP scheme in remote areas. Our aim is
to present new evidence on the impact of the CDEP scheme on economic and
social outcomes for Indigenous people in these areas. There has been
little research using large-scale data sets on the CDEP scheme in these
areas. The lack of research is a consequence of a lack of data on CDEE Those surveys that are capable of producing statistics have not included
reliable information on CDEP employment in remote and very, remote
areas. The 2001 Census allows for statistics to be produced for remote
and very remote Australia, but employment on the CDEP scheme is not
reliably identified. The release by the Australian Bureau of Statistics
(ABS) of the National Aboriginal and Tortes Strait Islander Social
Survey (NATSISS) 2002 provides for the first time more reliable data on
the CDEP scheme in remote and very remote areas of Australia. In this
article a range of economic and social outcomes of CDEP participants and
those in other labour force states (mainstream employed, unemployed and
NILF) are compared. However, using the NATSISS 2002 survey it is not
possible to identify.' the causal impacts of the CDEP scheme and so
some caution is needed in interpreting the results.
Except in our discussion of tables, we use the term
'remote' in a non-technical sense to refer to all those
regions that are technically classified in the Australian Standard
Geographic System as either 'remote' or 'very
remote'. We distinguish 'remote' from 'very
remote' in our tables in order to give the reader a finer-grained
understanding of the differences among those regions of Australia that
are 'remote'. Examples of remote areas include Alice Springs,
Mount Isa and Esperance. Very remote areas represent much of central and
western Australia and includes towns such as Tennant Creek, Longreach
and Coober Pedy, as well as most discrete Indigenous communities located
on the Indigenous estate, Indigenous-owned land.
The statistics presented in this article clearly' show that
remote and very remote areas together are quite different, both in terms
of the economic environment and the characteristics of the Indigenous
population. This is consistent with a large body of ethnographic and
anthropological research that has long highlighted the structural
differences between the Indigenous population in remote areas and the
Indigenous population living in non-remote Australia.
Our central argument is that data from the NATSISS 2002 support the
view that Indigenous participants can both raise their income above what
they would were they 'unemployed' while allowing them to
continue certain unpaid activities that are widely understood to be
socially beneficial. It provides a form of Indigenous employment and
income support in regions that are often very distant from mainstream
labour markets to participants that frequently have very different
aspirations, and very, different life chances, from other Australians.
The remainder of this article is structured as follows. In the
second section the labour force status of Indigenous people in different
areas of Australia is described. The third section presents evidence on
the effects of the scheme on the income of CDEP participants and the
extent to which participants are working more than short part-time
hours. In the fourth section participation in the customary economy and
cultural activities is analysed. In the final section the evidence on
the social and community development impacts of the program are briefly
summarised.
2. Indigenous labour force status in remote and very remote
Australia
In this section the labour force status of Indigenous people in
remote and very remote areas are described. The labour force status in
other areas of Australia (major cities, inner regional and outer
regional) are also discussed in order to provide a comparative
perspective of labour force status and the role of the CDEP scheme
across Australia.
The importance of the CDEP scheme varies from region to region. In
remote areas in 2002 16.9 per cent of the working age population was
employed in the CDEP scheme (Table 1). In very remote areas 42.2 per
cent were employed in the scheme. In contrast, in major cities just 3.7
per cent of the Indigenous working-age population was employed in the
scheme. In inner and outer regional areas, the proportions working in
the scheme were 4.6 per cent and 6.1 per cent respectively. Thus the
CDEP scheme is much more significant in areas in which there are fewer
or no mainstream employment opportunities. In major cities, 46.8 per
cent of the Indigenous working-age population is in mainstream
employment; in remote areas the proportion is 31.7 per cent, and in
very, remote areas a very low 14.9 per cent.
In very remote regions CDEP accounts for nearly three-quarters of
Indigenous employment and in remote areas it accounts for 35 per cent of
total employment. Given the low level of market demand for the labour of
most Indigenous people in remote and very remote areas it is likely that
very few CDEP participants would move mainstream employment in the
absence of the CDEP scheme. In other words the 'crowding out
effect' of mainstream employment by the CDEP scheme is small.
Assuming that the CDEP scheme has no crowding out effects, then in the
absence of the scheme the official unemployment rate of Indigenous
Australians in remote areas would increase from 17.2 per cent to 34.1
per cent and in very, remote areas from 7.0 per cent to 49.2 per cent.
The labour force status of non-Indigenous people living in remote
and very, remote areas of Australia is very, different than in other
areas of Australia. In remote areas the non-Indigenous employment rate
(for the population 15 years plus) was 66 per cent and the unemployment
rate was 6 per cent. In very, remote areas the non-Indigenous employment
rate was 73 per cent and the unemployment rate 5 per cent. These
employment rates are much higher than for the non-Indigenous population
in major cities where the employment rate is 58 per cent and the
unemployment rate 9 per cent. (Employment and unemployment rates for the
non-Indigenous population are from the 1996 Census.) These figures
highlight that in very remote areas, and to a lesser degree remote
areas, non-Indigenous people are primarily residing in the area for
employment.
3. Income and working hours
In remote areas the CDEP employed have a gross weekly average
income of $271. Although this is much lower than the average income of
mainstream employed of $587, it is substantially higher than the weekly
average income of the Indigenous unemployed ($168) and those not in the
labour force (S 190). The average income of Indigenous people in very
remote areas is similar to the average for those living in remote areas.
The main difference is that in very, remote areas the income of those
not in the labour force is higher than it is remote areas ($213 and $190
respectively). This difference is probably explained by the larger
average number of children in very, remote areas and consequently
greater amount of Family Tax Benefits payments received.
These findings reflect the relatively liberal rules and procedures
of CDEE First, CDEP organisations have the ability to develop
enterprises and win contracts using the CDEP workforce and on-cost
funding, thereby generating additional income which can be used to
increase participants hours and provide 'top up' wages.
Second, CDEP organisations may receive funding, primarily from
government, to offer traineeships or apprenticeships to participants,
especially where Structured Training and Employment Project (STEP)
funding is available. Traineeships and apprenticeships often involve
full-time employment (with combined funding from STEP and CDEP) and
consequently a higher income. Third, the income test applied to CDEP
participants is more generous than that applied to income support
payments and does not have the disincentive effect of the taper. Fourth,
CDEP participants are sometimes placed with third party employers, who
can top up their wages.
Although the notional CDEP wages component only provides for
part-time work (16-24 hours), a significant proportion of CDEP
participants' usual working hours are long part-time hours (25 to
34 hours per week) or even full-time hours. In remote areas, 10.8 per
cent are working 25 to 34 hours and 20.3 per cent are working full time.
In very remote areas 9.6 per cent are working 25 to 34 hours and 18.0
per cent are working full-time (Table 3). The scheme clearly generates
activity.
4. Participation in the customary economy and cultural activities
The tangible outputs of CDEP workers add directly to community
development, but may also enhance individual wellbeing over and above
the pecuniary benefits from increased income. Being unemployed is often
associated with higher rates of police harassment and arrest, low levels
of social capital and civic engagement; and high levels of drinking
related offences (Hunter and Taylor 2002). Furthermore, the social costs
of unemployment appear to spill over onto other members of a household.
The CDEP employed sometimes fared better and sometimes worse than the
unemployed on a range of indicators, but as expected the CDEP employed
generally fare worse than the mainstream employed. The similarity
between CDEP and unemployment may be overstated as the long-term
unemployed have substantially worse social outcomes than do the CDEP
employed (Hunter 2002). Many CDEP participants would be long-term
unemployed if they were not participating in the scheme.
It is often argued that employment in the CDEP scheme is attractive
to Indigenous people as it allows a combination of participation in
customary (non-market) activities and the paid labour market. The
NATSISS 2002 survey reveals that the CDEP employed are more likely to
have participated in such activities than are the mainstream employed
(Table 4). For example, in remote areas, 28.2 per cent of the CDEP
employed had attended funerals, ceremonies or festivals (that is,
participated in cultural activities) in the previous three months,
whereas only 5.5 per cent of the mainstream employed reported attending
these kinds of events. A much higher proportion of the CDEP and
mainstream employed attended funerals, ceremonies or festivals in very.
remote areas than in remote areas, but in both types of area the CDEP
employed were still substantially more likely to have attended these
kinds of events.
The CDEP employed are also much more likely than the unemployed to
have been fishing or hunting in a group. The NATSISS 2002 question only
asked about fishing or hunting which occurred in a group and hence the
statistics do not include fishing or hunting done as an individual
activity. In reality fishing and hunting is often an individual activity
(Altman 1987) and thus the NATSISS 2002 figures provide an underestimate
of the prevalence of these activities.
Of course, it may also be the case that those who are more
motivated and active are both more likely to participate in the CDEP
scheme and to undertake customary (non-market) activities. However, the
fact that the CDEP employed are more likely than the mainstream employed
to participate in these activities supports the hypothesis that
participation in the CDEP scheme provides the time and workplace
flexibility to undertake the customary activities to which many
Indigenous people aspire. (2)
However, using existing data sources it is not easy (or perhaps
even possible) to distinguish between the hypotheses that the kinds of
people who take up CDEP employment are those who are particularly active
in customary activities to begin with and the explanation that
employment in the CDEP scheme increases participation in customary,
activities.
Some commentators have highlighted that one of the important
beneficial social impacts of the CDEP scheme has been the resourcing of
over 200 organisations to represent Indigenous participants in a variety
of forums, concerning such matters as representing land interests,
development interests, and employment and training issues (see Rowse
(2002: 72-75) and several chapters in Morphy and Sanders (2004)).
Beyond the NATSISS data there is growing evidence (e.g. Airman
2003; Altman and Whitehead 2003; NLC 2004) that Indigenous participation
in the customary sector and in natural and cultural resource management
on the Indigenous estate is generating considerable benefits for the
nation and internationally in biodiversity conservation, fire abatement
and in control of exotic (introduced) weeds and pests. In some
situations, Indigenous CDEP participants are also participating in
biosecurity, coastal surveillance, and land and sea management
activities (NLC 2004). This all suggests that there are additional
positive externalities for Indigenous communities, regions and the
nation from the scheme that are not captured by NATSISS 2002 data, that
are often unrecognized, and that are consequently undervalued and
under-resourced.
This natural resource management (NRM) is supported by the CDEP
scheme in two ways. First, a number of CDEP organizations in remote
areas, are involved with 'caring for country' and other NRM
activities. Second, the scheme allows participants in remote areas to
choose between the level of engagement they undertake in the formal
labour market and the effort they invest in NRM.
There have been a number of case studies using both quantitative
and qualitative techniques of CDEP organisations in different areas of
Australia and at different times. Almost all of these studies have come
to the conclusion that the program has positive effects on the wellbeing
of individual participants' and on community, development (see
Altman et al. (2005) for a discussion of evidence). Government reports
and government-commissioned consultancy reviews of the scheme have also
invariably concluded the scheme has positive social impacts (Deloitte,
Touche and Tohmastu (1993), Office of Evaluation and Audit (1997) and
Spicer (1997)). We can therefore confidently conclude that the scheme
has positive effects on individual, family and community, wellbeing.
5. Concluding comments
Many assessments of the current development trajectory for
Indigenous communities in remote Australia are pessimistic. Government
policies of the last 30 years have allowed a combination of citizenship
entitlement (as an emerging right for Indigenous Australians) and
self-determination to facilitate life-style choice. However, this has
not delivered measurable improvements in economic and social indicators
for remote Indigenous people and communities as compared to those living
in other regions of Australia. There is however evidence that at the
national level most social indicators (including those measuring
employment, income, education and housing status) show that there has
been steady, although not spectacular improvement in outcomes between
1971 and 2001 (Altman et al. 2004). This finding is somewhat at odds
with the emerging public narrative of the 'failure' of
Indigenous policy.
While some indicators will exaggerate the event of disadvantage in
remote areas because they take no account of customary, activities such
as hunting and fishing, rates of economic and social disadvantage remain
high. Indigenous people mainly choose to live in remote areas for
non-market reasons--because of continuing links with country. While it
is sometimes argued that Indigenous residents of such communities should
migrate elsewhere to engage with the market economy, it is highly
doubtful that they would be able to effectively compete for mainstream
employment.
We contend that policy should enhance investment in what is
working. The CDEP scheme has been operating for 28 years and is a proven
means of providing workfare in remote areas with limited mainstream
opportunities for Indigenous Australians. It remains an important,
flexible and innovative program. The evidence presented in this article
shows that CDEP participants in remote regions have higher average
incomes than the unemployed and those not in the labour force. There
have been a number of case studies of CDEP organisations in different
areas of Australia at different times. Almost all of these studies have
identified positive effects on individual participants' wellbeing
and on community development. A number of government reviews have also
concluded that the scheme has positive social outcomes.
A key conclusion that can be drawn from the data presented in this
article is that the CDEP employed are more likely to participate in
customary (non-market) activities than are the mainstream employed. The
NATSISS 2002 data provides the first official statistical and broadly
based opportunity to compare participation in customary- activities in
remote and very remote areas.
Noel Pearson, a prominent Indigenous commentator, who has argued
that the CDEP scheme has enjoyed mixed success, with some communities
running very successful CDEP programs, while other programs are not
easily distinguishable from the dole. It is interesting that Pearson
appears to argue that the CDEP scheme meets his principle of reciprocity
and is therefore outside of what he terms the 'passive welfare
paradigm' (Pearson 2000). The CDEP scheme is a mutual obligation
type program and so fits well with the current approach to work force
participation and the recommendations of the most recent review of the
Australian social security, system (McClure 2000).
The policy aim to have Indigenous people in remote areas employed
in mainstream jobs is not new and has been expressed by successive
policy reviews since the early 1970s (e.g. Miller 1985). However, since
the identification of the need to create an economic base in remote
areas, no government has been successful in directly generating anything
but a tiny fraction of the mainstream jobs needed. While there may be
some potential for the government to increase the number of mainstream
jobs filled by Indigenous people in remote areas, it is simply
impossible for enough unsubsidised mainstream jobs to be generated in
the short to medium term. In this context the CDEP scheme has been very,
successful in generating positive economic and community development
outcomes at minimal cost to the Commonwealth budget--Australian tax
payers.
We are grateful to Will Sanders, Bill Fogarty and two anonymous
referees for comments on an earlier version of this article and to the
Chifley Research Foundation for financing access to purpose designed
cross-tabulations from the National Aboriginal and Tortes Strait
Islander Social Survey 2002.
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Endnotes
(1). Approximately 76% of the $570 million 2004/05 budget
allocation for the scheme was expenditure that would otherwise be
incurred in the form of social security payments (ATSIC 1203). In
2004/05, on a per participant basis, the expenditure was $14,595, of
which $11,092 was offset against social security payments and $3,803 was
the extent of additional expenditure per participant.
(2.) For more detail on these issues see a recent analysis using
NATSISS 2002 data of participation in the customary sector and in
cultural activities and the role played by the (DEP scheme in
facilitating such engagements by Altman, Buchanan and Biddle (2005).
Professor Jon Attman is Director of the Centre for Aboriginal
Economic Policy Research (CAEPR) at the Australian National University
and Dr Matthew Gray is Deputy Director, Australian Institute of Family
Studies (AIFS). At the time of writing Matthew Gray was a Research
Fellow at CAEPR. The views expressed in this paper are those of the
authors and may not reflect those of AIFS.
Table 1. Indigenous labour force status by region, 2002
Region
Major
Labour force status cities Inner Outer
per cent regional regional
CDEP employment 3.7 4.6 6.1
Mainstream employment 46.8 39.0 35.3
Unemployment rate 25.2 30.0 29.1
Unemployment rate (CDEP
counted as unemployed) 30.7 37.4 39.6
Total in the labour force 67.5 62.3 58.4
Population (No.) 83,300 52,900 60,100
Very Total
Labour force status Remote remote Australia
CDEP employment 16.9 42.2 12.7
Mainstream employment 31.7 14.9 35.5
Unemployment rate 17.2 7.0 23.0
Unemployment rate (CDEP
counted as unemployed) 46.0 75.7 43.3
Total in the labour force 58.7 61.6 62.6
Population (No.) 23,100 49,850 269,250
Note: Table population is Indigenous persons aged 15-64 years.
Source: NATSISS 2002.
Table 2. Average gross personal weekly
income ($) by labour force status,
remote and very remote areas 2002
Remote Very
Employed remote
CDEP $271 $276
Mainstream $587 $581
Unemployed $168 $167
Not in the labour force $190 $213
Total $283 $344
Note: Table population is Indigenous
persons aged 15-64 years.
Source: NATSISS 2002.
Table 3. Usual weekly work hours
of CDEP participants, remote and
very areas (%), 2002
Usual work Remote Very
hours per remote
cent
1-16 15.6 10.4
16-24 53.3 61.4
25-34 10.8 9.6
35+ 20.3 18.0
Population (no.) 3,900 21,100
Note: Table population is Indigenous
CDEP participants aged 15-64 years.
Source: NATSISS 2002.
Table 4. Cultural and social activities in the last three months,
remote and very remote areas, 2002
Remote Very
Remote
%
Recreational or cultural
group activities
Employed
CDEP 33.3 64.9
Mainstream 21.9 54.1
Unemployed 21.7 36.4
Not in the Labour Force 20.8 57.8
Community or special
interest group activities
Employed
CDEP 25.6 38.4
Mainstream 20.5 41.9
Unemployed 13.0 27.3
Not in the Labour Force 11.5 27.6
Funerals, ceremonies
or festivals
Employed
CDEP 28.2 65.9
Mainstream 5.5 41.9
Unemployed 13.0 50.0
Not in the Labour Force 20.8 69.8
Fishing or hunting
in a group
Employed
CDEP 35.9 76.8
Mainstream 4.1 47.3
Unemployed 8.7 50.0
Not in the Labour Force 17.7 70.3
Notes: Table population is indigenous persons aged 15-64 years.
Although fishing or hunting is included in this table it is
as much an economic as cultural or social activity.
Source: NATSISS 2002.