Bennelong Society Conference 2003:
An Indigenous Future? Challenges and Opportunities

Land Rights, Native Title and the Mining Industry

George Savell

President of the Bennelong Society Senator Jeannie Ferris, Members of the Society's Board, distinguished guests all.

I am honoured to have been asked to deliver this address on the nationally important issue of Land Rights, Native Title and the Mining Industry.

By way of background, I have been involved with Land Rights and Native Title issues since 1984. I have represented both the Agricultural and Mining industries over a continuous period of 19 years on these matters.

It will be no surprise to you that over that period I have formed some definite views of the concepts, and the reasons why both Land Rights and Native Title have raised such controversy in the community.

I have observed closely the development of a body of law to deal formally with the process of determining:

• whether Native Title still exists in an area;
• whether it has been affected or extinguished by past actions;
• who can now claim ownership of any Native Title rights which have survived; and
• just what Native Title rights remain in each particular claim area.

The mining industry has been closely associated with Land Rights and more latterly, Native Title and with the whole spectrum of practical problems which have arisen as a result of these concepts.

On 3 June 1992, in its Mabo (No.2) decision, the High Court of Australia recognised a form of customary native title which it said had existed for 'time immemorial'. The doctrine of terra nullius, that the land belonged to no-one before European settlement, was rejected. In the process of deciding in favour of the Meriam people, who occupy the Murray Islands situated in the Torres Strait, the Court established a doctrine of native title which now has effect throughout the whole of Australia.

Let's briefly revisit the High Court decision in Mabo 2.

• The basic findings of the High Court can be summarised as follows:
  • in upholding the claims of the plaintiffs, the Court rejected the doctrine that, prior to European settlement, Australia was terra nullius (land belonging to no-one);
  • the Court held that native title rights survived settlement, though subject to the sovereignty of the Crown;
  • after settlement, governments, (British, State Territory and Commonwealth,) could extinguish native title by legislation or by granting interests in land (such as freehold and certain leasehold interests);
  • in the case of the States, the power of the Crown to extinguish native title by legislative or executive action was now subject to overriding Commonwealth legislation---the Racial Discrimination Act 1975; and
  • subject to this Act, no compensatory damages would be payable for the extinguishment of native title.

We must recognise a further issue:

Native title was and is a social justice issue aimed at redressing the original dispossession of Indigenous people at the time of European settlement. Socio-economic questions also arise as a result of the Native Title Act.

Following the High Court judgement a number of major steps were taken by the Commonwealth, where the Keating Government had determined that legislation was required to manage native title.

The Commonwealth consulted the states and territories in an attempt to establish how native title should be dealt with in a collaborative way. Discussion papers were circulated and a public debate arose. This initiative failed so that a collective Commonwealth/State treatment of native title did not eventuate.

In response to the High Court ruling the Keating Labor Government drafted and presented the Native Title Bill 1992 to the Federal Parliament.

Certain unusual rights were settled on claimants including an ability to negotiate with developers for effect on claimed native title rights prior to completion of the claim process and before any rights had been formally awarded to the claimants. Other rights included an ability to receive compensation for the effect of new developments (known as future Acts) on native title rights in a claimed area.

The Native Title Act, following considerable parliamentary and public debate, was eventually passed by both Houses of Parliament on 22 December 1993 and came into effect on 1 January, 1994.

The highly political debate associated with the passage of the Native Title Act (the NTA) focused primarily on social justice questions relating to rural and urban Aboriginal groups. Little attention was paid to the implications of the legislation for the wider Australian community or the future economic development of the nation.

This Act has been since demonstrated to be incompetent legislation which has cost industries and the community vast sums of money in compliance costs.

The Native Title Act was fatally flawed from the outset. It is the only Act I have seen in my career which purports to manage an issue without providing a coherent definition of the thing to be managed.

The Commonwealth Parliament in 1993 thus effectively abdicated its authority to the Courts, which have struggled ever since to give form and substance to native title. The final condemnation of the Act is that it has clearly not served the interests of industry or the Indigenous community well, judging from the complaints from both sides.

Despite accusations by uninformed commentators, the Australian mining industry does not oppose or reject the concept of native title, nor does it have a philosophical or political objection to awarding Aboriginal Australians native title. The industry's grievances in relation to the legislation stem entirely from the Act's unworkable processes, most notably those relating to the claim determination and 'right to negotiate' processes. The Western Australian Coalition Government enacted its own legislation, the Land (Titles and Traditional Usage) Act 1993 (WA) on 2 December 1993. The Act was successfully challenged in the High Court by Aboriginal plaintiffs. In a decision handed down on 16 March 1995, the Court held that the Western Australian legislation was inconsistent with the Racial Discrimination Act 1975 and effectively struck it out.

As anticipated by AMEC in 1993, the NTA has become the most significant statutory disincentive to domestic mining industry investment ever encountered by the industry. The lodgement and registration of native title claims has steadily increased in recent years. Currently, over one third of Australia's land mass is under claim, while in Western Australia, 90 per cent of the State is under claim. As at April 2003 there were 640 active native title claims Australia wide with 144 of those in Western Australia.

Moreover, the Wik amendments introduced by the current Coalition Commonwealth Government in June 1998 to rectify the legislation's major shortcomings, have failed to deliver the results sought by the mining industry due to their heavy reliance on State-based native title regimes. The establishment of State native title regimes has proved very difficult; due to the Federal Attorney-General's approval of State regimes being subject to Federal Parliamentary disallowance.

The Federal Parliament's ability to disallow proposed State and Territory native title regimes has, unfortunately, transported native title to a new level of politicisation. The ALP and minor parties in the Senate have obviously resolved to claw back their perceived losses in relation to the Wik amendments by disallowing or amending, so as to neutralise the effectiveness of the State and Territory regimes proposed to date, despite decisions by the Attorney General which certify that the State and Territory legislation complied with the NTA.

Efforts respectively by the Northern Territory Government and by the Western Australian Government to have Territory and State regimes implemented in accordance with Section 43A of the Native Title Act were defeated by the Opposition and minor parties in the Senate. The only State where the Senate has allowed any form of State regime to become operational is Queensland, and this Act has now been further altered by the Federal Court, striking out some parts of the legislation.

The Senate gutted the original Queensland Act and the net effect is that the right to negotiate dominates. The Section 43A scheme for pastoral leasehold land was disallowed by the Senate. The scheme now applying in Queensland is actually more restrictive than the Commonwealth legislation it replaced. The Queensland legislation is so restrictive in terms of mineral exploration that exploration for minerals in Queensland has virtually come to a complete standstill, even before the recent Federal Court judgement.

The Queensland Government has now literally abandoned the use of this legislation and has instead, as was the case in Western Australia, reverted to the Federal process.

To demonstrate the problem, from mid-2000 and throughout 2001 over 11,000 Western Australian prospecting, exploration, mining and mining infrastructure tenement applications were stalled in the then Department of Mineral & Petroleum Resources system, awaiting grant due to the difficulties associated with native title. Furthermore, a significant number of the 11,000 tenement applications in the system at that time were lodged up to five years previously. In contrast, before the passage of the NTA, approximately 2,500 tenement applications could be found in the Western Australian system at any one time awaiting grant. The Wik amendments did little, if anything, to reduce the application backlog.

During the slow tortuous progress of native title claims and the many Court actions, claimants realised that native title may not deliver everything they initially believed it would. Arguments over connection to the land and inflated expectations for compensation in matters of effect on native title of 'future Acts' began to elevate the importance of Aboriginal Heritage issues as a means of establishing historical connection and to control entry to certain areas. Thus a joint native title/Aboriginal heritage position became common.

The current State Labor Government on coming to office, sought a way to reduce the backlog. In early 2002 a Technical Taskforce representing all stakeholders, chaired by National Native Title Tribunal member, Bardy McFarlane, presented a report on ways to deal with the backlog, which is currently being implemented by Government.

The two major recommendations of the Technical Taskforce were:

• the need for amendments to the Mining Act to allow reversion of some 5,200 Mining Lease backlog applications (many held for exploration purposes due to the terms of the Act being finite with respect to Exploration Licenses), to a new improved form of Exploration License

and

• the simultaneous resolution of the objection problem by Native Title claimants, to use of the expedited grant process for mineral title applications due to Heritage concerns.

A dual initiative is now being implemented to put these solutions in place.

An Aboriginal Heritage Working Group chaired by NNTT member Bardy McFarlane, on which all stakeholders are represented, is concluding regional Heritage template agreements to reduce objections to the use of the expedited process in grant of mineral titles.

Concurrently, a Department of industry and Resources Mining Recommendations Working Group, on which again all stakeholders are represented, was formed and has reached conclusions on what amendments to the Mining Act are required to clear the mineral title application backlog, together with longer term amendments to prevent the application backlog from re-occurring.

It is expected that both of these processes will reach conclusion by mid 2003.

Industry has made it clear that the amendments to the WA Mining Act will not be supported in the Parliament unless standard Heritage Agreements have been agreed between the Industry and the Indigenous people and the various Native Title Representative bodies (NTRB's) to ensure the minimum number of objections to grant of backlog applications.

In November 1998, the Miriuwung-Gajerrong people, whose traditional country crosses the border between Western Australia and the Northern Territory, had their native title claim recognised by a single Federal Court judge. The case went on appeal and in May 2000 the Full Court found that native title had been extinguished over significant parts of the claimed area including certain pastoral leases. In the light of this decision, the WA Department of Mineral and Petroleum Resources (DMPR) began to reduce the backlog of mining tenement applications by granting applications in areas where Native Title was said to be extinguished. The total number of applications in the DME system was however only reduced to about 10,500.

The importance of this decision turned on the fact that pastoral Leases (particularly enclosed and improved parts of these leases) extinguished native title. In Western Australia the majority of mineral production comes off Pastoral Leases.

Following the election of the Gallop Labor Government however, this process was suspended in favour of pursuing negotiated outcomes, which would effect total clearance of the backlog of applications.

The Full Federal Court decision in the Miriuwung-Gajerrong case was handed down on 8th August, 2002. In simple terms, the High Court decided that Native Title was a 'bundle of rights'. These rights could be partially extinguished or totally extinguished, they are not necessarily extinguished by pastoral leases or mining leases, they do not include rights to mineral and petroleum deposits and any exclusive right to fish in tidal waters has been extinguished.

The judgement re-affirmed Crown ownership of minerals and petroleum deposits.

Where Native Title rights and pastoral rights are in conflict, the pastoral rights prevail over Native Title rights to the extent that they conflict.

Thus, the High Court predictably extended and developed its approach in the original Wik Judgement from Queensland to Western Australia and the Northern Territory,

The High Court referred back to the Federal Court for detailed examination, the question of extinguishment of Native title rights based on the principles laid down in the Ward (Miriuwung-Gajerong) decision. The question of co-existence of Native title rights held by the Miriuwung-Gajerong to establish what can or cannot co-exist with other interests, was also referred.

While some certainty has been achieved, considerable uncertainty still prevails with respect to the Federal Court's decisions on matters referred from the High Court.

Increasingly, Native title claimants. Mining Companies and other stakeholders are coming to the conclusion that the only way to progress developments is by agreement directly between the parties. These agreements are reflecting commercial values and an atmosphere of goodwill between parties is increasingly evident. This is the final condemnation of the Native Title Act. This is a positive development and is likely to become the accepted future way forward.

Despite the Wik amendments to the Native Title Act in June 1998, many historical problems associated with the legislation remain unresolved, while a number of new difficulties have materialised subsequent to the passage of the amendments.

1. The claim determination process prescribed by the Act does not readily interface with the land title systems operated by the States and Territories, or with established commercial processes which form society's basis for commerce and trade. The claim determination process naively assumes that changes to land usage and proposed developments can be halted indefinitely pending the resolution of native title claims and, as such, ignores the commercial realities faced by the mining industry.

For example, many native title negotiations in train between claimants and miners for up to five years have made little progress due to the difficulties associated with multiple overlapping claims and/or exorbitant and unrealistic 'compensation' demands made on the part of some, or all of the claimants involved. Unfortunately, the commercial timeframes explorers and mine developers must adhere to provide extraordinary leverage to claimants in their efforts to extract financial and other benefits from developers, desperate to commence a project to access a global market 'window'.

2. 'Native title' is not defined by the Native Title Act, nor are the rights and responsibilities it confers clarified. The absence of a clear and practical definition of native title in the Act has fuelled a considerable degree of speculation as to what native title is and has created a climate of acute investor uncertainty over years.

To illustrate, Justice Malcolm Lee's November 1998 decision in relation to the Miriuwung Gajerrong native title claim in the Kimberley region of Western Australia and in the Northern Territory, raised more questions than answers in relation to what rights and responsibilities native title holders can expect to have recognised.

The Federal Court's March 2000 decision substantially clarified the position and overturned Justice Lee's determination. In turn, the native title holders/the State of Western Australia and other parties appealed the Federal Court's decision to the High Court, The High Court has now made further changes to the Federal Court's judgement and has referred some issues back to the Federal Court for further deliberation.

Uncertainty as to whether a Mining Lease extinguishes Native title wholly or partially and in what circumstances and what elements of co-existence may eventually apply, will exist at least until the new Federal Court judgement is available and probably beyond, if past events are any guide.

3. While the introduction of a strengthened claims registration test via amendment to the Act is seen as a big advance in terms of the Act's workability, in practice it has delivered very little tangible benefit to the industry. This is due to a growing number of native title claimants amalgamating their claims merely to ensure formal registration by the Tribunal and therefore access to the right to negotiate. Following registration, many claimants party to amalgamated claims simply revert back to individual negotiations with mineral developers, rather than undertake negotiations as an amalgamated group.

Clearly, this situation is not the outcome sought by the Federal Government or the industry. As the Native Title Act is silent on the issue, however, the legislation cannot stop the practice, which is commonplace in proven mineral provinces such as the Eastern Goldfields in Western Australia.

Further compounding this problem is the fact that since introduction of the revised registration test, a number of appeals have been lodged in the Federal Court by native title claimants and State Governments alike, disputing Tribunal decisions to accept or reject claims. This situation has produced ongoing developer uncertainty pending the appeal outcomes, while a claimant's ability to repeatedly amend and re-lodge their claim, has only added to the confusion.

4. Almost five years after the passage of the Wik amendments, not a single State native title regime has been established apart from a regime of dubious merit in Queensland. This is due solely to the need for Commonwealth Parliamentary endorsement of State and Territory native title regimes and, more specifically, the ALP and minor parties attitudes to the composition of proposed State legislation. It now appears certain that State and Territory attempts to establish native title regimes which work, will prove futile.

The Senate's treatment of Western Australia's native title legislation, which saw the ALP and minor parties combine to ensure the legislation's disallowance, was all the more disappointing given that the proposed State regime had, according to the Federal Attorney-General, satisfied the criteria applicable to State native title regimes as prescribed by the amended Act under Section 43A.

5. While AM EC has never supported the process of disallowance of legitimate State legislation by the Commonwealth Parliament, a: suggestion that the Commonwealth Parliament be afforded an ongoing right to scrutinise, seek amendment to and disallow subsequent amendments to State and Territory native title legislation, as enacted by State and Territory Parliaments, has seriously increased AMEC's concerns.

As repeatedly demonstrated, new legislation, regardless of its nature, will almost always require subsequent refinement to achieve workability and resolve unforeseen problems that only become apparent once an Act is in force.

AMEC is also concerned that should the Commonwealth Parliament be afforded the ability to vet later amendments to State native title legislation, the ALP and minor parties may then seek broader ranging Federal involvement in other aspects of a State or Territory's legislative affairs,

6. The extreme uncertainty generated by the Native Title Act has prompted many mining companies to reassess investment policy with respect to their Australian operations. The imposition of lengthy native title timeframes and escalating compliance costs on an industry that must contend with volatile global markets, long development lead times and huge capital investments, is a recipe for economic disaster.

(For further information, see AMEC's 'Essential Data for Australia's fining Industry - 2003' and the 'Core Issues Paper - Mineral Exploration, A Crisis Realised'.)

In relation to mineral exploration particularly/ recent years have witnessed a growing number of Australian mining companies committing substantial percentages of their mineral exploration budgets offshore. In Australia today, the majority of domestic exploration expenditure (which has plummeted in recent years) is being spent on granted mining leases, ie., 'brownfields' exploration, while over ninety per cent of Australian money going offshore is spent on grassroots or 'greenfields' exploration programs. Given that greenfields mineral exploration represents the research and development sector of the industry, and is the source of future mines, these statistics are a source of major concern.

Although Section 26A of the amended Native Title Act permits the establishment of State regimes which exempt mineral exploration from the right to negotiate process, negotiations between State and Commonwealth Government officials on the form such regimes should take have become deadlocked on the question of allowing drilling, an essential exploration activity.

The Section 26A scheme that has been allowed by the Senate in NSW and the scheme proposed for Queensland allow for titles to be granted but actually prohibit on-ground exploration activities without first obtaining the consent of native title parties. This effectively limits exploration to private land where only landholder consent is required.

7. The State legislation enacted in Western Australia, subsequently disallowed by the Senate, relied on a 'right to consult' rather than a 'right to negotiate' in order to provide a means of indigenous involvement in a dialogue with mining industry project developers. A 'right to consult' normalises the current legislative process which is seriously flawed in that granting a statutory 'right to negotiate' to persons who have not been awarded any rights to the land in question is a nonsense in commercial terms.

No other potential 'landholder' in Australia has such a legislative privilege.

While there is a legal difference between a 'right to consult' and a 'right to negotiate', the end result in terms of compensation is exactly the same, but critically for the mining industry the timeframes, and hence costs, are considerably reduced.

Compensation is in the hands of the mining company and will be governed by the commercial ability of a project to carry costs. If the costs of compensation are too great, the mining company will walk away, resulting in no compensation being received by Aboriginal claimants.

The 'right to negotiate' acts as a real disincentive to investment in Australia's mining industry and has been a major impediment to industry development since 1993.

8. Clearly, the Native Title Act has failed both the mining industry and Aboriginal Australians. While the establishment of a workable administrative system which provides greater certainty, equity and consistent, timely outcomes for native title claimants/holders and mineral developers is desperately needed, it will not be achieved without further changes to the Act and a major change in the attitude of the Federal ALP and minor parties.

What Needs to be Done?

1. In the first instance, the Act should be amended to prohibit native title claimants from negotiating separately with developers if their claim forms part of an amalgamated claim. Amalgamated claims should operate as such, ie., negotiations with mineral developers should take place on an amalgamated basis.

2. The Federal ALP and minor parties should accept the Wik amendments and cease trying to mitigate their perceived losses by blocking moves to establish State/Territory native title regimes that adhere to the parameters prescribed by the amended Act.

3. AMEC is also committed to ensuring that the Federal Parliament is not afforded an ongoing ability to scrutinise and disallow subsequent legislative amendments to State and Territory native title regimes, once established. Given that Section 43A of the amended Act provides the Commonwealth Minister with an ability to revoke 13

Federal Parliamentary approval of State native title regimes that, through amendment, no longer meet the regime criteria stipulated in the Act, ongoing Senate scrutiny of State regimes is unwarranted.

4. Finally, AMEC has long argued that mineral exploration tenements Should be exempted from the right to negotiate due to the low impact nature of such tenements, coupled with the fact that a tiny percentage of mineral exploration tenements ever result in a mine. Mineral exploration represents the Australian industry's future. The establishment therefore, of State/Territory regimes under Section 26A of the Act that exempt mineral exploration from the right to negotiate process, should be progressed by the Commonwealth with State and Territory Governments as a matter of urgency.

Why Has Native Title been such a Controversial Matter?

There is no doubt that the run up to and promulgation of the Native Title Act became a battleground for a clash of opposing ideologies and the stage for ongoing confrontation was set in stone at that time.

Native title became a tainted concept and despite efforts to reach practical outcomes, constant legal battles and appeals and counter appeals emerged over the years. State Governments and Native Title claimants were equally a part of that process. Miriuwung-Gadjerong and Yorta Yorta were the most contentious of these. The indigenous people were not well served by this as the Native Title Act and Native Title generally became a political plaything where political advantage became the goal not the betterment of indigenous people through according them access to land containing their ancestral roots.

Industry, particularly the mining industry, was caught in this process and despite making submissions to effect practical change, was not heard by mainstream parties. In the final months of the Keating Government I made a submission to the Attorney General, Michael Lavarch, and to Special Minister of State, Gary Johns. We met in Parliament House Canberra in late 1995.

In that submission I argued:

• that mineral exploration should be exempted from native title process until ground disturbance occurred at the final stage of exploration;

and

• that native title should be defined in the Native Title Act in the following terms:

'For the purposes of this Act, Native Title is defined as rights in land and includes the right to pass over, camp on, take sustenance from, collect material from, conduct ceremonies on and enjoy traditional cultural pursuits, but does not include exclusive possession or the right to exclude others from the land the subject of native title'.

These were the rights enjoyed by indigenous Australians prior to colonisation through British settlement.

It is interesting that the High Court of Australia has arrived at pretty much the same definition eight years later.

The Political Factors

The battle for advantage filtered down to State level and there is no better example of the negative circular affect which developed as the disallowance of Western Australian and Northern Territory legislation and the gutting of the Queensland legislation by the Federal Parliament. These Acts would have created practical State regimes of advantage to practical outcomes, without in fact disadvantaging outcomes for developers or indigenous people.

The Wik amendments which passed the Senate through Senator Harradine voting with Government interests were never really accepted by the Labor opposition as a democratic defeat. They have shown very little policy balance in native title issues in recent years in my opinion and seem dedicated to the spoiling role irrespective of the national interest.

This political situation continues today and has caused huge expenditures of public funds both at the Commonwealth, State and industry level to little purpose.