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Indigenous families miss out on regional spending | TRaCK: Tropical Rivers and Coastal Knowledge

TRaCK: Tropical Rivers and Coastal Knowledge

Science and knowledge that governments, communities, industries for sustainable use of Australia's tropical rivers and estuaries

Indigenous families miss out on regional spending

Indigenous families miss out on regional spending

Increasing the quantity of goods and services produced in northern Australia regional communities mainly benefits non-Indigenous households, according to new research.

Researchers from the Tropical Rivers and Coastal Knowledge (TRaCK) program developed a model that shows that merely injecting money into an area doesn’t mean that Indigenous people will automatically reap the benefits.

TRaCK researcher Dr Natalie Stoeckl from James Cook University found this to be the case whether the increased cash flow came from stimulating industry or increasing non-Indigenous household incomes (by, for example, providing tax refunds).

The new economic simulation model tracked impacts on household incomes for both Indigenous and non-Indigenous people from stimulating different businesses, including accommodation, cafes, and restaurants, agriculture, mining and government.

“It’s a chain of supply issue, and it demonstrates how economic benefits can flow in very lopsided ways,” Dr Stoeckl says.

Researchers used towns in the Mitchell (Queensland) and Daly (Northern Territory) river catchments as case studies areas.

The model showed that money coming into the region disproportionately flows to non-Indigenous households. For example, just 1-3 cents of a $1 stimulus in the agricultural, construction and recreational sectors reaches Indigenous households, while non-Indigenous households receive between 20 cents and 33 cents.

“Put simply, because many Indigenous people aren’t employed by private businesses and the number of Indigenous business owners is comparatively low, the money coming into these areas flows straight to the shop-owners and business operators – who are mostly non-Indigenous,” Dr Stoeckl says.

“Indigenous people in northern Australia are often disconnected from the mainstream economy, so actions that increase the size of the non-Indigenous economy do not generate significant benefits to the Indigenous sector.

“This research has important implications for regional development policy, since only a relatively small share of monies injected into these regional economies will find its way into the pockets of Indigenous householders.

“People and policies seeking to significantly improve the incomes of Indigenous people living in this part of the country need to change the way goods and services are produced.”

Dr Stoeckl suggests that structural change is needed to increase Indigenous rates of employment and rates of business ownership or co-ownership.
“Change could, potentially, improve the lives and livelihoods of both Indigenous and non-Indigenous householders alike. It may be a long-term game, but it is not zero-sum,” says Dr Stoeckl.

Dr Natalie Stoeckl will talk about the research results this Thursday, September 9 at 1pm at James Cook University - in Townsville: DA003-002, Cairns: A1.129 (video link). For more information, see: http://www.jcu.edu.au/blogs/atjcu/entry/jcu_tropical_lecture_series_revised

This research was also funded by James Cook University, Charles Darwin University and the Tropical Savannas CRC.

TRaCK was established in 2007 as a research hub under the Commonwealth Environment Research Facilities Program to provide the science and knowledge that governments, communities and industries need for the sustainable use and management of Australia’s tropical rivers.

TRaCK receives major funding for its research through the Australian Government’s Commonwealth Environment Research Facilities initiative; the Australian Government’s Raising National Water Standards Program; Land and Water Australia; the Fisheries Research and Development Corporation and the Queensland Government’s Smart State Innovation Fund. 

For more information, see the website www.track.gov.au

For interview:
Dr Natalie Stoeckl, School of Business, James Cook University, Ph: 07-4781 4868 or 0414 783 979 natalie.stoeckl@jcu.edu.au

For more information about TRaCK:
Ruth O’Connor, TRaCK Knowledge and Adoption Coordinator, Griffith University, Ph: 07-3735 5359, r.oconnor@griffith.edu.au

For media assistance:
Jenni Metcalfe, Econnect Communication, Ph: 07 3846 7111 or 0408 551 866,  jenni@econnect.com.au