Dr Ros Kidd
Historian - Consultant - Writer
Breach of Trust
Tonight I want to look at the relationship between the Queensland
government and the Aboriginal population – how it was established in
law, and what historical evidence reveals about how official powers were
utilised during the twentieth century. Because of the context in which
this forum arises, I will concentrate particularly on financial matters
(and figures are given in today’s value). Obviously this is a work in
progress, and tonight’s time is brief, but it will give you a feel for
how the system operated.
First, the matter of relationship and executive powers. The intent of
the Queensland government is clearly stated in the preamble to the Act
passed in 1897: ‘to make provision for the better protection and care of
the Aboriginal and half-caste inhabitants of the colony’. In
parliamentary speeches at that time the home secretary stated: ‘It is
owing to our presence here as colonists that they are reduced to their
present straits’. He conceded a duty ‘to compensate for the injuries’
inflicted in the process of driving Aborigines ‘from their native
hunting grounds’, saying: ‘We recognise that duty, we are willing to
perform it, and we are now providing the necessary machinery for that
purpose’. It is clear that the 1897 Act established a legal
relationship between the government and the Aboriginal population, and
that relationship was of a fiduciary nature – that is, the government
established in law a role for itself as protector and carer of
Aboriginal people.
Under this law the government could define as a ward of state every
Aboriginal inhabitant of Queensland, a category which was soon widened
to include those of part-Aboriginal descent. Rural police sergeants
were delegated to operate as protectors to enforce the Aboriginal Acts
and regulations, and areas were defined as Aboriginal reserves upon
which a range of restrictions operated. Although it devolved some of
the financing and most of the management of missions to church
authorities, the government was totally responsible for conditions on
all reserve communities and for the lives of every person confined
thereon.
Aborigines could now be forcibly transported and interned on reserves,
or sent out to employment. The government controlled where and how you
lived, right to marry, care and custody of children, the food you ate,
the clothes you wore, the amount of schooling and medical attention
available to you. There was no explanation of this regime to the people
trapped in it, no legal process, no right of appeal. From 1901
officials were empowered to care, protect and manage the property of all
Aborigines, to take possession, retain, sell or dispose of this
property; in short, ‘to exercise in the name of an Aboriginal any power
which the Aboriginal might exercise for his own benefit.’
Around 1904 a Trust fund was established to receive savings of missing
or deceased Aborigines; files show only a small portion was regularly
distributed. At this time also the government started taking money
from the accounts of settlement residents towards the costs of running
these institutions – 5% from those with dependents and 10% from those
without. In 1919, by which time all Aboriginal wages were paid directly
to police protectors, rural workers also had money taken from their
savings, at the rate of 2.5% from those with dependents and 5% from
those without. This money went into a new Trust fund intended as
unemployment insurance.
What was the outcome of this regime of ‘care and protection’ for those
removed to Aboriginal reserves until the 1970s? Evidence shows that
under official guardianship these communities have always been so
grossly underfunded as to endanger life, that these children were denied
the education mandated to all Queensland children, that these families
lived in appalling overcrowded squalor in huts frequently condemned as
unfit for human habitation, were provided with food known to be
insufficient for health and nutritionally inadequate, were frequently,
even into the 1970s, dependent on water which was known to be unfit for
human consumption, were habitually without the medical treatment
standard for the rest of the state. On these government institutions
labour was mandatory but mostly unpaid until the late 1960s, when a wage
of only one quarter the basic wage was introduced, pitching these
families well below the poverty line, a penalty not reimbursed by
housing and amenities as was publicly claimed, but confidentially
refuted. The government knew people sickened and died because of these
entrenched pernicious conditions, as innumerable officials’ reports
attest over almost eight decades, yet the system was maintained.
What of the children? The government took guardianship of every
Aboriginal child under 16 years – extended to 21 years in 1939 - whether
or not the parents were living, and this power included authorisation of
marriages ad adoptions. How did it execute this duty? We know from
decades of evidence that children were underfed, lacked clothing and
basic shelter, suffered scandalous rates of parasitic infestation, died
unnecessarily of easily preventable diseases, received little schooling
and were worked from an early age. And that was just children in
government ‘care and protection’ on missions and settlements. We know
that from 1919 children under 12 could not be contracted to outside
employment…unless the protector endorsed it. In 1957, the director,
their legal guardian, commented that child labour was still common in
the pastoral industry and many suffered broken limbs. We know he
condoned this, suggesting merely that ‘undersized and weedy’ children
not be put to hard labour. He said: ‘We try to look on these people as
human beings.’ Such cruel exploitation would, in a parent, have
attracted charges of criminal negligence.
Throughout the twentieth century the linchpin to administrative controls
was the enforced labour regime upon which profitability of the
developing pastoral industry depended. How did the government secure
the best interests of this labour force? In 1919 the Native Affairs
department set rural wages at only two-thirds the white rate, despite
evidence from frequent surveys identifying Aboriginal labour as often
better skilled and more stable. We know the department failed to
enforce even this discounted rate, being frequently several years in
arrears with adjustments to white wage increases; in 1950, for instance,
Aboriginal workers were getting two-thirds of the 1938 rate, effectively
only 25% of the white wage. We know the department was complicit in the
exploitation of men hired as trackers to police at scandalously low pay;
evidence of the 1960s confirms official knowledge that ‘most of them
have suffered financially’, with several men listed as using over $8000
of their savings just to survive. As recently as 1970 the agreed rate
was $110, less than half the basic wage; in 1974 that wage ratio
continued unchanged.
Regulations in 1919 had set minimum conditions for pastoral workers, but
the department never implemented systematic inspections to enforce them
despite accumulating evidence of gross breaches. Regulations also
dictated amounts of pocket money to be paid to workers during the work
period, yet for all of its 70-year duration it was known that the pocket
money system was a sham. We know protectors rarely inspected books on
site, we know there was no guarantee money entered in books was actually
received by workers. In the 1940s the system was described by officials
as ‘a farce’; in 1958 it was said books were routinely filled in at the
close of the contract period. Six years later, and after 60 years’
operation, auditors confirmed the system remained fatally flawed,
reporting: ‘the department appears to exercise no direct supervision
over the keeping of these books or of the payment of pocket money by
employers.’ Because the pocket money component was often between half
and three-quarters of the wage, failure to stamp out fraud on pocket
money meant failure to safeguard workers’ wages.
The department was responsible for the management of Aboriginal
property, but, notwithstanding a 1901 regulation directing protectors
to keep ‘proper accounts of all moneys’ and designating them as ‘public
accountants’ under the Audit Acts, it created a system whereby around 90
of these untrained men ran rural savings accounts. The results,
predictably, were disastrous. In the 1920s auditors declared almost
half the deductions were wrong; in the early 1930s they said there was
still no internal system to check transactions; in the 1940s it was said
there was no way to verify withdrawals on Aboriginal accounts. In 1958
the director admitted his department had been ‘held culpable for failing
to ultimately collect wages owing’, adding: ‘it is futile raising
excuses…we have accepted the responsibility of protecting these people
by controlling their employment and collecting their wages.’ In the
1960s auditors again slated the ‘fair margin of error’ in postings which
‘remain undetected’ at head office.
Systemic defects facilitated not only negligence but also fraud by
protectors on the savings from which – at their discretion – they
allowed workers to make small withdrawals. Thumbprints were introduced
as early as 1904 to counter doctored receipts, yet 30 years later fraud
was still described as both common and entrenched. In 1933 savings were
centralised at head office specifically to reduce police fraud, yet over
subsequent decades auditors noted that thumb printed and witnessed
dockets continued to surface, even when no transaction had taken place.
Although an internal inspection had warned in 1932 that Aboriginal
savings remained more vulnerable to fraud than any other government
accounts, the department refused then, and refused ever, to allow
workers to see what was happening to their money. Despite this litany
of damning evidence, never once were protectors charged under the Audit
Acts.
Only in 1965 was there a possibility of appeal to a magistrate against
seizure by the director of control over personal assets; and only in
1966 were Aborigines issued with bank books and could finally see a
record of dealings on their accounts, although ‘this was just for
information of individuals…all accounting systems will operate as
usual’. It was several years later before people were allowed free
access to their own money; many found almost nothing remained in their
accounts. By 1968, after almost 50 years, the government finally
stopped taking money from private savings, and when equal wages were
mandated nationally, the days of discounted labour were almost over.
Aboriginal workers, although not those living on reserves, finally
enjoyed autonomy of employment.
As legal trustee for both private savings and Trust funds, there is no
doubt the government demonstrated negligence, and possibly collusion, in
maintaining a system so detrimental to Aboriginal savings. Indeed
habitual misuse by government itself is revealed in successive audit
reports and internal inquiries. An inquiry in 1922 showed that both
Trust funds were being used as operational accounts and expended for
development and capital works on settlements, grants to missions, loans
and compulsory relocations. Inspectors described this range of outlays
as ‘unsound’ and urged ‘rules be formulated to control expenditure’ from
both funds.
But no such rules were made. And, during the ten years from 1925/35,
covering government by both political parties, these Trust funds were
raided for over $3.5 million (today) to relieve consolidated revenue.
Fifty per cent of the deceased estates Trust was simply siphoned into
the operating account, as was an amount equivalent to over $900,000 from
private accounts; yet against this evidence the minister denied in
parliament that Aboriginal savings were used for departmental
liabilities. During this period the department also seized bank
interest, taxed settlement inmates an extra 5 per cent, and charged
patients at Fantome Island at twice the calculated costs of medical
care. No Aboriginal was advised of any of these raids on private
monies.
The auditor in 1941 condemned the multiple appropriations from workers’
savings citing unemployment fund deductions, seizure of bank interest,
and so-called ‘contributions’ to buildings, fencing and amenities on
rural reserves, which he said should have been charges on the state.
The director conceded that ‘much of the taxation is an injustice’, and
was maintained only to cover budget shortfalls of almost a million
dollars annually. Indeed between 1939 and 1945 successive auditors
argued no deductions from savings were valid because regulations had
been cancelled and not then regazetted.
In view of the abject poverty of the Aboriginal population, it is
incredible that the government, as trustee for their interests – and
their property – should have siphoned off vast sums of Trust monies and
savings for its own benefit. Since 1926, by simply defining bulk
amounts as either ‘idle’ or ‘surplus to needs’ the government pursued an
investment agenda into the late 1960s to create revenue for ‘the
reduction of expenditure on Aboriginals throughout the state’. No
regulations had allowed for this profiteering. In 1933 when all private
savings were centralised in Brisbane, over $12 million, effectively over
85 per cent of private savings, was immediately invested. Year by year
escalating amounts frozen in investments incisively quantify Aboriginal
deprivation. From 1957, by amending its regulations, the department was
able to offer these savings for regional hospitals’ development, at a
time when reserve hospitals were appallingly underfunded. In the late
1960s the government was still playing investment broker with over $20
million of Aboriginal money.
The generation of investment interest and the ‘contributions’ from
Aboriginal savings were major income sources, along with child
endowment, to the Aboriginal Welfare Fund, which was started in 1943.
By absorbing all Trust funds and income from Aboriginal enterprises on
reserves, and by validating expenditure loosely as ‘for the benefit of
Aborigines generally’, this Fund legitimised government dealings which
had for years attracted censure from auditors. Yet evidence shows the
government continued to charge against it items described as ‘legitimate
vote expenditure’ such as development costs and farm wages on two
pastoral properties in the 1940s, in the 1950s for wages – including for
white overseers, for land for a hostel near Townsville, trucks and
launches, and in the 1960s for reforestation at Hopevale mission,
sewerage at the hostel and a new store on Palm Island. From the first
years, the Welfare Fund often covered up to one-third the cost of
Aboriginal administration. Brought to insolvency on many occasions, the
Welfare Fund often could not meet legitimate calls on its resources.
A
n internal inquiry in 1991 suggested many investments were probably
economically unviable, and that ‘unwise decisions may have been made’ by
the executive officer. Certainly we know that the cattle properties ran
at a loss every year after 1975, losing $2.4 million to 1980 and a
further $11 million to 1990. Money was clawed back by raising rents on
welfare housing, attracting harsh criticism from federal officers. We
know that increasing numbers of workers were transferred against Welfare
Fund enterprises, including federal housing projects, after the state
government refused to fund wage increases in 1982.
We know the state ignored commonwealth directives and ultimately
streamed around $200 million of federal housing money through the
Welfare Fund in the decade 1980/90, yet no register was kept of its
allocation, indeed several reports merely note building of ‘sundry town
houses’. We know ‘surpluses’ of unspent housing funds were achieved of
$7.5 million 1980/84 and a further $11.25 million from 1985/90, no doubt
benefiting the state by around 16% on the short-term money market; such
interest being a bonus for treasury. We know investments were cashed in
to maintain operations of the Welfare Fund, and the deteriorating
position was also camouflaged by over $800,000 from the sale of Comalco
shares in 1987, notwithstanding that that money had been earmarked for
private lending to Aboriginal families.
It has been estimated that perhaps $400-$500 million has been passed
through the Fund in its 50-year operation until it was frozen in 1993;
around $8 million remains today. Yet it is admitted that no proper
accounts were kept, there are no registers of assets, files and records
are hopelessly muddled. There should be deep concerns as to the probity
of transactions of this Fund, which was operated on behalf of, and
supposedly ‘for the benefit of, Aborigines generally.’
The 1991 inquiry into the Welfare Fund suggested that because of
incompetent account-keeping and consequent lack of material evidence,
‘illegality would be impossible to establish.’ But there was an
important caveat to that opinion, and that was the phrase ‘in the
absence of evidence of abuse of trust.’ Since the government was
trustee for the Welfare Fund it had a statutory requirement to keep full
and detailed accounts: surely absence of those records is a breach of
trustee’s duties. The government had a statutory duty always to act in
the interests of it beneficiaries – the Aboriginal people whose money
and enterprise fuelled the Fund; there is no doubt it is open to
challenge on this score. The blatant conflict of interest and the
unquestionable failure to secure the best interests of those whose
property it controlled, breach the basic requirements of fiduciary
duty. Time after time, in its administration of the Aboriginal
population, the Queensland government has demonstrated callous disregard
for the duty of ‘care and protection’ so ambitiously undertaken, in
1897. Today’s government must be held accountable for the failures and
malfeasance of its predecessors.
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