First Nations Australians and the Budget – A Quick Guide

At best, the Federal Budget is confusing for most Australians. With four budget papers (each hundreds of pages in length), Ministerial statements and media, it should be of no surprise that many of us find it overwhelming to get through – so First Nations Economics is here to break it down for you.

The Australian Government’s latest budget’s headline figure is $1.3 billion in targeted funding for Aboriginal and Torres Strait Islander communities, in what is described as a substantial investment aimed at improving the economic, social, and health outcomes.

While we welcome this additional investment in First Nations programs and services and agree it should be celebrated, by comparison in 2022/2023 the NSW Government was estimated to have spent close to this figure on First Nations-targeted programs and services. Overall, greater involvement of the First Nations community-controlled sector in service delivery and budgetary decision making is critical to changing the tide and closing the gap.

Economic Empowerment and Housing

A major focus of the budget is economic empowerment, primarily through promoting home ownership among First Nations Australians, a lofty goal that has until today been hindered by poor rates of First Nations economic inclusion. A key initiative is the $70.9 million boost to Indigenous Business Australia‘s (IBA) Home Loan Capital Fund, aimed at helping more Indigenous Australians purchase homes and build intergenerational wealth. Reforms to the Aboriginal and Torres Strait Islander Act 2005 will enable IBA for the first time in its history to raise funds for business and community investment, further strengthening economic opportunities. These changes will significantly boost this incredibly important institution and allow it to engage First Nations Australians and the broader Financial Services Sector in future-leading conversations about First Nations economic prosperity.

To support Indigenous entrepreneurs, the Government has introduced a place-based business mentoring and coaching program designed to assist First Nations businesswomen and the Indigenous Procurement Policy is being strengthened to enhance job creation and business growth. To do this, the Government is increasing Commonwealth Indigenous procurement targets from 2.5% to 3% from July 1, 2025, with annual increases until reaching 4% by 2030, and requiring Indigenous businesses to be 51% First Nations owned and controlled.

Seemingly to ward off growing concerns about black cladding, this potentially controversial change could see Indigenous procurement shift signficantly at the federal level. The government noted that it remains committed to exploring options to tackle black cladding in other ways, with the National Indigenous Australians Agency (NIAA) vowing to work with relevant regulators and support services to identify opportunities to make it easier for First Nations people to report black cladding that might amount to unlawful conduct and provide targeted education, guidance and support for First Nations business owners.

How the change will affect Aboriginal organisations that are not businesses remains unclear, with NIAA’s website specifically referring to requirements for Indigenous businesses to be 51 per cent or more First Nations owned and controlled (or registered with ORIC) to access the IPP.

Healthcare Investments and Wellbeing

The unacceptable gap in health and wellbeing outcomes continues to be a stark reminder of the needs for additional investment in First Nations-led health responses. This year’s budget allocates $506.4 million to Closing the Gap initiatives, including to expand culturally appropriate mental health services, strengthen nutrition programs in remote communities, and improve detection and management of diseases like rheumatic heart disease. The Government is also investing in integrated oral and hearing health services for children in remote areas.

The Northern Territory Remote Aboriginal Investment agreement, valued at $842.6 million, is also seeking to drive greater healthcare, education, and employment opportunities in Australia’s North. $24.7 million is earmarked to train and fund First Nations psychology students, increasing the availability of culturally competent mental health professionals.

However some healthcare organisations have expressed that, despite increased funding to Medicare, regional Australians—including Indigenous communities—have been overlooked. The incentives to bulk bill and other healthcare investments are deemed insufficient to address the unique challenges faced by these populations.

Infrastructure and Community Development

Investment in infrastructure is another priority, with $36.7 million allocated to upgrading essential wastewater management services and potable water supply in the Torres Strait Islands, as well as $28.4 million dedicated to constructing seawalls to protect low-lying islands from climate-related flooding.

While this investment in climate resilience is a good start, it should be noted that in September  2022, the U.N. Human Rights Committee found that Australia’s failure to adequately protect Torres Strait Islanders against adverse impacts of climate change violated their rights to enjoy their culture and be free from arbitrary interferences with their private life, family and home. As such this investment should be seen as a starting point, and late at best.

The Government is also continuing its commitment to improving living conditions in remote communities. Initiatives include $11.4 million for the establishment and maintenance of community laundries, which will reduce health risks, and $21.4 million for the development of a nutrition workforce to enhance food security. The budget also includes the already announced reduction in cost of 30 everyday item products, such as produce, nappies and milk, in more than 76 remote stores.

Again, access to clean water, basic hygiene supplies and food security remain some of the largest barriers facing the health and wellbeing of remote First Nations communities. Additional investment is needed in order to reverse the often third world living standards endured by some of our most vulnerable communities.

On housing, the budget’s failure to enhance the Housing Australia Future Fund and expand social and affordable housing is concerning. This omission is particularly concerning for Indigenous Australians, who experience higher rates of homelessness and housing insecurity. The lack of substantial investment in social housing is seen as a missed opportunity to address these pressing issues.

Education and Employment Support

Education remains a cornerstone of the budget, with funding directed at increasing school engagement and employment pathways for Aboriginal and Torres Strait Islander young people. The Clontarf Foundation will receive $33.6 million to extend its school engagement initiative for young First Nations men and $137.3 million will support the transition from the Community Development Program to a new remote employment service.

To preserve First Nations culture, $11 million is allocated for the continuation of the First Nations Languages Policy Partnership, which while welcomed funding could be potentially better served on grass-roots efforts to preserve language and culture. $3.6 million will also be used to digitize at-risk audio and video collections held by Indigenous broadcasters by the Australian Institute of Aboriginal and Torres Strait Islander Studies (AIATSIS).

The budget’s allocation of only $407.5 million over four years for public schools falls significantly short of the previously promised $16.5 billion in additional “Gonski funding.” This shortfall has raised concerns adequate funding for public education, which could disproportionately affect schools with high populations of Aboriginal and Torres Strait Islander students. Additionally while investment in education for First Nations boys educational engagement is needed, funding should be prioritised for existing First Nations community-led education providers, as well as a greater focus on First Nations women and girls.

Environmental and Cultural Heritage Protection

The Government is also prioritising environmental sustainability and cultural heritage. A portion of the budget supports the expansion of Indigenous Protected Areas, which play a crucial role in conserving biodiversity and empowering Traditional Owners to manage land and sea resources. Additionally, remediation efforts in Jabiru Township will ensure that essential infrastructure is upgraded, hazardous materials are managed, and ecological restoration is undertaken in partnership with the local community. However additional funding is needed to better protect Country, prepare for climate resilience and engage more young people in traditional cultures.

Environmental organisations have criticised the budget for allocating significantly more funds to fossil fuel subsidies than to environmental protection. The Australian Conservation Foundation highlighted that the government is spending six times more on fossil fuel subsidies than on initiatives to protect the environment. This disparity is concerning for Indigenous communities, who often have deep connections to their lands and are actively involved in land conservation efforts.

Social Justice and Community Safety

The budget provides some ongoing support for Stolen Generations survivors through the extension of the Territories Stolen Generations Redress Scheme while $21.8 million will be allocated over two years to fund the delivery of prevention, early intervention, and response services addressing family, domestic, and sexual violence in First Nations communities.

To address systemic issues affecting First Nations children and young people, the Government is establishing the National Commission for Aboriginal and Torres Strait Islander Children and Young People. This initiative aims to advocate for the rights and wellbeing of Indigenous youth and ensure their voices are heard in policy-making processes.

An allocation of $10.7 million over four years from 2024–25 has been made to fund the next stage of the First Nations Justice Policy Partnership. This partnership focuses on implementing strategic frameworks to improve justice outcomes and transform the justice system to reduce adult and youth incarceration rates. First Nations Economics has been proud to partner with the JPP and is glad to see resourcing for its work continue.

Noting increasingly hardline policy on First Nations youth justice across Australia and the ever-increasing rate of First Nations youth detention and adult incarceration, more support is needed to remediate challenges for First Nations people in the justice sector. Only an additional $24.0 million in 2024–25 is provided under the National Legal Assistance Partnership to support Indigenous Legal Services as well as the National Family Violence Prevention Legal Services, despite calls from the National Aboriginal and Torres Strait Islander Legal Services (NATSILS) for $1.15 billion in additional investment for equitable access to culturally safe legal services.

Focus on First Nations Women

The Women’s Budget Statement highlights that since the 2022–23 October Budget, over $4 billion has been invested in initiatives to support women’s safety and deliver the National Plan to End Violence against Women and Children 2022–2032. This includes funding for frontline services, emergency accommodation, and programs aimed at addressing the unique challenges faced by First Nations women. Additionally, $3.4M has been committed to co-design interventions to increase the participation rate of First Nations women in business.

Local Government Funding

No new local government programs were announced in the budget. This lack of funding, according to the Australian Local Government Association, could impact local councils’ ability to deliver essential services and infrastructure projects in Indigenous communities, potentially hindering efforts to close the gap in service delivery.

Conclusion

The Australian Government’s budget represents a significant step toward closing the gap and promoting self-determination for Aboriginal and Torres Strait Islander communities, but it could go much further. By investing in housing, healthcare, education, business opportunities, and cultural preservation, these measures provide a pathway to greater economic and social equity. While continued commitment and collaboration with Indigenous communities will be essential, this funding signals a strong effort to support First Nations Australians in building a prosperous and sustainable future. Some of our critiques highlight areas where further attention and funding are needed to address systemic issues effectively. Education, regional healthcare, housing, environmental protection, and local government support are key areas where we  see room for improvement to better serve Aboriginal and Torres Strait Islander populations.