Priority Reform Two: Building the community-controlled sector

Outcome:

There is a strong and sustainable Aboriginal and Torres Strait Islander community-controlled sector delivering high quality services to meet the needs of Aboriginal and Torres Strait Islander people across the country.

Target:

Increase the amount of government funding for Aboriginal and Torres Strait Islander programs and services going through Aboriginal and Torres Strait Islander community-controlled organisations.

Minister responsible

The Prime Minister and the Minister for Indigenous Australians

With agreement from all Ministers to maximise opportunities for achievement of Closing the Gap outcomes in their portfolios, with a specific focus on addressing Priority Reforms.

The path forward

Through this Implementation Plan, the Commonwealth reaffirms its commitment to build the capacity and capability of the Aboriginal and Torres Strait Islander community-controlled sector. Across Commonwealth departments, efforts are underway to advance the priority actions below to increase the amount of funding for Aboriginal and Torres Strait Islander programs and services being delivered and led by Aboriginal and Torres Strait Islander organisations, in particular the community-controlled sector.

The Commonwealth commits to:

• Working in partnership with all levels of government and the Coalition of Peaks to jointly agree additional sectors for Sector Strengthening Plans in 2023 as well as develop an evaluation methodology
• Improving the transparency, consistency, identification and reporting of expenditure on Aboriginal and Torres Strait Islander programs and services

Increase opportunities for Aboriginal and Torres Strait Islander organisations, including community-controlled organisations, to access grant funding opportunities, including through finalising a business case for a grant connected policy.

Priority actions

Strengthening the community-controlled sector

The Commonwealth will work in partnership with relevant governments and the Coalition of Peaks to jointly agree additional sectors for Sector Strengthening Plans in 2023, as well as develop an evaluation methodology. The evaluation approach will be applied to the Early Childhood Care and Development Sector Strengthening Plan as one of the mature community-controlled sectors. Findings from the evaluation will be used to inform development of additional plans.

To support the sector, the Virtual Funding Pool (VFP) is available. All governments can draw on their contribution to the VFP in partnership with Aboriginal and Torres Strait Islander community-controlled organisations to increase capacity where agreed to deliver more high quality, culturally appropriate services to their communities.

Identifying First Nations expenditure

Clause 113 of the National Agreement required government parties to review and identify current spending on Aboriginal and Torres Strait Islander programs and services. In 2022, the National Indigenous Australians Agency led a Commonwealth-wide review. A report outlining key findings of the review and tangible opportunities was provided to the Joint Council on Closing the Gap in December 2022. Further opportunities for the collection, recording and reporting of First Nations expenditure are being explored. This includes an approach to better identify service providers, particularly community‑controlled organisations, as part of future First Nations expenditure reporting. Future approaches should contribute to increased transparency and reporting requirements under Clauses 59(d) and 118(d) of the National Agreement.

Prioritising funding to Aboriginal and Torres Strait Islander organisations

The current Commonwealth Grants Rules and Guidelines 2017 provide flexibility in how entities can work with stakeholders, including community-controlled organisations, to administer grants and achieve government policy outcomes. This means there is flexibility now for Commonwealth entities to preference Indigenous organisations in the selection of grants, to achieve government objectives.

Under the National Agreement, funding prioritisation policies will be implemented progressively, with implementation complete by 2024. As a first step, a business case for a Grant Connected Policy will be finalised for government consideration, to give effect to funding prioritisation policies under Clause 55(a) of the National Agreement.

The Commonwealth is working with the Coalition of Peaks to identify evidence-led approaches to applying a ‘meaningful proportion’ of funding to Aboriginal and Torres Strait Islander organisations (Clause 55(b) of the National Agreement) to develop an enduring policy and budget framework for implementation by 2024. To enable this, a working group has been established comprising representatives from the Department of the Prime Minister and Cabinet, Department of Finance, Treasury and the National Indigenous Australians Agency, with an initial focus on the 2023–24 Budget context. Guidance has been developed by the Coalition of Peaks in agreement with the Commonwealth, for agencies when developing policies or proposals for the 2023–24 Budget context.

Summary of new actions

*A full appendix of new and existing measures being undertaken by the Commonwealth to support Closing the Gap efforts is on the NIAA website, at Closing the Gap implementation measures.