Stolen wages – US and Queensland


There is no doubt the Queensland government saw itself as trustee for the Aboriginal money it held for private individuals.  From as early as 1901 legislation stated protectors ‘acted as trustee’ for wages they controlled, successive Annual Reports list  ‘Aboriginal wages held in trust’ ‘for the natives’ and detail ‘Aboriginal Trust Accounts’, and in 1956 the department’s director wrote of his authority ‘in his capacity as trustee for any Aboriginal on whose behalf money is held’.

We now know the government failed utterly in its duty as trustee. It contracted children and adults to work when it knew many people suffered atrocious conditions including physical and sexual abuse.  It contracted people to work at wages as low as 30 per cent the white rate when it knew they were worth at least equal wages: Aboriginal girls and women filled most of the high demand for domestic workers, and Aboriginal stockworkers were continually reported as being more highly skilled than their white mates.  The government was warned almost every decade that employers were cheating workers of their pocket money, but the government wouldn’t even issue new books so the old ones could be checked at head office.  In the mid-1960s auditors said there seemed to be no supervision of pocket money payment, which had averaged around 50 per cent of the wage.  In the 1957 year alone, that’s a probable loss of over $18 million among the 4500 pastoral workers.

We know the government used the trust funds for buildings on the settlements, for subsidies to the missions and for costs such as removals to reserves.  We know the government took up to 80 per cent of private savings for investment so it could keep the extra interest – it was these funds which built hospitals around south-east Queensland.  It exploited these savings for its own gain for forty years.  The savings were paid back, but in the meantime people didn’t have that money available for their needs; and it is a breach of trust law to make a profit from someone else’s trust money.

We know the government intercepted child endowment and pensions.  Instead of these benefits being extra money to improve people’s health, the government reduced the grants to missions, forcing them to use these benefits to cover the deficit.  Over the years, from the start of child endowment in 1941 and the start of pensions in 1960, by simply cutting its own spending by the amount of the benefits, the Queensland government is richer by millions and millions of dollars.  It also used endowment for buildings on the settlements and at Aitkenvale near Townsville.

These are the Stolen Wages, although I haven’t mentioned the failure to distribute workers compensation and deceased estates, and I haven’t mentioned government raiding of private savings accounts to pay for amenities on its country reserves.   As we heard tonight, the Stolen Wages are grounded in, and themselves intensified, the unquantifiable emotional and social cost of fractured families, unremitting and largely unrewarded work, lousy conditions and physical and sexual abuses – which I have described in Trustees on Trial.

When the Queensland government said it was being generous in paying a maximum $4000 in reparations it knew people might be owed vastly more than that.  When the government said people had to sign away their right to take legal action it knew almost no-one has enough documents to be sure this is the right decision.  While just over 5000 people were paid the $2000 or $4000, for most this was a very hard decision and does not indicate approval for this cynical reparations deal.  We know almost one third of the people who sought the payment were rejected because the government can’t find their records.  This, it seems, is justice Queensland-style.

So how do we get real justice for the Stolen Wages?  The way the legal system works makes it very hard for an individual to successfully sue for lost wages and entitlements.  This would depend on having evidence which is strong enough to uphold a charge that money was defrauded or misappropriated from their account.  And of course, since the government still controls all the records, this relies on them finding sufficient files, and we know from the big percentage whose claims were rejected, that this is highly unlikely.  It is unbelievable to me that the accused, so to speak, controls the evidence which can be brought against them while the whole appalling array of management and accountability failures, of negligence and misuse, remains quarantined from scrutiny.

So this is why I wrote Trustees on Trial.  I read about the class action started by Elouise, and I realised that there were many basic similarities: inadequate accounting systems, inadequate controls over receipts and withdrawals, inability to determine cash balances, failure to provide account holders with meaningful statements of their accounts.  These words, in fact, were said by the District Court judge in the US class action, where Indian fund management was described as so chaotic it was ‘akin to leaving the vault door open.’  That certainly applies for Queensland.  As in the Cobell case, the Queensland government has never accounted to the people for the monies it held for them in trust, and people have no way of finding out unless a court compels it to adhere to standard trust practices.  Like the Cobell case, people are seeking to recover what was rightfully theirs

Given its superior expertise and comprehensive authority, and the fact account holders were denied knowledge of dealings on their funds, it could be argued governments had a legal obligation to use ‘a greater degree of skill’ than the ordinary man of business in preserving the trust funds in its control, and a requirement for a higher standard of accountability.  I note the US court confirmed in the Cobell case that the duty to account is ‘black letter’ trust law; that losing the records is not a shield against litigation but a primary breach of trust law.  Indeed in 2003 the US court demanded the government account for all money and property controlled in trust since 1887.  This, it seems, is justice US-style.  Although as Elouise has said, the government has not yet complied with these court orders.

There is also the wider trust duty which arises when a person or institution holds the power to adversely affect the legal or practical interests of another, and where the other person is vulnerable to that power being abused; this is called a fiduciary duty.  In Trustees on Trial I look at the circumstances here and internationally where courts say they will enforce the fiduciary responsibilities of governments that manage Indigenous money and property.  Courts in both Canada and the US have said governments are legal trustees in this role as trust managers and that they are therefore legally responsible for good management of that money or property.

Although this has not been successfully argued in Australia no cases here have examined the detailed evidence that I have spoken of for Queensland.  And it is not only international law that convinces me the government did hold a fiduciary duty to protect Aboriginal interests in its management of Aboriginal lives and finances in Queensland.  I found that in recent Federal Court decisions the judges have said Australian courts will recognise a fiduciary duty enforceable by the courts if an economic interest is at stake.  Stolen Wages are economic interests.  And that is the core of Trustees on Trial – that successive Queensland governments have abused their powers and duties in their trust management of Aboriginal finances, and that a successful case could be mounted that the government is a legal trustee.  This would put the government’s financial controls under court scrutiny; it would have to account for all money held in trust since the turn of last century.

Copyright Dr. Rosalind Kidd. Website development by: Ryan-Thomas Robinson