Australia's radical wealth conversion

As we watched the horrible images involving our prime minister and leader of the opposition being dragged away from the potential violence of small sections of the Aboriginal community, many Australians could not help thinking about the proposal to change the Constitution to give greater recognition to this section of the Australian community – a proposal that on the surface seemed fair.

But what few thought about is that in a few years large sections of the Aboriginal community are set to become among our richest people controlling tens of billions of dollars, reflecting the big slice of mining revenue they have negotiated.

As I pointed out in my Management Insights comment six months ago (The rising fortunes of aboriginal Australia, July 12), before long we may see Aborigines represented on the BRW Rich List in proportions well above their representation in the Australian population. The Australian population will require considerable adjustment to this dramatic change in the distribution of wealth in Australia. There will be social consequences.

I must emphasise that this is not some comment designed to inflame a delicate situation. It is a simple fact that we need to appreciate. This prediction comes from none other than Warren Mundine, chairman of the Australian Indigenous Chamber of Commerce and former ALP president. You will find the video of my interview with Mundine fascinating.

I must emphasise that the looming riches for significant sections of the Aboriginal community does not solve the immediate health and other problems in the community. But the royalty deals Aborigines have already done with mineral companies, and those that are ahead, mean large segments of the Aboriginal community will move from being the poorest people in the country to being among the richest.

They are going to move from welfare to being major taxpayers and they are already working with tax lawyers and accountants.

Mundine remembers the disaster that took place as a result of the 1970s and 1980s mineral deals. Money was handed around and it was effectively wasted. It did not benefit most Aboriginal communities. This time we are talking billions rather than millions and Mundine explains that the Aboriginal community will try and learn from past mistakes.

They are looking to transform Aboriginal education and possibly set up Aboriginal banking and other institutions. New towns may be set up that will be very different from those in the east and south. Given their looming wealth, the Aboriginal community will need to think about whether tent embassies are the way to go. Perhaps Tony Abbott was right.