Township Leasing on Aboriginal land in the Northern Territory

The Australian Government is interested in talking with Traditional Owners and community members about the home ownership and economic development opportunities that township leasing can help deliver on Aboriginal land in the Northern Territory. Township leasing is a voluntary option under Section 19A of the Aboriginal Land Rights (Northern Territory) Act 1976 (Land Rights Act) and provides an alternative to leasing under Section 19 of the Land Rights Act.

A township lease helps to provide a strong foundation for building economic activity and intergenerational wealth in towns on Aboriginal land. It involves granting a head lease over the whole of the community, under which long term subleases can be granted in accordance with the terms of the township lease agreed to by Traditional Owners. This encourages a local focus to decision making and streamlines land administration, which allows decisions to be made in commercial timeframes. This can attract outside investment and help people to buy their own homes or start a business by giving more confidence to business and financial institutions.

A township lease is typically a lease from Traditional Owners to the Executive Director of Township Leasing (Executive Director), a statutory office holder who is independent of Government. The Executive Director holds and administers the township lease according to the terms of the lease agreed to by Traditional Owners and works with Traditional Owners through a Consultative Forum. By leasing to the Executive Director, Traditional Owners choose another way for land in their community to be managed and receive the benefit of a dedicated land administrator who takes a structured approach to consultation with Traditional Owners. The Executive Director makes sure that anyone occupying the land within the township now, or in the future, has a formal agreement in place and pays rent to Traditional Owners.

A different model of township leasing, where a community entity holds the township lease rather than the Executive Director, is currently being worked on for the community of Gunyangara. This approach has been developed at the request of traditional owners, who have strong local organisations with business and development experience and want to strengthen local decision-making in their community. Gunyangara can provide a model for other communities who wish to administer a township lease in future, giving communities a new option when determining tenure arrangements that work best for them.

Irrespective of which entity holds a township lease, land under the lease remains Aboriginal land and Traditional Owners receive rent for the use of their land. Communities under a township lease are advantaged because the long term tradeable tenure is a suitable platform for Government investment, including in social housing.

Current Township Leases

There are township leases on the Tiwi Islands at Wurrumiyanga, Milikapiti and Wurankuwu and in the Groote Eylandt region at Angurugu, Umbakumba and Milyakburra.

These leases are held for between 80 and 99 years. A 99 year lease provides the optimal term for intergenerational transfer of subleases to support home ownership and economic development.

There have been positive economic development outcomes in township lease communities including the establishment of Traditional Owner trusts and business operations, retail outlets and accommodation facilities. Township leasing has led to several Tiwi families owning their homes.

The Executive Director is assisted by staff from the Office of Township Leasing, who travel regularly to existing township lease communities to consult and liaise with Traditional Owners, sublessees and other community members.

Further Information

If you would like further information on township leasing you can:

  • view the Township Leasing Factsheet below

  • view the Gunyangara Community Entity Township Lease Memorandum of Understanding below

  • view the Wurrumiyanga Township Lease Review Factsheet below

  • read the Frequently Asked Questions below

  • visit the Office of Township Leasing website

If you are a Traditional Owner and you are interested in a township lease you can:

  • talk with your Government Engagement Coordinator or Indigenous Engagement Officer

  • talk with your Land Council

Frequently asked questions

Why is leasing important?

Aboriginal land in the Northern Territory under the Aboriginal Land Rights (Northern Territory) Act 1976 (Land Rights Act) is inalienable and communally held. The land cannot be sold so Traditional Ownership of land is protected for generations to come.

Over the past few years, Traditional Owners, Land Councils and Government have worked to formalise land use arrangements on Land Rights Act land. Negotiating and agreeing leases in major remote communities has been a key part of this.

A lease is a formal, written agreement between a lessor and a lessee that provides rules on the use of a specific area of land for a specific period of time. The lessor and lessee are clear on the arrangements for the use of the land, including their roles and responsibilities. A lease can set out specific rules on a variety of things including what the lessee can and cannot do with the land, cultural observances, environmental protections, rights of access, insurance and payment of rent, rates, taxes and charges.

Leases can be used to leverage land as an asset which can help build financial wealth in Australia’s mainstream economy. For example, having a long-term tradeable lease is a necessary step in obtaining a loan from a financial institution to buy a home. All forms of leasing on Aboriginal land ensure that the people using the land recognise Traditional Ownership.

What is a township lease?

Township leasing is provided for by Section 19A of the Land Rights Act. A township lease is a long-term lease over a township on Land Rights Act land. The lease over the town area of the community is typically granted by the Aboriginal Land Trust to the Executive Director of Township Leasing (Executive Director). The Executive Director is an independent Commonwealth statutory office holder established under the Land Rights Act.

The land under a township lease remains Aboriginal land and the head lease sets out the rules for how the land can be administered by the Executive Director, including the basis on which the Executive Director may issue subleases to land users in the town.

A different model of township leasing, where a community entity holds the township lease rather than the Executive Director, is currently being worked on for the community of Gunyangara. Gunyangara can provide a model for other communities who wish to administer a township lease in future, giving communities a new option when determining tenure arrangements that work best for them.

Communities under a township lease are advantaged because the long term tradeable tenure is a suitable platform for Government investment, including in social housing.

How is a township lease agreed?

Traditional Owners and the relevant Land Council negotiate the proposed township lease with the Australian Government.

The Land Council undertakes consultations with Traditional Owners and other affected Aboriginal groups and communities on the proposed township lease as required under the Land Rights Act. Traditional Owners make a ‘yes’ or ‘no’ decision on the proposed township lease and the Land Council must ensure that Traditional Owners understand the proposal. The Land Council must also determine whether the proposed township lease is reasonable. Further information on the steps in a township lease negotiation is provided in the township leasing fact sheet.

A township lease is voluntary. It is an option for Traditional Owners who are seeking a land administration system for their communities that can provide for land transactions in a similar way to land administration in other towns across Australia. Traditional Owners can maintain their involvement in land administration through an advisory role to the Executive Director in a Consultative Forum. Further information on the Consultative Forum is provided below and in the township leasing fact sheet.

How is a township lease different from leasing Aboriginal land in the Northern Territory through Land Councils?

Section 19 of the Land Rights Act allows for government, individuals, businesses and organisations to apply to the relevant Land Council for leases over specific areas of Aboriginal land. These leases are often referred to as Section 19 leases. Section 19 leases are applied for, consulted on and, if agreed, granted on a case by case basis.

The Land Council undertakes consultations with Traditional Owners and other affected Aboriginal groups and communities on a section 19 leasing proposal as required under the Land Rights Act. Traditional Owners make a ‘yes’ or ‘no’ decision on every leasing proposal and the Land Council must ensure that Traditional Owners understand each proposal. The leasing proposal must be approved at a meeting of the relevant Land Council’s Full Council or delegated authority, which will determine whether the proposal is reasonable. Full Council meetings occur only a few times each year.

The Section 19 leasing process is suited to the handling of leasing proposals for significant developments on Aboriginal land outside of townships, including large-scale infrastructure, agriculture or mining related projects. Section 19 leasing has also become commonplace within townships on Aboriginal land, especially for government service provision over multiple lots.

Traditional Owners can continue to work with their Land Council on Section 19 leases within townships on a case by case basis. However, Traditional Owners may decide that streamlining leasing processes by setting the leasing rules upfront, then letting a land administrator manage township land use according to these rules, is more suitable for major communities and their future development. This is the voluntary alternative provided by township leasing under Section 19A of the Land Rights Act.

How can a township lease benefit Traditional Owners and other people living in major communities on Aboriginal land in the Northern Territory?

A township lease provides a strong and consistent land administration system for the entire township area while ensuring the township land remains Aboriginal land. A township lease gives Traditional Owners an option to have their township land managed by a dedicated, impartial land administrator such as the Executive Director, who actively formalises land arrangements across the township and takes a structured approach to obtaining advice from Traditional Owners through a Consultative Forum.

A 99 year township lease helps to provide a strong foundation for building economic activity and intergenerational wealth in towns on Aboriginal land. It provides for the Executive Director to grant long-term subleases over specific parcels of township land, after considering the views of the Consultative Forum. Efficient land administration and the ready availability of long-term, tradeable subleases can help to attract outside investment in a town. Traditional Owners and community members can use their long-term subleases to obtain a loan from a financial institution to buy their own home or invest in a business.

Communities under a township lease are advantaged because the long term tradeable tenure is a suitable platform for Government investment, including in social housing.

Neither the Australian Government or Executive Director make a profit from township leases or subleases. Under existing township leases, Traditional Owners receive the rental returns from all subleases granted under the township lease, less administration costs when they become payable.

Under existing township leases, the Australian Government has negotiated an advance payment of expected rent from subleases. Advance rent payments benefit Traditional Owners by providing a lump sum at the beginning of the township lease which can support significant investment by Traditional Owners in local economic development activities. These payments are paid back from income generated under the township lease.

How do Traditional Owners participate in land administration under a township lease to the Executive Director?

The terms of the township lease, which provide the land administration rules, are negotiated between the Government, Land Councils and Traditional Owners, and can be tailored to reflect Traditional Owners’ aspirations for the community.

All existing township leases have required the establishment of a Consultative Forum. A Consultative Forum is usually comprised of nominees of both the Traditional Owners and the Executive Director, with a majority of the members being nominated by Traditional Owners.

The Consultative Forum is critical to the governance of a township lease and facilitates formal communications between the Executive Director and other Forum members on the Executive Director’s land administration activities. The members of the Consultative Forum discuss land use and other issues arising in relation to the performance of the township lease, local development opportunities and forward planning for land development. The Executive Director must have due regard to the views of Forum members.

Traditional Owner members of existing Consultative Forums have appreciated the regularity and structure of land use discussions and forward planning that the Forum enables. Regular reviews of the township leases are conducted by the relevant Consultative Forum. There is further information on the Wurrumiyanga Township Lease Review in the Wurrumiyanga Review factsheet.

Under existing township leases, members of the Consultative Forum who are nominees of the relevant Aboriginal Land Trust are expected to share information with other Traditional Owners and community members on the business of the Consultative Forum. The Executive Director and staff from the Executive Director’s Office of Township Leasing travel regularly to existing township lease communities to consult and liaise with Traditional Owners, sublessees and other community members.

Do Traditional Owners have to agree to a township lease to ensure the continuation of services?

Township leases are voluntary and municipal and essential services are not contingent upon a 99 year lease. Traditional Owners do not have to agree to a township lease in order to continue to receive services.

A 99 year township lease is about creating land administration arrangements that deliver the transferability of ordinary freehold title, which gives confidence to business and financial institutions to invest in activities on Aboriginal land while preserving Traditional Ownership. A township lease can create a functioning housing market and support home ownership in remote Aboriginal communities.

The provision of social housing by Government now includes a policy on the sale of public housing to eligible tenants. Building social housing in remote communities should therefore be targeted where land tenure, such as township leases, allows for home ownership.

Is the Aboriginals Benefit Account (ABA) used to pay for township leases?

Payments related to acquiring and administering township leases under section 19A of the Land Rights Act are sourced from the Aboriginals Benefit Account (ABA). This is expressly provided for under section 64(4A) of the Land Rights Act.

Township leases agreed to date have included an Advance Payment on rent for the first 15 years of the township lease. Sourced from the ABA, this payment is intended to be repaid to the ABA from income generated by subleases under the township lease.

The ABA is used for the administration costs of the entity that holds the township lease, for example the Executive Director and the Office of Township Leasing. Where payable, administration costs of a township lease are deducted from rental income generated by the township lease.

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