Global Policy Forum

By Helen Hughes *

The Rudd Government has an unparalleled opportunity to make a contribution to the evolution of real solutions for small Pacific islands by removing the asylum-seekers facility that delivers 20 per cent of Nauru's income.

Nauru's 21sqkm of land lies just south of the equator. Its nearest neighbour, Banaba Island in Kiribati, is also a mineral phosphate deposit, now abandoned. Fiji, New Caledonia and Australia are thousands of kilometres away. Nauru has a population of 13,000, about the same as Gunnedah shire in NSW.

Nauru's marine phosphate, to which it negotiated full access in 1963, gave it great potential wealth. If sensible management and investment advice had been followed, Nauruans could have been educated and lived well. Every Nauruan family could have had investments worth $1 million when the phosphate ran out. Instead, more than $2.5 billion was wasted on pretensions to statehood, lost in investments that promised unrealistic returns and, more simply, was stolen.

Nauru has gone from being one of the richest communities in the world in per capita terms in the 1960s to being a mendicant living on Australian aid. Taiwan makes a significant contribution by keeping the uneconomic Nauru airline flying. Living standards are abysmal. Educational levels have declined steeply. The population's fishing skills have been lost. Unlimited leisure and the consumption of highly processed foods have resulted in terrible health. Nauru has perhaps the highest level of diabetes in the world - evident in amputated limbs - compounded by obesity and alcoholism. Some Nauruans have escaped to live and work in Australia, New Zealand, Fiji and the US. A reform government has been elected to try to put Nauru together, but totally unrealistic expectations persist.

Although Australian high commissioners were in Nauru for the 40 years of its existence as an independent state, Australian officialdom sat on its hands as Nauru's tragedy evolved. No nation that is dependent on aid can call itself independent. An Australian finance team and an Australian police commissioner in effect run Nauru. They are attempting to restore services and balance the budget, but a Government and public service establishment way beyond the means of a Gunnedah shire make this impossible. Nauruans are being treated like children by Australian officialdom, the UN and the 30 other international organisations that have signed the country up as a member. They are not being informed about their options, which are fairly straightforward because there are no economic possibilities on the horizon that could gainfully employ Nauru's population.

Nauru can opt to continue to live on aid, without meaningful jobs for most of its people. Few of the children and youngsters growing up there now will have fulfilling lives under this option. Worldwide experience suggests the dysfunctional effects of welfare dependence would continue to grow despite efforts to contain them. A few more lucky Nauruans would escape abroad.

But Nauru could negotiate an association status with Australia that would give its people access to work and residence in Australia. Aid would immediately be focused on education, perhaps including the technical college sought by Nauru's Minister of Foreign Affairs, Kieren Keke, so that Nauruans could opt for permanent employment in and hence emigration to Australia. This would not be a guest worker scheme that would give Nauruans only a few months in Australia followed by months of doing and earning nothing on Nauru. After finding work, Nauruans would be able to bring their families and settle in Australia, as do other Pacific island immigrants.

There would be a corresponding timetable for sharply reducing aid. Australian taxpayers would cease to fund Canberra-style government, international embassies and public services for what is in effect a country shire. The police commissioner's establishment would become a country cop shop. A shire engineer would be employed to run the public utilities. A voluntary council would run Nauru's affairs. This arrangement works extremely well on Norfolk Island, where living standards are 10 to 20 times better than those of the rest of the Pacific islands.

Many Nauruans living and working in Australia would no doubt wish to retain ties with their island and spend their holidays with their relatives. Remittances would flow back home. The Nauruan language and traditions would be preserved. Young people would have a future. There are many successful models to follow. For example, there are more people of Maltese origin in Australia than in Malta. Australia would have contributed far more to Nauru by offering work opportunities that finally treated Nauruans as grown-ups than it can ever provide through aid.

About the Author: Helen Hughes is a senior fellow of the Centre for Independent Studies. She helped Nauru negotiate the 1963 agreement with Australia, Britain and NZ that gave Nauru the world price for phosphate.