3.98 The ALRC has not been asked to inquire into compensation for the extinguishment of native title. However state governments have pointed out that compensation is relevant to the consideration of the connection requirements of the Native Title Act. Concerns arise on two related fronts.
3.99 First, two state governments raised concerns that changes to the Native Title Act could increase the liability of state and territory governments for compensation. The South Australian Government reported that ‘virtually all determinations of native title are followed by negotiations or claims for significant compensation for historical extinguishment’.
3.100 The Native Title Act provides that where an act extinguishing native title is attributable to the Commonwealth, compensation is payable by the Commonwealth, while the states and territories are liable for compensation when their acts extinguish native title. The South Australian Government noted that ‘the financial assistance package promised by the Commonwealth at the time of the Native Title Act and since is still yet to come to fruition, leaving the bulk of the cost of native title recognition with the states and territories’. The Commonwealth has entered into discussion with the states and territories regarding a Commonwealth contribution to state and territory compensation liabilities, but no final agreement has been reached.
3.101 Secondly, one state government has expressed concerns about the absence of a commitment from the Commonwealth Government to contribute to funding for alternative settlements. In 2013, the Western Australian Attorney General said that, without such a contribution, there is ‘a disincentive for the states/territories to adopt more progressive native title policies’. 
3.102 At the 2008 Native Title Ministers’ Meeting, Ministers agreed to negotiate on ‘Commonwealth financial assistance that could better facilitate state and territory settlement of native title issues’. The ALRC is not aware that such an agreement has been finalised. However in 2010, the Commonwealth entered into a written agreement with Victoria under Native Title Act s 200 for the provision of financial assistance to that state ‘to enable benefits to be provided to native title claim groups under settlement agreements’. The Commonwealth’s financial contribution will not exceed the state’s financial contribution. The agreement notes that ‘the Commonwealth will determine any contribution it makes to Settlement Agreements with States and Territories on a case-by-case basis and extend this Agreement accordingly’.
3.103 The Western Australian Government has sought a Commonwealth contribution to the proposed settlement with the Noongar community.
3.104 Alternative settlements, and the respective contributions of governments to their funding, are policy matters and the ALRC will not make recommendations in this regard. However it is important to note that both Indigenous leaders and government Ministers have indicated that alternative settlements are preferable to a continued reliance on litigation. Some progress is being made towards alternative settlements, and further progress will allow native title litigation to be just one of a range of means for achieving land justice for traditional owners and certainty for other parties.
South Australian Government, Submission 34; Western Australian Government, Submission 20.
South Australian Government, Submission 34.
Native Title Act 1993 (Cth) ss 17, 22A.
Ibid ss 20, 22G.
South Australian Government, Submission 34.
Western Australian Government, Submission No 18 to Senate Committee on Legal and Constitutional Affairs, Parliament of Australia, Inquiry into Native Title Amendment (Reform) Bill 2011, August 2011.
Michael Mischin, ‘Improving the Native Title System’ (paper Presented at National Native Title Conference, Perth, 14 June 2013) 12.
Joint Working Group on Indigenous Land Settlements, ‘Report to the Native Title Ministers’ Meeting 2008-09’.
COAG, National Partnership Agreement on Native Title cl 27 <www.federalfinancialrelations.gov.au>.
Ibid cl 31.
Ibid cl 4.
Department of the Premier and Cabinet, Western Austrlaia, The South West Settlement: Questions and Answers (February 2014) Department of Premier and Cabinet <www.dpc.wa.gov.au>.
Native Title Ministers Meeting Communique 2009; National Native Title Council, Submission 16.