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Just lending a handRemote indigenous communities are in penury, but their businesses are thriving thanks to an American expat, writes Michelle Wiese BockmannJune 29, 2006
STARTING from a small shed with a few bags of flour and $5, US-born Glendle Schrader launched a $20million empire that manages businesses for Aborigines in remote communities.When Schrader moved to the isolated South Australian community of Pipalyatjara to manage its community store in 1975, he recalls seeing packs of dogs so hungry they gnawed through tin cans to get to food. He says he used the last of his petrol to drive to the government settlement of Docker River in the Northern Territory and bought supplies for the store on credit. Those first successful commercial contacts with the Anangu people of central Australia have deepened significantly. Schrader, 53, is now at the helm of an indigenous business empire with $10 million in assets that turns over an estimated $20 million a year. Yet the empire he has built is owned by the nation's most desperate and dysfunctional Aboriginal communities. Schrader's high-powered influence - especially among male leaders - amid the grog, petrol sniffing, endemic violence and abuse in some of these communities, has divided many. "Sooner or later we're going to catch up with him and run him off the lands," says one high-profile female leader who asked not to be named. A disgruntled former employee says "the community at Uluru refer to him as the farmer: the Aboriginal people are the cattle and he just goes up every now and then to check on his stock. The people he is profiting (from) are starving and living in Third World conditions while he lives the high life." Schrader lives in a comfortable but not ostentatious property near the beach in Adelaide's southern suburbs. He refuses to disclose his salary or the amount of government funding that flows through the empire he manages. He agreed to meet The Australian at the offices of legal firm Johnston Withers to discuss his affairs in the presence of a freelance journalist engaged to provide media counsel. Although he came to Australia in the early 1970s, Schrader's American accent remains strong. Asked to respond to criticism that he is a leech "who gets rich off the back of blacks", he becomes clipped and closed. "Well, I disagree," he says. "My wage is not picked by me but negotiated by other people. Our growth doesn't (affect) my salary. It's easy to make ill-informed comments from the sidelines." Schrader dismisses concerns about his presence and influence in central Australia as indicative of fractured indigenous politics. "If there was somebody else to do it (this job), I would be happy for them to do it," he says. Schrader runs Wana Ungkunykja, the money-making arm of the Nyangatjatjara Aboriginal Corporation. He launched the corporation in 1993 with $250 and shareholders who comprised about 1000 Anungu adult members of three central Australian communities, Mutitjulu, Imanpa and Kaltukatjara (Docker River). These communities remain plagued by substance abuse, poverty, illiteracy, violence, ill-health and financial mismanagement, yet they are the effective owners of the multimillion-dollar enterprise that Schrader manages. He is also chief executive or secretary of more than a dozen associated companies and trusts. These businesses include roadhouses, a newsagency, tourist companies, a cattle station, community stores, a four-campus high school and screen-printing workshop for the Imanpa community. Schrader also runs a private job network for Anangu people. He says he employs 200 through the businesses, whose number The Australian estimates at about 30. Only 70 of his employees are indigenous. Schrader says profits over the years have resulted in payments to each of the communities averaging $100,000 annually. With the profits, the communities have been able to take out loans and purchase assets such as roadhouses and cattle stations. The money is distributed under contract and approved by trustees. "Aboriginal people are really worried about their kids; for many communities this is the only discretionary money they get and they apply that to their kids and their culture," he says.
Schrader refuses to discuss his private life and gives away little about his well-connected background and the Aboriginal powerbrokers to whom he is close. He is married to Lois Pearson, a cousin of Cape York indigenous leader Noel Pearson, who has long championed the need for more private-sector partnerships to reduce welfare dependency. Pearson's view is endorsed by the Labor Party's federal president Warren Mundine, who says Aboriginal-controlled companies can help to bring economic development to communities and rescue them from poverty. "All the problems are poverty-related, and we have to deal with that or our conditions will not improve," Mundine says. "One of the ways we can do that is having enterprises making money, that are profitable, with the benefits of that profit returning to the Aboriginal community." He says Aboriginal people have to be made "more wise" and given skills to quickly become entrepreneurial. "Benefits must be returned to the Aboriginal community and the Aboriginal community needs to receive those benefits, otherwise we'll have this continual circle of poverty." An ABC Four Corners program aired on May 29 showed a meeting at which Schrader took over running the Imanpa community store, which was on the brink of closure. Despite concerns about conflict of interest and proxy voters, community council members, some of whom are illiterate, signed a legal document handing over store management to Schrader's Ninti Corporate Services. "That's typical of him," says one leader. "That's how he operates." However, none of Schrader's critics are prepared to speak publicly, not even those who are prominent and powerful. In 2005 Schrader presided over a similarly contentious takeover of the store, garage and community council at the troubled Ernabella community in South Australia's remote north. Ninti has managed and distributed government grants for Ernabella. "Because the Government was not comfortable last year directly funding the community, so they chose to fund us," Schrader says. Ninti is also contracted to operate the community store at Docker River. Schrader says the Ernabella and Imanpa stores were "a couple of hundred thousand dollars" in debt when he took over. A previous store manager at Ernabella had been busted by police for "running grog" and was now in jail for other offences. "It was typical of the type of people who can take over and manipulate and then rip off Aboriginal communities," he says. Schrader formed Ninti Corporate Services in 2004 to provide financial management to broke Aboriginal communities. Last February he briefed a federal and South Australian Aboriginal lands taskforce on the "useful options" his business provided "for communities that could not manage their assets". Schrader says all businesses other than Ninti are profitable, while the job network just breaks even. He expects Ninti, which charges a fee of between 2 per cent and 4 per cent of gross turnover in the stores it manages, to start turning a profit by next year. Although Schrader paints a positive picture, there are some financial storm clouds hanging over him. Last month the Registrar of Aboriginal Corporations appointed an administrator to manage Schrader's parent corporation, Nyangatjatjar Aboriginal Corporation, because of financial concerns. Schrader insists he had no role in managing the corporation until February 2006. He took over after auditors raised doubts the corporation could continue as a going concern. The former administrator was Clive Scolley, who was replaced by the corporation's own subsidiary, Ninti. Schrader fought the decision in the Federal Court, but lost. "I think that Aboriginal people have been hard done by throughout Australian history ... This had been something that gives me personal satisfaction and fulfilment that I may be contributing in some small way to righting some substantial wrongs," he says. It's not the first time Schrader's business deals have been under scrutiny. He clashed with South Australia's former health minister John Cornwell in the late 1980s over funding and spending for an Aboriginal-controlled public health clinic he established and ran. Schrader blames Australia's tall poppy syndrome for the criticism he attracts. "I'm proud of the job I've done and I know that the directors, who are my bosses, are quite proud of the work that my companies have done, and why shouldn't they be? The job I've done is long and hard."
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