THE overwhelming support for two constitutional changes affecting the government's dealings with indigenous people at a referendum held 40 years ago tomorrow was a national expression of hope. The changes were technical in nature but in their intent they were a giant leap on the road to reconciliation. The vote acknowledged that the gap between indigenous and non-indigenous Australians was incompatible with a modern nation's self-image as an enlightened, free and fair society.

As The Australian editorialised at the time, however, the constitutional changes were "no guarantee of action". It is with sorrow that we note the accuracy of that prediction. While there have been significant advances in Aboriginal legal rights and laudable achievements by Aboriginal academics, politicians, actors, athletes and artists, the appalling state of Aboriginal health and welfare dependency remains the biggest blight on Australia's international reputation and shames us all. On many measures, Aboriginal people have gone backwards over the past 40 years, something that would have seemed inconceivable in the euphoric atmosphere of optimism that the "yes" vote created.

Tomorrow's anniversary is an opportunity to speak the truth about the mistakes of the past 40 years and to find common ground for an enlightened, broad-based plan for reconciliation. The time has come for a new national compact between indigenous and non-indigenous Australians, one that can unite Aboriginal leaders, communities, the politicians, health professionals, educationalists and, crucially, business behind a plan to close the gap. The first step is an honest review of the policy of exceptionalism that began with the 1967 referendum and has informed academic and administrative discussion ever since. Exceptionalism grew out of the romantic belief that Aborigines wanted space to live according to their own traditions separated from the settler society that had corrupted their identity.

As a means of improving the lives of Aboriginal people, exceptionalism has been a disaster. Its most insidious legacy is the entrenchment of homelands, remote, festering, welfare-dependent communities where 90,000 Aboriginal people now live. Let us not mince words. Exceptionalism is apartheid, the Afrikaans word for separateness. Mercifully, it is not the jackboot apartheid of pre-1993 South Africa. There is no systematic oppression or domination of blacks by whites, no forced segregation, and thanks to the 1967 referendum, indigenous people in Australia are citizens of their own country. But while Aborigines have been politically enfranchised, they have been economically disenfranchised by the unintended consequences of exceptionalism.

Exceptionalism was the retirement project of a distinguished man of honest intent, Herbert Cole "Nugget" Coombs, the governor of the Commonwealth and Reserve banks from 1948 to 1969 who helped set up the Australian National University. But exceptionalism was philosophically flawed, a fatal fusion of romanticism and Marxism, which drew on their common theme of the superior virtue of the oppressed. Unlike Marxism, exceptionalism was anti-modernist, taking as its model the pre-1788 hunter-gatherer society in which Rousseau's noble savage lived uncontaminated by an invading culture. Like Marxism, however, it regarded property as theft, putting communal ownership ahead of private, rejecting the mechanism of a capitalist free market. This was the Coombs experiment's fundamental flaw. It resulted in the homelands policy, adopted by both the Whitlam and Fraser governments, which established remote, autonomous settlements where Aborigines could fish, hunt and practise their ancient rituals. Coombs's Arcadian paradise was sustainable only through welfare, by subsidising unproductive indigenous communities with wealth transferred from the non-indigenous economy. Judging by the sentiment expressed at the 1967 referendum, most Australians might have seen this as a money well spent if it was the means by which historical injustice could be righted and a unique ancient culture preserved. But it is not. The appalling consequences of welfare dependence in these remote homelands - boredom, social disintegration, alcoholism and violence - are the fruits of Coombs's neo-pastoralist dream.

Far from enriching Aboriginal culture, the Coombs experiment has corrupted it to a level that makes it deeply resistant to progress. It has encouraged a world view that looks back to an imagined golden age, that dreams of the past, not the future. Superstition and sorcery breed fatalism and resignation. Poor education promotes dependency and exclusion. Work is not recognised as a route to wealth, rather wealth is a threat to equality because riches provoke envy. Endemic corruption in welfare delivery discourages enterprise, wealth comes from connections, graft rather than grafting. Identification is with the narrow community and family is a fortress against the broader society. Women are subordinated to men.

In the context of the time, the dream of a separate Aboriginal Australia was understandable. In the late 1960s, mainstream Australia was still largely mono-cultural, conservative and predominantly Anglo-Saxon. The White Australia policy was still in force, though it was beginning to be dismantled. But much has changed in the last 40 years. Successive waves of immigration have created ethnic communities which remain true to their original culture while playing a constructive role in the wider society. This is integration, not assimilation.

Ironically, those on the Left who cling to the Coombs apartheid model would be supporters of enlightened multiculturalism. They are also the same people who opposed apartheid in South Africa. They fail to see the fatal contradiction in the Coombs experiment, that a policy that was meant to end paternalism and deprivation ended up promoting it through bureaucracy and welfare. It left Aboriginal people hopelessly isolated, mere observers, not participants, in the economic miracle of the past 40 years.

There can be no progress without economic integration. We can no longer deny Aborigines the right to aspire to good education and good jobs, to own houses and cars, to enjoy holidays and build a future for their children. Some remote communities have found ways of making money through art, tourism or mining but others are hopelessly trapped in welfare reliance. What is needed is education, support and encouragement for those who want to move out of remote communities to find work. After all, Australia is a country that understands the value of migration as an instrument of economic adjustment.

The Weekend Australian believes that in 2007 there is a fresh consensus for change based on practical, sustainable and life-enriching solutions. Under John Howard, the federal Government has made a start at turning the corner, even if concrete results are hard to see. Mr Howard's first Aboriginal affairs minister, John Herron, pioneered the project of practical reconciliation at a time when Aboriginal activists and their friends on the Left were obsessed with the politics of symbolism. More recently, Amanda Vanstone saw through the brave decision to abolish the Aboriginal and Torres Strait Islander Commissioner. Few have mourned the passing of this monolithic monster.

Now voices on the Left of politics, among them Opposition Leader Kevin Rudd, ALP president Warren Mundine and former Labor minister Gary Johns, are promoting the cause of responsibility rather than welfare developed by Noel Pearson and his Cape York Institute. Crucially there is support from business, something not seen as important by Coombs, a committed Keynesian economist. The Weekend Australian believes that rising standards of living are the product of progressive enterprise, the acceptance of risks, the encouragement of adventure and the prospect of rewards. There is, as Robert Menzies once said, no government department that can create these things.

Tomorrow's anniversary is not a day to look back - it is a day to look forward, true to the spirit of the five million Australians who voted "yes" at the 1967 referendum. Their intention was to close the gap, loosely defined as that idea then was. It was a vote in favour of reconciliation without any clear idea of how it might be achieved or how it might be recognised once it was achieved.

Today The Weekend Australian joins the call for a concerted effort to close the most important gap between indigenous and non-indigenous Australians - the 17-year gap in life expectancy. By framing the discussion around the longevity gap, we can cut through the divisiveness and bitterness that has characterised the indigenous debate for the past 40 years. Closing this gap is not just about health. It is about improving education and housing, access to training and jobs, empowering indigenous people with hope and aspirations, the right of everyone in a fair and decent society. It is, in a profound sense, a defence of the right to a life.