Australia is undergoing a troubled period in its relations with minorities and indigenous peoples. The government appears to be placing a stronger emphasis on 'Australian-ness', emphasizing a 'white' rather than a composite national identity. This reaction, against a backdrop of growing immigration of Asian/Muslim populations (currently close to 8 per cent of the population), is raising tensions in cities such as Sydney, as manifested in the violence on Cronulla Beach in December 2005. Following the same trend, Pauline Hanson, former leader of the One Nation Party, announced plans in December 2006 to make a come-back in the federal elections of 2007 on an anti-immigration platform; she has accused black African immigrants of bringing HIV/Aids to Australia.

Over the last two years, the replacement of the elected Aboriginal and Torres Strait Islander Commission by the government-appointed National Indigenous Council has denied Aboriginal nations (2.4 per cent of the population) effective political participation. Meanwhile, mining and other extractive industries see ever-increasing commercial values in Aboriginal homelands. The Aboriginal and Torres Strait Islander Act of 2005 (with amendments) that came into force in October 2006 needs to be monitored closely in this regard. Despite the landmark 1992 Mabo decision concerning land rights, Australia seemed for a long time to be making little progress in terms of the recognition of native title. However, in October 2006, the Perth High Court ruled in favour of the Noongar people's claim, accepting a native title claim over urban land in the city. Political parties have expressed consternation over the result of the case, and the government has announced that it is preparing to file an appeal. In December 2006, an agreement was struck between the Githabul people and the New South Wales state government to share ownership of World Heritage-listed rainforests covering 6,000 sq km. The resolution of the land rights issue remains the key to reconciliation between Australian settlers and Australia's indigenous peoples.

Aboriginal life expectancy remains 20 years lower than that of other Australians, some Aboriginal languages are disappearing, and the nations face an array of other social problems. In December 2006, following a court ruling that there was not enough evidence to prosecute police involved in the death of an Aboriginal man in custody, indigenous leaders complained that 'Aboriginal lives can be taken with no consequences.'

Australia's 'Pacific solution' anti-refugee policy has seen it re-interpret its territorial dimensions to avoid responsibilities over intakes of refugees by establishing a 'clearing house' on the island state of Nauru to keep refugees away from the Australian mainland.

The Tasmanian government's apology in 2006 for its role in the Stolen Generations scheme (where Aboriginal children of mixed descent were taken from their families and settled with white families between approximately 1900 and 1969) goes against this trend. The apology, announced alongside a compensation package of AU $4 million (US $3.12 million), provides a model for other states, although thus far they have been reluctant to acknowledge their responsibility for the policies of eugenics that have been perpetrated against the Aboriginal nations for more than a century.

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