The CDEP scheme was developed as a response to the perceived social threat of sit-down money to Indigenous communities in the 1970s. Ironically, the scheme is now being criticised as being one of the main factors driving the social effects of prolonged welfare dependence. This paper updates the Office of Evaluation and Audit 1997 Report that evaluates the scheme. While this paper shows that the CDEP scheme has a significant effect of reducing social pathologies, vis-à-vis unemployment, the positive effect of the scheme is substantially less than the protective effect of having mainstream (non-CDEP) scheme employment. Consequently, it is the lack of mainstream employment options, rather than the presence of the CDEP scheme that drives the social pathologies identified in recent public debate. Notwithstanding the evident community development associated with the CDEP scheme, it cannot be the whole answer for disadvantaged Indigenous communities, which also need a mixture of economic development, infrastructure spending and bottom-up policy initiatives.

This paper was written as part of an ARC Linkage grant (LP0776958) titled 'An inter-disciplinary analysis of the dynamics of Aboriginal interactions with the criminal justice system' that involves a collaboration between the ANU and NSW Attorney Generals Department.

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