A 500g tin of Nescafe Blend 43 = $40. Meet the companies feeding remote communities

This is part one in a series. Read the full series here.

Every day, more and more Australians grapple with how they’re going to make ends meet and when they’re going to get their next meal. But food insecurity in the cities pales in comparison to remote Australia, where access to food is not just a matter of affordability but also availability.

There’s only one place to buy food and supplies in remote Central Australian Indigenous communities. As a result, those general stores control what’s on the shelves, the quantity and quality of supplies, nutritional value, cost of living, and ultimately whether or not there’s food on the table.

“​​It actually makes me sick when I sit there and watch the news and all I hear about is the cost of living crisis,” Wirrimanu-based manager of Warlayirti Artists Poppy Lever told Crikey and reporting partner Indigenous Community Television (ICTV).

“Your current crisis is what we’re used to. In community, it’s now three times that.”

Some prices seen by Crikey and ICTV in community general stores include:

• Unleaded petrol fluctuated between $3.00 and $3.75 per litre.
• Always Fresh olive oil 500ml sold for $17.10. In the cities it normally goes for $9.00. 
• Western Star supersoft spreadable butter sold for $10.30. It’s normally $7.00.
• Kraft cheese singles sold for $8.30 compared to the standard city price of $4.25. 
• SunRice medium grain white rice 2kg cost $10.10. Normally $6.70.
• Nescafe Blend 43 (medium roast) 500g was $40. This is regularly priced at $18. The 250g equivalent was $26.00, up from $13 and the 150g jar cost $17.40 compared to $11.50.
• Dilmah extra strength black tea 100 pack sold for $11.50. In the cities it’s $8.80. 

So why is it so expensive to service the bush? Who sets the prices? How often is food delivered? Who’s in charge and why are there so few local Indigenous employees? What’s the job description of a store manager and what power do they wield in community?

Crikey and ICTV spent four days on the road investigating various general stores in Northern Territory and South Australian remote Indigenous communities. Notwithstanding the trying conditions of the desert, reporters witnessed a litany of errors and a series of shortcomings, oversights and vulnerabilities in staffing, services and store function.

Let’s meet the companies

There are three groups that run general stores in remote Central Australia: Outback Stores (a Commonwealth company that sits in the prime minister’s portfolio), Mai Wiru (an Aboriginal-controlled and owned company), and independent (meaning it’s run by the community itself). 

Outback Stores launched in 2006 under the auspices of the Department of Prime Minister and Cabinet. It remains there today with a direct line of contact to Minister for Indigenous Affairs Linda Burney. As is customary with a Commonwealth company, Outback Stores reports to an independent board of directors — a board that includes former Northern Territory politician (and mother of federal shadow minister for Indigenous Australians) Bess Nungarrayi Price and ABC journalist Dan Bourchier. 

The organisation operates 54 stores nationwide, but its biggest footprint is in the NT with stores at 34 remote locations. The first official Outback Store launched in May 2007 at Canteen Creek — a remote NT community approximately 521 kilometres northeast of Mparntwe (Alice Springs) — mere months before the NT intervention was introduced by the Howard government. Under these “emergency reforms”, general store licencing and management in Indigenous communities were rolled out at scale.

Since 1999, there have been many iterations of federal, state, and territory inquiries into the availability, nutritional value, pricing and security of food in remote Indigenous communities. These reports and subsequent recommendations have consistently looked into the role and set-up of those companies that manage the provision and price settings of food, with recommendations focused on environmental and “remote” road-blocks, regulation, licensing agreements, top-down vs bottom-up governance structures, and overwhelmingly how to improve health outcomes for Indigenous peoples through promotion of healthy foods. The latest inquiry was commissioned in 2020 by former minister for Indigenous Australians Ken Wyatt in response to allegations of price gouging in remote Indigenous community stores.

The management model for Outback Stores is ultimately contingent on the financial viability of a store. In the case that it is deemed “commercially self-sufficient”, the profits are meant to be funneled into community projects nominated and signed off by a local store committee. If a store is not turning a profit, the role of Outback Stores is to financially assist and ensure there’s food on the shelves. 

Based on the latest data submitted in its 2022 annual report, the company held over $680,000 in loans to community stores, with interest charged between 5 to 7% over a 1-to-15 year period. There were $2.25 million in overdue store payments.

The company as a whole turned a $4.9 million deficit and its four most senior staff (since expanded to five) earned a combined $1.16 million.

How does Outback Stores compare to Mai Wiru?

The Aboriginal-controlled and owned Mai Wiru emerged from a 2002 “regional stores policy” designed to tackle food accessibility, affordability, range and quality in the Anangu Pitjantjatjara Yankunytjatjara (APY) Lands. Driven by an APY Land-wide 25-member steering committee, the Mai Wiru policy — Pitjantjatjara for “good food” — was set up with support from Nganampa Health Council and Ngaanyatjarrra Pitjantjatjara Yankunytjatjara (NPY) Women’s Council.

In 2010, the policy birthed a company — Mai Wiru Regional Stores Council Aboriginal Corporation — to function as the “peak body coordinating the operations of community-owned stores in the region”. The company is headquartered in Alice Springs and runs freight operations from Adelaide.

NPY Women’s Council CEO Liza Balmer — now independently involved in monitoring food availability, price and nutrition in their stores — told Crikey and ICTV that the state of food in communities had “improved incredibly” from Mai Wiru’s inception when the stores were so bad she had to BYO food for nutrition workshops. But even today, she said, the company did not always successfully implement the pillars of its founding policy.

According to Mai Wiru’s 2022 financial report, the company turned a $1.27 million deficit for the year to June 2022. The combined salaries for the six-person leadership team were $1.15 million, up from $796,566 in 2021. The company made a disclosure that it paid $63,000 in HR consulting services to a company controlled by CEO Dennis Bate’s son-in-law. In total, the company spent $238,802 on consultancy, up from $70,825 in 2021. Bate’s daughter is also part of upper management. 

What’s the ideal model?

Outback Stores and Mai Wiru manage the majority of stores in NT and SA remote Indigenous communities, but there are still some independent stores in the hands of local communities.

Balmer said that although it was important for local community to be heavily involved in the governance and management of general stores, independent was not the preferred model.

“A regional and an Aboriginal community-controlled model are always better than the actual community itself,” she said. “The capacity within small communities to run these services are often very limited and it really opens up the possibility of employing not-so-honest people who can manipulate the community.”