The hard place in the shadow of the rock

There were huge celebrations when Ayers Rock was handed over to its traditional owners 25 years ago. But despite owning Uluru, Aborigines nearby live in misery

Twenty-five years ago yesterday, thousands of people descended on a patch of red dirt in the Australian desert to witness a momentous event: the handing over of the title deeds to Ayers Rock, the sandstone monolith that towers over the pancake-flat landscape of central Australia, to its traditional owners.

It was a high point in the Aboriginal struggle for land rights, and a time of enormous optimism. A new era of self-determination and economic independence appeared to be dawning for the Anangu people, who had lived in the area for 22,000 years.

But as locals gathered at the rock, now called Uluru, for the anniversary celebrations, the mood was subdued. While "handback" has brought some benefits, including a small share of the income generated by one of Australia's most popular tourist attractions, the Anangu still live in poverty and squalor – many of them in a township situated at the base of Uluru but invisible to well-heeled visitors.

Home to a shifting population of several hundred, Mutitjulu has a reputation as one of Australia's most dysfunctional remote communities. Claims of rampant child abuse at Mutitjulu – never proven – triggered the government's "intervention" into the Northern Territory in 2007, designed to stamp out violence and raise health and living standards in the indigenous desert settlements.

The intervention, launched at Mutitjulu by John Howard's conservative government, has continued, in a watered-down form, under Labor's Kevin Rudd and Julia Gillard. But the place is no better off, according to Vincent Forrester, a local elder, who says the only new infrastructure is a police station and two police houses.

Mr Forrester calls Mutitjulu "the forgotten community... out of sight and out of mind". As elders performed traditional dances yesterday in the shadow of Uluru and boys showed off their spear-throwing skills, he recited a litany of despair: people living 30 to a house, girls sniffing petrol in a quest for oblivion, children leaving school without numeracy and literacy skills, men hanging themselves.

"I live in a Third World community that has yet to really benefit from being so close to a national icon," said Mr Forrester, chairman of the Mutitjulu Community Aboriginal Corporation.

Mutitjulu evolved from the old motels and camping ground that achieved notoriety as a result of the Lindy Chamberlain case. (Mrs Chamberlain's daughter, Azaria, was snatched from the family's tent by a dingo in 1980; she was convicted, and later cleared, of the baby's murder.) Much has changed since then, and tourists now stay 12 miles away, at the Ayers Rock Resort.

What has not changed – despite signs entreating visitors not to climb the rock – is the spectacle of tourists swarming over a place that, for Aboriginal owners, is imbued with deep cultural and spiritual significance. "We've not been able to get them to understand and respect our wishes," says Reggie Uluru, whose family adopted the name by which the area was traditionally known.

The handback of land – which included the neighbouring Olgas, another massive ochre outcrop, now called Kata Tjuta – was bitterly opposed by many Australians. Callers swamped talkback radio, and the Northern Territory government waged a A$200,000 (then £98,000) campaign against it. At the ceremony in 1985, a low-flying plane trailed a banner stating "Ayers Rock for all Australians".

The scaremongers claimed that access to Uluru, the geographical and spiritual heart of Australia, would be restricted. "There were dire warnings that the rock would be locked away by the traditional owners," Gina Smith, deputy director of the Central Land Council, which represents landholders, told a crowd of about 200 yesterday. "As you can see, the rock is still here. People got their land rights and the sky has not fallen."

Uluru was not the first land rights victory – that distinction belongs to Wave Hill, a vast Northern Territory cattle station returned (in large part) to the Gurindji people in 1975 after a nine-year fight.

But it was the highest-profile success to date, for the rock was the great national symbol. And title was granted only on condition that the Anangu lease it back to the government, which created a now World Heritage-listed national park, jointly administered by traditional owners and park officials.

The former receive one-eighth of the gate money, amounting to about $800,000 (£497,000) last year and divided between an estimated 600 people. Another eighth is spent on community development projects, such as sports facilities and arts centres. The park has 10 indigenous staff, most of them rangers, with others working there on an ad hoc basis. Aboriginal elders advise on projects such as monitoring endangered species and conducting controlled burns of vegetation.

Tourism should be another major source of jobs – yet the Ayers Rock Resort, a cluster of hotels, restaurants and shops, is a white ghetto. Of the 670 people employed there, only one is Aboriginal. The tour business, too, is white-dominated, although there is one highly successful indigenous company, Anangu Tours. At the rock, it is disconcerting, but not unusual, to bump into a white guide relating ancient indigenous stories.

Phillip Toyne, a lawyer who spent 10 years helping the Anangu win back their land – a battle he describes as "a very controversial and bloody process" – says that low educational levels are one factor thwarting the fulfilment of Aboriginal aspirations.

Last week, the resort was bought by an indigenous corporation, which plans to set up a hospitality training college. The move sparked optimism, with predictions that it would transform Aboriginal job prospects, and also foster an atmosphere in which fewer tourists climbed the rock.

Donald Fraser, a land rights activist and traditional owner, looked weary yesterday when asked why elders did not simply ban visitors from climbing. "We're different to white people," he said. "We prefer to negotiate. We'll just keep working at it until the right time comes."

The festivities might have drawn a larger crowd were it not for recent heavy rains, which have made the desert bloom with wildflowers and sent waterfalls cascading down Uluru. The downpours have made dirt roads impassable, and yesterday dawned so misty that the rock vanished completely.

Later the clouds lifted, and so did the mood. Elderly ladies boogied to a succession of rock bands, and ran races with billy cans balanced on their heads. Children performed cartwheels in the sand dunes and, in the background, the rock shimmered, putting on an endlessly changing display of colour and light.

Mr Fraser and other elders stressed how important it was to regain cultural control of their land. Asked what the handback signified, David Ross, director of the Central Land Council, said: "Aboriginal people had been locked out on the fringes of society for a couple of hundred years, so it was a hell of a big deal.

"We've gone from a base of zero, where we had no rights whatsoever, to now being recognised as the traditional owners of this country."