Community in mainstream discourse is a meaningful evocation, but its acquired meaning in indigenous policy has a sickly quality to its sweetness. When we use the word to refer to indigenous polities and places there is a more problematic meaning.

Places like my home town were not always known as communities. When I was growing up we called our home town the mission. We still often fall back to the old word from time to time. Those were the days when the Lutheran Church still held administrative responsibilities, but these arrangements came to an end in the 1980s.

Back then the word we most used to describe the physical place was village. Never town, never community, always village.

When the change came to community the truth is the new word came about through governmental fiat. The commonwealth government now referred to Aboriginal communities, and the word became commonplace in the title of their programs and policies. Queensland legislation then formalised the concept of communities that were to be governed by a version of local government called community councils.

When bureaucrats, politicians and non-government organisations engage in the discourse of community in indigenous affairs, they perpetuate an oppressive concept. I would go as far as to say it is one of the central misconceptions in indigenous policy.

Community in the indigenous Australian context means commune and communitarianism. Outsiders who interact with the people of these places are projecting their own fantasies of communitarianism on to them. In turn the people of these places have adopted this meaning. And the result is crippling.

It is understandable why this has happened. These places have shared connections in terms of cultures, languages and histories. The people of Aboriginal places like my home town are bound by kinship ties that make these societies dense if fractious. They are different from open societies.

But the bureaucratic paradigm of community that has grown in Australian indigenous policy, the outcome of the romantic projections of outsiders, has become the iron cage of the bureaucratic commune. Held in the thrall of passive service delivery by the outsider providers, it is a species of community unknown in the rest of Australia. When Tony Abbott said some years ago that Aboriginal communities were the last bastion of the old Soviet-style communes, he was not far off the mark.

In open society, communities have three spheres in which citizens live. People move between these three spheres. Though invisible, we all know that the principles applying to these spheres are quite distinct. There is a public sphere in which we engage with other citizens. There is a private sphere in which we and our own families make our own decisions, including our relations with other individuals and families in their own private pursuits. There is then the voluntary sphere where we are not mandated to contribute, but we do so for the larger good.

Notice the differing principles that govern how we conduct ourselves in these three spheres. In the public sphere the principles are service and duty, and there is an expectation of impartiality. The pursuit of one’s private interests and that of one’s family in the public sphere is proscribed, because it amounts to nepotism and corruption. But we would hardly call the pursuit of individual self-interest or family preference nepotistic or corrupt in the private sphere.

The private sphere is where we want families to take care of their own, and to pursue their own self-interest. When they do this the result is in fact socially beneficial. This is how private self-interest actually drives social development.

In the voluntary sphere the principle that governs our behaviour is our regard for others in our society. We contribute and participate not because we have a public duty or because we are animated by self-interest, but because we want to make our world a better place.

Vibrant and successful societies are those where these three spheres are equally prominent.

The problem with the artificial Aboriginal communities of remote (and not so remote) Australia is they are characterised by a dominant public sphere. The private sphere is stunted and anathema to the dominant concept. It is not that self-interest does not exist – it is ever present – it is just that it is not free to find legitimate expression. So where does self-interest end up? In nepotism and internecine conflict between families desperate to control the public structures of the community.

The voluntary sphere is as stunted as the private sphere. The true history is the voluntary sphere has shrunken since the mission days. It shrunk because it was displaced by the public sphere. Governments began to distribute grants to pay for social and cultural activities that were once the province of voluntary groups. Instead of carefully considering what investment governments might make to support social and cultural activities, the Leviathan came crashing in with handouts.

The final problem with the idea of community in the indigenous policy context is that it is as elusive and ephemeral as thin air. Who and what is this community that is supposedly going to take responsibility for the children who are walking around the streets late at night? Who and what is this community that is going to “own” and “drive” the development of new alcohol management plans for these places? Who and what is this community that is going to do any number of things upon which countless government policies and programs are premised?

The community is the ultimate bureaucratic alibi, because when it comes to identifying who and what he or she is, he or she is an absent actor. Where bureaucrats see community, I see individuals and families.

Noel Pearson is chairman of the Cape York Institute for Policy and Leadership.