The Federal Government has responded to the senate inquiry according to the Sydney Morning Herald.

As Australian art continues its record-breaking run at auction, the Federal Government has come good on a promise to share the spoils with artists and their families.

It is determined to introduce a resale royalty scheme this year giving artists a percentage of the sale price whenever their work is sold. The details have yet to be finalised but some industry bodies have called for a flat rate of 5 per cent on all sales and for the royalty to apply to all works sold for more than $500. That would mean an artist who sold a work 10 years ago for $500 could reap up to $10,000 if it was sold again for 200,000.

But not everybody is happy:

The Arts Minister, Peter Garrett, said the resale royalty and a new code of conduct to regulate the industry were cornerstones of the Government’s efforts to bolster and clean up an industry blighted by exploitation.

“I think we’re really starting to describe a pretty substantial agenda for the future,” he said.

But the Government’s determination to install a resale royalty – a move the Senate inquiry rejected – was condemned by the art consultant, Adrian Newstead. He says it will be “an absolute disaster” for the indigenous and non-indigenous art markets which are already starting to falter in weakening economic conditions.

Mr Newstead says a “very, very small number” of works by indigenous artists have sold for more than $100,000. “Only 17 living and deceased indigenous artists have generated secondary market sales in excess of $1 million. Had there been a resale royalty on indigenous art since 1994, 86 per cent of all the money that would have been collected would have gone into the estates of seven dead artists.”

Mr Newstead said the royalty was a distraction from other, more difficult, issues.

“A resale royalty is no substitute whatsoever for enlightened government policy in the area of indigenous health, education and community development. This is the Government’s responsibility, not the responsibility of people who sympathise with Aboriginal aspirations and put their money directly into their pockets.”