A new council has been elected, and there are now transparent auditing systems. Recent elections saw an influx of "new broom" council members not linked to the Anderson-Hanley family dynasty, which had presided over an epidemic of substance abuse, millions of dollars in funds unaccounted for, and the purchase of expensive equipment, including four-wheel-drive vehicles that can no longer be found.

The changes at Papunya, 280 kilometres west of Alice Springs, in the central desert, come as the Federal Government's three-month inquiry into community's finances is about to report on hundreds of thousands of dollars in work-for-the-dole payments still unaccounted for.

The report, due to be handed to Cabinet Secretary Sharman Stone next week, is believed to contain damning criticism of Papunya's financial practices under its former chief executive, Steven Hanley, including purchasing practices and the administration of the community employment programs. It is, however, unlikely to recommend action against individuals.

The Sunday Age believes that although the investigation, conducted by a private firm of auditors, received an unexpected level of co-operation it was also hampered by a chronic lack of documentation and shoddy records.

The report's findings are expected to highlight anomalies and recommend an administrative overhaul.

Although investigators have pored over Papunya's accounts, it is believed the principal investigator spent only one day at the community. Papunya's newly appointed chief executive officer, Brian Perry, said yesterday the new councillors had been quick to adopt several reforms to make administration "more transparent and accountable", and had tried to improve services, including rubbish collection.

"I can now report that the rubbish bins are full of rubbish, that the recording studio is being brought back into running order, and we are investigating options for programs to tackle petrol sniffing," he said.

The Northern Territory electoral commission confirmed that two councillors, both members of the Anderson family, had been replaced in the recent elections. Mr Perry said the council was determined to restore financial integrity and tackle serious health and substance abuse problems that had increased significantly in recent years.

The Federal Government investigation followed a report in The Sunday Age that revealed, among other things, that an independent audit of Papunya's 2004 accounts had found assets and funds either missing, misappropriate or unaccounted for.

The audit questioned the payment of $500,000 in work-for-the-dole payments paid to 45 people.

Council documents produced at the time stated that only seven people were employed full-time under the scheme, two part-time. Papunya is one of Australia's most impoverished indigenous communities.

More than 25 per cent of its 350 peoples are categorised as habitual substance abusers, and little if anything had been done by the council to eradicate the problem, despite ample money for programs.

Investigations by The Sunday Age revealed that Mr Hanley, who is married to the ALP member for Macdonnell, Alison Anderson, presided over a chronic period of community mismanagement.

Holding no formal qualifications for the job, Mr Hanley appointed a chef with no qualifications to run petrol sniffing programs; resisted attempts by local government authorities to assess his performance, and was responsible for forcing World Vision to abandon its programs.

The community's Warumpi arts co-operative was forced to close after allegations that $80,000 had been siphoned off.

Mr Hanley ran the council for four years until June last year after taking over from his wife, Alison, who relinquished the job to become an ATSIC commissioner.