The Community Development Employment Projects (CDEP) scheme was developed as a response to the perceived social threat of 'sit-down money' to Indigenous communities in the 1970s. Ironically, the scheme is now being criticised as being one of the main factors driving the social effects of prolonged welfare dependence. This article updates the Office of Evaluation and Audit 1997 report that evaluated the scheme. While this paper shows that the CDEP scheme has a significant effect of reducing social pathologies, vis-avis unemployment, the positive effect of the scheme is generally substantially less than the protective effect of having mainstream (non-CDEP) scheme employment. Consequently, it is the lack of mainstream employment options, rather than the presence of the CDEP scheme that drives the social pathologies identified in recent public debate. Notwithstanding the evident community development associated with the CDEP scheme, it cannot be the whole answer for disadvantaged Indigenous communities, which also need a mixture of economic development, infrastructure spending, and bottom-up policy initiatives. Another policy option might be to facilitate mobility where the prospect for regional growth is limited; however, it should be noted that incentives for individuals to move are altered when the other development policies work.