The Australian Bicentennial Authority gave support to a proposal to establish the Australian Bicentennial Multicultural Foundation. The idea was first proposed by the Federation of Ethnic Communities' Councils of Australia National Conference in 1981.In 1986 the Federation and the Australian Institute of Multicultural Affairs jointly convened a Working Party which consulted widely concerning the objects and direction for the Foundation.In June 1987 the Authority invested $3 Million in the Australian Bicentennial Multicultural Foundation Trust Account. In September 1988 the Funds were transferred to the Foundation after it was legally incorporated as an independent organisation.

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