Canberra: An Indigenous man who spent almost five years in jail after being wrongfully accused of killing a non-Indigenous man in Broome in 2010 has been granted $1.3m in compensation from the Western Australian government.

Gene Gibson, a Pintupi man from the remote community of Kiwirrkurra, was arrested and charged in 2012 with murdering 21-year-old Joshua Timothy Warneke.

The charge was downgraded to manslaughter in 2012, after the supreme court ruled an interview conducted by police without an interpreter present inadmissible.

He pleaded guilty to the charge on instructions from his lawyers and was sentenced to 7 and a half years’ jail, but the conviction was overturned on appeal on the basis that he did not have the cognitive ability or English language skills to understand the legal process. He was released from jail in April 2017. He is now 26.

On Wednesday, WA attorney-general John Quigley said the state would pay $1.5m in compensation to Gibson, of which $200,000 will be set aside to cover management fees of the Public Trustee.

“The State makes this payment in recognition of the miscarriage of justice suffered by Mr Gibson,” Quigley said. “In making this payment, the State has taken into account the flaws in the investigation, Mr Gibson’s vulnerability, loss of liberty, and the hardship, hurt and loss he would have experienced as a result of his conviction and imprisonment.”

Quigley said the amount offered was “appropriate” and “adequately reflects the gravity of the wrong done to Mr Gibson by the State”.

Gibson’s lawyers had asked for $2.5m when making the application for an ex gratia payment in August.

It’s the third largest ex gratia payment made by the state of WA to a person who has been detained.

Andrew Mallard, who spent 12 years in jail for murder before his conviction was overturned by the high court, was granted $3.25m. The family of Warburton elder Mr Ward, who died from heat stroke after travelling in an unairconditioned prison transfer van, was granted $3.2m.

In September, the family of Yamatji woman Ms Dhu, who died in custody in a Pilbara police station in 2014, was granted $1.1m.

The police investigation that resulted in Gibson’s arrest has been subject to three reviews, including a damning report by the Corruption and Crime Commission which said the case highlighted “systemic failures” in WA police, particularly around its handling of vulnerable witnesses and use of Aboriginal language interpreters.

Gibson speaks several languages but his English is poor. He is also cognitively impaired and believed to suffer from foetal alcohol spectrum disorder.

Former WA police commissioner Karl O’Callaghan said after the appeal that he “deeply regretted” the failures of police that led to the wrongful conviction.

But he later admitted to discussing the need to re-interview Gibson with his replacement, commissioner Chris Dawson.

“When we re-investigate the crime, which we have said that we are going to do, that would probably mean a discussion with Gene Gibson in the future,” O’Callaghan told the West Australian newspaper in August. “It does not mean he is a suspect. There was nothing secret in that meeting and nothing that I haven’t spoken about publicly.”

In July, WA police offered a $250,000 reward for information leading to the person responsible for Warneke’s death.