01 May 2015
by Ruth Spielman

The people infrastructure equation

How might we be living in 40 years time ? The Government's Intergenerational Report (IGR) tells us there will be a lot more people. What it doesn't tell us, of the National Growth Areas Alliance (NGAA), is how the infrastructure to support more people will be provided; the roads, the public transport, the health and the education facilities. Without them road congestion will worsen, it will be harder to get to work and our health and well being will decline.

This will affect everyone but those most affected will be where population is growing in leaps and bounds and where jobs and services are already lacking. Yet these are also the places where there is most potential – land is affordable, the population is relatively young, there are many small businesses and there is a keenness to build the suburbs of the future.

Most of us would think that it stands to reason if you have more people you need more infrastructure. Infrastructure is mentioned in the IGR but in a section on government spending, it says that unlike the NDIS, aged care, pensions and education, infrastructure spending is not dependent on population size and structure and tends to be variable and dependent on discretionary government decisions. How can that be, you may well ask. So here is our first task – we must remind governments that more people requires more spending on infrastructure. That our current issues like congestion are due to continued population growth without the necessary infrastructure. Those living in outer growth suburbs know this only too well. So do those living closer to city centres where outer suburban traffic travels to get to jobs and services.

Outer growth suburbs around the nation house over four million Australians and are growing at double the national rate. Migration has been a major driver of the growth. They are designated by their respective State Governments to accept more people. In the 24 council areas that the NGAA represents, 100,000 extra people are expected each year to 2026. There are plans and strategies to house them, but not commitments for much of the associated infrastructure. Councils do their bit but they only raise 4% of taxes. States raise about 16%. The Federal Government raises the other 80%, some of which is handed over to the States. But there is an imbalance in where the money is raised and where it needs to be spent.

It's not just about fixing problems, though. It is about picking winners. To do that we need to understand what will bring the most rewards and where the potential lies. We have already mentioned some of the attributes of the growing outer suburbs and the opportunities they provide. Unlocking the potential requires road and public transport connections as well as jobs and services closer to home.

These areas contributednearly $118bn to regional economies in 2012/13. But they could be contributing a whole lot more with some assistance. SGS Economics and Planning has calculated that needed infrastructure and service investment in outer growth areas would permanently boost national GDP by 1% or $18bn per annum, tax revenues would rise by $6bn per annum and hundreds of thousands of ongoing jobs would be created.

There are steps we should be taking and they are quite straightforward. According to Tim Williams, CEO of the Committee for Sydney, a higher quality of life will help drive jobs growth, not the other way around. Creating town centres as places that are attractive to businesses as well as workers is a key ingredient, including in the growing outer suburbs.

Health and education are other ingredients for success. Families rely on them for the services they provide. They also generate jobs and they attract other associated businesses. Health receives much attention in the IGR. But it deserves much more recognition than simply how much it is costing us in the short term. SGS Economics and Planning quotes the World Bank in saying that economic participation would be boosted if everyone had access to health, education and transport connections.

Greater workforce participation is a goal of Government, the IGR tells us and it hones in on women, young people and parents as well as older people and people with disabilities. Measures to improve their working prospects are envisaged, though it's not clear what these will be. It might be stating the obvious to point out that it would be good to focus on where these groups are concentrated. Investing in the infrastructure to drive jobs growth in the growing outer suburbs, where many women, young people and parents live and where unemployment and underemployment is evident, would be a great place to start.

Everyone knows the equation - that our cities won't work properly if we keep stacking in more people without adding the infrastructure to support them. We need to tackle it head on, not keep turning a blind eye. How we get to the future we want is by investing in infrastructure where it matters most; where there are burgeoning populations with the potential to be more liveable and more productive.

The fast growing outer suburbs are such places.