Will miners, retirees and the NBN drive Tony Burke’s decentralisation agenda?

Grey areas show parts of Victoria without access to Broadband (mainly ADSL)

It’s easy to see why that most Whitlamesque of policies – decentralisation – has been revived in this election campaign. Not only does it offer the familiar prospect of more jobs and economic activity in regional areas, it can also be sold as improving the quality of life in our crowded, heaving cities.

However I think the Minister for Sustainable Population, Tony Burke, is stretching credibility with his latest claim about what’s driving decentralisation.

Speaking at the National Press Club debate last Thursday, Mr Burke argued that the decentralisation debate is different now to what it was 40 years ago. Then, he argues, it was all about moving people to regional areas by relocating government departments. Now however decentralisation is:

“being driven by the market through the movement of retirees, through the mining boom and through the roll-out of the National Broadband Network, which allows businesses that previously could only be located in the heart of the CBD to locate in other areas”

His use of the present tense is curious because there’s little evidence of actual decentralisation away from Australia’s two ‘super cities’ – Sydney and Melbourne – to regional centres over the last five years. Sydney grew 1.4% p.a. over 2004-05 whereas regional NSW grew by 1.1%. In Victoria, Melbourne grew 2% p.a. but the remainder of the State grew 1.4% p.a.

But it’s the drivers of growth he cites that I find even more curious.

The mining boom has a huge knock-on effect on the entire national economy but its impact on population growth in regional Australia is small and relates to a limited number of regional centres. For example, Roebourne Shire in the Pilbara, which contains Rio Tinto’s iron ore operations and the NW Shelf LNG plant, has a population of only 19,000 (mainly in Karratha and Dampier) and grew by 2,500 persons over 2004-09.

Retirees were a source of growth in some “surf and sun” coastal cities in earlier decades but the key driver of growth for that group, cheap housing, no longer applies. As I’ve discussed previously, the great bulk of retirees prefer to age in place. The value of retirees as an engine of regional economic growth is in any event questionable. Their incomes are usually modest, they don’t start businesses and their demands on local services are high.

I wouldn’t describe the National Broadband Network as “driven by the market” but it will no doubt make the lives of regional residents and businesses better. However it’s a big call to argue that it will promote significant decentralisation. Earlier technological innovations like the phone, fax, mobile phone, and dial-up/ADSL internet did not drive the growth of regional centres at the expense of the big cities. There is now a considerable body of opinion that e-communication makes big cities even more desirable by increasing the demand for face-to-face communication. The NBN might possibly be a necessary condition for large-scale decentralisation, but it’s far from being a sufficient one.

Decentralisation is very, very difficult to pull off in Australia. The experience of Canberra is instructive. It is close to Sydney, very well served by air connections and has a huge endowment of public servants. Yet over 83 years it has only grown to a population of 350,000 whereas Sydney now has 4.5 million people and Melbourne has 4 million.

Despite the rhetoric, Mr Burke isn’t really on about decentralisation – the main game is the politicians old favourite, regional development.

P.S. I’m not so sure about Mr Burke’s claim that the decentralisation programs of the Whitlam Government were driven by relocation of government departments. So far as I’m aware, the only significant shift was the NSW Government’s central mapping authority’s move from Sydney to Orange in the 70s. I know the NSW primary industry department also moved to Orange but my understanding is that happened some years later (?). For the most part, the decentralisation program of the Whitlam era was premised on the idea that industry could be attracted to regional centres from Sydney and Melbourne.

4 Comments on “Will miners, retirees and the NBN drive Tony Burke’s decentralisation agenda?”

  1. Don Arthur says:

    Alan – On the Whitlam government’s policies …

    I think the Whitlam government was talking about relocating Commonwealth public servants to Albury Wodonga but lost office before anything happened.

    There was some controversy about this at the time. In 1975 state MP W.L. Lange complained that

    “… on the industrial side, the corporation appears to be following a policy of giving priority to the establishment of government departments in the area in preference to factories. This seems to indicate that the area will be used to curb the rate of growth of Canberra rather than Sydney and Melbourne, which was the original intention.”

  2. […] previously concluded (here, here, here and here) that the prospects for diverting growth from our cities to regional centres on a significant scale […]

  3. […] might play nicely to country seats and to the Government’s strengths like the NBN, but it’s unlikely to contribute much to alleviating growth pressures in urban […]

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