Australia: Grow now, plan later

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By Leith van Onselen

Another week, another report of how Australia’s population ponzi, combined with the complete and utter lack of infrastructure planning and investment, is destroying living standards. From The ABC:

Five million Australians… spend hours spent getting to and from work, have inadequate access to essential services like health care, there are half-finished transport projects and their kids attend overcrowded schools.

The National Growth Areas Alliance (NGAA) represents 23 councils around Australia that are calling for a dedicated investment fund for fast-growing outer suburbs.

The NGAA’s chair is Glenn Docherty, who is also the Mayor of the Playford, a community about 25 kilometres north of Adelaide’s central business district.

Playford is considered to be one of the fastest-growing communities in the country.

“It’s … currently home to just under 90,000 people and its population is set to double in the next 30 years,” Mr Docherty said.

He said like many fast-growing communities, the infrastructure in Playford had not kept up with the boost in population.

“We have a half-electrified rail line out in our community – an on again, off again project,” he said.

“We have roads that are congested, we have schools that have just been opened and have been full within the first term and obviously healthcare facilities, which are not keeping up with demand with our population growth.

“We’ve got residents that can’t find a seat on a train to get into the city, we’ve got kids spending more time in the back seat of a car than playing in their backyard, because they’re sitting on congested roads.

“And we’ve got families worried about how long it will take and how they get access to the nearest emergency department.”

Who would have thought that growing Australia’s population by 3.6 million residents in a decade (an increase of 18%), without a commensurate rise in public investment, would lead to higher congestion, less access to public services, more expensive housing, and overall lower living standards?

All of which leads me, once again, to quote the sage words by The Australia Institute’s Richard Denniss, who noted the following last year:

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“Australia is one of the fastest growing countries in the developed world and our infrastructure isn’t keeping up. It isn’t keeping up now and hasn’t kept up for the last 10 years, and it’s not budgeted to keep up in the next 10.”

“What politicians are doing is every year they announce record spending on this and a new that, but what they don’t point out is that on a per person basis, per person we are spending less on health, per person we’ve got less access to transport, per person the reason the queues in the hospital keeps getting longer is because we are not building hospitals as fast as we are growing our population. They all know it, they just don’t say it”…

“If you want to double your population – and that’s our plan – we want to double our population – you have to at least double your infrastructure to maintain people’s standard of living… We’re talking schools, we’re talking hospitals, we’re talking trains, we’re talking roads, we’re talking police”…

“Population growth costs a lot… If you double the number of citizens then you double the number of teachers and double the number of nurses. It’s pretty simple math. But of course, you don’t have to double them if you gradually plan to lower the number of services. If you are happy for us to gradually lower the number of services in our health system, our aged system, if you are happy for congestion to gradually get worse, if you are happy for the amount of green space per person to decline, then you can do what we do”.

It’s hardly rocket science, is it?

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.