Report: Sydney and Melbourne commute times to balloon

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The Regional Australia Institute (RAI) has released a new report warning that Sydney and Melbourne are facing dramatic increases in commute times if their populations are allowed to expand as projected by the Australian Bureau of Statistics (ABS):

For most cities, ABS and state government projections have been released out to the mid-2030s. Our modelling extends this timescale out to 2056 by continuing the average growth rates. Extending the timescale, inner-city areas of Melbourne, for example, are projected to increase from 1.2 million people in 2016 to 2.6 million people in 2056. Meanwhile outer suburban areas of the city are forecast to grow from 3.4 million to 7.6 million people – a 122 per cent increase. Despite having a network of included regional centres, future projections only anticipate an additional 553,000 people living in these areas (78 per cent growth).

Likewise, in Sydney, inner suburbs are projected to grow by 800,000 compared to 3.8 million in the outer suburbs – a 106 per cent increase. Included regional centres are only projected to grow by 46 per cent or 696,000 people.

Over the same period, outer Brisbane is projected to nearly triple, growing from a population of 1.1 million to 3 million by 2056. Inner Brisbane will only experience 52 per cent growth while included regional centres will double their population. This represents a remarkable change in direction for South East Queensland, moving from a distributed growth model to the outer suburban population dominant pattern of the other major cities.

In Perth, inner suburbs are projected to grow by 73 per cent compared to outer suburb growth of 127 per cent, from 1.4 million to 3.2 million people. As Perth doubles, included regional centres will experience only limited growth of 335,000 people (an 88 per cent increase)…

SYDNEY

The projections by the ABS and state government estimate that the population of Greater Sydney could more than double, from approximately 4.6 million people in 2016 to almost 9.3 million by 2056 (Table 3).

The vast majority of this population growth (~3.8 million or 83 per cent) is expected to occur in the outer suburban areas. At the same time, included regional centres are projected to grow from 1.5 million to 2.2 million people (an increase of 46 per cent).

Under this business as usual scenario, the economic model finds that for residents of outer suburban Sydney, population growth alone will contribute an increase of roughly 1.6 per cent to overall average incomes (in 2016 dollars), a small increase in unemployment, 5.3 per cent increase in house values and a 60 per cent increase in commute distances…

Overall, the business as usual scenario suggests that on a per capita basis existing residents and those who will come to live in the outer suburbs in Sydney are on track to experience the largest proportion of the downsides of population growth with limited or no benefits in terms of income and employment…

MELBOURNE

The projections based on ABS and state government projections indicate that the population of Melbourne could more than double, growing by an estimated 5.6 million people, from 4.6 million in 2016 to 10.2 million people by 2056 (Table 6).

The vast majority of this growth (~4.2 million or 74 per cent) is expected to occur in Melbourne’s outer suburban areas. Regional cities and included regional centres are expected to grow substantially from nearly 710,000 to 1.3 million (an increase of 78 per cent). ..

Under the business as usual scenario, the economic model found that for residents of outer suburban Melbourne, population growth alone will contribute an increase of roughly 1.9 per cent to overall average incomes (in 2016 dollars), a small increase in unemployment, 7.5 per cent increase in house values and a 63 per cent increase in commute distances…

Overall, as with Sydney, the downsides of population growth will fall most heavily on people who come to live in outer Melbourne, with limited or no benefits in terms of income and employment…

The RAI’s modelling follows similar results to Infrastructure Australia’s 2018 modelling, which projected worsening congestion, longer commute times, and reduced access to jobs, schools, hospitals and green space as Sydney’s and Melbourne’s populations balloon to a projected 7.4 million and 7.3 million people respectively by 2046:

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All of which begs the question: why are policy makers persisting with the mass immigration ‘Big Australia’ policy if it is guaranteed to lower residents’ living standards?

According to the ABS’ own projections, Australia’s (as well as Sydney’s and Melbourne’s) future population growth will be driven almost entirely by strong net overseas migration (NOM) – both directly as migrants step off the plane and indirectly as they have children (counted as ‘natural increase’):

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Therefore, cutting immigration is the number one solution to safeguarding future liveability in our major cities.

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.