It is probably a coincidence...But I have been banging on about the intersection between economic growth, population, infrastructure, and housing for a year or so now. My key point has been that we don’t actually have national population, infrastructure and/or housing strategies. And that you cannot have one strategy developed independently of the others. We don’t know what our socially and/or economically optimal population levels are. And so we cannot possibly know what our infrastructure or accommodation needs are either. I’ve also made the point that these are federal government, not state or local government, imperatives. We have to work out where we want to put these people, and not leave ourselves vulnerable to the vagaries of individual state approaches. And we need to develop a positive national narrative about people. They are, after all, our single most important resource.
Anyway, two weeks ago I wrote these words in Business Spectator, which was followed up by a similar a piece in Crikey last week. And it seems like Ruddie & Co have listened:
“[I]t is shameful that we don’t have a national population and infrastructure strategy. Policy makers have to look forward over the next four decades and work out our optimal population growth rate in the absence of any constraints. They then need to evaluate the magnitude of the actual constraints. But they should do so with an open mind. There is no point, for example, taking existing transportation technology and holding it constant. We have to back our ability to continue to innovate…So our national population plan has to look to the future and in a courageous and creative manner address:
1) Australia’s long-term human capital requirements;
2) The ramifications of those population projections for real GDP per capita and public finances;
3) The infrastructure that will be required to support the population base;
4) How that infrastructure will be funded by the public and private sectors;
5) The consequences of the population expectations for the nation’s housing needs;
6) Where we expect to locate this new housing (i.e. in which cities), and hence our long-term urban plans; and
7) The inextricable linkages between new housing supply and infrastructure investment, where the latter is a condition precedent to ‘enabling’ new shelter.
Population planning, infrastructure spending, and housing supply are not state government problems. They are first-order national policy imperatives. The federal government needs to articulate the blueprint and then work with the states to implement it.
With this in mind, I would propose that the federal government immediately establish a new Population and Infrastructure Planning Department to address the questions outlined above.
Based on extensive due diligence and consultation with states, the Commonwealth should develop a granular national infrastructure plan and ultimately provide funding for the key strategic projects that derive from this road-map (alongside the private sector and states, as required).
Crucially, this infrastructure spend can then be used as a driver of specific housing supply outcomes. That is, the Commonwealth could demand zoning, building approval, and land release results in exchange for underwriting new infrastructure development. The idea here is that you only elastify housing supply in areas where new infrastructure can support higher population densities.”
It was therefore very pleasing to hear today that Kevin Rudd has announced a new Minister for Population. And these were Kevin’s words, which sound strikingly familiar:
"Our challenge is to make sure that we get our future population levels as right as possible….And against that analysis make sure we're planning properly for the infrastructure needs, for the housing needs, for the transport needs, for the regional needs. And that's why we're doing what we're doing."
The critical point is that Ruddie is opening up the debate about the “levels”. He is effectively calling into question the Treasury’s Intergenerational Report forecasts, as I have. I am convinced they are wrong. I think the 2050 number will be 40 million or higher, not the 36 million presently projected. And I am also confident that with the right investments Australia can comfortably accommodate much larger levels. Anyways, the new Population Minister, Tony Burke, expanded:
"Whether it be urban planning, whether it be transport, provision of health services and other government services, right through to water infrastructure…These issues have never previously been coordinated at a government level, and they require a high level of cooperation with every level of government."
