Dr Tim Williams will provide a keynote speech at the National Growth Area Alliance Conference in Adelaide today (Thursday). Following is a summary of Dr Williams’ speech, which argues that the federal government needs to place greater focus on Australia’s cities.
Australian cities are real orphans of public policy at the moment. They create most Australian wealth but their role is not recognised in federal policy and their infrastructure is not a focus of the federal government’s funding plans. This has to change, in the national interest. The government must stop thinking of infrastructure as boiling down to simply roads between cities and start working with the state governments to identify and jointly fund key infrastructure in our cities.
It must also realise that with the mining investment boom now over, the time is right for a new program of infrastructure investment where most innovation in forward-looking, knowledge-driven sectors is actually taking place in our cities.
Sydney for one is now again the fastest growing capital city in Australia, contributing in itself 23 per cent of national GDP. That is two-and-a-half times the contribution made by the resources sector, creating many more jobs directly and indirectly. And what happens to the wealth created by cities like Sydney?
Research by SGS for the Committee for Sydney shows that 82 per cent of the tax gathered in Sydney goes to the federal government, with very little of that returning to the city in the form of infrastructure investment.
The federal government takes from the cities but on present plans it will give little back as reinvestment in the wealth-making engines of national growth. It will not be co-investing with state governments in the public transport infrastructure of our cities – leaving our cities behind competing cities globally, as others recognise that public transport is the key to economic success in modern cities and the knowledge economy. Added to this, the federal government is planning to actively cut its spending on education in states as part of the budget process. This will mean insufficient funding for our cities in both hard and soft infrastructure.
The danger from this under-funding of our cities is not just that the nation will not be investing in the real engine of national economic success. It also means that much of the benefit of growth will be confined to areas and communities already well served by infrastructure.
The social cohesion of our communities is at stake when city infrastructure is under-funded. Essentially, we are seeing inadequate infrastructure investment for some of the fastest growing parts of our cities such as those in the growth areas that need it most to achieve not just economic objectives but also social inclusion. In such areas we are creating places where people live but have to travel long distances to employment with all the consequences for individuals, families and lost productivity of that failure to invest in infrastructure and to fill the jobs gap.
And remember, while our cities are growing twice as fast as regional Australia the growth areas are growing twice as fast again. Policy and spending need to reflect this fact and address the emerging challenges, urgently.
It is critical that the federal government invest in our cities. State governments simply haven’t got the resources to do the job. This is why I echo the call made by the NGAA for the upcoming national discussion on a renewed Federation to have as a key focus policy and funding for cities.
Cities are the love that cannot seem to speak their name in Australian public policy. The Constitution is silent on them and they are falling through the cracks in our fiscal structures. We need action for cities, now.
Dr Tim Williams is chief executive of the Committee for Sydney.