Population strategy avoids dangerous mistakes, although its lack of focus on infrastructure investment is disappointing

13 May 2011

The Federal Governments sustainable population strategy, released today, sensibly avoids imposing any damaging population caps on the nation or on our major cities, according to the Urban Taskforce.


The Taskforces chief executive, Aaron Gadiel, said while the strategy does little harm it also doesnt provide a meaningful platform for federal infrastructure investment in our cities.


Were pleased that the Federal Government has walked away from the notion that some parts of Australia are at ˜carrying capacity, Mr Gadiel said.


The strategy correctly observes that changes in the way resources are used and developments in technology allow us to sensibly grow without unsustainable impacts.


Mr Gadiel said the strategys definition of sustainable Australia is practical.


Sustainability is a highly subjective idea, but we can see that people are voting with their feet to be part of many growth communities across Australia, he said.


As the strategy says, sustainable communities are those that have the characteristics that make them places where people want to work, live and build a future.


Its the residents, prospective residents, workers and prospective workers of a community that must ultimately judge its sustainability, not Federal Government population planners.


Mr Gadiel said the first principle that guides the strategy, freedom of choice, was also particularly welcome.


Anyone whos been involved in land use planning over the last 10 years would know that many government officials have little time for the idea that homebuyers should be able to choose the kind of housing they buy, Mr Gadiel said.


The public debate about urban development is full of people wanting to tell others what kind of home they should own.


These constant assertions that development should be a certain percentage greenfield and a certain percentage infill, are based on the notion that governments should dictate housing outcomes, rather than home buyers.


Anyone who believes in ˜freedom of choice should accept that the governments job is to provide development capacity for all types of housing, and it is home buyers who, through their purchases, decide the mix between compact inner suburban homes and larger outer suburban houses.


In March the Urban Taskforce released the People Power report which modelled the economic consequences if the sustainable population strategy was used to freeze the size of Australias major cities.


The report found that a government policy capping a citys population at current levels will lead to:


¢ an 18.3 per cent decline for Sydneys residential property prices over ten years;

¢ a 15.3 per cent decline for Melbourne;

¢ a 14.7 per cent decline for Brisbane;

¢ a 6.6 per cent decline for Adelaide; and

¢ a 12.6 per cent decline for Perth.


Mr Gadiel said that major cities were the most productive places for people to live and work and would continue to be the engine room of Australia population and economic growth.


If government policy restricted Australians access to these places, more people would be forced to settle in areas where they are less productive, earn less and have more restricted choice of goods and services, he said.


A systemic government policy seeking to redistribute population growth to less productive locations will have a greater economic impact than any changes to the headline rate of national population growth.


Even if the government allows the annual rate of national population growth to continue at recent levels, the Australian community may end up bearing huge social and economic costs if that growth is not able to be accommodated in major cities.


The People Power report found that a population cap imposed across Australias five biggest cities could reduce national income by $5,000 per person within 10 years.


Were pleased that the Federal Government has avoided the traps laid out by fringe groups, Mr Gadiel said.


Although it is disappointing that there is no solid commitment to federal infrastructure investment to help tackle the sense of congestion being experienced in some cities.


Its also surprising that the document includes no plan of action to free-up restrictive planning laws, although there are some important statements of principle.


The Urban Taskforce is a property development industry group, representing Australias most prominent property developers and equity financiers.


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