Why our choice is smart or dumb growth

It’s not a growing population that puts Australia’s prosperity and liveability at risk, Infrastructure Australia’s Future Cities report finds. It’s unplanned growth that is the real problem.

Australia’s largest cities are facing a “watershed moment” in their growth and development, Infrastructure Australia argues in the fifth paper in its reform series.

Over the next three decades, Australia’s population is projected to increase by 11.8 million people – the equivalent to building a new city the size of Canberra each year for the next 30 years.

Around three quarters of this growth will occur in our four biggest cities of Sydney, Melbourne, Brisbane and Perth.

By 2046, Sydney will be home to 7.4 million people with Melbourne trailing just slightly on 7.3 million. Perth will boast 4.3 million residents, and Brisbane will grow to accommodate four million.

Last week, former prime minister Tony Abbott reignited debate by suggesting the federal government should reduce immigration levels from 190,000 to 110,000 people a year. Cutting immigration would address “stagnant wages, unaffordable housing and clogged infrastructure,” Abbott said.

Australia’s population growth rate is around 1.6 per cent a year, or 390,000 people. Half of this growth is from immigration.

Returning fire, Treasurer Scott Morrison said that Abbott’s proposal would cost the federal budget up to $5 billion because “basically the economy [would not be] growing at the same level and people who come as skilled migrants pay taxes, make a net contribution to the economy”.

Now is not the time to “wave the white flag on population growth or dredge up dogmatic slogans that our cities are full,” says the Property Council’s chief executive Ken Morrison.

“We must accept that we are on an unavoidable growth trajectory, and to recognise that our future prosperity is linked to the performance of our cities.”

Infrastructure Australia is firmly in favour of population growth, which it argues is a “powerful source of economic dynamism”.

But failing to effectively anticipate and respond to growth, is likely to mean “declining economic productivity, increasing environmental pressures and a marked reduction in each city’s quality of life”.

Scenario analysis undertaken by Infrastructure Australia finds that “unplanned growth” delivers the “worst outcomes” for our fastest-growing cities.

In both Sydney and Melbourne, for example, the scenario which delivers the greatest proportion of greenfield development, the lowest population densities, and the lowest integration between land use and infrastructure has poorer job and infrastructure access outcomes for future residents.

“If the problem we face is failing to prepare for growth, the answer is greater connectivity, Morrison adds.

He points to recent analysis of house prices in Brisbane’s outer suburbs, which suggests that two-hour commutes and long hikes to local train stations have driven a price crash. Prices at Park Ridge in Logan have fallen by 33.3 per cent alone.

There is clear demand to “pull forward” investment in public transport, particularly the $10 billion earmarked by the Commonwealth for urban rail, Morrison says.

While significant investment in infrastructure is currently underway in Melbourne, including the $5.5 billion West Gate Tunnel and the Melbourne Metro Rail, Infrastructure Australia says the city’s world-renowned liveability is at risk from “uncompetitive public transport and unequal access”.

In Sydney, the WestConnex and NorthConnex projects, metro rail link from the CBD to Parramatta, and new tram lines promise to transform the city, but under each scenario commute times still double.

“This points to need for more nuanced transport policy where public transport, road investment and demand management play a role,” Ken Morrison explains.

Morrison says Infrastructure Australia’s work removes the “false narrative” around Australia’s choices when it comes to growth.

“Our cities are growing – and burying our heads in the sand is not an option. Our choices are between smart growth and dumb growth, not no growth at all.”