4.1
This chapter highlights the value of rural and regional Australia and discusses the new global environment. It also discusses two predominant challenges faced by regional Australia – the movement of people to the state capitals, and the mistaken perception of regional areas as ‘second class’ towns and cities. Despite these challenges, regional Australia provides the majority of Australia’s merchandise exports and regional cities generate over 15 per cent of Australia’s national output.
Defining rural and regional Australia
4.2
The Committee is aware that different definitions and criteria are used to identify Australia’s regions. These definitions are largely shaped by the purpose for which the distinction is required. For example, the purpose could be to capture data, to make policy and investment decisions, to secure funding, or to meet particular administrative needs.
4.3
For this inquiry, the Committee has adopted a broad and inclusive definition of rural and regional Australia, similar to that used by the Regional Australia Institute (RAI). It includes all the towns, cities, and areas outside Australia’s largest capital cities; Sydney, Melbourne, Brisbane, Adelaide, Perth and Canberra.
4.4
The rationale for using this definition is that the focus of the Committee’s inquiry has been on those towns and cities where the majority of Australians are not concentrated. Those areas that are usually excluded from general discussions of Australia, its population, its economy and the policy options for securing continued growth and prosperity.
Definitional limitations
4.5
The Committee recognises that regional Australia is not a homogeneous category defined simply by what it is not—a major capital city. Regions are diverse, each holding unique potentials and challenges, and regional development policy must be tailored to address this diversity.
4.6
As Professor Robyn Eversole informed the Committee:
Regional Australia is a cultural imaginary: in practice, every region is different.
4.7
The Committee also recognises the complexities in identifying appropriate regional units to which policy responses can be developed, co-ordinated and managed. While some types of units—functional economic regions (FERs), local government areas or Regional Development Australia (RDA) Committees – may be appropriate for some purposes, they might not work for others.
4.8
The Committee believes that for the purposes of policy development, a fluid and flexible definition of region is needed. Regional definitions need to shift to suit local conditions and economic realities.
4.9
Further, the Committee is aware that community consultation and input is vitally important to defining the target area for regional development projects and strategies. Communities are usually best placed to demarcate the appropriate boundaries and parameters to frame such policy.
Value of rural and regional Australia
4.10
Rural and regional Australia makes a marked contribution to the well-being of the entire country. They provide many of the basics of Australian life – food, clean water, energy, building materials, and places for recreation. They are the gateway to Australia’s iconic outback, national parks and wilderness, countryside, and most coastal areas. They are also integral to the nation’s economy and the nation’s defence.
4.11
The regions are the backbone of Australia’s exports sector. The major industries of regional Australia—agriculture, forestry, fishing and mining—accounted for nearly 60 per cent of Australia’s merchandise exports in 2016. Seven out of ten of Australia’s top exports are primarily produced in the regions.
4.12
According to the RAI, regional Australia’s 31 ‘great small cities’ alone—home to 4.6 million people—produced $229.5 billion gross value added in 2013. This is ‘over 15 per cent of Australia’s national output and internationally is comparable with the national output of Finland’, a country of over 5.5 million people.
4.13
The economic and social contribution of rural and regional Australia is set out below.
Economy and employment
4.14
Regional Australia is a driving force to the prosperity of the country, adding strength, vitality and diversity to the nation’s economic performance. The regions are home to nearly 9 million Australians (around 35 per cent of the total population), produce approximately 40 per cent of the national economic output, and employ around one third of Australia’s workforce.
4.15
These regional cities had higher growth rates than the metropolitan areas between 2002 and 2010, with long-term growth rates matching those in metropolitan cities. They also share comparable economic performance with the major capitals in output, participation and productivity, with comparable unemployment levels.
Case Study: SA – Exporting hay from the Eyre Peninsula
Kimba brothers and farmers Matthew, Andrew and Josh Vandeleur successfully entered into an arrangement with hay retailers Balco Australia to supply more export hay from the Eyre Peninsula region.
The brothers bought first-class hay-making equipment and drop-deck semitrailers, and managed to engineer a $25 premium per tonne for that particular line of hay, because it was grown in a drier, tougher environment.
Matthew Vandeleur said the hay coming out of the region was a premium product.
Just the shorter growing season, thinner stems and higher sugars, it is a lot more palatable. We have been growing hay over here for 10-odd years and it makes great hay and we want the world to know about it.
Mr Vandeleur said it was about getting a regionalised brand with the hay that the Asian market loved.
They love the digestibility and the fact that they do not have to feed the cattle as much as what they would on some of the lower quality stuff.
Mining
4.16
Mining is not only the driver of many of Australia’s regional economies, it contributes significantly to the national economy. For 2015-16, the mining industry contributed approximately $115 billion to the economy, ranking as the third highest contributing industry to Gross Domestic Product (GDP), at seven per cent. The annual growth of mining output was 6.2 per cent, representing the highest growth rate of all industries. The industry also employs 216,500 people, or around 1.7 per cent of Australia’s total workforce.
Agriculture
4.17
Agriculture has traditionally underpinned regional Australia’s economies and remains important for both regional and national prosperity. Agriculture contributed $58.1 billion to the national economy in 2015-16, representing three per cent of GDP. This was an increase of $3.7 billion from 2014-15.
4.18
Australia’s regions are the breadbaskets of the nation, providing Australians with the vast majority of their foodstuff and underpinning the nation’s high level of food security. Imported food products, primarily processed items, account for only 15 per cent of Australian household consumption.
4.19
Agriculture contributes significantly to Australia’s export sector. The industry exported $44.8 billion worth of product in 2015-16, or 77 per cent of the industry’s total output.
4.20
Agriculture employed 304,200 people, as of 2017, or three per cent of the total Australian workforce. When the complete agricultural supply chain is included, this figure rises to 1.6 million people. Around 99 per cent of all agricultural businesses are wholly Australian owned.
Case Study: NSW – Mr Ed Fagan, successful farming industry
At the Orange public hearing, Mr Reg Kidd, Deputy Chair of Regional Development Australia Central West, referred to a successful farmer exporting produce internationally from the Orange region. That farmer was Mr Ed Fagan, from Cowra.
Mr Fagan was awarded the NSW Department of Primary Industry's Farmer of the Year 2015. The Fagan family's 1600-hectare property produces lamb, grain, as well as horticulture crops such as asparagus. Mr Fagan’s property was well suited to horticulture as well as broad acre farming:
I know it sounds complex but it doesn't seem that complex from day to day running. A lot of the crops don't cross over, so you might have beetroot for a portion of the year and then we finish beetroot and then we can start onions, so it's not as though everything is colliding.
Food processors approached Mr Fagan, and he was able to build his business around those initiatives. The judges highlighted Mr Fagan's use of innovation, management skills, environmental sustainability and community involvement as some of the reasons for his win.
Tourism
4.21
Tourism is another major regional industry that adds to the overall prosperity of the nation. Tourism contributed $54.7 billion to the Australian economy in 2016-17, over three per cent of GDP, and accounted for 10 per cent of Australia’s export earnings, at $37.2 billion. The industry employed nearly 600,000 workers, or around five per cent of the total workforce.
4.22
Regional areas disproportionately contribute to the output of the Australian tourism industry. While one third of all tourism businesses were located in regional areas, these regional businesses accounted for 44 cents in every tourist dollar spent in Australia for 2015-16.
Case Study: Qld – the Gold Coast
The Gold Coast is a striking example of regional development over the post-war period. Its success has been driven by services including tourism and leisure, recreation, and lifestyle services.
The Gold Coast is an internationally famous tourism destination and one of the fastest growing regions in Queensland. This significant growth has been ascribed to the city’s natural attributes derived from its location between the coastline and hinterland as well as its lifestyle opportunities and affordable housing. The Gold Coast has developed from being essentially non-existent in the 1950s to becoming Australia’s sixth largest city in 2017 with 576,000 residents.
Defence and security
4.23
Australia is large and sparsely populated and its defence requires the deployment of Defence assets into, and significant engagement with, the regional Australia. In its submission to the inquiry, the Department of Defence emphasised the vital importance of the regions to Australia’s defence, and noted that the ‘location of Defence bases and facilities is determined in accordance with Australia’s wider defence strategy as set out in successive Defence White Papers’.
4.24
As an indicator of the strategic importance of the regions to Australia’s defence, 34 per cent of Defence personnel, or 33,300 persons, are located in regional and rural areas.
4.25
The value of rural and regional Australia to the nation can not be overestimated. It is the cornerstone of the nation’s economic prosperity. As advanced by the RAI, ‘promoting growth in all regions is crucial to optimising growth in the national economy and opportunity for all Australians’. Rural and regional Australia must be supported to operate at its full potential.
Case Study: International – Boulder, USA
Thirty years ago, Boulder, Colorado in the US, was suffering economically. In response, the US Federal Government, in conjunction with the universities, invested significant resources in defence and defence innovation research. This has since turned Boulder from a backwater into one of the US’s ‘start-up’ capitals. According to the August 2013 Kauffmann Foundation Report, Boulder has the highest ‘high-tech start-up density’ of any metro area in the US.
Globalisation and 21st century Australia
4.26
Twenty-first century Australia, and its regions, exists within a world of increasing complexity caused by the ongoing process of globalisation. This process is characterised by uncertainty and rapid change and has ramifications for the way regional development policy is conceptualised, formulated, and implemented.
4.27
The impact of globalisation is expressed in a number of so-called ‘megatrends’ which affect all areas of the world; Australia’s regions included. Most significant of these megatrends are:
1
increasing urbanisation;
2
the ageing of populations;
3
increasing connectivity between and among countries and regions; and
4
accelerating technological change that is increasingly disruptive to established industries.
4.28
The net impact of these megatrends is the emergence of a policy environment which is characterised by volatility, uncertainty, complexity, and ambiguity – also known as ‘VUCA’. These megatrends also contribute to decreasing liveability in major cities caused by population growth and consequent congestion.
4.29
Professor Anthony Sorensen, a member of the Committee’s informal expert panel, elaborated on the impact of these trends.
4.30
Professor Sorenson described ‘five tyrannies’, or structural issues arising from globalisation, and related factors, that affect policy making generally but also specifically in rural and regional development. These five tyrannies include:
The ‘tyranny of the macro’; regional Australia is ever more impacted by national and international factors. These factors include Australia’s international relations and trade agreements, various national-level policies, and the actions of foreign governments and markets, all of which are beyond the region’s control.
The ‘tyranny of technology’; technological change could potentially re-write the geography of regional and rural Australia. For example, Treasury and the Productivity Commission have forecast that within the next 20 years, 40 per cent of existing jobs will disappear as a result of automation, including professional services such as accounting, legal and medical jobs.
The ‘tyranny of unknown futures’; not only will technological change majorly transform Australia’s regions (and the nation more generally), the pace of such change is accelerating to the extent that predicting the future economic and social landscape is increasingly difficult. For example, it is possible that the rate of technological change over the next 30 years will match that of the past 300 years.
The ‘tyranny of expanding scale’; regional and rural areas will need to learn to better join the national and global economy to ensure their prosperity. Regional service centres have traditionally catered to their immediate rural hinterlands and will face increasing disruptions if they are unable to tap into national and global markets.
The ‘tyranny of geography’; rural and regional Australia is not one uniform social, economic and geographical area. Rural and regional communities can be very different in terms of their social complexions, resource bases, locations with respect to markets or major cities, infrastructure and other social services. Rural and regional Australia is diverse and complex, and this is another issue that requires recognition when forming policy.
Case Study: NSW – Armidale named in the Top 21 Smart Communities
In 2016, Armidale received an international accolade from the Intelligent Community Forum (ICF) by being named in the Top 21 Smart Communities for 2016.
The ICF is an international think tank which studies and promotes the best practices of the world’s most intelligent communities. Armidale was identified as a Smart21 Community for 2016. Through this accolade, Armidale has participated in international debate, intelligence sharing, ideas collaboration and ‘future-proofing’ discussions with some of the most intelligent minds and innovative cities in the world.
Armidale was by far the smallest place to receive this accolade. Other communities included Kaohsiung and New Taipei in Taiwan; San Diego in California; Montreal, Toronto and Vancouver in Canada; and some of the large cities in Europe. This is a good example of how very small places, remotely located by global standards, can successfully participate on the global stage.
4.31
The new conditions of 21st century Australia, sometimes referred to as the Second Machine Age, or the 4th/5th Industrial Revolution, require a flexible long-term approach to regional development policy.
4.32
Paul Collits and James Rowe have discussed the implications of this environment on the factors necessary for good regional development policy. They argue that policy should focus on, among other things, connective infrastructure, facilitating all forms of mobility, opening regions to the world and other regions, and strengthening ecosystems to allow regional players to better adapt to change. These issues are discussed further in Chapter 5.
4.33
The authors also argue that our conception of region needs to shift to better enable policy discussion, formation and implementation. They contend that:
… in a globalised and in many senses borderless word, “real” regions’ boundaries are not fixed in place and time.
4.34
Instead, regions are in constant flux due to the impacts of globalisation, the emergence and shifting of new economic activities and industries, and the constant churn of population. As noted earlier, this requires a flexible definition of region and an on-going engagement with communities to identify the appropriate boundaries for regional development policy.
4.35
Similarly, Professor Sorenson submitted that this new globalised environment will require Australia’s regions ‘to become supremely agile’. He explained:
Agility, in effect, requires a focus on the future; knowledge or emerging technologies and their likely economic and social impacts; willingness to discard existing thinking and even industries; greater risk acceptance; constant networking among peers and learning from experience; mutual assistance between business and community groups; and so on.
4.36
Professor Sorenson advanced that in order to confront the rapidly changing environment of the 21st century, regional communities will need to engage with the so-called ‘six Cs’: capacity, choice, connection, collaboration, creativity, and change agility. Elaborating further, Professor Sorenson argued that policy should focus on:
…how we change the ability of communities to perceive their operating environment and to change their behaviours in a way that are amenable to accelerating, say, the uptake of new ideas, the grabbing of opportunities; and, perhaps the obverse, to relinquishing the past and letting go of things that are no longer relevant.
Rural and regional challenges
4.37
The Committee is aware that regions face constraints. Two are discussed here; the movement of people to the state capitals, and the mistaken perception of regional areas as ‘second class’ towns and cities.
4.38
The Committee sees these issues as intimately linked; regions may struggle to attract and retain population if they are perceived to be inferior to the capital cities. Similarly, if there is a perception that moving to the regions may be detrimental to people’s careers and lifestyles.
4.39
The Committee rejects this notion. Rather, it is the Committee’s view that the regions may well hold the answers to many problems faced by Australia, including overpopulation, congestion, and the expense of living in the major cities.
Perceptions of ‘second rate’ regions
4.40
The RAI recently asserted that Australia’s regions are:
… widely misunderstood. Portrayed in our national economic discussion as perpetual laggards, struggling to transition to services based new industries, too small to matter, and with little future potential.
4.41
This, the RAI argues, is a myth:
The evidence is clear that regional cities do NOT lag metropolitan outcomes.
4.42
The economic performance of Australia’s rural and regional areas is robust and of vital importance to the prosperity of the nation.
4.43
Despite this strong performance, myths about the regions as second-rate or inferior to the major cities persist. Professor John Halsey, from Flinders University, explained:
One of the struggles we have, I think, in terms of building a focus on rural and regional Australia in a proactive way is some of the wider discourse or the overall thinking that winners are those who go to the city and make good, and losers are those who stay in the bush and put up with what's there, which is totally wrong….
You'll always read stories which push against that, but I think the dominant framing is around that sort of first class and second class or A team and B team. I've been hugely criticised for saying that, but it seems to me to be pretty pervasive.
4.44
The RAI submitted that such perceptions have major ramifications for how regional development policy is conceived:
A perception of wasted money patching up widespread regional decline has held Australia back from making smart investments in development in places that are home for 9 million people and 40 per cent of our economy.
4.45
Professor Robyn Eversole, similarly, rejected this type of perception and asserted that Australia’s regions are:
… diverse, dynamic places populated by diverse, dynamic communities. The dominant way of ‘seeing’ regional Australia, as a cultural periphery beyond the capitals, causes Australians to regularly miss opportunities to achieve best-practice regional development.
4.46
In his submission to the Committee, Mr Max Hardy highlighted a key principle for ‘all effective engagement for regional development’. He noted that viewing the regions as a ‘problem’ to be fixed has serious ramifications for how regional development projects are funded and managed. Mr Hardy submitted:
It focuses on community and business assets and strengths rather than problems and needs (strength based rather than deficit approach). The more inadequate a community is labelled, the more funds are invested and controlled by external agencies. Focusing on the strengths and assets of community…starts with what makes a community strong, and recognises that everyone has skills, interests, and experience that can contribute.
4.47
Ms Bridgette Bellenger, Regional Network Leader, Department of the Chief Minister, Northern Territory commented that in the Northern Territory, the focus is on opportunity rather than costs:
In the Northern Territory our lens to this work is inseparable from the northern Australia policy framework. The northern Australia policy is critical to growing and developing the Territory, using an opportunity lens rather than a cost-benefit approach.
4.48
Innovative Research Universities (IRU) suggested that some of these negative perceptions could be addressed by governments prioritising regional areas in the rollout of research infrastructure. In particular, the IRU recommended:
Reverse the order of roll out of new services to start some in regional areas to alter the perception of being regularly last and create incentives to be in such regions.
Case Study: Tas – Mountain bike riding
In northern Tasmania, the Blue Derby Mountain Bike Trails were established in Derby. Derby’s social and economic indicators showed a low-waged community with a high reliance on social security. On the initiative of the Dorset Council, Derby was identified as the site for 80 kilometres of innovative mountain bike trails. The Federal Government also provided $3 million of support.
The trails have hosted a round of the Enduro World Series – the only time they been held in Australia. Derby expects around 30,000 visitors a year to its mountain bike trails, which are regarded as among the top five mountain bike experiences in the world. In the process, over 40 full-time, permanent jobs were created in Derby.
4.49
The Committee unequivocally rejects the perception of regional areas as problems to be fixed. They are not. The Committee is convinced these areas can and must play an increasing role in Australia’s development.
4.50
However, the Committee does acknowledge the risk that, if there is no significant investment in infrastructure and services in regional Australia, or a well-coordinated national and regional strategy to facilitate development and growth, this perception will become a reality.
4.51
It is the Committee’s view that regional development policy needs to include Australia’s major cities and rural and regional areas. This is about establishing a continuum that forms a symbiotic relationship. The growth and prosperity of one should entail the growth and prosperity of the other. The solutions to the problems of one can be found in the other.
Maintaining population
4.52
Demographic trends in rural and regional Australia are not simple or uniform. The regions show an overall trend towards steady population growth. This trend, however, is not shared across all regions, between larger and smaller regional areas, or between the coastal and inland areas.
4.53
Two trends however are worth noting here. First, there is a trend of capitals pulling people from smaller rural towns. Second, there is trend of population movement from inland to coastal locations.
4.54
The Bureau of Infrastructure, Transport and Regional Economics (BITRE), recently examined the long-term evolution of Australia’s towns. Key findings of the Bureau’s study included:
the decline in the number of small towns;
the growth of regional centres; and,
population movement to the coast.
4.55
In addition, it found that the change in settlement patterns across Australia over the century from 1911 reveals that: ‘regional Australia is much more urbanised than it was a hundred years ago’.
4.56
Regional Capitals Australia (RCA) also noted that ‘there has been a trend of consolidation from smaller towns to larger regional centres’. Similarly, Centroc submitted that:
Both Orange and Bathurst are growing at a greater rate than other LGAs in Central NSW and there is a perception that there is a drift from the region into the centres to access better services as the population ages.
4.57
Growing, attracting and retaining population is paramount to regional development initiatives. Mildura Rural City Council explained this significance:
The maintenance and renewal of existing communities is a key long term issue, as is building the lifestyle infrastructure required to service a growing regional city to attract future population growth…With the increase in population, jobs growth inevitably follows. Population increases the demand for more schools, hospitals, shopping centres and further expansion within the community.
4.58
The Committee heard that regional development policy and the decentralisation of some government services and functions can help to curtail these population trends. Ms Catherine Murdoch, from the Tasmania Department of State Growth, commented:
… we face population decline. We are implementing, as a state, a population growth strategy, and we really do believe there is a place for regional development and the movement of agency portfolios, rather than departments, potentially, that would enhance this current population decline but also potentially enable us to keep our skilled professionals, by providing a career path for them within Tasmania, particularly if we are looking at placing higher level positions within regions.
4.59
The impact of population growth and decline in regional communities is multifaceted and interrelated. Population trends can readily impact on a range of services, facilities and opportunities in regional areas. Similarly, the availability of services can themselves impact on population trends.
Young people
4.60
Australia’s cities and regions are experiencing an ageing of their populations. This is exacerbated in regional areas due to the ‘ubiquitous outmigration of young adults from regional areas’. This trend is less pronounced in coastal regional areas. For example, Charles Sturt University submitted that:
Whereas all regional areas have experienced a net decrease in young adults, coastal areas have seen net gains due to immigration of young families.
4.61
The persistent loss of young people from much of regional Australia has serious ramifications for regional development. Ms Alexandra Gartmann, Managing Director and Chief Executive Officer (CEO), Rural Bank, told the Committee:
We know that attracting and retaining young people in rural and regional communities is a key priority and focus area for government, business and community alike, because of the very clear benefits for regional development.
Case Study: Tas – Burnie youth council
Burnie’s youth council introduces young people to governance and local government, and encourages youth to be involved at a young age – i.e. primary school students and high school students. On the council is a newly formed group called ‘the Coasters’ that has been established on the north-west coast, and Burnie City Council has provided support and invested in that new organisation. The Coasters were established by a group of young professionals and it is being very well received right across the region.
Burnie City Council has a program called ‘DreamBIG’, which encourages aspiration among young school children at year 5 level. Children learn about employment opportunities across the region and approximately 70 employers volunteer their time to have those children come into their workplaces and learn about the key businesses along the northern Tasmanian coast.
4.62
While it is largely accepted that many young people will leave regional areas for education, work, leisure, and lifestyle reasons, the challenge for regional communities is to get them back.
4.63
Providing motivation and support for the return of young adults and their families is an essential ingredient in sustainable regional development. Professor John Halsey, suggested that effort needs to be made to provide ‘a pathway back’ for young people. In the context of education and training, he said:
Part of it, I think, is rethinking the role of schools and local communities and their engagement with young people in their formative years and trying to set up, if you like, a conversation which opens up opportunities and pathways. But the opportunities and pathways are not just pathways out. Noel Pearson talked to me about how what he's trying to work on is the orbiting of students. It's a pathway out but also a pathway back, for want of a better term.
Part of the construction of the pathway out and the pathway back is not only a scholarship that goes out but also trying to think of something which can attract a young person back into the community by—it might sound a bit old fashioned—almost commissioning them to go and do something and then opening up the possibility to come back and build the capacity in their local area, whether it’s around one of the, if you like, established professions like law or accounting or in other areas.
4.64
Central to attracting and retaining young people in rural and regional communities is employment. Livingston Shire Council submitted that:
Employment opportunities for youth and university graduates (outside of the capital cities) are critical for retaining young (energetic and innovative) talent in the region.
4.65
The Committee also heard that if adequate support structures are in place, far from being a career set-back for young professionals, working in the regions can be a developmental experience that positively enhances career prospects. Professor Halsey explained this point:
There is a different way of thinking about that, and that is that it is a rich, intense professional development and learning opportunity. But systems have to put around significant support. But one of the problems with the way funding and professional development are organised is that that support is not there. So instead of seeing this as a huge opportunity to develop your skill and knowledge and attitude and make a contribution and really develop your expertise, it is seen more in terms of problems and issues rather than opportunities for development and growth.
Service delivery
4.66
With declining populations in smaller rural and regional towns, the provision of services becomes problematic for these communities. This is because it can be difficult to find personnel and funding to support services.
4.67
The RAI produced a report on regional services and concluded:
While the number of service delivery professionals in some towns had greatly improved, this growth was limited mainly to inner regional areas. Efforts to increase the number of service delivery professionals in small towns in other areas were much less successful. Between 1981 and 2011, the number of professionals in inner regional small towns grew by 85 per cent, but there was growth of only seven per cent in small towns in remote and very remote areas. This is despite the fact that education and health outcomes are consistently worse in remote and very remote areas.
4.68
A large number of service providers now rely on the internet as a means of delivery. In some cases this is not ideal – particularly with regard to older people less familiar with new technology, or in areas where adult literacy is not high. This point was made by the Community and Public Sector Union (CPSU) in Launceston:
… when you talk about Centrelink management with service delivery they say they want 80 per cent to be online, with people self-servicing. We were at a recent thing where 26Ten, an adult literacy group within the state government, was saying there was 47 per cent digital illiteracy in Tasmania. And that's for all Tasmanians, not just Centrelink customers. The idea that you can today turn on a switch and have 80 per cent go online isn't going to happen. It's just unrealistic. We would argue that you actually do need a higher level of face-to-face service delivery in Tasmania.
4.69
The Committee is aware this can be a compounding issue for communities. Smaller populations may impact on the provision of service delivery. This may lead to a reliance or shift to online services, which can be challenging for communities with low levels of digital literacy or poor digital connectivity.
Technological innovation
4.70
Technological advancement and associated automation of industry have been a major boom for businesses in city and regional areas. These advancements, however, entail challenges for maintaining rural and regional populations. This is because fewer jobs are needed for more automated and efficient industries. For example, RCA submitted:
… while there was growth in Australia’s agricultural sector (a staple of the regional economy) the rise of automation and overall efficiencies in this sector meant there had been a decline in the number of people employed in this sector.
4.71
The Committee also heard that while automation will lead to the loss of certain categories of jobs, changes in businesses processes and the structure of the economy will lead to the emergence of new job opportunities in the regions.
4.72
For example, Mr Tony Mahar, CEO of the National Farmers’ Federation, informed the Committee:
It’s a conundrum, a dilemma. What I’d like to think is that, yes, as farms consolidate there might possibly be more automation and fewer traditional jobs, but that if you were successful there might be newer jobs not necessarily on the farm but in the region in terms of service and technology application.
Case Study: NSW – Lack of infrastructure and connectivity hindering local business.
At the Orange public hearing, two examples were given that highlighted that lack of infrastructure and connectivity were hindering local business. In one case, a young woman setting up a catering business from her farm, had to meet clients in town at a coffee shop so that all concerned had internet access in what was still a professional environment.
In the second case, a young man was setting up an engineering business on his farm approximately 40 kilometres from the city. Similarly, when he meets his clients it must be at a sporting club. That young man also commented that when he has to order steel he has to ask the delivery to be made in a city location as there's no available freight depot.
4.73
A similar view was expressed by Mr Bradley Siddans, Human Resources Manager for Oakley Beef Exports. He noted that while technology may displace workers within the company, it may lead to opportunity and growth in other areas of the company.
Its considered that in 10 years 40 per cent of the jobs in our industry won’t be there in their current form. It’s not necessarily that 40 per cent of the people won’t be there. The expectation is that we will continue to employ the large numbers of people that we do, it’s just that the work we ask them to do will change…
We can put in a piece of equipment that costs $2 million, for example, and that might take us from five people down to one in that exact area, but it allows us to expand to employ another 50 people because the throughput of the company goes up at the same time. Those are the sorts of technological changes that we make, more than the machines and automation removing people from the industry altogether.
4.74
The Committee is optimistic that the loss of jobs in regional industries due to technological innovation can be counterbalanced by job creation in emerging or associated services. The key is to ensure regional communities can develop this capacity and manage technological change.
4.75
In his evidence to the Committee, Professor Sorenson spoke broadly about the impact of technology and ‘transformative industries’ on regional communities. In particular, he advanced that regions need to develop a ‘local culture of innovation’:
…the critical issue for regions is the ability to, at a very early stage, understand and recognise the technologies coming on stream and be able to assess how those technologies might be able to be used to sustain the local community and local circumstances. To do this requires a cultural background grounded in innovation.
4.76
Professor Sorenson identified education and training, networking, and community engagement as means to building this capacity.
Population distribution
4.77
Australia will increasingly have to come to grips with the impact of national population growth and managing increasing congestion in the major cities. The nation’s population is set to grow to over 40 million people over the next 50 years. Most of this growth will be in the major capitals. The four largest cities will grow by 45 per cent by 2031.
4.78
Regional centres will continue to experience steady growth rates. However, these rates will not match that of the major capital cities nor will they be uniform across the regions. This will lead to an unbalanced population growth picture. The Committee for Gippsland submitted:
Although the population in regional Australia is predicted to rise at about 26% through to 2030, this rate of population rise in regional areas is substantially slower than that predicted for this period within our capital cities.
4.79
Australia’s regions have a significant role to play in taking population pressures off the major capital cities and helping rebalance the growth of the nation’s population. Innovative Research Universities commented:
The concentration of Australia’s population in a few major cities poses major challenges. There is an urgent need to make better use of the potential from the breadth of the country, for example from its northern regions, to reduce the pressure on the major cities and create positive outcomes for all current and future Australians.
4.80
Promoting the movement of population out of the cities will also have benefits for the nation’s economy in general. The RAI explains:
…for every 100,000 Australians who choose to live in growing regional cities rather than our big five cities, an additional $50 billion will be released into the economy over 30 years in reduced congestion costs and increased consumption.
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Encouraging the re-location of people from the cities to regional areas requires the regions to be seen as attractive locations to live and work. As noted by RCA:
… regional cities have the capacity to absorb more population growth but ensuring these cities are seen as the liveable and investable alternative needs more assistance and planning is the key.
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The Committee notes that this is an issue that requires active and creative solutions. Solving problems caused by congestion in the cities may be counterproductive in the long term unless it is combined with programs to encourage population growth in regional areas.