The dire need for infrastructure spending in Australia

Less Infrastructure Spending? A Big Australia? No Thank You

The supposedly ‘great minds’ down at The Age and the Grattan Institute seem to think two rather wrongheaded things.

The first is that we don’t need major infrastructure projects. Apparently, they’re nothing but election-time vote grabs.

Secondly, they believe a ‘Big Australia’ policy is completely fine.

How about we reject both of these ideas?

Let’s start with the infrastructure issue.

The Age and the Grattan Institute point to the fact that, ‘…half of Melbourne’s population has travelled for 30 minutes a day, since 2004.

But this can be deceiving, as congestion forces people to change jobs and move houses to cope with it.

This congestion occurs on both the roads and public transport.

Take Melbourne as a case study.

Melbourne’s population has just recently hit the five million mark.

In June 2009, there were four million people in Melbourne. That’s 20% growth in less than a decade.

You can feel it on the streets and in your car — it’s significantly busier.

But it comes at a cost.

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The cost of poor infrastructure

A report by TomTom, the GPS service provider, estimates that:

Traffic congestion is costing drivers hours in lost time and businesses more than a combined $3.5 billion in lost productivity across 10 of Australia’s biggest cities.

This is not to mention the sheer discomfort anyone trying to catch public transport experiences during peak hours.

All of this points to a pressing need for improved infrastructure — something Infrastructure Australia is taking on with big plans.

So, we can fix the first position.

Now for the second position.

The GDP growth behind Big Australia is an illusion

On current estimates, Australia’s population is set to reach 35.9 million by 2050, and 62.2 million by 2101.

Why the fuss?

Surely we can deal with the extra population?

Well, it isn’t so simple.

For the past 26 years, our uninterrupted economic growth has come on the back of steady immigration.

With 1.6% population growth in 2017, Australia has derived 63.2% of its population growth from overseas migration.

The population growth spurs GDP growth, but does little for the average Australian.

For instance, growth in GDP per-capita is 1.2%, which is less than half the GDP growth rate of the government trumpets — 3.4%.

This is a far more crucial figure.

Meanwhile, wage growth is now below inflation and household debt at historic levels.

It seems the average Australian doesn’t simply benefit from a rapidly increasing population.

Rather than juice the numbers with a Big Australia policy, it might be best to put forward policies that will have a real impact on the wallets of average Australians.

You could start by clearing up growing peak hour congestion for one.

So much for the great minds at The Age and the Grattan Institute.

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Lachlann Tierney
Lachlann Tierney is a writer for The Australian Tribune. He has a background in politics, public policy and has studied at London School of Economics. Lachlann is interested in small government, tertiary education matters and energy policy.
Comments: 1

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  1. Infrastructure improvements generate more traffic because people think that is what it meant to do…make life easier but sadly it has the opposite effect. If these projects had the effect of deterring more traffic it might just help. Why attempt to make life easier when its more realistic to make it more difficult and make people think how they can contribute to a viable solution….wishful thinking I suspect.