Radio National - Breakfast with Hamish Macdonald

Hamish Macdonald: Scott Morrison’s push to cut immigration will face stiff resistance from the Labor states when he hosts COAG talks with the premiers in Adelaide this morning. Population policy will be the number one issue on a packed COAG agenda which will also include health and education funding. Last month, the Prime Minister flagged a reduction of around 30,000 immigrants to take the pressure off our overcrowded bigger cities and he wanted to give the states a bigger say on how to balance population pressures.

Alan Tudge is the Minister for Cities and Population and as Scott Morrison puts it, he is the Minister for congestion busting. I spoke with him a short time ago.

[Excerpt]

Alan Tudge: Good morning, Hamish.

Hamish Macdonald: The Labor states, at this point, appear that they won’t play ball on this. They say that the focus should be on infrastructure spending not the migration intake itself. Doesn’t that mean that this approach that your pushing of bottom-up to manage population growth, will fail at the first hurdle?

Alan Tudge: To the contrary, I’ve had very good discussions with many of the state leaders, chief ministers in Northern Territory for example. They want stronger population growth and they want the infrastructure to match it.

And that’s what this approach is, it is looking at the situation city by city, state by state to say: what is your carrying capacity now and into the future and how can we support the population growth to meet that carrying capacity.

Hamish Macdonald: So our population in August this year topped 25 million, that is 33 years ahead of schedule. By 2047, it’s expected to grow by another 11 million people and 80 per cent of that growth is expected to be in the biggest capital cities: Sydney, Melbourne, Brisbane, Perth and Adelaide. Are you saying that as a result of this process, we won’t see that growth or that growth will occur elsewhere?

Alan Tudge: Well we certainly want to see a better distribution of the growth. Certainly, 75 per cent of the growth over the last few years has been into Melbourne, Sydney and southeast Queensland. Whereas a place like Adelaide and the Premier Marshall there, have been open about saying they want to grow faster.

So there’s an opportunity here to slightly ease the pressure on places like Melbourne or Sydney which are really feeling the congestion pressure and to support the aspirations of places like Adelaide and Darwin and Perth and Hobart, which all do want to grow slightly faster. We’ve also got the regions as well which many places are crying out for more workers. They simply can’t get a warm body to do the job.

Hamish Macdonald: Can we be specific though, about the numbers? Because if we’re talking about 80 per cent of that growth coming in those bigger cities, are you saying that you don’t want that to be the case?

Alan Tudge: No. We’re saying that what we’d want to do is see a better match between what the population growth is and what the carrying capacity is of those cities. So that you don’t have runaway population growth without the infrastructure being developed at the same time.

And in Melbourne and Sydney, I think there’s been a bit of a mismatch and people are really feeling it because the roads are congested, some of the housing levels haven’t been keeping up with population growth.

So how can we better align that city by city and region by region? Now, what that might mean is that we slightly ease the pressure off Sydney and Melbourne and say, support the faster growth in some of the other places in Australia.

Hamish Macdonald: So given what you have just said, isn’t the issue of Commonwealth spending on services and infrastructure key? I mean Victoria, for example, has 25 per cent of the population but just 10 per cent of the infrastructure spend. If you’re saying you want a better match, a better distribution, isn’t Commonwealth spending actually the key matter here?

Alan Tudge: We’ve got record infrastructure spending, $75 billion over the next 10 years. And for Victoria, which is my home state, they’re getting 30 per cent of that $75 billion because it is fast growing state. And Melbourne is certainly the fastest growing city in Australia.

But you’ve just got to understand that at the federal level, we largely control the population growth levers through the migration intake, whereas the states and territories largely have the responsibility for developing the infrastructure, the housing approvals, the schools and the hospitals et cetera.

What we need to do is to better align those two things because that’s when you can get better managed, controlled population growth where the infrastructure and the services are keeping up. And that’s what this approach is about, a bottom-up approach that we’re asking states and territories to tell us what us their carrying capacity in their cities both now and in the future and how can we match population growth to support that carrying capacity.

Hamish Macdonald: So Minister, if we take Victoria as the example, in order to do that, you’re either going to have to reduce the growth of the population or increase the amount of infrastructure spend, don’t you?

Alan Tudge: [Talks over] We’re…

Hamish Macdonald: I don’t really understand how you achieve the objective that you’re describing without one of those two things?

Alan Tudge: Well, we are asking every state and territory leader to come forward by the end of January to tell us what are their population plans in their states. They’re the ones who are responsible for the infrastructure build for the schools, the hospitals, the housing approvals. And then let’s try to match the population growth to that.

Hamish Macdonald: So unless you are willing to give them more money, they would have to reduce their population growth projections?

Alan Tudge: Well in fact, most of the leaders, I think, will be putting forward proposals to grow their populations faster than what they presently are. That’s what I would expect certainly from a South Australian Premier, he said that openly.

That’s what I’d expect from the Chief Minister of the Northern Territories. Possibly the same from Western Australia and Tasmania. So we’ll see what comes out of Victoria and New South Wales in terms of what they say.

Hamish Macdonald: The parliamentary budget office figures seem to indicate that federal infrastructure spending is actually going to fall over the next four years from eight billion in 2017 to 2018 to 4.5 billion in 2021 to 2022.

That paints a pretty clear picture of the direction of travel of this whole process, doesn’t it? If there’s going to be less money for infrastructure spending from the Commonwealth, if the states are not able to produce that sort of money themselves, then we’re really just talking about declining growth rates in terms of population, aren’t we?

Alan Tudge: The states are primarily responsible for building infrastructure in their [indistinct] regions. But the federal government is a very significant financial contribution towards that and we have put a record amount of infrastructure dollars provided to the states and territories to contribute to that. Seventy-five billion dollars over a ten-year pipeline and that will continually…

Hamish Macdonald: [Talks over] But do you accept that the numbers are going down in the coming years though?

Alan Tudge: And that will continually be looked at each and every year in the budget context. But certainly, this year’s budget was a record amount of infrastructure expenditure…

Hamish Macdonald: [Interrupts] But can we just be honest about the funding that is available. Is it going up or is it going down over the coming years? I mean, you want to be elected as the federal government again, I presume next year. Let’s be honest about whether the money is going up or down.

Alan Tudge: Well there’s record amounts of infrastructure investment right now. That’s what I can say. That’s what we announced in this year’s budget. A record amount over a period of time.

Hamish Macdonald: [Interrupts] Can you acknowledge the projections or not? As I understand that grants will half over the forward estimates from 0.4 of a per cent of the GDP to 0.2 per cent of the GDP.

Alan Tudge: [Talks over] No, I don’t acknowledge that.

Hamish Macdonald: [Talks over] Why?

Alan Tudge: I acknowledge that we’ve got record investments in infrastructure over the next decade. And each and every budget, we update what the infrastructure expenditure looks like. And so this is very typical of the budget process but certainly we’ve never invested more money from the federal level into infrastructure right across the country.

Hamish Macdonald: I take it though that you don’t dispute the figures put forward by the Parliamentary Budget office?

Alan Tudge: No. But just the way the infrastructure dollars are spent, Hamish, is that every single budget, you go through a process and we outlined a massive budget commitment in the budget this year over the next 10 years. Inevitably, these get updated and examined each and every year as we go forward as well.

Hamish Macdonald: The New South Wales Premier Gladys Berejiklian appears to be the only state leader who supports cutting immigration in their actual state. She's come up with a plan to give international students incentives to leave Sydney, for example, to study elsewhere in the state.

We don’t know if the incentives will be financial or related to visas. Can you just explain for us, how something like that would work?

Obviously, if people are becoming citizens of this country, we don’t necessarily control- we can’t control where they are based, if visas are attached, perhaps that’s possible. Is there are a role for the Commonwealth in a process like this, where you’re getting people that come to Australia to go to a particular place?

Alan Tudge: Certainly, we’re taking a look at that and this is one of the ways that we can support the growth aspirations of some of the regions or the smaller cities and take a bit of pressure off the big capitals is by creating further incentives for the new migrants to choose those smaller cities or regional areas.

And you can create incentives through the visa process and you can put conditions upon those visas for people to stay in those areas for a few years. The evidence suggests that when we do that, we already do that at a small level, people abide by their conditions and indeed do stay there for many years even after their conditions have expired.

Hamish Macdonald: Alan Tudge, I know you’ve got a flight to catch. We will leave it there. Thank you very much.

Alan Tudge: Thanks very much, Hamish.

Hamish Macdonald: Alan Tudge is the Minister for Cities, Urban Infrastructure and Population.