Smart Cities through smart planning

Thank you for the opportunity to speak at Smart Cities Conference.

I'd like to start by acknowledging Adam Beck, the Executive Director of the Smart Cities Council, Les Walker the Deputy Mayor from the Townsville City Council, as well as dignitaries from the ASEAN Region and New Zealand who have joined us here today.

It is great to be here this morning in Australia's largest capital city.

Sydney provides a great example of the challenges associated with rapid population growth—and also—an example of the good outcomes and benefits that can be achieved when all levels of government work together to properly plan and grow our cities.

Through this conference, you will have heard a lot about what it takes to have a ‘smart city’. Technology is, of course, one aspect and I will touch on this. But I want to focus my remarks on another aspect of having a smart city: smart planning. At both a national and city level. Because if you don't have good planning, then it doesn't matter how much technology you have, cities will become less liveable. And ultimately, it is productive, prosperous and liveable cities that we are after.

I would like to take you through some of the challenges we have due to our federal structure—when one level of government controls the major population growth lever, while the other is responsible for infrastructure and service delivery—and how we might ameliorate some of these challenges.

Let me start with some facts.

Australia is growing very rapidly; among the fastest in the developed world. We grew by 3.75 million in the last decade, which is nearly twice as many as in the previous decade.

As an immigrant nation, we have had periods of rapid growth since European settlement, but our current growth rate has only been surpassed by a brief period in the 1920s and during the “populate or perish” period immediately following World War II.

Of course, in raw numbers of people, our growth has never been higher. Our nation is adding the equivalent of a city the size of Canberra every year and the size of Adelaide every 3.5 years.

This growth would be challenging enough to manage with adequate infrastructure and services, but there are two additional factors that make it even more challenging.

First, the growth is not evenly distributed. Rather, 75 per cent of the growth has been to the three large urban areas—Melbourne, Sydney and South East Queensland—while the rest of the country has had very modest growth.

Hence, on a city basis, Melbourne has been growing by 2.7 per cent, Sydney by 2.1 per cent and South East Queensland by 2.3 per cent.

This is very rapid growth by any standard. Among the English speaking world, only three cities grew faster than Melbourne in absolute numbers: Houston, Dallas and Atlanta.

Second, the growth is well above what was forecast. For example, the 2002 Intergenerational Report predicted Australia would grow by about 2.5 million people over the next 15 years. We actually grew by 5 million.

Melbourne was predicted by the Australian Bureau of Statistics to grow by 500,000 from 2004 until 2107. It grew by 1.2 million.

The single biggest contributor to the growth that I have described is international migration. It accounts for 60 per cent of all growth, but 65 per cent of Melbourne's growth and 83 per cent of Sydney's. The rest is made up of natural increases (with internal migration a factor in terms of the growth of particular locations within Australia).

How did we, as a nation, get the forecasts so wrong? Our birth rate and life expectancy were slightly above forecasts, but the main reason was that Prime Minister Rudd in 2007 almost doubled the immigration intake, without any forewarning.

This put the population growth onto a new, unplanned trajectory. And we are still catching up on this. The data shows that while infrastructure expenditure largely matches the population increase, there is a lag.

The problem is that through the migration lever, the federal government largely determines the population growth which then drives the demand for housing, roads, rail and other infrastructure and services.

But then it is the state's responsibility to provide the supply of those things.

As I mentioned, this is a challenging but manageable problem when the population growth is predictable, but is particularly hard when demand rapidly increases without warning.

The congestion problems in Sydney (which we are now just getting on top of) are the result of this mismatch from past years. On the one hand, we had Premier Carr saying that Sydney was full and was consequently not building for the future, as Dr Liz Allen of ANU has noted. But then, just a few years later, Prime Minster Rudd turbocharged the population growth. State and federal policies were working in opposite directions.

Thanks to a huge infrastructure investment, supported by the Coalition Government, Sydney is now getting on top of this problem. In a couple of years' time, when the major works are completed, Sydney's roads and rail will be much better again. But it has meant years of unnecessarily high rates of congestion.

So how do we learn from the past and address this structural problem?

We need to put in place a better planning framework that better aligns population ambitions with infrastructure and service delivery. Our population plans need to be more bottom up—state by state, and region by region—as much as they are top down.

We then need to put in place the migration settings to support those plans. Some states, like South Australia, for example want 15,000 more people each year. Some regions, like south western Victoria, cannot get enough people to fill the available jobs. There are an estimated 46,000 vacancies in regional Australia today, according to the Regional Australia Institute.

Of course, we need to continue to invest record amounts in infrastructure in the process.

The other important part to this is the City Deals. Each City Deal is unique, but they have the capacity to do much smarter planning at the local or regional level involving all three levels of government.

The best example of this is the Western Sydney City Deal. This is a partnership between the Australian, NSW and eight local governments to deliver rail, jobs and community infrastructure for the people of Western Sydney.

The City Deal builds on the unique opportunity of the Western Sydney Airport—a $5.3 billion Commonwealth investment—to catalyse the new ‘Aerotropolis’ to attract investment, increase job diversity and ensure access to opportunities right across Western Sydney.

There are 38 City Deal commitments across six key themes that will be delivered by the Australian and NSW Governments together with the eight local councils that make up the ‘Western Parkland City’.

Already we are seeing the benefits of our investment and vision for Western Sydney, with recent announcements that two of Japan's biggest multinational companies have committed to the region. The commitment by Mitsubishi Heavy Industries and Sumitome Mitsui Financial Group demonstrates how smart planning attracts smart investment.

There is no doubt the Western Parkland City is developing into a smart city as a direct result of smart planning between governments.

The airport itself will be a ‘smart airport’ with the most up to date technology built into it from the beginning.

Smarter planning is the best way the federal government can lead in the creation of smarter cities.

But there are other ways too. Let me mention two—both of which have a technology focus.

The first is to support smarter road and transport systems. We are investing a record $75 billion into infrastructure, but if we can get better utilisation of infrastructure, we can achieve better congestion-alleviation for the money invested.

My home town of Melbourne has been one of the leaders in using technology to achieve this through smart technology like variable speed signs, ramp signals, travel time signs, underground sensors and CCTV cameras. They are all part of a dynamic traffic system that is responding in real time to what's happening on the road at any point in time. This has resulted in capacity improvements of 19% and combined safety and efficiency performance improvements of 50%.

The federal government has supported some of this managed motorways technology, including as part of the Tullamarine Freeway widening which has recently been completed, as well as other projects.

We are also endeavouring to be ready for, and help shape, the challenges and opportunities that will come from driverless vehicles. This also has the potential for another step change increase in capacity utilisation of existing road, rail and other transport assets.

Technology is changing rapidly and there are a range of predictions about how quickly we are going to see a take up of driverless vehicles. TransPosition has undertaken modelling which suggests that saturation of highly automated vehicles in the Australian fleet could occur roughly between 2050 and 2060. At the other end of the spectrum, in 2016, Telstra's Chief Technology Officer predicted that by 2030 all cars could be driverless.

The federal government is taking a strategic leadership role to coordinate more cohesively with other governments and agencies to implement future transport technologies in Australia.

An Office of Future Transport Technologies has been established within my Department to enable the Australian Government to work with industry and State and Territory Governments to ensure Australia is ready for the challenges and opportunities ahead.

The opportunities for driverless and/or on-demand public transport services are particularly exciting. It will lead to greater efficiency, more convenience for the public, and a blending of the definitions of public and private transport.

The New South Wales Government is currently trialing an On Demand bus service. On Demand is a flexible alternative public transport service, which allows people to book a vehicle via an online app or over the phone, from their home or a nearby location such as a shopping centre or hospital, taking them to a local transport hub or landmark. The cost is comparable to a one-way bus ticket and it allows people to access public transport when and where they need it, improving connectivity to the existing public transport network.

This trial is an example of smart planning, applying technology in an innovative way to transform existing services not only making it more efficient for government but also providing better services for the community.

The second way that the federal government can support cities becoming “smarter” by using technology is through the funding of innovative projects that if successful, can be replicated elsewhere. We have done this through our $50 million Smart Cities and Suburbs program.

It encourages innovative technology-based approaches that improve the livability of cities and regional centres across Australia.

We have already done the first round and soon, I will be announcing the successful applicants for the second round.

Some of the successful projects from Round 1 included:

  • The Smart parking project at North Lakes which is trailing smart parking technology to improve traffic congestion associated with the introduction of pay parking at the North Lakes shopping centre. This will benefit the community by reducing traffic and parking congestion, and data analytics will allow the council to make evidence based parking management and investment decisions for the future.
  • The Smart Tourist Town project in Kapunda is an investment in technology such as CCTV, Wi-Fi, bin sensors, electric car charging systems, renewable energy generation and LED public lighting to improve efficiency and reduce expenditure.
  • The Automated Traffic Management Project at Fraser Coast is installing integrated traffic counters with automatic database upload in the urban areas of Maryborough and Hervey Bay. Open data will be provided in real time, allowing for planned mitigation of traffic movements, and data analysis will allow evidence-based decisions for investment in traffic management and infrastructure.

Cities are the most important social and economic structures in Australia. We are lucky to have vibrant, well connected cities and regional centres that rate highly amongst the most liveable cities in the world.

We need to maintain the liveability of our cities. We need to continue to make them more productive as they are an engine of wealth creation.

This can be greatly assisted through technology and data analytics, but developing more sophisticated planning frameworks remains critical.