NSW Government "decade of decentralisation needs major surgery"

1st March 2013

The NSW Government “Decade of decentralisation needs major surgery” according to Peter Bailey CEO of the Foundation for Regional Development said today in giving evidence to the Parliamentary review of the decade of decentralisation.

In reviewing the program initiatives he offered the following observations and suggestions.

$7,000 Relocation allowance

Great idea as it was put forward by the Foundation to both sides of Politics prior to the last election, however it needs tweaking;

Extended to people renting in Sydney who relocate and buy or build in a designated Country or Regional areas.

Needs a substantial marketing campaign to promote the relocation allowance and to promote regional NSW as a destination similar to the Victorian Campaign that has now been running since 2004.

Needs to be managed and promoted by the Dept. of Trade and Investment with appropriate Budget allocation, not the Office of State Revenue; the later has no experience or expertise in promoting and ensuring Govt programs achieve their objectives.

Anomalies occur; for instance where a family move from Newcastle to Lake Macquarie or Wollongong family access the allowance by moving 10 kilometres, to the southern side of Lake Illawarra in Shellharbour Council who can access the grant!

Jobs action plan

The Payroll Tax threshold is $689,000 and only applies if you employ additional people it has been meant to generate an extra 60,000 jobs over 3 years and has only generated 3,500 jobs regionally.

Unnecessarily bureaucratic, where 1 form is needed for one job and if an employer is employing 50 people it requires 50 forms.

Lack of awareness of the program and really only benefits the big end of town such as Woolworths, Coles and Bunning when they open new stores.

Does nothing to help Small and Medium size businesses, which don’t reach the Payroll Tax threshold.

Achieving Target 470,000

The State Govt. bold target of an extra 470,000 will not be achieved by 2036 as stated in the State Plan it is likely to be missed by 230,000 unless changes are made.

The target needs to broken down regionally either through RDA’s or ROC’s and then each region needs to then work with Councils to develop local targets. It is only by engaging with the regions and the Councils that we can achieve targets such as these.

Each Council and region then needs to develop their own strategies to achieve the target.

It is also important that if the Govt. wants to achieve the target it must put some resources towards achieving target 470,000 or otherwise it just continues to be a number in a document unlikely to be achieved.

Resources for Regions

This tax, which is from regional NSW, generated;

2010/11 - $1,240,000,000

2012/13 - $1,878,000,000

2014/15 - $2,518,000,000 anticipated.

This has only generated $10M in grants for 2 councils Singleton and Muswellbrook and is awaiting asset sales before the grants are paid.

This is the State’s growth tax and it should be about Govt. supporting areas where they are likely to get the greatest return, not waiting for Asset Sales on a depressed Real Estate market.

We are proposing the Resources for regions be increased to $100,000,000 and then moved to 5% of the tax in the next terms of Govt. and increasing to 10% by the end of the next 4 year term

We are seeing great rollout of money into Sydney what about the regions the engine room of our State and investing in those regions.

Regional Marketing Fund

The Foundation was funded last year to study the gaps in the marketing of regional NSW in terms of encouraging people and businesses to relocate to regional NSW and in addition develop a plan for the creation of a Regional Marketing Fund so desperately needed if the State is achieve its regional population target of an extra 470,000 by 2036.

Regional NSW background

There is a general drift of population to QLD, WA and other states we have lost 2 Federal seats to QLD and likely to lose another seat to QLD in the next Federal redistribution.

Regional growth rate in NSW is continuing to slow and is now 1/3 of regional Victoria’s and QLD growth rate.

Victoria in particular has grown significantly in the last 9 years on the back of a long term marketing campaign and this is why we need to fund the creation of a regional marketing Fund for NSW.

People wont move if they don’t know and so a regional marketing fund is essential – more than 30% of Sydney residents weren’t born in Australia!