Labor leader, Mark Latham

Taking greater responsibility

Mark Latham's Evatt Breakfast seminar address.

Federal responsibilities for cities

By Mark Latham

Introduction

In The Australian newspaper last month, Christopher Lloyd, a Professor of Economic History at the University of New England, lodged the following letter to the editor:

What happens when Mark Latham's suburban strategy, and Gough Whitlam's before him, is successful and the erstwhile Labor-voting disadvantaged suburbanites achieve their aspirations, get their higher degrees and city or academic jobs, move to Bondi, become Radio National listeners, develop a conscience about asylum-seekers and Aboriginal injustice and grow to hate monarchical symbolism? ¹

Professor Lloyd may know a lot about economic history but he needs to update himself on the recent history of Western Sydney.

Increasingly, successful people in our region are staying in the western suburbs. They are more likely to move into new, double-storey housing estates - such as Macquarie Links, Glenwood and Glenmore Park - than move to Bondi.² Professor Lloyd has repeated one of the dated stereotypes about Sydney's urban geography: that the city is divided in two - the west and the rest. Even worse, he has repeated an elitist and patronising view of the suburbs: that educated people do not live there, decent jobs are located elsewhere and its residents are yet to develop a social conscience.

All of this, of course, is nonsense. Every day, the changing face of Western Sydney further dates and invalidates this stereotype. Globalisation has transformed suburban Sydney - its economic aspirations, its urban form and its political values. The western suburbs have benefited from this process. Commentators who depict the region as an endless flatland of fibro homes and fringe dwellers do so from a position of ignorance. They are blind to the economic revolution of the 1980s and 90s and the new politics this has created. It is no longer a question of the west and the rest. Sydney is now a large, global city with a range of regions and interests. We need to modernise our understanding of the metropolis. I would argue that the city has broken into three distinctive arcs.

First, a Global Arc that stretches from the North Ryde business park through the North Shore, the inner-city and the eastern suburbs to Kingsford-Smith Airport. This is an internationally competitive and cosmopolitan area with all the lifestyle attractions (and expenses) of a world city. Politically, the Global Arc is willing to embrace the rights agenda and symbolic issues. At the 1999 Republic referendum, for instance, each of its federal electorates voted Yes (Bennelong, Bradfield, Berowra, Warringah, North Sydney, Sydney, Lowe, Grayndler, Wentworth, Kingsford-Smith and Barton).³

Second, a Middle Arc that spans the older western and south-western suburbs - from Hurstville to Blacktown, from Auburn to Liverpool. This area comprises a mix of traditional working class communities and newly arrived migrants. It has above-average levels of unemployment and welfare dependency. It also features a high rate of urban churning, especially in its ethnic base. Bob Birrell's research at Monash University has identified a sharp rise in the proportion of overseas-born people in the Middle Arc, matched by a corresponding increase in Australian-born populations in Sydney's inner and outer suburbs.⁴ This is what the Americans call "white flight" - the movement of young families and retired people from troubled neighbourhoods to the relative stability of the urban fringe.

Third, an Outer Arc that stretches from the new release areas of the Central Coast to the North-West Corridor, Penrith-Hawkesbury, the Macarthur region, Sutherland Shire and North Wollongong. These suburbs reflect the benefits of economic mobility. They house the small businesspeople, the contractors, franchisees and consultants of the new economy, living in double-storey estates on the urban fringe.

When Paul Keating said in the 1980s that his economic reforms would change Australia forever, he meant it. Thirty years ago, there were 200,000 small businesses in this country. Today there are one million. That's an additional 800,000 small business families. And where do they live? Most likely, in the new suburbs ringing Australia's major cities, close to their businesses and the communities in which they grew up. This is the great driver of economic aspiration in our society. When I grew up in Green Valley in the 1970s, our values were based on the politics of us versus them - the working class versus the North Shore. Now, when a young person grows up in my electorate, they can see prosperity in the neighbourhood next door. Social mobility has become more tangible and achievable. The politics of envy has been replaced by the politics of aspiration.

The other dominant political theme in the Outer Arc is social responsibility. For the first time in Sydney's history, moving to the outer suburbs has become a lifestyle decision. People do not want the troubles of other areas to follow them to the fringe. This is why they place a premium on public decency and responsibility. Not surprisingly, people who have experienced lawlessness truly value the rule of law. This is the commonsense of suburban life.

Contrary to Professor Lloyd's assertion, the suburbs have a strong social conscience. It is based on a practical understanding of how the good society requires a certain level of order and cohesiveness. This is one of the pillars of social justice: the shared expectation that people are responsible for their own behaviour. Indeed, none of our institutions can succeed without sanctions against irresponsibility. It is not possible to learn and succeed at school if some students are allowed to cause chaos in the classroom. It is not possible to have a strong and trusting community if people live in fear of crime. It is not possible to create public confidence in the tax-transfer system if people can get away with fraud and free loading. Social rights need to be matched by social responsibility.

Thus, politics on the fringe follows two golden rules:

• The party that backs economic aspiration ahead of economic envy will most likely win; and
• The party that has the longest list of excuses for people who do the wrong thing will most likely lose.

Federal responsibilities

If these changes were only happening in Sydney, it might be possible to leave them to the States and local government. In practice, however, they are occurring throughout our capital cities. Sydney may be Australia's first global city but it will not be the last. Globalisation is also having a profound impact on Melbourne, Brisbane and Perth.

The growth of our cities is being driven by federal factors: economic openness, active migration and major infrastructure decisions, especially the construction of airports and universities. In the new economy, airports are the equivalent of the seaports of the 19th century - the main transit points for the movement of people and products. Universities generate much of the knowledge and innovation of the Information Age. Both are essential to the development of global economies and global cities.

The federal government needs to take greater responsibility for the urban consequences of its policies. It is not sufficient for the national government to drive change in our cities but leave the management of change to the States and local government. Cities, the places where most Australians live, are a national responsibility. No level of government can afford to ignore the impact of internationalisation on our communities and lifestyles. As a discipline, urban planning has lost much of its certainty. In the new economy, the location of investment and jobs is moving at a faster rate than urban form. This has increased the degree of difficulty in planning our cities and suburbs. All levels of government need to respond to this challenge.

There are other good reasons for federal responsibilities. Urban form and efficiency have a powerful impact on Australia's economic growth rate. For instance, 30 per cent of Australia's GDP is produced within a 100 kilometre radius of the city of Sydney. In large part, our national prosperity relies on the effectiveness of transport, communications and settlement programs in our major cities. Economic management and urban planning are two sides of the same coin.

Simon Crean has declared his intention to put cities back on the national agenda. We want to modernise Australia's housing and urban policies. This is a vital part of the Labor tradition. For 50 years, this issue has differentiated us from the Tories. Menzies left the enormous post-war growth of our cities to the States. Gough Whitlam and Tom Uren put suburban services and infrastructure on the national agenda. Fraser took them off.

This cycle of action and inaction continued in the 1990s. Brian Howe created the Better Cities Program and then, in one of the early and worst decisions of his government, Howard abolished it. As with most issues, he has returned to the narrow complacency of the Menzies years. Even though federal policies are changing the face of our cities, the federal government has little interest in urban policy. It sees the cities solely as a cost-cutting exercise, through reduced funding for the Commonwealth-State Housing Agreement (CSHA) and urban infrastructure. The only federal minister to take an interest in urban form has been Joe Hockey.⁵ The Hockey plan for Sydney is to double its population - to bring an additional four million migrants to the city, without additional federal support for their settlement and the services of a civilised city. All change, no responsibility. This is the Howard and Hockey approach to urban policy.

Urban sprawl

As a world city, Sydney will continue to grow. This is inevitable. The challenge for government is not to prevent growth but to more effectively manage it. The city should not be allowed to sprawl beyond its environmental, financial and lifestyle limits. I oppose the Hockey option of a mega-city of eight million people, stretching from the Southern Highlands to Newcastle, devoid of open space and urban amenity. Sydney must not become the next Los Angeles.

We must recognise the natural limits of our geography. Sydney is surrounded by fragile river systems and national parks. Its topography and wind movements are conducive to photochemical smog, especially in the Cumberland Basin. On environmental grounds alone, we must combat Sydney's sprawl. The financial and lifestyle costs of urban sprawl are also excessive. It is estimated that the public cost of servicing a new housing lot on Sydney's fringe is 25 times more expensive than the cost of infrastructure for in-fill development. High-quality consolidation is a town planning and economic necessity.

Without the effective management of Sydney's growth, the costs of congestion will continue to grow. This is a car-dominated city in which more than 80 per cent of journeys are made by private vehicle. In the Outer Arc, car transport is a way of life. There are huge social and lifestyle costs if people are forced to travel long distances for employment and basic services.

In my 25 years of political involvement in the outer suburbs, there has only ever been one issue. How do we move the jobs and services to where the people have moved? Without adequate planning and provision, commuters are forced to spend long periods of time - up to 20 hours a week - away from their families and communities. Urban sprawl is a barrier to social capital.

Sydney's Outer Arc has many more labour force participants than labour market jobs. Penrith, for instance, has a job deficit of 36,000. In Campbelltown the shortfall is 34,000. This results in long journeys to work on Sydney's congested roads. In peak hour, it now takes 70 minutes to travel from Campbelltown to Blacktown and 80 minutes from Rouse Hill to the eastern suburbs. This is a modern form of water torture - weaving through back streets and sitting at traffic lights on under-developed roads.

These are serious problems for which all levels of government must take responsibility. National economic and migration policies are driving Sydney's growth. The national government must be part of the solution on the urban fringe. It needs to meet the legitimate aspirations of suburban families to live, work and learn in the one community. In effect, we must demand a higher standard of urban development. In the past, governments have released residential land without requiring the early development of employment land. While in recent decades, developers have paid contributions for the provision of municipal services, they have not contributed to the new urban agenda, particularly the provision of community-based education and lifelong learning.

This must change. The federal government has a role to play in securing an integrated form of development, so that jobs and services are available as the residents move in. The Mawson Lakes development in Adelaide is an outstanding example of how this can be achieved. Through land banking and public-private partnerships, high quality yet affordable housing is being built adjacent to a technology business park, two new schools and a university campus.

This model needs to be replicated nationally. Aspirants on the urban fringe are demanding a range of new services, such as broadband Internet access, telecommuting and learning centres. It is good commercial practice to make these facilities available. It is good government policy to partner these efforts. Integrated development is the best way of achieving win-win outcomes - for residents, developers and governments. This is a key objective in the ALP's policy review process. We want people in the outer suburbs to be able to live, work and learn in the one community. We want to overcome the Howard government's neglect of housing and urban affairs. We reject the Hockey option of unlimited sprawl and congestion. A federal Labor government will fulfil its responsibilities for Australia's cities.

Urban renewal

In the past, the urban renewal agenda has been associated with the inner-city. As Sydney has grown older, however, the need for renewal has moved to the Middle Arc. The mass of three-storey walk-up flats constructed in the western suburbs in the 1960s and 70s has deteriorated significantly. These areas usually adjoin public housing estates that also require redevelopment.

This is an opportunity for Commonwealth-State private housing partnerships. The objective should be to consolidate and redevelop the sites, with a better mix of housing types and urban design. Given the proximity of these neighbourhoods to town centres and public transport, it is possible to achieve strong commercial and urban consolidation outcomes. Most importantly, the renewal projects would substantially upgrade the amenity and lifestyle of places like Liverpool, Fairfield and Bankstown.

Urban renewal should be a leading objective of the Commonwealth-State Housing Agreement (CSHA). In the private sector, more than 50 percent of new capital spending goes into home renovations. In public housing, however, renovation work has been as scarce as employment creation. More than half of Australia's public housing stock was constructed before the 1960s, often in the wrong place with the wrong design. It badly requires redevelopment. This will not be achieved without private sector involvement. State housing departments simply do not have the expertise or resources to do the job properly. We need to follow the model adopted by the Defence Housing Authority in the 1990s. Through partnerships with progressive developers such as Delfin, DHA was able to fully redevelop its housing stock. I want the CSHA to be a redevelopment agreement, not just a funding agreement for rental housing.

Federal-State co-operation is also required to overcome public housing poverty. This is the slow-burning scandal of Australian public life - the steady deterioration in the social and economic environment of our broadacre housing estates. We need to develop new and innovative solutions to poverty, through social entrepreneurship, social venture capital and community ownership schemes. These ideas will be examined in Labor's policy review, along with other reforms to end the curse of social exclusion.

Urban affordability

Australia faces a housing affordability crisis, both in the ownership and rental markets. Home ownership rates among young Australians have fallen. Low-income families have been priced out of the property market in our major cities. Cutbacks to public housing have produced record waiting lists and placed additional pressure on private sector rents.

In the past, governments have dealt with affordability concerns through demand-side policies, such as rent assistance. These strategies need to be complemented by supply-side policies that ease the pressure on the rental market. Increased home ownership has a crucial role to play in this process. By reducing the demand for rental accommodation, it is possible to drive down rental prices.

Labor's policy review will consider a range of innovative home ownership models, such as shared equity schemes, co-operative housing, matched savings accounts and nest-egg accounts for young Australians. Whereas the current homeowners grant was designed to compensate for the negative impact of the GST, Labor wants to create permanent and more substantial forms of assistance for homebuyers. This is my top priority in housing policy. Other affordability strategies will also be examined, including:

• Government land banking on the urban fringe as a way of combating price speculation and urban sprawl;
• Urban renewal partnerships that consolidate public and private sector sites and reduce unit costs;
• The revitalisation of the CSHA and expansion of public housing stock; and
• Streamlining the planning approvals system, with lower compliance costs and more flexible development codes (such as dual residential use by small business).

Conclusion

Before he became President, Abraham Lincoln wrote that "the legitimate object of government is to do for the people what needs to be done but which they cannot, by individual effort, do at all or do well for themselves." This idea, pioneered on the Illinois frontier, is just as relevant today on the fringe of Australia's cities. In isolation, the private property market cannot achieve for people the social benefits of integrated development: the containment of urban sprawl, the provision of basic services, the renewal of housing stock and more affordable accommodation. These things can only be achieved by government - not just part of the public sector, but by all levels of government working together.

This role is doubly significant for the national government. The States and local councils do not have the power or resources to deal adequately with the urban consequences of globalisation. Federal responsibilities are all-important. This is why Labor wants to put cities back on the national agenda. We are the only party with a clear vision for suburban Australia:

• Economic ownership for all;
• Social responsibility from all;
• Fully serviced and cohesive communities with all.

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