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Discussion paper

Population growth and infrastructure in Australia: the catch-up illusion

Population growth Transport infrastructure Infrastructure Population Australia

Sydney and Melbourne now have worse traffic congestion than New York and Toronto. This congestion is but one symptom of an infrastructure shortfall caused by Australia’s rapid population growth, fuelled by very high levels of immigration since the beginning of this century.

If these trends continue towards a ‘Big Australia’, living standards for existing residents will continue to decline as people are forced into smaller, more expensive and lower-quality housing, endure worsening traffic congestion, pay more to access basic infrastructure and services, and have less access to public services and green space.

Our political leaders are claiming that these problems can be managed by decentralisation, better planning and more investment. This paper disagrees with those propositions.

Key points:

  • The rapid population growth rate of about 1.6 per cent per annum results in Australia’s infrastructure supply not keeping up with demand, despite our best efforts. Consequently, individual living standards are being eroded through rising congestion, declining housing affordability, growing infrastructure costs (e.g. toll roads and water), environmental degradation, and overall reduced amenity.
  • As the numbers of people arriving in our major cities increase to unprecedented levels, so does the cost and complexity of providing more infrastructure. Each additional person (whether by immigration or birth) requires well over $100,000 of public infrastructure, to enjoy the same standard of living provided to existing residents. If that investment is not made (and it often isn’t), then the pressures and demands upon existing infrastructure builds up, causing congestion.
  • With continuing rapid population growth, Australia’s infrastructure catch-up will remain illusory. The backlog can only increase, further adding to congestion and loss of amenity.
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