12 April 2022

Federal Government treats Canberra as a poor cousin while others prosper

| Stephen Oxford
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The Australian Institute of Sport.

ACT facilities such as the Australian Institute of Sport are crying out for investment. Photo: File.

Has the Federal Government given up on Canberra? It would seem so based on the Federal Budget.

Government spending remains at some of the highest levels in more than 20 years. However, the ACT does not benefit. It has the lowest levels of any jurisdiction’s infrastructure spend by the Federal Government with other spending generally targeted elsewhere.

Even when considering spending comparative to population, the ACT fares poorly compared to other jurisdictions. This indicates the ACT should demand at least double and up to five times the current levels of infrastructure spending.

Perhaps Labor’s Andrew Leigh said it best: “We make up 1.6 per cent of the national population. We got 0.3 per cent of the infrastructure spend – less than a fifth of our fair share of infrastructure.”

While the ACT received less than $60 million of infrastructure investment in the Budget, the Northern Territory, with a smaller population, received $538 million.

The Northern Territory is a much larger land base than the ACT and infrastructure spend is not just about ensuring every taxpayer is getting their ‘share’ of government investment. But there are quite evident infrastructure deficiencies in the ACT that the Federal Government could, and arguably should, address.

READ ALSO Federal Budget 2022: ACT snubbed again in infrastructure spend

Now is not the time to forget the capital. Earlier this year Commsec reported the ACT as the second weakest economy in the country, with low levels of consumer spending and high unemployment. The ACT places only ahead of Darwin in economic performance.

While there are signs nationally that the economy is improving (the Reserve Bank has suggested interest rates may rise as early as later this year), economic recovery can have some negative implications for Canberra.

For instance, as the economy recovers, government spending typically decreases. We can see this impact in the size of the public service following the Global Financial Crisis when the workforce reduced from 182,505 staff to 166,261 staff, or close to 10 per cent.

Given the ACT is home to about 60,000 public servants and more than 70 per cent of Canberra businesses operate in the public administration sector, a similar reduction post-COVID could see about 6000 public servants lose their jobs and more than 15,000 private sector workers in the public administration sector under pressure.

In recent times there has been criticism of the current government’s $2 million per day consultancy spend. A change to a Labor Government could see the makeup of the public sector workforce shift considerably with expertise sourced internally rather than through drawing from more than 150,000 consultants in the ACT.

While the Budget includes an overall increase in the size of the public service, these numbers are insignificant (400 staff) and these roles are spread nationally.

Most growth is in Defence and National Security, with Defence roles in particular not likely to be based in the ACT. The government has also announced a ‘reboot’ of its decentralisation plans, which would likely see public service roles leave the ACT in favour of regional areas.

And while an incoming Labor Government may remove staffing level caps for agencies, hope for public sector growth may be misguided given the pressure will be on any new government to implement a sensible economic strategy and provide a pathway back to surplus. In the past we have seen this translate to savings measures that have had proportionally greater impact on the ACT than in other states and territories.

Already we are seeing scrutiny of small areas of spending, such as furniture contracts in the Services Australia portfolio. With office space costing the Commonwealth more than $2.5 billion each year, this area of spending is sure to get attention when any government is looking for savings.

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Another area of concern is the cost of living in Canberra. With an average wage of slightly more than $70,000 and the average house price now more than $1.1 million – affordability of housing is a challenge. While our unemployment levels are low, we also have a challenge attracting skilled workers. There is no doubt housing affordability plays a role in people deciding where they want to live.

There are signs Canberra businesses will have some tricky years ahead. With demand for workers declining, household debt at one of the highest levels in the world and rising interest rates, there is reason to be cautious about the ACT economy. There are also low levels of federal infrastructure spending and difficulties attracting skilled labour to Canberra – all with the backdrop of businesses closing their doors and the second weakest economy in the country.

And while spending on national institutions such as the War Memorial and the new National Aboriginal and Torres Strait Islander cultural precinct are welcome, further spending on key national infrastructure should be identified and prioritised.

Institutions such as the Australian Institute of Sport are crying out for investment. Significantly deteriorating facilities over the past 20 years have placed Australia’s future Olympic and high-performance sports outcomes in jeopardy.

Canberra already cannot host large crowds for Canberra Capitals finals matches and will not be able to host NRL or rugby games without a future stadium solution. Embarrassingly for the capital, we no longer have the right facilities to host our national teams.

The collection institutions have been seeking further funding for years – with historical items unable to be stored appropriately, endangering key artefacts and risking the preservation of Australian history.

It is time for Canberra to demand more from the Federal Government, to receive its share of national infrastructure spend, which will generate jobs and reinforce pride in our city as the national capital.

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Labor for twenty plus years and we wonder why??????

Vinson1Bernie10:50 pm 12 Apr 22

Well you will vote ALP in the lower and upper houses 65-35 in redistributed terms . Why would either of them bother spending money – if we are allegedly so well educated why isnt there a greater push to make these seats marginal. Pocock etc this time performance is yet to be seen – he was a jackal on the field and he will be a solo likewise in Parliament…

HiddenDragon7:58 pm 12 Apr 22

The ACT may not do as well as other parts of the country, particularly those which are somewhat less rusted-on in their voting habits, from federal infrastructure spending but in other respects we are doing strikingly well compared to the rest of the nation.

The household savings figures at the bottom of this page show that in the 2019-20 year, the household net saving rate in the ACT was about 9 times the national average – in the preceding year it was more than 20 times the national average, with the ACT’s 1.6% of the nation’s population stashing away 35.7% of national household savings.

https://www.abs.gov.au/articles/insights-household-income-and-saving-state-and-territory#australian-capital-territory

With details like that tucked away in the national stats, it might be just as well for Canberrans that the choice on 21 May is between a leader who doesn’t know the price of household basics and a leader who doesn’t know basic economic stats.

It wont change with a change of government either. One side accepts it wont win a lower house seat and the other knows it will win them all. No need to throw any money at the electorate.

“infrastructure spend is not just about ensuring every taxpayer is getting their ‘share’ of government investment. But there are quite evident infrastructure deficiencies in the ACT that the Federal Government could, and arguably should, address.”

Strange if these deficiencies are “quite evident” why there was no actual discussion of them then.

Perhaps you should have just stuck with the first bit, where the ACT’s layout and demographics are fundamentally different to other states and territories which explains the vast majority of the difference.

But it is also the responsibility of the local government to identify and present projects for Federal funding. If there were robust business cases for infrastructure spending then we would receive more. What has the ACT Government been doing?

Surely we should be demanding less politically motivated government spending rather than wanting more when it suits us.

Amazing how money magically appears when one of their under threat MPs or Senators of not being re-elected. The system really is broken.

Agree, apparently Zed does so much for Canberra??

Federal Government gives ACT cash – ACT spends it on 100 year old tech of toy trams and wasteful spending on rainbow roundabouts

The tram is one thing, but wasn’t the roundabout all of about $5,000?

Amazed how many people get all knotted up about something that isn’t even a rounding error for the ACT – yet makes some people in the community very happy. There is expenditure on all sorts of things way in excess of this that people should get angry about.

The $6500 ACT government spent on the rainbow roundabout in Lonsdale st Braddon painted by members of the community is hardly loads of money. Where are the other roundabouts?

Ignore. $5000 paint job is too much but wasting billions on submarine deal with that we’ll never get is A-OK.

It’s either homophobia, ignorance or just being butt-hurt partisan shill.

How much was paid for SSM debate in advertising? or how much revenue was lost from it.

Envy – the old homophobia chestnut. Please refrain from that rubbish. It’s taxpayer money. Agree with the Submarine deal. Either we want Defence of union jobs. Lease them – instant force multiplier right there. The trams are wasteful. If the government wanted better transport options and lower emissions, spend all that money on electric buses, not a fixed, old technology.
Going back to your comment on partisan shill, esvy, I’m not fan of Morrison. Also, I can’t stand any political party.

Capital Retro8:10 am 13 Apr 22

How much did the same-sex traffic light signals in Braddon cost?

The “National” Government has given up on the “National” Captial and there has been very little investment in the captial since the the late 80s

I am a Rabbit™11:51 pm 12 Apr 22

I don’t agree with how far current funding is below the average, but those days were never sustainable. Australian tax payers already subsidies Canberra quite significantly through federal employment, and it was always unreasonable to assume that they should continue to pick up the bill for day to day territory functions too. It’s like people who still harp on about self government – parasites from a bygone era.

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