Rethinking regional development policymaking
For some, government and locals working together to design and deliver regional policy is not new. But it is a rethink from traditional approaches, and it is what the Organisation for Economic Co-operation and Development’s (OECD’s) latest report is highlighting as essential to regional development moving forward.
The Regional Australia Institute’s (RAI) 2018 Inquiry Program is well aligned with the OECD report’s overarching message: successful regional development policy involves locals working with government, rather than for government.[LP1]
This blog breaks down some of the OECD’s broader thinking on collaborative regional policymaking and the ways it can inform regional development in Australia.
Considering the OECD’s regional report in an Australian context
To foster successful collaboration in Australia’s regional policy environment, we need to learn from what is already going on – both within and beyond our national borders. It is too easy to look at isolated policy cases and say, ‘we’ve tried to be collaborative, but the locals just didn’t get it’.
New ways of doing things always require a bit of ‘learning on the job’. Some honest reflections on the successes and failures of a new policy approach is essential. So is a rethinking of what ‘success’ actually looks like, particularly with multiple players involved in design and delivery.
How can locals work with government?
In Australia, collaborative arrangements between locals and government are growing – see City Deals (federal) or Accelerating Growth Loans (NSW). How best to design and deliver these new types of development policy is still under question. But there is some guidance.
In its regional policy release, the OECD identified nine lessons for more successful regional development policy (Table 1). This is a great start, but these broad lessons are not specific enough for locals to implement, nor have they been tested in the Australian environment.
The RAI will use its new Inquiry Program to road-test these lessons and identify some Australian specific examples and successes.
Table 1. Nine lessons identified by OECD and criteria for future regional development policy design
Source: summarised from OECD (2018)[i]
What sorts of policy tools are available?
We all have our own ways of grouping the tools that deliver the policy on the ground. The latest OECD report uses three categories (contracts, financial instruments and grants). These categories provide a useful mechanism for aligning existing and future policy tools to the new collaborative regional development approach.
Below is the RAI’s summary of the three tool categories, with a synthesised risk and reward outline based on our experiences (Table 2).
Table 2. The risks and rewards of alternate policy tools
Overall, the OECD report is a stocktake of the current ‘best-practice’ approaches to designing and delivering regional development policy. Throughout Australia, we have seen many policies that are already using these practices and trailing new collaborative approaches to delivery.
The challenge for Australia is to ensure that collaboration is both vertical and horizontal – working with and across all levels of government and all local leaders. Too often, private business or a specific tier of government is missing from regional policy design and delivery.
The RAI’s insights over the last few years have clearly placed us at the forefront of the new thinking in regional development policymaking. Keep an eye out as we continue to release work from our 2018 inquiry program throughout the year.
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[i] OECD (2018). Rethinking Regional Development Policy-making. Available at: http://www.oecd.org/governance/rethinking-regional-development-policy-making-9789264293014-en.htm
[ii] Pearson, L.J., Carter, A., Houghton, K., and How, G.(2017). Blueprint for Investing in Regional City Deals: Are You Ready to Deal?, The Regional Australia Institute; Charbit, C. and Romano, O. (2017). Governing together: An international review of contracts across levels of government for regional development. OECD Regional Development Working Papers 2017/04, OECD Publishing. Available at: hhtp://dx.doi.org/10.1787/ff7c8ac4-en.
[iii] Wishlade, F. and Michie, R. (2017) Financial instruments in practice: uptake and limitations. Background paper prepared for the seminar ‘When to use financial instruments’, held 28 June 2017, OECD Headquarters, Paris.