Move a public servant, get a cheaper house
As seen in the Financial Review, April 20 2017
A push by the Nationals to move government agencies from the cities to the country could help solve Australia’s housing affordability crisis, deputy Prime Minister Barnaby Joyce said. And some Commonwealth agencies could move to the country even if they don’t pass a cost benefit analysis, he insisted.
Government ministers will have until August to prove to Regional Australia minister Fiona Nash and Finance Minister why their departments should remain in metropolitan locations, triggering criticisms the decentralisation policy was effectively Nationals pork barrelling.
Mr Joyce, defending the policy, doubled down on his controversial decision to move the Australian Pesticides and Veterinary Medicines Authority by insisting future public service relocations may not pass a cost-benefit analysis either and they would still go ahead.
“If you say we will premise everything purely and solely on cost benefit analysis, I tell you what will happen,” Mr Joyce said.
“We wouldn’t be having this press conference in Canberra because it would never exist. It wouldn’t have passed the cost benefit analysis and this great city, incredibly beautiful city wouldn’t be here.”
Public transport, the Sydney Opera House and New Year’s Eve fireworks displays would also cease to exist if subject to a cost benefit analysis.
He said the costs versus the benefits of moving federal agencies would be considered by Cabinet but would not be determine the outcome.
Instead Mr Joyce focused on the impact of higher demand for regional housing would have on Australia’s housing affordability crisis.
“We allow people the opportunity to get closer to a house they can afford to pay off,” Mr Joyce said adding some of the public service moves could involve shifting from the inner-cities of major capital cities to the outer fringes.
“They can look and say I can buy that house for $300,000. That is affordable.
“They know on the same wage in Sydney they won’t pay it off. It won’t happen. They will be a renter.”
Mr Joyce’s housing comment were backed up by the government-funded think tank Regional Australia Institute which predicts $42 billion would be released in the Australian economy over the next 30 years through reduced interest payments on home mortgages if 100,000 Australians chose to live in regional cities rather than capital cities.
The Institute’s chief executive Jack Archer said the decentralisation of the public service in France, Finland, Ireland and the UK had reduced inflationary pressures on property and job markets in the capital cities.
He said 83 per cent of Commonwealth public service jobs were in big cities and those located elsewhere were generally lower paid and with little influence over government policies.
Mr Joyce insisted on Thursday the government would not shift major policy departments – such as Treasury – to the regions.
Mr Archer warned caution against rushing “headfirst into a one-size fits all” decentralisation policy because the cost and disruption in the first few years meant the benefits took longer to arrive.
“If we make a change we need to stick to it. A ten-year, bipartisan strategy is needed to ensure this policy strengthens and secures our national economy and social infrastructure in the long term.
However, Archer also believes the government must show caution before “rushing headfirst into a one-size-fits-all policy position on decentralisation.
The costs of change and disruption to public services occur in the first few years and the benefits take longer. If we make a change we need to stick to it.
A ten-year, bipartisan strategy is needed to ensure this policy strengthens and secures our national economy and social infrastructure in the long term.
“Relocation is not always an effective response to economic problems in regional Australia. It can alleviate local economic weakness in the short term, but if the decision is reversed in the future it leaves regional centres high and dry with a gaping hole in the housing and labour markets.”
See the original article at www.afr.com/news/politics/move-a-public-servant-get-a-cheaper-house-20170420-gvoice