Will Deputy PM Barnaby Joyce succeed in herding public servants out of Canberra?

The recent controversy surrounding the relocation of the Australian Pesticides and Veterinary Medicines Authority (APVMA) away from Canberra to Armidale and the National’s push to force government departments to justify why they should remain in Canberra has helped reignite debate around regional development.

So too has intensifying anxiety around house prices in Sydney and Melbourne and the rising despair of first home buyers and renters, which federal Treasurer Scott Morrison has indicated will be a cornerstone of his May Budget.

Deputy Prime Minister Barnaby Joyce, whose New England electorate takes in Armidale, and National’s Deputy Leader Fiona Nash have led the charge to eject cadres of Canberra’s public servants into the regions, despite the APVMA relocation failing the government’s own cost-benefit analysis and being fiercely opposed by most of its workers and the National Farmers’ Federation.

More than 80 per cent of APVMA staff, many of whom are highly specialised scientists, have refused to up sticks for Armidale. APVMA’s chief Kareena Arthy quit the agricultural chemicals agency one week ago for a job as Deputy Director-General of Enterprise Canberra, rather than move.

But Nash and Joyce won’t let go.

Ms Nash has said that regional Australians “have just as much right to a government career as Melbourne, Sydney and Canberra residents”.

“The fact is most moves of government departments to the regions will save money on rent and rates. It’s also fact the vast majority of employees in government departments don’t need to visit the Minister’s office in Parliament House,” Ms Nash said. “Indeed two thirds of Australian government jobs are already outside Canberra, many of them in Melbourne and Sydney.”

Sydney University Emeritus Professor Frank Stilwell, a political economist who has written widely on regional development, says targeting public sector jobs in Canberra is a furphy when Sydney and Melbourne are the most overheated.

Prof Stilwell says Canberra’s creation back in the early 1900s as the nation’s independent capital city, was designed to decentralise economic activity away from Sydney and Melbourne.

“It was a counter magnet for the overdevelopment of the eastern seaboard. Frankly [moving jobs out of Canberra] just doesn’t make sense to me,” he says.

Creating Canberra was “socially legitimate and long-term and did not involve politicians pork barrelling for their own electorate”.

The critical mass of public servants in Canberra allows for interactions between agencies, knowledge clusters and greater staff mobility.

Australian National University Emeritus Professor of political science John Warhurst agrees that Canberra is the wrong target for decentralisation.

“It is actually the best Australian example of decentralisation to the bush that there is. It is a bush capital. The Nationals should be proud of this national achievement rather than try to undermine it,” he wrote, in a piece for Fairfax yesterday (Thursday).

“Furthermore, Canberra is still quite a small city, dependent on public service employment.”

Prof Stilwell says APVMA’s relocation looks especially ill-advised since it is not backed up by the Ernst and Young cost-benefit analysis commissioned by the government and foisting the move on staff was unlikely to be popular.

“It is very disruptive for anybody. Many people have already invested in homes and have kids in schools. Not that Armidale is a backwater. It’s great for education and affordable real estate prices that are much more attractive than our overstressed capital cities.

“If this [move] can’t work, maybe there is something wrong with the process. Shifting around the federal public service is just not really addressing the problem.”

Prof Stilwell says that what is needed is a coherent strategy backed by all three tiers of government with state government leading the way to address the overcentralisation in Sydney and Melbourne, “that’s where the action needs to be”, he says.

While he won’t be drawn on which state government departments or agencies should go bush, he says he would target relatively autonomous, footloose agencies that were not linked into a political cluster where staff needed to interact.

There has already been some decentralisation, such as moving the ATO to Gosford.

But he says it takes political will to plan decentralise jobs and growth and this kind of co-operation and nation building has not happened since Whitlam’s national regional strategy in the 1970s, which bit the bullet after three years when Malcolm Fraser was elected.

“It’s not pie in the sky, it just hasn’t happened for a long, long time in Australia. It needs to have cross-party support or it will get switched on and off when the government changes.”

He says this vision has never been reinstated, other than the Building Better Cities program under the Hawke government and led by Deputy Prime Minister Brian Howe.

A national strategy would need to be underpinned by research to investigate long-term, sustainable policy options alongside a willingness to invest in rural and regional infrastructure such as hospitals, schools, public housing and roads.

“State governments have to be the leading agencies but they’re not going to do it unless there’s a national plan because otherwise they are in competition with each other.”

The government should also focus on enticing private businesses to the regions, not just the public sector.

For example by offering preferential payroll tax rates, developing industrial parks, building public housing and other infrastructure such as fast rail links between state capitals, with stops on the way to develop two or three regional centres in each state.

“It’s a complex process. They just need time to get everyone used to the idea, get everyone committed so that eventually it develops its own inevitable momentum. While it’s a [political] football and controversial it’s not going to tick any of the boxes of economic viability,” Prof Stilwell says.

Regional development has received further attention with the transplantation of the UK City Deals program to Australia, where capital investment is funnelled into particular regions around cities with targets for infrastructure and growth.

Prime Minister Malcolm Turnbull known to be a fan of the project and early Australian cities deals have already been signed for Townsville, Launceston and Western Sydney.

Regional development must be addressed because the consequences of not pursuing it are high: unequal distribution of jobs, wealth and growth and loss of social connection in regional areas on the one hand; congestion, inflated house prices and environmental degradation for city dwellers on the other.

“It’s a win-win, when it is done well,” Prof Stilwell adds.

The Productivity Commission’s initial report Transitioning Regional Economies says that regional development should be pursued in the light of the end of the mining boom, the slow growth of agriculture jobs due to technology and rising productivity and manufacturing sector shrinkage to make regional areas and their people more resilient.