Morrison told to get the regional economy fix right
THE Federal Government must resist applying a one size fits all approach to supporting regional communities hit hard by job losses and economic downturn.
Regional Australia Institute CEO Jack Archer welcomed Treasurer Scott Morrison's directive on Wednesday to the Productivity Commission, ordering it to pinpoint the towns and cities that are teetering on the brink of disaster in the wake of waning mining activity and other economic impacts.
The report's April deadline suggests the Federal Government will focus its 2017 budget on regional communities, potentially to deflect rising disfranchised voter support for Pauline Hanson's One Nation Party.
RAI research shows 8.8 million people live in regional Australia and these communities account for a third of the nation's output, providing work for one in three Australians.
National accounts figures for the September quarter revealed the economy went backwards following the mid-year Federal Election and wage growth figures were the lowest on record.
Queensland recorded just 1.2% growth, which was well short of New South Wales's growth rate of 5%.
Mr Archer said the national focus on struggling towns and cities was long overdue and he hoped it would change the way the Federal Government approached areas outside of the capital cities.
"We run a trickle-down macro-economic policy where if we get the high level settings right, then growth for the whole economy goes well - everything will be fine,” Mr Archer said.
"What's becoming clear is that this approach is not working, especially for particular parts of the economy.
"Frankly the Federal Government needs to stop and rethink and see if there's a better approach.
"We need to identify how the Commonwealth can take a flexible approach to each region by pro-actively identifying what's likely to happen to the economy and investing to support the best outcomes.”
Mr Morrison said researchers would examine a range of areas including the impact of the 457 skilled migrant visa program on struggling regions and how communities adapted to export growth.
Mr Archer said the Productivity Commission needed to also consider flexible social support services that adapted to the particular needs of individual communities.
"The way that we provide services and welfare to regions is very rigid and doesn't provide flexibility to get things right in different places,” Mr Archer said.
"I hope the Productivity Commission looks at how social services and other investments can be more responsive to different regional needs to help people get out of the welfare trap and into employment.”
The commission is due to hand its findings to Mr Morrison before the 2017 budget. - ARM NEWSDESK