Contrary to what seems to be a widely held belief, it is not an easy matter to make jobs simply materialise in places that have a shortage of employment. It is a difficult and complex business that involves much more than merely rezoning land for business use.
However hereâ€™s an outrageous shortcut for developing Melbourneâ€™s west. Why not shift the seat of Government in Victoria â€“ politicians, bureaucrats, departments, the whole kit and caboodle â€“ out of the CBD to somewhere like, say, Werribee?
Such an action would give an enormous boost to the development of the west and reinforce the Governmentâ€™s new policy of developing significant suburban activity centres. A location like the west makes sense because the weight of future metropolitan growth will have to be north of the Yarra due to environmental constraints in the south and east.
This is a shocking idea but itâ€™s not as far-fetched as it sounds (although I donâ€™t mean to suggest that it would be costless or easy, much less politically tempting).
The standard argument for retaining the seat of Government in the CBD is that high level strategic operations obtain external economies of scale from co-location. Thus the efficiency of government in Victoria is greatly enhanced by face-to-face contact between politicians and bureaucrats on the one hand, and captains of business on the other. Further, the CBD maximises access to high human capital workers because of its excellent accessibility, particularly by rail, from all parts of the metropolitan area.
Thereâ€™s some substance to these arguments but not enough. Look at the US, where the seat of government is not located in the most populous city in 33 out of 50 States. For example, the capital of California is Sacramento, not the considerably larger Los Angeles or San Francisco, and the capital of New York State is Albany. Many of these capitals are small â€“ the population of Olympia, capital of Washington State, is less than 50,000.
Look also at Canberra, which has operated successfully since 1927 at a considerable distance from the CBD of every State capital. No major corporation has felt it necessary to up-sticks and leave Sydney or Melbourne in order to be close to the seat of government. The rash of new overseas companies that established regional headquarters in Australia over the last twenty years largely located in Sydney (and to a lesser extent Melbourne), not Canberra.
Even after more than 80 years, Canberraâ€™s population is a mere 350,000 â€“ about 9% of Melbourneâ€™s.
Thus being in a large urban area, much less in the CBD of a large city, does not appear to be a prerequisite for the efficient operations of Government. What probably matters most is that politicians and senior bureaucrats are located in the same place.
In any event, enhancements to the rail system from projects like the proposed Melbourne Metro would greatly increase connection between the CBD and a new â€śParliament House at Werribeeâ€ť. Consultants, lobby groups, industry associations, the media and any others who provide services for the politicians and bureaucrats would doubtless follow their clients west.
Public servants would drive more in the short term but, as was the case with Canberra, workers would migrate over time to live closer to their new offices. Better public transport services both to and within the west would be needed.
It might be argued that the bureaucrats can be shifted but not the politicians. But that really would be inefficient. CBD public servants largely work in policy-related areas. Senior bureaucrats need to be near both their staff and their Ministers. Government is perhaps the pre-eminent example of how important face-to-face contact is in conveying nuanced, ambiguous information (the sine qua non of politics).
Some might object to Parliament moving out of its historic home. Yet itâ€™s been done before with Federal Parliamentâ€™s move to a new building in 1988. The Victorian Parliament building, which was never completed, is in any event grossly overcrowded â€“ it would be more suitable as a museum, gallery or library.
Perhaps the key benefit would be development of a major suburban activity centre that could potentially rival the CBD in influence and importance (but probably not in size). It would strengthen the attractiveness of the west as a residential and business location and consequently accelerate the shift away from the south and east. It would recognise the reality that the great bulk of jobs in Melbourne are now in the suburbs.
The obvious downsides are largely short-term. They include disruption to the commuting patterns of a large number of public servants, over-supply of office space in the CBD and an increase in the share of commuting by car. Thereâ€™s also the cost, including construction of a new Parliament House although thatâ€™s long overdue anyway.
Although this idea is perhaps a little left field, the surprising aspect to my mind is that there is no really compelling argument against it. Were it to be taken further, a wider range of prospective locations both within Melbourne and in regional areas would have to be considered. After all, itâ€™s a one shot wonder â€“ itâ€™s not a sustainable strategy for developing all regions in the State. I just like the idea of Werribee. Thereâ€™s lots of spare land at the Western Treatment Plant too.