Bendigo suburbia in regional Victoria could be set for more “overspill” growth from Melbourne

The Liberal/National Opposition in Victoria is pushing its policy of “decentralising” a large share of Melbourne’s future population growth to the regions. It released a formal policy document last week, Looking forward 2050: managing population growth for all regions.

The key benefits claimed for the policy are a reduction in growth pressure on the existing Melbourne metropolitan area; faster access for regional residents to the metro area; and an improved economic and social outlook for existing regional populations e.g. more local jobs to service the new residents, more government services, more social opportunities.

The Opposition isn’t talking about them, but there are also potential downsides. The main one is the incremental cost of providing trunk transport infrastructure connecting regional centres to the metro area, but there’s also likely to be loss of economies of scale in delivery of government services. New residents will likely live at lower density than if they’d settled in Melbourne, be more car-oriented, and live in new suburbs built on more environmentally valuable land. Some existing regional residents will resent the change in the social and physical character of their towns.

Some points to consider:

  • Despite what it claims, the Opposition’s policy isn’t decentralisation in the standard sense of creating new jobs in regional centres like Whitlam tried to do without success in the early 1970s (see Is regional sprawl better than suburban sprawl?). Rather, this is a policy to create regional dormitory towns housing workers who commute to Melbourne on fast transport infrastructure.
  • Since at least one worker in each household would commute to the metropolitan area, I don’t think it can be argued regional dormitories would reduce agglomeration economies in Melbourne. Indeed, there’s an argument it enhances the attractiveness of Melbourne for business by providing a wider range of locational choices for workers.
  • It doesn’t put an end to sprawl. It essentially shifts part of the metropolitan fringe from outer suburbs like Werribee and Melton to regional centres like Ballarat and Bendigo i.e. it replaces suburban sprawl with regional sprawl.
  • While I expect it would mostly attract households who would otherwise have settled on or close to the metro fringe, regional living is also likely to have wider appeal e.g. it might be attractive to some CBD professionals who can’t afford an inner/middle metro suburb but wouldn’t be seen dead in the likes of Melton or Sunbury (public servants!).
  • As I noted here, the policy is likely to be a political winner for the Opposition. It’s promising voters a solution to big city woes like increasing traffic congestion, poor housing affordability and redevelopment pressures in established suburbs, while simultaneously promising new economic opportunities to the regions and better transport links to the capital.
  • The policy capitalises on the inevitable. Regional dormitories have already started emerging because some households find the higher commuting costs are outweighed by the lower housing costs. Given continued strong population growth, the demand for regional dormitories will continue to grow because existing metro area residents oppose intense redevelopment of their neighbourhoods.
  • What might be a small impact in the context of metropolitan growth could have a very big impact on a particular regional centre, especially one that attracts a disproportionate share of settlers. That impact could be both positive (more local jobs) and negative (unwanted changes in social character).
  • The keystone of the policy is provision of high quality trunk transport infrastructure connecting regional centres to the metro area. It’s usually argued that would be some form of high speed rail. It’s likely to be very expensive to build and operate, and will benefit a relatively small number of travellers for decades. It’s also inevitable there’d be irresistable pressure to upgrade intercity motorways.
  • Importantly, providing dormitories for metro workers is probably the only way that regional centres with a poor economic outlook can grow and provide jobs for locals.

I understand Infrastructure Victoria is assessing the costs and benefits of diverting some population growth from the metro area to the regions. That’s an important exercise because I don’t think it’s obvious that regional sprawl is preferable to suburban sprawl and/or redevelopment of established metro suburbs. “Decentralising” population but not jobs isn’t containing Melbourne; it’s spreading it out.