New Approaches, New Institutions? A National Symposium Federalism & Regionalism in Australia

Regionalism and Economic Development: Achieving an Efficient Framework Prof Andrew Beer School of Geography Flinders University, Adelaide

Federalism & Regionalism in Australia Agenda Nature of the Problem Neoliberalism Responses to Economic Restructuring as an Example of Regional Development More General Arguments Conclusion

Federalism & Regionalism in Australia The Nature of the Problem Unequal outcomes in the economic performance of Australia’s regions –Income and growth differentials within States and between States A Federal dimension to this problem –Australian Government has a responsibility for the growth of the national economy as a whole –State Governments tend to see States as regions and pay great attention to their performance relative to each other Basic political dynamics favour some regions – especially metropolitan regions – over others A non-aggression pact, but is it honoured in the breach? –Outcomes exacerbated by neoliberal philosophies

Federalism & Regionalism in Australia Neoliberalism and Regional Economic Development Over last 20 years best practice in economic development is regionally focussed and delivered –More responsive to global markets –Empowers the community and mobilises community resources –Better meets the needs of the region But, also plays to neoliberal philosophies of government that see central governments wash their hands of responsibility for economic development

Federalism & Regionalism in Australia Neoliberalism Peck and Tickell (2002) – a general model of noeoliberalism based on free market economic theory and enacted through the processes of globalisation and contemporary government reform. O’Neil and Argent (2005) have argued …neoliberalism presents an agenda of possibilities for those with the power to enact change. But this agenda must be devised and playe out in historical and geographical circumstances. Critically, also a powerful force for denying action on the part of government

Federalism & Regionalism in Australia Neoliberalism in operation: Economic restructuring in Southern Adelaide Employment loss at MMAL –Prime Minister announced job losses in April 2004 –1,167 jobs lost – 700 involuntary redundancies –A Structural Adjustment Fund for SA aimed at attracting new investment worth approx $45 m Five sub committees, including SSIDWG – the only regional response A region already suffering from closure of Port Stanvac and downturn in wine industry

Federalism & Regionalism in Australia

Outcomes of SAF Funds fully committed and clear evidence of an impact but… –While 1200 jobs notionally created, half will be in Northern Adelaide, largely Edinburgh Park –Government funding not informed by priorities of the region –No funds for long term regional action – once off funding –Economic future of the region no more certain than before –SAF not a ‘best practice’ regional economic development activity Key lessons – no long term central government commitment to the region –Federal money, enacted through the State does not result in good outcomes –UK Government did better in dealing with Longbridge where powerful RDA took a long term strategic approach with their 7,000 sacked workers

Federalism & Regionalism in Australia Extending the Argument SAF is simply an example of broader failings in regional development that result from our Federal structure, the division of responsibilities between the tiers of government and neoliberalism –Practitioners report They are not involved with or consulted about large scale development projects Their funding is insecure and this forces them to engage in the projects they can get funded for, rather than the work the region needs Insufficient funds in total are provided for regional development Management structures imposed on them by central governments often create distance between them and the broader community Considerable time needs to be spent lobbying central governments for infrastructure and other investment The key partnerships have to be with central governments in order to secure funding into the future

Federalism & Regionalism in Australia Conclusion Other nations have more effective regional development frameworks than Australia –The US model, for example, is a Federal model but local governments are stronger financially and politically – with positive impacts SAF is an example of the poor fit between centrally driven regional initiatives and the real needs of the region –And neoliberalism plays it role, with govts limited in their engagement Regions need more political power if they are to achieve better economic development outcomes and a higher level of wellbeing for their citizens