Systemic failure in governing big cities and not immigration is the root cause of the urban challenges facing Australia today.

Dr Marcus Spiller, principal and founding partner of SGS Economics & Planning, believes that viewing Australia’s urban challenges as an immigration problem was wrong, given how the country’s successful immigration program has contributed to its healthy economy and continuous growth. The selective intake of migrants ensures a ready pool of workers for jobs that Australians cannot do or are unwilling to do.

The rapid increase in population in Australia’s biggest cities, Sydney and Melbourne, is raising questions about the immigration policy and whether Australia will be able to sustain its historically high immigration rates.

Spiller attributes these growing pains to governance issues rather than the immigration program, observing that the failure extends beyond the current problems in the housing sector.

This is especially surprising for a country with an elite GDP per capita ranking (US$55,200 in 2017) that is unable to plan and deliver the urban infrastructure necessary to keep pace with immigration. In comparison, the UK with a much lower GDP per capita of US$37,800 has managed it quite well in Greater London where the population has grown at around 100,000 per year since the mid-1990s.

There is no clear housing policy in place in Australia.

The government, both at the Federal and State levels, has ignored the social housing sector, and views the housing challenge through the prism of household investment. There’s lack of clarity in the policies and programs related to urban transport.

Thanks to the over-reliance on income and consumption taxes as opposed to land taxes, the States have a vested interest in maintaining buoyant property markets and sprawling cities.

Planning systems in the States continue to revolve around rezoning and infrastructure projects that give windfall gains to speculators. By not allowing the community to reserve ownership of development rights, valuable resources for investment in transport, affordable housing and other facilities for the growing city are sacrificed.

Silo thinking by States in policies and investment is impacting the transport sector too.

Dr Spiller concludes by saying that the problem is not about too many migrants, but a system where urban growth management is in the hands of two tiers of government that are not competent for the task.

He buttresses his argument with a recommendation made by Infrastructure Australia in its recently released ‘Future Cities’ report, which seeks “profound reforms in urban management including the establishment of autonomous urban governments such as the GLA”.