BULLOO SHIRE COUNCIL SUBMISSION TO THE SENATE ECONOMICS REFERENCES COMMITTEE [email protected]

RESPONSE BY MAYOR JOHN FERGUSON ON BEHALF OF THE BULLOO SHIRE

CONTACT DETAILS [email protected]

Phone: 0746218000

Attention Committee Secretary Senate Economics References Committee PO Box 6100 Parliament House CANBERRA ACT 2600

Submission Senate Economics References Committee Indicators of, and Impact of Regional Inequality in Australia May 2018 1

25 May 2018 Committee Secretary Senate Economics References Committee PO Box 6100 Parliament House CANBERRA ACT 2600

Dear Mark Fitt,

Inquiry into the indicators of, and impact of, regional inequality in Australia

I am writing on behalf of the Bulloo Shire Council with a brief submission to the Inquiry into the indicators of, and impact of, regional inequality in Australia. Please see below an introduction to our Shire followed by individual responses to the questions.

About the Bulloo Shire Council

The Bulloo Shire is the third largest Shire in and includes the towns of , Hungerford, , and Cameron Corner. Thargomindah is the hub of the Bulloo Shire and lies on the Bulloo River, approximately 1000 km due west from along the Adventure Way. It has 3 other townships Hungerford, Noccundra and Cameron Corner, where the 3 States of Qld, NSW and SA meet. The main industries are Agriculture, resources, tourism and government services. http://www.visitbulloo.com.au/ 1. Experiences of individuals and localities of unequal access to opportunities and unequal outcomes in non-metropolitan areas

The Bulloo as a remote outback town is presented with additional barriers, long recognised in many reports and studies, and they are summarized below: • Low levels of population retention • Remoteness and accessibility • High air fare costs for the one public transport offering - air • High construction costs translating into limited development • Land access is constrained to either landholders or small townships • Access to affordable housing due to low lending ratios • Low levels of advanced technologies and lack of technology • Volatility due to climate change and reliance on mining and agriculture • Tourists are ‘put off’ by the perception that all road networks are unsealed as well as the considerable driving distances between towns

These issues constrain development opportunities and also limit local home ownership. The Council is a major employer and provides considerable housing and this also considers to a low home ownership statistic. For those that can afford to buy, bank lending ratios are also very low (40:60) so considerable amounts of capital are required for purchasing even small and inexpensive homes.

Submission Senate Economics References Committee Indicators of, and Impact of Regional Inequality in Australia May 2018 2

The corporate nature of the Council employee/employer relationship also translates into low levels of entrepreneurship and risk taking especially in relation to business start-ups.

2. Views on the causes of inequality between regions, especially between capital cities and other areas The main causes of the Bulloo Shire Council’s inequality compared to metro areas are: • our remoteness • high costs of living, construction and development • Cyclical dominance of agricultural and mining sectors

3. Analysis of the economics of regional inequality, including wider impacts Whilst the main barrier to development is remoteness, isolation of the townships and access to our region, these have a negative effect on other major sectors such as employment (low levels of staff retention); access to skilled workforce; business & investment attraction; high travel costs; cost of living in general; access to specialized medical services and more.

3.1 Transport Road Funding is critical for all State roads to improve economic viability, tourism and lifestyle. This investment is multi-dimensional and both Industry and Tourism need good roads to connect our many Queensland attractions that are spread across both the Outback and the State. Currently the Queensland growth corridors are coastal and this directs significant amounts of funding to these areas. Whilst that is important, equitable funding should be considered, not only to improve economic viability, communication and connection for smaller communities. It should also be acknowledged that civil construction is a major employment activity for many small and remote councils so that this underpins employment and local spend.

3.2 Commonwealth Funding Ndrra Flood funding (Climate Change) The Commonwealth changes to the method of funding road damage under the Ndrra flood program have been greatly welcomed throughout Queensland as it now allows Council day labour workforces to participate and plant to be used for restoration works. Road making is still a critical activity for the Council and employs 50% of the workforce.There is a need for the same approach for drought through an ‘exceptional circumstances’ assessment process as in times of pro-longed drought the roads break up just as significantly however due to a lack of water and over a longer period of time.

Commonwealth Drought Support and Relief programs have been a critical success factor during the 2014 – 2019 and have allowed many landholders to remain on properties building resilience. 2017/18 has been an exceptionally dry year, unlike many of our other Queensland counterparts and given the short good season in 2016, local landholders have remained in maintenance mode rather than building self-reliance. This is because environmentally whilst many areas may have experienced one or two good seasons, the climate has meant that this has been followed by significant drought. It must be acknowledged that resilience building is a

Submission Senate Economics References Committee Indicators of, and Impact of Regional Inequality in Australia May 2018 3

slow process and thus this takes time. Currently exceptional circumstance support is still required to help maintain communities and populations.

These programs also highlight the importance of the consideration of a national climate change policy position at the Federal Level. This would then allow more strategic alignment (and assistance) for Local Government.

Intergovernmental Financial Assistance Grants Commonwealth Financial Assistance to Local Government – A detailed review of the National Principles governing the distribution of the Commonwealth Financial Assistance Grants was endorsed at the 2017 conference especially in relation to those small and remote councils that are heavily reliant on subsidy and support.

The Commonwealth’s grant programs need to be reviewed to ensure that smaller areas are able to access funds such as the Regional Growth Fund. This $10m grant (50:50 subsidy) was out of the reach of many Councils including ours, however we are just as in need of economic growth support to create jobs.

Continued funding for significant economic development projects, such as the Thargomindah Geothermal Project, is vital. It is also important to highlight that prospectus development needs to be supported to allow remote Councils to bring more projects to market.

3.3 Health Services

There is still more opportunity for funding and telehealth in rural and remote and we highlight the success of initiatives such as the “Heart of Australia’ to provide specialist services on a rotational basis to rural communities. This is a wonderful and innovative solution and should be supported and the model replicated for all specialist and allied health services.

Currently the RFDS provides an excellent service in Thargomindah however this is a fly in fly out service at great cost to the Commonwealth. We would like to see skills built at the local level so that local communities such as ours could work towards a sustainable model.

We raise that subsidies for transport and travelling costs in relation to community care programs should also be reviewed to ensure equity as travel is an inevitable part of the remote lifestyle.

Age care accommodation options needs to be considered as our communities age. Technology and robotics could add significant value to the construction costs of these types of options and more research and experimentation should be done in this domain.

The Bulloo Shire still has a volunteer ambulance officer model, this is not safe and should be reviewed.

Submission Senate Economics References Committee Indicators of, and Impact of Regional Inequality in Australia May 2018 4

3.4 Communication

Connectivity is still an issue in remote areas such as ours as the majority of the landholders only have satellite access. Given the contribution to both State and National GDP additional options through Telstra should be canvassed. The Federal Government pays significant sums to providers such as Telstra under their Universal obligations policy. This should be better directed at filling the infrastructure gap and exploring technological innovations to establish low cost and high quality options. There may also be radio technology that can be supported to fill the gap in communication requirements, supplementing expensive satellite communications and allowing businesses to have multiple options for different data sets.

3.5 Tourism The economic benefits of tourism to remote communities are very significant however much of the tourism product is either under developed or only in the early stages. Commonwealth investment in development packaging would be instrumental in fostering and growing economies and opening u Australia to the world. Current funding is aimed at promotion and marketing and development is a real gap. In addition seed funding for new ventures should be considered especially in relation to tourism start ups eg 4 wheel drive tourism etc. Tourism development can add significantly to our overall and local economies as well as offer new and interesting employment opportunities.

3.6 Education Education is the great equaliser, however remote education need to ensure that students particularly in the later stage on secondary education are disadvantaged compared to their urban counterparts. This is largely due to two factors – curriculum development and connectivity. Connectivity is the single biggest issue in preventing the offer 21 st century skills and access to University. Without this access this is creating second class outcomes which will inevitably manifest in poor social determinants of health including poor employment outcomes. This does not place us well now or into the future.

3.7 Renewable Energy

The Bulloo Shire has a major geothermal and solar project underway in order to provide better energy outcomes to the whole town. What is also necessary is to leverage this investment into industry and population attraction and skills. Support for end of grid projects is vital.

3.8 Air Transport Costs The Bulloo Shire has Rex Airlines arriving twice a week and this is subsidised at the State level. However, given that this is our only public transport, the cost of airfares in remote areas is becoming a significant issue for residents and children returning to school. The Bulloo Shire supports accessible pricing for all rural residents.

Submission Senate Economics References Committee Indicators of, and Impact of Regional Inequality in Australia May 2018 5

4. Examples of solutions: what has caused some regions or towns to prosper?

We believe that four concepts could alter the prosperity of regions, especially remote regions. These are:- 1. Zonal tax concessions – review and revival of contemporary tax concessions (see Attachment 1) 2. Renewable energy as innovation (Attachment 2) 3. Focused economic development on enablers 4. Population policy

4.1 Zonal tax concessions for Remote living Agriculture From an agricultural perspective, the region has been settled since the late 1870’s. It was an early route for colonial exploration through explorers such as Leichhardt, burke and Wills and others on their way to the gulf. It has been a significant base for the Kidman Empire since the turn of the 20th century and has strong and robust supply chains for organic beef and sheep.

The review and revival of contemporary tax concessions to support and enable this sector and their local communities requires a much needed review, it has been over two decades since remote area allowances have been looked at effectively from an economic development perspective. See Attachment.

In addition, this sector needs to be targeted for increased technological training and development in order to reduce the cost drivers in agriculture. In addition this development would see a ‘front line’ of agricultural services to the sector and provide opportunities for future jobs. Many properties are large scale, both local and foreign owned and provide opportunity for domestic and international markets.

Oil and Gas The growth in our Shire has been long influenced by gas and oil development in the Cooper Basin. This area is one of the largest and most significant inland sources of oil and gas in Australia and has sustained significant development since the 1970’s. There is continuing development today and reserves capable of support energy supply for the next 5 decades. In addition there is also mineral capability in the Eromanga Basic stretching north which offer future development opportunities for the resource and technology sectors.

This sector and our regional opportunities should continue to be exploited and transitioned into evolving green industries. These resources are essential to underpinning our national energy availability.

We believe that there is a way to bring it all together by Meshing the NEM!

Submission Senate Economics References Committee Indicators of, and Impact of Regional Inequality in Australia May 2018 6

4.2 Renewable Energy Opportunity Queensland is the second biggest user of energy in the National Electricity Market and unlike SA has poor wind power resources. Queensland does have excellent solar power resource however the lower quality solar resources in North Queensland are being developed in preference to the very high quality PV resources in Western Queensland. Western Queensland PV is better as there are many more sunny days due to the absence of cloud cover (which can be a frequent occurrence in tropical North Queensland, and we don’t have cyclones that add to the construction cost of North Queensland PV and suitable land is much cheaper in SW Queensland. There is also a growing risk for Southern Queensland if all the large scale renewables are developed in North Queensland – making South East Queensland, where most of the electricity is needed, very vulnerable.

The Bulloo Shire has excellent PV capacity, existing gas and geothermal resources. Council believes that developing solar PV in south western Queensland instead of north Queensland, this area could become a powerhouse and generate electricity to resolve peak load issues in Brisbane and the Gold and Sunshine coast cities that now occurs around 5pm to 7pm. This could lead to not only a better future but a significantly different and prosperous one.

Meshing the NEM The Finkel Power System security and Electricity Market Review was a result of the emerging issues in both supply and pricing of Electricity. The fundamental problem is that both SA and Queensland are on the extremity of the NEM with only a single interconnector to the rest of the NEM. We believe that constructing an electricity grid (through the market) from Bulli Creek in South-eastern Queensland to Davernport in South Australia via the south western area of Queensland, following the existing oil and gas corridors via Thargomindah to Innamincka through to Adelaide, could be achieved.

This option has the capability to ‘open up’ central Australia for the generation of low cost, high quality renewable electricity – it meshes the NEM across the country and by strengthening the South Australian and Queensland grids has the potential to ensure stronger reliability and lower wholesale electricity prices across the National Electricity Market.

Of note, a well-placed renewable hub(s) connected to the new interconnector and located alongside the new transmission line would create better alignment of economic incentives, through renewable zones, to boost development and deployment of energy based industries in Western Queensland stimulating regional development. The development would also significantly reduce current high electricity costs in Western Queensland that are based on inefficient small scale diesel generation and empower consumers to shrink bills as well as attracting new industry through the plentiful supply of reliable, clean electricity in the Western Queensland region.

A grid with the advantages of simplified land tenure, should not be ignored; the south west of Queensland and North Eastern South Australia support very low populations and is primarily grazing country or national park capable of running transmission

Submission Senate Economics References Committee Indicators of, and Impact of Regional Inequality in Australia May 2018 7 grids with minimal land tenure issues. Innovations in transmissions technology could reduce the traditional costs to this type of infrastructure by as much as 50% making it a viable solution for the market place. This would ensure this concept is both green and well demonstrated, capable of ‘meshing the existing grid’ to fortify all energy transmission across eastern and central Australia, thus future proofing transition infrastructure and renewable development well into the 21st century.

4.3 Economic Enablers as part of strategy development Council is also adopting an economic development strategy to consolidate and build growth. The focus is on actions that can be achieved over the next 5 years. The Strategy addresses the range of issues, challenges and opportunities for sustainable economic development in the region that have been determined through an extensive process of targeted research, consultation, engagement and analysis. Bulloo Prosperity will be led by Bulloo Shire Council in partnership with the Queensland Government, Commonwealth Government, regional development bodies such as the South West Regional Economic Development board (SWRED), business and industry and other supporting partners across the region. The strategy focuses on the ‘enablers’ of economic development by identifying and articulating the enablers and attributes which support the region’s economic development such as critical infrastructure, community services and facilities, local and regional planning frameworks and partnerships. The aim is to influence the potential of the region and its appeal as a place to visit, to invest in and to work and live.

4.4 Ready and Waiting Population Policy and strategies Outback Queensland represents some 60% of the state with only 2% of the population. For the Bulloo, the 2016 Census saw a 30% decline in population due to the downturn in the mining sector. Council, in conjunction with all layers of Government needs to address this decline and review its policies and programs to ensure that positive action can occur. We believe that population migration and immigration offers an obvious opportunity for regional and remote Australia.

Whilst we acknowledge the growing prominence of Australia’s cities, we also note that these populations are growing even faster than trends predict creating bigger problems especially in relation to infrastructure and service requirements. In reality, whilst these cities are attracting increased migration and immigration at record numbers, they are poorly placed to do so. (Q and Q Population Debate 2018) Alternatively, if 100,000 Australians/immigrants moved to regional cities and towns this has the potential to save as much as $50 billion over a 30 year period in reduced congestion and increased consumption (RAI 2016). In addition, initiatives such as the Evocities demonstrate that their recent 2017/18 campaign evidenced a 345% increase in responses across the 7 NSW regional towns in relation to interest by Australians to move to a regional city. (Evocities submission 2018).

We believe that rural and remote towns everywhere would also embrace new settlement. Success is relative, and on a much smaller scale has the potential to prove a ‘butterfly effect for the reversal of decline. Recent press has highlighted the Submission Senate Economics References Committee Indicators of, and Impact of Regional Inequality in Australia May 2018 8 success of migration to towns such as Nhill, Pyramid Hill, Mingoola, Biloela, Dalwallinu, Hamilton, Rupanyup, and Nobby. (RAI Media Release 2018).

If we match the decline with the need, this surely provides a great opportunity for small and larger rural/ remote towns to reduce inequity through a solution based process. We believe all of Local Government would welcome these new migrants simultaneously providing a solution capable of re-generating local economies through growth rather than requests of increased subsidies due to decreasing population numbers.

Councils Target Accordingly, Thargomindah in the Bulloo Shire is just such an opportunity. We have set ourselves a target of 3 families per year. Over 5 years this would significantly improve our local economy adding potentially 15 families and their children to the Shire, immediately boosting education, facility and recreational utilisation and health returns.

Contrary to the popular opinion about the lack of jobs in the Outback, the Bulloo Shire has skilled and non-skilled jobs as well as infrastructure such as housing. We also can provide low cost facilities access (pool) a free gymnasium, free swimming lessons, free afterschool and holiday programs and better educational outcomes through increased teaching levels. Our Shire can offer opportunity to get ahead as well as a significant amount of social infrastructure to ensure quality of life.

As a local Council we would happily welcome settlement by Australians, enterprise workers as well as refugees and humanitarian entrants. It would only take a small numbers of settlers to significantly change our outlook and reverse current decline (BSC Interview 2WEB 2018). Simply put we are ready and waiting.

Yours faithfully,

John Ferguson Mayor Bibliography • J. Archer, Regional Australia Institute, Great Small Cities, • http://www.regionalaustralia.org.au/home/2016/10/economic-growth-requires- connected-regional-cities-notfactory-floors, Accessed 23 May 2018 • Ferguson, J, 2018. Radio Interviews W Harrison 2 WEB April, May 2018. • Mack, K on behalf of Evocities group, 2018 Inquiry into indicators of, impact of • Regional Inequality Submission, May 2018 • Q and A Abc TV, April 2018 Debate about populations • Regional Australia Institute, Deal or No Deal – Bringing Small Cities into the National Cities Agenda, April 2016, p.6 • Regional Australia Institute Success of Small Towns, Media Release, May 2018 Submission Senate Economics References Committee Indicators of, and Impact of Regional Inequality in Australia May 2018 9