REGIONAL SCIENCE

A S S O C I A r I () N M STRALIA \ M ZEALAND SECTION

Published by: Regional Policy the Australian and and Practice New Zealand Regional Science Association, Inc. Vol. 2, No. 1, May 1993 Editorial Board: Contents Tony Sorensen, University of New England Editorial 2 Ann Hodgkinson, The Meenaar Industrial University of Park - a Cooperative Approach Wollongong by State Government and David Singe, the Avon Community. David Singe 3 Wheatbelt Development Facts and Figures #1 Derek Kemp 10 Commission, Northam The Amalgamation of the Kalgoorlie and Boulder Councils in Western Australia Ian Cowie 10

Please address all The Pilbara 21 Report: queries and corres¬ Another Pipe Dream? Stewart Houghton 12 pondence concern¬ ing this publication Facts and Figures #2 Derek Kemp 16 or the RSA to: Tony Sorensen, c/- Narrogin Enterprise Centre Carol Hardie 16 Department of Geo¬ graphy & Planning, Local Development Initiatives University of New in The Mid-Atlantic Regions England, Armidale, of the U.S.A. Ann Hodgkinson 17 2351. Tel: (067) 73 2880; Community Economic Analysis Rod Jensen and Fax: (067)71 1787. Ann Hodgkinson 21

Papers In Concluding Note 22 Regional Policy is a twice-yearly The Australian and New Zealand Regional publication aimed at Science Association Inc. is a non-profit the membership of the ANZRSA and organisation dedicated to the promotion others who are of efficient and effective regional interested in current regional develop¬ development strategies through ment practice. research, education and the discussion ISSN: of ideas.

Regional Policy and Practice v2.1 1 EDITORIAL and participate in the economic and cultural benefits of moving into a global system. I he subject matter tor this editorial originally came in a tit of pique when it seemed the Moreover, it should not be forgotten that promised Minister for Regional Development globalisation has an intra-national as well as a had been lost in the election aftermath. supra-national regional dimension. It is at this Nevertheless it reappeared as part of the level that the inclusion of regional development Ministry of Industry, Technology and Regional with industry and technology makes sense. Development, the reworked DITAC, under MITI, which is increasingly becoming an Alan Griffith. On reflection this is probably not acceptable model for individual development in a bad idea. And at least it gets us into the inner Western nations, has a series of regional Cabinet! bureaus as well as sector divisions. While this might be explained in terms of the political Now we have regional development back on the influence of Japanese regions, it also reflects an political agenda let us hope they do something acknowledgement that economic growth has to worthwhile with it. According to the Australian be shared around and that small and regional Labour Party Policy Document 1993, a task- businesses need to be integrated into sector force under Hon. Laurie Brereton, M.P., had development. Regional development thus been established to develop a program for the ensures an efficiency element by not excluding then proposed Department of Regional potential global firms from industry Development. This policy document appears to development on the basis of location. focus in regional issues relating to adverse effects of individual restructuring on some The importance of regionalism in industry communities, the impact of Commonwealth development becomes explicit as global firms programs on "lagging" regions and impedi¬ move from being large integrated transnationals ments to adjustment in these regions. to being more frequently characterised by col¬ laborative alliances between independent firms. May we suggest that this an altogether too Existing regional organisations would be negative approach to regional development. As readily transformed into supportive offices to the articles in this and previous issues of assist local firms in this process if a well Regional Policy and Practice suggest, what is understood strategic direction for each sector happening on the ground in regional develop¬ existed. The concept of clusters of related ment agencies involves positive outcomes by industries which form input-output communities to build up their economies rather relationships and collaborative R & D ventures than simply reactions to macro forces beyond with each other is also a clearly regional aspect their control. This positive approach is reflected of this new approach to industrial development. in the recent emphasis by State Government on The development of successful industry clusters ‘self help’ regional policy and on local com¬ would clearly add to the local development parative advantage strategies which involve impart of global growth in regions such as the building on strengths. This appears in sharp Illawarra, Hunter and Latrobe Valley which contrast to the terms of reference of the current contain industries capable of competing in Industry Commission inquiry into Regional global markets. Industry Adjustment which focuses on impedi¬ ments to labour and capital mobility. The last The cynic is now crying that all this has been thing a "lagging" community needs is to lose to tried before. This is true. However, now it is better off regions more of those workforce and possible to add elements which were missing in entrepreneurial skills and capital it still has, the earlier experiments. For that is what they thereby serving to denude its ‘self help’ were — experiments. Now we need the options. Commonwealth Government to provide an overall strategic framework as to sector devel¬ Rather, what is required from the opment and internationalisation in which Commonwealth Government is a clearly articu¬ regional firms can confidently advise local firms lated statement of how regional commodities and develop regional plans. Then regional net¬ and regional industries fit into the overall devel¬ working and international regional alliances can opment strategy for the country. Equity consid¬ occur not in isolation as has occurred in the past erations are clearly important in ensuring all but as an integral part of future national Australians regardless of where they live have development. the opportunity to share any future prosperity

2 Regional Policy and Practice v2.1 Nevertheless, it must not be forgotten that THE MEENAAR INDUSTRIAL PARK regional development is not just industry devel¬ - A CO-OPERATIVE APPROACH BY opment. This destination has been lost in same STATE GOVERNMENT AND THE States while being well accepted in others. AVON COMMUNITY. Regional development also means community development as is illustrated in the U.S.A. David Singe, examples included in this issue. The community Department of State Development, WA. side involves employment issues, particularly training and placement services. It also involves [The views and opinions expressed in this paper are community enterprises and community self help those of the author and not necessarily those of either projects related to the provision of new facili¬ the Western Australian Government or the Department ties. Increasingly, it will also involve local of State Development.] responses to environmental and conservation issues. It is important this side of regional [Editor's Note: This is an edited version of a development does not get lost within a new paper presented to the 16th Annual Australian focus on industrial development. To solve this and New Zealand Regional Science Association problem perhaps the establishment of regional Conference, Ballarat, December, 1992. It is agencies capable of packaging and reconciling longer than our usual aticles because it is an ex¬ the different programs to meet specific local cellent account of creative regional development needs will be required. involving State and local interests.]

So please excuse the overly political nature of Background this editorial. However, the 1993 elections while seeming to mean ‘back to business’ also The Avon Valley was the first area of inland contains within the new Ministry format the settlement in Western Australia, surveyed and opportunities for a new and vigorous settled in the early 1830s. The fertile soils of the redirection of policy. Nowhere is this more Valley contrast to the sandplains of the coast, needed than in regional development. Let us with the Darling Ranges separating the two. hope the opportunity is grasped by our policy Like much of inland Australia, transport devel¬ makers. And our practitioners, probably some opments, agriculture and commercial services of the hardest working grassroots toilers in were the driving force for the growth of the economic development are given some sign that area. Northam established its regional primacy the light in the hill still shines. when the decision to extend the railway to the Eastern Goldfields (Coolgardie, Kalgoorlie) On a more prosaic, but no less important, note saw it become a rail junction. The towns of this issue focuses on regional policy and prac¬ York and Toodyay remained smaller, local tice in Western Australia. We are fortunate to centres (see Map 1). The expansion of agricul¬ have contributions on an interesting cross sec¬ ture to the east during the twentieth century sub¬ tion of topics that reflect the diversity of the sequently created a string of small communities regional practitioner’s domain. Subject matter throughout the Wheatbelt as it is colloquially ranges from the development of an innovatory known. industrial estate and promotion of the remote North-West, to small business promotion and Northam’s sphere of influence has been sub¬ local government reorganisation. The editors, stantially undermined by the location and size of and the readers for that matter, owe the authors Midland which is located at the foot of the a considerable debt of gratitute for their efforts. Darling Ranges 17 km east of Central Perth. We look forward to receiving future contribu¬ Unlike Northam, situated 98 km east north east tions from ANZRSA members and others in the of Perth, Midland has direct transport links with both the agricultural country to the north and remaining states.^ Northam’s Wheatbelt hinterland. Midland there¬ Ann Hodgkinson fore developed major saleyards and other agri¬ Tony Sorensen cultural service activities before becoming a David Singe regional centre on the outer edge of the expand¬ ing Perth metropolis.

This helps explain why the Avon region, un¬ usually for an area adjoining a major city, has experienced sustained a substantial population

Regional Policy and Practice v2.1 3 0 100 200 L J Kilometres

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,00 /Coorow --75 . / 50 I / Moora Dandaragan # Koorda • Bencubbin Mukinbudin

Wongan Hills /Midlands Westoma Southern C. ss Lancelin Calingiri Dowerin /. jrayning \ • \ */Wyaikatcnem •\ Guilderton Gingin Bindoon * ' ' / / 50 75 100 125 * Toodyay^oomallin^ Kellerberrin * ■ # Clackline \ Merredin Northam York • / J % XBrucifRocT Perth !8^i7iWi°ui-din5r-■«. •^a.re.rr-d^T* - » >*V ’• Brookto'n^^1^--Kondinin • « • * -X'VXX 'uPPERGREAT Wander,ng • f U 3 '"p wicke^ln- \Kulin Boddington • Williams * .1 SOUTHERN % V. \ V Narr°g|n / / • Lake Grace # ^ x^^Wagin • Dumbl^yung ,

Darkan Nyabing Woodanilling Katanning

Statistical Division Boundary

MAP 1 Main urban centres of the Combined Central region with distances of 25, 50, 75 and 100km superimposed.

Regional Policy and Practice v2.1 loss overall and only very restricted growth in funds to support a Keynote Speaker for the some parts. Other major factors include the event. Concurrently, Lee asked the then region’s narrow economic base, which offers Director of the Institute, Ian Fairnie, to identify declining employment opportunities; its rela¬ a suitable speaker as part of Faimie’s trip to the tively sparse population; the tradition of sending United States of America. students to boarding schools in Perth; and the proximity of central Perth, which offers an Fairnie’s recommended Harry Martin, inviting lifestyle and climate. These lead in turn Executive President of the Community to: Development Foundation (CDF), based in • the perception that the region’s retail and Tupelo, Mississippi. Singe secured $5,000 commercial sectors lack Perth’s range and through the Regional Development Advisory competitiveness; Committee to assist with most of the travel • a poor level of recreational and cultural costs and Lee organised the “Rural activities; Revitalisation’’ conference, held at Muresk in • the perception that the quality and range June 1989. Martin’s presentation inspired the of secondary education in the region is ninety or so participants, as he explained the inadequate; evolution of the CDF over a forty-year period, • a lack of higher and technical education commencing in 1946, demonstrating the need services; for long-term thinking, the importance of • an inadequate range of health services that strategies and the value of periodic, regular re¬ encourages many patients to travel to assessment. Perth. To ensure that some relevant and useful direc¬ Local government administration in the entire tion resulted from the seminar, a series of brief Wheatbelt is Australia’s most fragmented (see resolutions were agreed. The NRPA’s goals Map 2). The Central Region’s population of were to: some 75,000 is served by forty-four munici¬ • promote rural revitalisation based on job palities (two town councils and forty-two shire growth - “the alternative to decline’’; councils). Although the Avon Valiey is the • change people's attitudes to recognise the region’s most densely settled area, its 26,000 need for self investment in local inhabitants are administered by 10 small-scale development; municipalities. Northam has gradually emerged • form development groups, based on iden¬ as a major centre of regional administration. tifiable communities, and employ facilita¬ Twenty-four State Government agencies are tors (these groups were to be multi- represented, many of them at regional office funded community-government partner¬ level, and only in a few instances is the region ships); is administered from elsewhere, usually Perth. • develop education facilities to serve the communities’ interests effectively (the First Steps facilities were to allow both social growth through enhanced compulsory education The 1986-87 rural recession was the catalyst for and skills training for business and significant community-based economic devel¬ industry); opment in the Avon region. Instead of follow¬ • create a chair of Rural Development, ing and accepting the usual “boom/bust” eco¬ based at Muresk, to stimulate and guide nomic cycle, a few people started to discuss development; seriously how to ensure development and the • audit community assets to determine types of changes in attitude and approach re¬ strengths, weaknesses, opportunities and quired to achieve it. Jim Lee, then Business threats and thereby enable logical Manager at Muresk Institute of Agriculture, had approaches to future development; recently become the President of the Northam • seek and develop venture capital; and Regional Promotion Association (NRPA), an • tap expert advice. incorporated body jointly funded by the Town of Northam, Shire of Northam, Northam Representatives from ten municipalities forming Chamber of Commerce and the Western the “natural” Avon region met at Cunderdin in Australian Tourism Commission. He took his August 1989. They endorsed the concept of idea for a seminar to David Singe, Regional creating a plan to overcome the long history of Manager of the Department of State rural depopulation through long-term solutions, Development (then the Department of Regional and established an interim committee - compris- Development and the North-West), seeking ing one representative from each

Regional Policy and Practice v2.1 5 MAP 2 STATISTICAL AREAS WESTERN AUSTRALIA At 30 June 1990

STATISTICAL DIVISION BOUNDARY MIDLANDS

STATISTICAL SUB DIVISION BOUNDARY CAMPiON

STATISTICAL LOCAL area BOUNDARY

TOWN OP THE SAME NAME AS * xrxiRAiS THE STATISTICAL LOCAL AREA

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6 Regional Policy and Practice v2.1 municipality and Jim Lee as chairman - to Experience in Tupelo showed that people would frame a constitution for the Avon Community commute up to 80 km one-way in order to work Development Foundation (ACDF) and set the on a daily basis. In 1988, Singe had drawn up a following four objectives: diagram of the Wheatbelt, applying classical Geography (Weber) showing that an 80 km 1. The creation of quality jobs for present concentric circle approximated the daily ser¬ and future generations. vice/employment limits for travel. Lee and 2. The establishment of centrally located, Singe had discussed this and realised the non-residential industrial parks that would similarities to the Tupelo Plan. provide bases for the diversification of employment opportunities needed in the The ACDF therefore examined the location of region. basic services required for an industrial park 3. To plan and foster educational facilities and investigated potential sites that fitted the ge¬ that will enhance the quality of life of the ographical model. A locality called Meenaar, people of Avon. some 20 km east of Northam, had excellent 4. To actively encourage the provision of access to basic services and the region’s popu¬ quality health care services for the people lation via the Great Eastern Highway, the of Avon. transcontinental railway, the Goldfields and Agricultural Water Pipe and the electricity grid. Development of the Idea The ACDF examined three parcels of land in the area, finally targeting a property that appeared With no funds, but lots of drive and enthusi¬ to have soil types and a drainage pattern suitable asm, the concept of the “City of Avon” and the for well-designed industrial development. ACDF was taken to the community by the interim committee, with Lee at the helm. A Negotiations with the property owners saw the request was made to the Regional Manager of ACDF take out a 2 year purchase option on the the Department of Regional Development and land, for a sum of approximately $800,000. the North West for funds to design a letterhead, Concurrently, in early 1990, the ACDF produce a “City of Avon” map, and furnish arranged to meet with the Premier, then Peter conceptual drawings of an industrial park. This Dowding, to discuss a request for State was successful in October 1989. Steps were Government funding of $1 million to be di¬ also taken to incorporate the ACDF, discuss a rected towards the establishment of the Meenaar funding formula from local government, seek Industrial Park, whose total cost was estimated taxation exemption for donations and to discuss at $20 million. The fate of politics saw ways to achieve the agreed objectives. Using Dowding removed as parliamentary leader of logic and commonsense, the ACDF conducted a the ALP and Dr Carmen Lawrence installed as simple analysis of potential sites, based on the the new premier. She honoured the 21 February Tupelo Plan, as explained by Harry Martin at meeting with the deputation, but it became clear the Rural Revitalisation Seminar. over the next three months that the money would not be forthcoming. In 1945, Tupelo was a town of 7,000, with a hinterland of some 60,000. Northam’s popula¬ ACDF formed a Meenaar Industrial Park project tion in 1989 was 7,000, with a service hinter¬ committee, which included the Engineer from land of a further 20,000. Despite some differ¬ the Town of Northam and a number of regional ences in economic structure and social managers of State Government departments and characteristics, there was sufficient similarity in agencies. Apart from costing infrastructure the two areas to consider transferring the development, it targetted several industries as Tupelo Plan’s philosophy to the Avon Region. potential occupants of the Park. They included The Tupelo Plan saw the location of new beef feedlots; the relocation of the Midlands industries in open-field sites located between saleyards from the eastern suburbs of Perth; existing towns, rather than locating them in the warehousing of agricultural chemicals; the centre of one or other community. This manufacture of noodles, textiles, and fertilisers; locational philosophy was based on maximising metal fabrication, and others. the benefit of the employment to a number of communities, whose residents would not have Selling the Idea to move to obtain work. It effectively reduced the residential mobility of the labour force. About this time, the State Government directed the Industrial Lands Development Authority (ILDA) to undertake studies of regional sites for

Regional Policy and Practice v2.1 7 heavy industry. Kalgoorlie. Geraldton anti need for fundamental change in approaches to kwinana were on the original list. While refus- economic and social development. I he mg to provide $1 million for Meenaar land Department of Regional Development’s acquisition, the Premier advised the A CDF in Director, Dr Wally Cox, was also approached May WO that the Government support would by Lee. Cox was not happy with ILDA’s re¬ he limited to extending ILDA’s terms of refer¬ sponse. He ensured Government recognition of ence to include a preliminary assessment of ACDF’s innovatory thinking through advice to Meenaar. If we take into account ILDA’s hostile the Premier’s office. The CCRDAC had also, views of the Meenaar concept, this represented through the Minister for Regional Development, a large victory for ACDF’s lobbying. The placed pressure on the Minister for Resources General Manager of ILDA reported to the Development to also consider supporting the Under Treasurer in March 1990 that: Meenaar proposal.

“We recently conducted a study of the Despite some top level support, many Perth Northam region to assess its potential for officials had strong reservations about the site. heavy (ie.. minerals based) industry, but After one visit, a senior officer described it as our consultant concluded that there was “a dog of a site”. Other senior public servants, little likelihood of this type of industry who were busily committed to trying to being attracted there. ...we have offered replicate Kwinana on the coast north of Perth, to assist Mr Lee by extending this study held a similar view. Incidentally, Kwinana is to cover a preliminary assessment of the now considered by many to be a visual, proposed Meenaar site location, should locational and environmental failure. the Government approve this sugges- tion.. • yy “In summary, I believe the This is exactly what the Premier chose to do. proposal to be largely the ACDF had indicated it would provide $5,000 to expression of a sense of des¬ assist with any study, providing the findings peration to halt the drift of were made available to it. population from the region, The same piece of correspondence contained particularly by school other interesting observations, including: leavers and other young people, and an anxiety to “do “In summary, I believe the proposal to be something" about it". largely the expression of a sense of des¬ peration to halt the drift of population from the region, particularly by school leavers and other young people, and an In his 1990 annual report, Jim Lee reported his anxiety to “do something” about it”. belief that the most important aspect of ACDF activities had been to educate the public, via the The ACDF held exactly that view, but the press, about ACDF, the “City of Avon” and Manager’s expression of it, in the context of the future needs. He also noted that some Perth letter, was clearly an attempt to prevent any residents were concerned about the city’s commitment to working on the Meenaar pro¬ “limitless” development and the importance of posal. The complexities of lobbying and com¬ giving them an option. Perhaps more notable, munity-driven development process are recog¬ he commented that the method he had used was nised through the concurrent and inter-related to kick shins, bang head and bite ankles. actions of other organisations. “I have been informed by a member of Meenaar was also supported strongly by the the committee that this method has Combined Central Regions Development alienated some sectors of Government but Advisory Committee (CCRDAC), whose func¬ forty years of compliant action has tions was to provide advice on economic and resulted in our present predicament. The social development to the Minister for Regional people of the South West enjoy the Development. Although that committee's mem¬ luxury of having 20 times as much per bership, which included Singe (as chair) and head spent on their development as do the Lee, was drawn from far beyond the Avon people of the Wheatbelt.” region, its unanimous support recognised the

X Regional Policy and Practice v2.1 He was duly re-elected as Chairman. (Kemerton), Kalgoorlie, Geraldton, Karratha and Northam (Albany was included later). This Establishing Meenaar was the first time that Northam had been speci¬ fied as a key centre for industrial development. In November 1990 the Minister for Regional Further, the expected site to the north of Development, The Hon Pam Buchanan, issued suburban Perth was rejected as unsuitable. a media release calling for the development of heavy industry in areas other than metropolitan Within weeks of the announcement, Ashton Perth. This was one sign that changes in policy Mining released a public statement that they had were imminent. The Government had an¬ assessed fifteen sites in Western Australia to nounced that a new Department of State locate a rare earths processing plant, and Development would be formed, merging the Meenaar was their preferred choice, subject to Departments of Resources Development; environmental approval. The irony was missed Economic Development; Trade; and Regional by few. Having generally aimed for industries Development and the North West. This effec¬ which would be value-adding to agricultural tively brought into the same structure, the production, the first serious contender was a senior bureaucrats who disliked Meenaar, and minerals-based industry. The words of ILDA regional staff who were supporting it. The from March 1990 rang in the ears of the ACDF. Minister for State Development was Ian Taylor, Unusually, the Government then had a tenant Deputy Premier and Member for the Goldfields for a site which it approved in principle, which - the first time for several years that an MP it didn’t own (the ACDF still held the purchase from outside the North West of WA held the option) with a well respected company ready to development portfolio. develop there. Much of 1992 was spent unravelling this riddle!

...many Perth officials had strong Two environmental impact assessments were undertaken concurrently: one of the whole of reservations about the site. After the Meenaar site, of approximately 600 one visit, a senior officer de¬ hectares; and the other of the Ashton Mining scribed it as “a dog of a site”. Company portion of the land. Both reviews have received the approval of the Environmental Protection Authority and the decision of the The first major step towards realising Meenaar Ashton Mining Company to proceed should be occurred in March 1991. The ACDF set out the announced in early 1993. Subsequently, Government support it required at a meeting interest has been shown by proponents of a $25 between Minister Taylor, MPs Barry House million noodle-manufacturing plant. (Liberal) and Max Trenorden (National), Jim Lee, and Bob Fisher (Executive Director, In August 1992, the State Government through Regional and Community Development, Landcorp (formerly ILDA) signed an option to Department of State Development). It was purchase the Meenaar site, the simple ceremony agreed that Lee would provide an outline of taking place in the Northam office of State work required for the Meenaar project. The Development. Throughout the process, the Minister offered the support of government ACDF has insisted that the management of the officers to work on various stages of the pro¬ park be the responsibility of a board with a ma¬ ject, with overall co-ordination being the jority of community (non-government) people responsibility of the Regional Manager at and a community resident to chair it. Originally Northam, the Project Co-ordinator (Perth the ACDF has intended to be the owner of the office) and the ACDF. Meenaar site, but agreed that it should be the State, subject to the structure of the Lee provided the outline as required. He later management committee being accepted. The referred to the March meeting as the “turning final details of this are currently being point”. He also stated that “with so many bad formulated. stories abroad about politicians it is a breath of fresh air to witness such co-operation across There was an enormous amount of community party boundaries”. Ian Taylor visited the liaison throughout the development of the Meenaar site in April 1991 and was clearly im¬ Meenaar project, particularly with individual pressed with it. By October 1991 he announced property owners who adjoin the site. Not all are the Government’s policy to develop industrial in favour of the development, but all have been sites in the key regional centres of Bunbury fully informed at all times. The only major fail-

Regional Policy and Practice v2.1 9 urc in the process was a sudden imposition by THE AMALGAMATION OF THE the Environmental Protection Authority ot a 1 KALGOORLIE AND BOULDER kilometre non-residential development COUNCILS IN WESTERN boundary around the perimeter of the industrial AUSTRALIA park. This had a detrimental impact on the future land-use options of adjoining farms. Ian Cowie Given that less than 50 percent of the Meenaar Principal Policy Officer, WA Government site is intended for development (the balance includes fenced-off remnant vegetation or will Australia’s major regional centres are often di¬ be landscaped), the 1 kilometre boundary was vided communities, with more than one local seen by all involved parties as an affront. It was council presiding over the domain. Often seen as the only decision which had been made without a major obstacle to regional behaviour and iden¬ direct community involvement and the only tity, local government is not always as en¬ decision to cause ill-feeling. It has since been trenched as it may appear. The City of overturned.* Kalgoorlie-Boulder is now testimony to changes of attitude.

FACTS AND FIGURES #1: Introduction A Miscellany of Australian Growth Characteristics and Prospects up to In recent years there have been widespread 2001 moves to amalgamate local governments. Some notable examples include Queensland and This material was compiled by Derek Kemp Tasmania, where the State Governments are (Queensland Department of Business, Industry supporting amalgamations. Victoria represents and Regional Development) from reports issued another State where there has been a push for by the Queensland Government Statistician’s local government amalgamations. Here, attention Office and SEQ 2001. has recently focussed on the Geelong region. However, these moves have been met by Growth Sectors widespread resistance from local government.

1 Queensland's fastest growing business In Western Australia, the State Government has sectors in output terms over the four years indicated no desire to force local government to 1995/96 are expected to be: amalgamations. However, in this policy envi¬ ronment, an amalgamation of two Western Sector Percentage Australian councils recently occurred. This paper Growth Per describes the historical background to the 1989 Annum amalgamation and details its ramifications.

Communications 4 Events Leading To Amalgamation Recreational, personal and other services 4 Local government amalgamations and boundary Transport and storage 3 changes have been quite common in the Community services 3 Goldfields region of Western Australia. These changes can largely be attributed to the demo¬ Queensland’s export growth will graphic changes which occurred in association strongest in: with the booms and busts in the region's mining industry. Sector Percentage Growth Per The impetus for the amalgamation of the town of Annum Kalgoorlie and the Shire of Boulder began in 1986 when two local businessmen launched the Community services 14 “One Kalgoorlie” movement. In response to this Communications 10 movement, both councils decided to support an Recreational, personal investigation into the advantages and disadvan¬ and other services 8 tages of amalgamation. Howeverv while this Wholesale/retail trade 7 study was slow to commence, political lobbying for the proposal continued to occur.

I 0 Regional Policy and Practice v2.1 This lobbying bore fruit on November 13, 1988 unanimous agreement from councillors, ex¬ when meetings of both the Kalgoorlie and councillors, council staff and the public that the Boulder Councils were held. Both of these planning for amalgamation was inadequate. The meetings extended past midnight. At approxi¬ resulting administration was seen as disorgan¬ mately 1.20 am, unification motions were ised and inexperienced. There was also limited moved and carried simultaneously in both consultation with the staff of the Kalgoorlie and Council meetings. The Boulder meeting carried Boulder councils which created considerable the motion unanimously while the Kalgoorlie uncertainty and disquiet. meeting carried the motion by nine votes to one. The investigation had still to be completed. There were a number of specific problems cov¬ ered by the speed of amalgamation. These included the need to prepare interim budgets and The impetus for the amalgamation conduct multiple audits because the amalgama¬ tion did not occur at the end of the financial year; of the town of Kalgoorlie and the the existence of incompatibilities between the Shire of Boulder began in 1986 accounting and computer systems of the two when two local businessmen councils; the lack of a thorough audit of the launched the “One Kalgoorlie” books of both municipalities before the amalga¬ mation occurred; and the inconsistent policies movement. and by-laws operating in the two council areas at the date of amalgamation.

The Councils set February 1, 1989, as the date Improving The Process for unification and established a Co-ordinating Committee to progress a multitude of matters While local environmental and political consid¬ relevant to the merger, such as appointment of erations will determine whether it is appropriate staff, the identification of office accommodation to conduct a referendum before a voluntary and the like. This Committee held its first meet¬ amalgamation of councils occurs, the appoint¬ ing on December 2, 1988, and met four further ment of a Commissioner to administer any times in the following eight weeks. The councils which voluntarily decide to amalgamate Committee was chaired by the permanent head in the future would appear desirable. The of the Department of Local Government with the Commissioner should ensure the continuing Shire Clerk of Boulder acting as Co-ordinator. operation of all normal council functions, but, in addition, undertake the task of amalgamating the The Committee decided that a combined council bureaucratic structures in an organised way. of 26 members would operate until the annual local government election date in May 1989. The appointment of a Commissioner means the After the election, the new City of loss of locally elected representatives and a Kalgoorlie/Boulder would be served by 13 reduction in local democracy. However, it is councillors. suggested that the Commissioner ask all former councillors to join an advisory body or bodies to The Need For Haste provide local input and assistance and the Commissioner consult with the general public In contrast to the difficulty in getting the amal¬ and inform them of developments in the amal¬ gamation study started, the decision to amalga¬ gamation process on a regular basis. In this mate and the actual amalgamation occurred was way, local community input to the decision generally supported by both the people involved making process will be maintained. in promoting the unification and the residents of Kalgoorlie themselves. There was widespread feeling that if the amalgamation decision had ...the appointment of a been put to a public referendum, the proposal would have been defeated, particularly by Commissioner to administer any opponents raising fears of rate increases. councils which voluntarily decide to amalgamate in the future would Problems With Amalgamation appear desirable. While the speed of amalgamation was widely supported as essential, the haste created numer¬ ous administrative problems. There was almost

Regional Policy and Practice v2.1 11 To avoid financial inefficiencies, it also appears THE PILBARA 21 REPOR1 vital that amalgamation occur at the beginning of ANOTHER PIPE DREAM ? the financial year (July 1). In such circum¬ stances, it is argued that the amalgamation Stewart Houghton, process would occur much more smoothly.* Department of Geography, University of Western Australia

Stretching from Exmouth Gulf in the west to the edge of the Great Sandy Desert in the east, • Please let us know what you the Pilbara region of Western Australia is one of think of this issue and how it the most isolated in Australia. From an economic perspective, however, it is also one might he improved. The address is of the most important. Exports of iron ore are on page 1. currently valued at almost $3 billion per annum, while exports of liquefied natural gas to Japan • VVe would like to start a worth almost $1 billion - are expected to increase significantly in the next few years. 'Letters to the Editor' column in Despite the on-going development of the North the next issue. If you feel strongly West Shelf Gas Project, however, development about any issue raised in this issue in the region has slowed significantly since the - you like it or hate it! - please construction phase of iron ore mining ended in the early 1970s. The vision of a major industrial write letting us know. You are complex developing in the Pilbara based on also welcome to send letters local raw materials ( iron ore, natural gas and commenting on any topical aspect salt) quickly faded and the latest census put the of regional policy or practice - or total population of the Pilbara Statistical Division in 1991 at no more than 48,400, of indeed your daily work. whom almost 10 percent were ‘visitors’.

• We are constantly looking for In July 1991, the government of Western copy for the next issue. Please Australia authorised a comprehensive study of the Pilbara aimed at identifying, (a) future eco¬ submit short items like those in nomic development opportunities in the Pilbara, this issue to any of the editors. with particular reference to downstream pro¬ The last issue focused on cessing; (b) the future infrastructure require¬ Queensland and this looks at ments of industry in the region; (c) the educa¬ tional, health and other social needs of local Western Australia. What is communities in the Pilbara; and (d) more effec¬ happening in Canberra, or Sydney tive means of improving communication or Melbourne. Even if policy and between residents of the region and all levels of practice are virtually dead, we government. In addition, the study was required to address the question of land use would like to know whv!! conflict in the Pilbara and to prepare land use plans for two specific areas - the Burrup • What, for that matter, should peninsula and the Central Pilbara (Steering the RSA do to improve the way in Committee, 1992). which regional development The resultant document - Pilbara 21: Final policy is developed and sold to Strategy Report - which was presented to the government or the private sector? Minister for State Development in June 1992. consists of three sections: Part 1 provides an overview of development in the Pilbara to date: • This is your opportunity to Part II focuses on the problem of attracting sec¬ have vour sav. Don't miss it! ondary processing activities to the region, land use conflict and social issues; and Part III outlines a wide ranging series of objectives, together with strategies designed to achieve them. Specific land use proposals for the Burrup peninsula - the site of Woodside’s on-

I 2 Regional Policy and Practice v2.1 shore gas liquefaction facilities - and the Australian Iron Ore Consultative Council aimed Central Pilbara are contained in separate at reducing the number of industrial disputes Attachments. Although the Report adopts an (Thompson, 1987). overall time-frame of thirty years, it foreshadows many of the recommendations Although the prospect of further industrial being implemented within two years. development was originally affected by deci¬ sions of the State and Federal governments, a The following paragraphs briefly review the number of reasons continue to make the devel¬ main conclusions and recommendation of the opment of secondary processing of raw material Report, with particular reference to the devel¬ in the Pilbara unlikely (Linge, 1980). These opment of downstream processing, the need for include: a high level of dependence on overseas the land use planning in the Pilbara, and the es¬ markets, reliance on public sector investment tablishment of a Pilbara Development for infrastructure development, the financial and Commission. administrative complexity of such an undertak¬ ing, the cost of attracting labour to the Pilbara, Downstream Processing and the alleged unwillingness of investors to locate manufacturing facilities in remote single- Following the development of the export iron industry towns. Pilbara 21 also identifies a ore industry in the late 1960s, the discovery of number of additional constraints, including high commercial quantities of natural gas off the energy costs, delays in the project approval Pilbara coast in 1971 significantly altered the occasioned by Aboriginal heritage legislation perception of the region’s economic potential (currently under review), the impact of the and led to speculation that a major industrial Fringe Benefits Tax on companies providing complex might soon be constructed in the subsidised housing to employees, and the high Pilbara (Pilbara Study Group, 1974 ). level of industrial dispute which characterised However, as a result of disagreement between the Pilbara iron ore industry in the late 1970s State and Federal governments over the control and early ‘80s. of off-shore resources and rapidly changing economic circumstances, further industrial de¬ As the Report acknowledges, the constraints to velopment failed to materialise. In a subsequent economic development and downstream pro¬ analysis, Linge (1980) argued that, although cessing can be readily identified. The difficulty some processing of raw materials (such as ore is implementing effective strategies to overcome beneficiation and gas liquefaction) might take these constraints’ (Steering Committee, place, the development of manufacturing activi¬ 1992,p. 16). Hence, the Report makes only two ties in the Pilbara was never likely to occur. specific recommendations with regard to Similarly, using a more theoretical approach, downstream processing industries. These relate Harman (1981) predicted that the Pilbara would to the establishment of a Pilbara Energy and become locked into its role of raw material Gas Authority, aimed at using natural gas either supplier, dependent on external sources of for electricity generation or direct mineral pro¬ capital and technology. cessing, and the need to review the secondary processing provisions of the various resource During the 1980’s, however, a number of development agreement acts (see Wade, 1987). changes have taken place in the Pilbara iron ore On the crucial question of labour costs - which industry. In 1980, the two existing energy- it claims are 30-50 percent higher than in Perth intensive pelletising plants in the region closed - the Report appears to see new enterprise and producers faced increasing competition bargaining agreements as offering a possible from Brazil and other sources. As a result, the solution. Pilbara iron ore industry has recently undergone a significant degree of rationalisation. With the Despite the existence of numerous constraints, take-over of Goldsworthy Mining by however, Pilbara 21 takes an optimistic view of Goldsworthy, the number of companies operat¬ the region’s economic future. This is based ing in the area has been reduced from four to partly on a predicted shortfall in steel-producing three, port facilities have been up-graded, the capacity of 33.3 million tonnes in East and size of the mining industry workforce has been south-east Asia by the year 2000. But the main substantially reduced, new work practices have reason why the Pilbara is seen as having a been introduced, and producers have made ‘second opportunity' to expand into down¬ strenuous efforts to reduce their dependence on stream processing at present relates to the ‘great Japanese demand. In addition, the Federal and improvement' said to have occurred in State governments helped to establish the West

Regional Policy and Practice v2.1 13 industrial relations over recent years (Steering the government are clearly anxious to avoid a Committee, 1992,p.21). repeat of the situation which delayed approval of the new mine at Marandoo. Unfortunately, this argument has become diffi¬ cult to sustain in the light of subsequent events. According to the Report, mining leases cur¬ Soon after publication of the Report, a two- rently account for approximately 30 per cent of week strike over the employment of non-union the Central Pilbara and concern about the status labour disrupted Hamersley Iron’s operations, of existing mining tenements, particularly those followed by a walk-out of workers at Shay Gap lying within the boundaries of the National over BHP’s decision to replace them with con¬ Park, clearly lies behind the proposal to develop tract labour. Further industrial unrest has also a comprehensive land use plan for the area. occurred among workers employed by Robe Indeed , in the longer term, the Report advo¬ River Iron Associates, following a protracted cates the establishment of land management dispute in 1986 which, at the time, some ob¬ plans for the whole of the Pilbara, based on servers interpreted as signifying the beginning agreements worked out between various of a new phase of capital-labour confrontation ‘special interest groups’ (pastoralists. in the Pilbara (Thompson, 1987). Aborigines, mining companies, and representa¬ tives of State and Local Government). Although the Report places great faith in the concept of ...the main reason why the multiple land use (ie. zoning), it remains to be seen whether this approach, using the Decade Pilbara is seen as having a of Land Care project in Western Australia (Soil ‘second opportunity’ to expand Conservations Council, 1992 ) as a model, can into downstream processing at prevent further conflict from occurring. As the present relates to the ‘great im¬ Report itself acknowledges, decisions regarding mining and other forms of land use ultimately provement’ said to have occurred involve political considerations which, in most in industrial relations over recent cases, can only be resolved by the government vears. of the day.

Although the Report supports the concept of Thus, despite the existence of high-grade natu¬ ‘sustainable’ land use, it clearly places a ral resources and the region’s proximity to premium on mining and industrial development. Asia, most of the obstacles to the development Thus, Pilbara 21 not only recommends that land of secondary processing of raw materials in the use planning should take account of the needs Pilbara remain. In addition, the findings of the of future industrial development but also evalu¬ recent Royal Commission into government ates a number of potential sites for future heavy dealings in the 1980s may also have tarnished industry. It concludes that none of the three Western Australia’s reputation as a ‘safe’ area sites examined (Port / South Hedland, Dampier for investment. At a time when the world / Burrup Peninsula and Dixon Island / Cape demand for steel is falling, the prospects of a Lambert) offers a clear advantage over the major steel-making plant being established in others. However, the need to preserve a rail the Pilbara seem as far away as ever. access corridor to a potential new deep-water port on Legendre Island appears to lie behind Land Use Planning the land use zoning proposal put forward for the Burrup peninsula. At first sight, it may seem curious that more than a quarter of Pilbara 21’s 80 pages should The Pilbara Development Commission be devoted to potential land use conflict in such a sparsely populated region as the Pilbara. The The most important recommendation of the explanation lies mainly in recent attempts by Report relates to the establishment of a Pilbara Aborigines and conservation groups to prevent Development Commission, charged with the Hamersley Iron developing a new iron ore mine task of implementing the other recommendation on the edge of the Karajini National Park in the of the Report and with promoting economic and central Hamersley Ranges (Environmental social development in the region. Pilbara 21 Protection Authority, 1992). Since the mine is also recommends that, foremost among the only the first of a second generation of iron ore tasks of the new Commission should be: com¬ mines likely to be developed in the area over the pletion of a feasibility study into the establish¬ next twenty years, both the mining industry and ment of a Pilbara Electricity and Gas Authority;

I 4 Regional Policy and Practice v2.1 the establishment of ‘an integrated tourist devel¬ ment in Australia should treat the Pilbara as a opment strategy aimed at broadening the ‘developing region’, warranting special consid¬ economic base of the region’; and the estab¬ eration in terms of zone allowances and taxa¬ lishment of a local Employment and Training tion. As such, the Report should be viewed as a Unit ‘to provide industry with a skilled local political document, rather than an objective workforce which can respond to opportunities analysis of the region’s development potential. as they arise’ (Steering Committee, 1992, In adopting such a strong ‘pro-Pilbara’ Executive Summary). approach, however, it runs the danger of losing touch with current economic realities. Despite In all, the Report list over 100 proposals requir¬ an apparent decline in trade union power ing ‘immediate action’. They range from ascer¬ (Thompson, 1987), it is difficult to justify the taining the economic viability of pearling and optimism shown in the Report about the other aquaculture activities off the Pilbara coast region’s ability to attract secondary industry. and monitoring the effects of tourism on the On the other hand, the Report is probably physical environment, on the one hand, to correct in identifying tourism as offering the promoting the concept of energy-sensitive best prospect of broadening the region’s current design of buildings and improving access to narrow economic base.* child and day care facilities in the region on the other. Clearly, implementation of many of the NOTE recommendations will require additional fund¬ ing and rely heavily on the goodwill and 1. The Pilbara Development Commission resources of other government agencies. Bill was approved by the Western Australian Parliament on 4/12/92.

A fundamental argument of the REFERENCES

Pilbara 21: Final Strategy Report Environmental Protection Authority (1992), Marandoo is that higher levels of govern¬ Iron Ore Mine and Central Pilbara Railway: ment in Australia should treat the Report and Recommendations of the Environmental Protection Authority, Pilbara as a ‘developing region’, Environmental Protection Authority, Perth. warranting special consideration Harman, E J (1981), Ideology and mining development in terms of zone allowances and in Western Australia, 1960-1980, [in] Harman, E J and Head, B J (eds). State, Capital and taxation. Resources, Nedlands, University of Western Australia Pess, 167-196. Linge, G J R (1980), From vision to pipe dream: yet Given that the Act establishing the Commission another northern miss, [in] Jennings, J and contains a sunset clause restricting it to a life of Linge, G J R (eds.). Of Time and Place, five years, critics may legitimately question the Canberra, ANU Press, 285-296. Pilbara Study Group (1974), The Pilbara Study. ability of the Commission to carry out many of Canberra, AGPS. the recommendations within this time-frame. In Soil Conservation Council (1992), Decade of Land Care the environmental sphere, for example, the Plan: Western Australia. Perth, Soil and Environmental Protection Authority in Western Conservation Council of Western Australia. Australia has recently drawn attention to the Steering Committee (1992), Pilbara 21: Final Strategy lack of basic data on which land management Report, Perth. decisions in the Pilbara can be based Thompson, H (1987), The Pilbara iron ore industry: (Environmental Protection Authority, 1992). mining cycles and capital-labour relations. Thus, the establishment of a detailed land man¬ Journal of Australia Political Economy, 21, 66- agement plan for the Central Pilbara alone 82. Wade, R (1987), Resource development agreements in appears to represent a major undertaking. Western Australia, [in] Parker, P (ed.). Resource Despite slogans like ‘Pilbara solutions for Development and Local Government: Policies for Pilbara problems’, nearly all major policy Growth, Decline and Diversity, Canberra, AGPS, decisions affecting the region will continue to 95-99. be made elsewhere.

Conclusion

A fundamental argument of the Pilbara 21: Final Strategy Report is that higher levels of govern¬

Regional Policy and Practice v2.1 15 NARROGIN ENTERPRISE CENTRE FACTS AND FIGURES #2: A Miscellany of Australian Growth Carol llardie, C haracteristics and Prospects up to Enterprise Consultant, Narrogin Enterprise 2001 Centre, WA.

Small Business The Narrogin Enterprise Centre was established in February 1989 and was the first such centre • Small businesses account for 97 percent set up in an inland town in Western Australia. of all establishments in Australia and Current funding is received under the Local Queensland Enterprise Centre Program through the Depart¬ • The sectors with the fastest growing ment of Commerce and Trade. There are now' number of small businesses between 24 centres operating throughout the State, with 1983-4 and 1989-90 were in the service several new ones to be established shortly. As a sector: finance, community services, measure of the program’s success, Narrogin construction and recreational services statistics for the period February 1989 to • Small businesses account for 48 percent December 1992 have been 2438 contacts, 100 of the national workforce, but only 41 new businesses assisted, and 193 jobs created percent in Queensland. These rates have for new and existing business. been fairly constant since the mid 1980s. First, what do we do? We help people turn their Self Employment business ideas and dreams into realities. We are not under the illusion, however, that our • A higher proportion of Queenslanders are clients, with or without us, would get their slef-employed than nationally - 16 business ideas up and running. We believe that percent as against 12 percent. we make it easier and quicker. We also help • Self employment in Queensland small those people already in established businesses. business grew at twice the national rate - 6.6 percent as against 3.9 percent - in the six years to 1989-90. As facilitators we are not special¬ • Self-employment in Queensland rose fastest in the services sector over the six ists in anything. We are general¬ years to 1989-90: community services ists who know a little about a lot (11%), construction (9%) and financial of things. services (9%).

Financial and ‘in-kind’ support from Local Government is a key feature of this program and at Narrogin we have both Town and Shire Council representatives as members of our Management Committee. As Facilitators The 1993 National Conference /Development Officers/Enterprise Consultants we answer to anything - we operate under a of the Australian and New local management committee which is made up Zealand Regional Science of Local Government, business and local community service clubs representatives. Each Association will be held in centre is unique, operating towards its own Armidale, NSW on the 6th to particular community and region needs, whilst each facilitator has their own differing 8th. December inclusive. personality and individual flair. The flexibility Please pencil this date in your of the position makes it very exciting and rewarding. As facilitators we are not specialists diary as there will be three in anything. We are generalists who know a days of practitioner-oriented little about a lot of things. We refer clients to workshops and seminars. professionals for specialist advice. Details will be circulated later. Most of our clients belong to the small picture. They may be a one person operation, a husband

I 6 Regional Policy and Practice v2.1 and wife team, or a couple of friends who have LOCAL DEVELOPMENT INITIATIVES got together with a business idea. Generally, IN THE MID-ATLANTIC REGIONS our clients have little capital and limited ability OF THE U.S.A. to access finance. We, therefore, must be innovative in helping them. Ann Hodgkinson Department of Economics, University of When a client comes in, we help with whatever Wollongong assistance or advice he or she needs. The degree of help depends on what the client is Introduction looking for. We cover all aspects of small business. It could be marketing, researching an This article describes some of the activities idea, pro-motion of a product, advertising, being undertaken in cities in the mid Atlantic business plan-ning, alternative products, regions of the U.S.A. by local development product presentation, packaging, business agencies. The cities of Baltimore, Philadelphia viability, import or export information, ideas on and Pittsburgh were united in 1989 as part of a accessing finance, helping to break down study tour under the Commonwealth government bureaucratic barriers, networking, Government’s innovations in local government and so on. Most impor-tantly, we are an program. information service that is very flexible and adaptable to suit each individual client. It is All three cities had suffered major losses of important for us to think laterally and to be able individual employment in the past decade result¬ to think on our feet. If something doesn’t work, ing in both rising unemployment and urban we find another option. decay. With very little Federal support avail¬ able, local initiatives had to be developed We are reactive, only working with a client we arising from local government, business he or she approaches us for help. I always tell associations and charitable foundations. While clients that if they work 100 percent then so will the scale of the projects developed in these cities I. If they stop, so do I. The motivation and would be beyond the scope of the average driving force always comes from the client. It is regional organisation in Australia, they provide their business idea, never ours. It is also our some idea of what local knowledge and role to be aware of and access any government imagination plus co-operative public and private financial assistance that is available. Any avail¬ sector efforts can achieve. They thus typify the able schemes are considered ‘tools of the trade’, ‘self-help’ approach which lies behind many enabling us to offer a wide and varied service. local economic initiatives in our regions today and hence may help ‘lateral thinking’ practitioners in their search for new solutions. It is important for us to think laterally and to be able to think on our feet. If Not-for-Profit Corporations something doesn’t work, we find another option. This was the most common form of organisa¬ tion used to implement local economic initiatives in the United States. It was also being increasingly adopted in Canada. Not-for-profit Success is variously measured by different corporations were being established by local people. Some clients may only require a very governments, private sector organisations, small amount of assistance. It may be to find churches and community organisations, social out how to register a business name. Another research groups and most particularly when a client may come to us while their idea is still project was being implemented involving more floating around in their head and we will work than one of these groups. The size of these with them from the beginning through to the up corporations could vary from two or three and running stage. employees to larger organisations with over 50 employees. We are at the grass roots level. We offer clients the opportunity to explore totally their business Each city visited had a multitude of these corpo¬ idea and all the options that surround it. We are rations. It was striking that each tended to be a sounding board. We help them weave their limited to a single mission and they were seen way through the maze of barriers that are out very much as the implementation authority and there, making sure that, if at all possible, their not a policy-making or strategy development idea or dream will become a reality. body. That role rested either with the city

Regional Policy and Practice v2.1 17 government or the private sector association • Baltimore Economic Development who then established a separate corporation to Corporation (BEDCO), Baltimore, implement aspects of their program. Maryland. Interesting aspects of this corpo¬ ration include it providing a ‘one stop shop’ for new firms interested in establishing in the area although its primary focus was on It was striking that each tended to retaining local firms and assisting them to be limited to a single mission and grow. Although fully owned by the City of thev were seen very much as the Baltimore, it worked closely with the State implementation authority and not Government and the private sector. It has also been involved in the redeveloping of old a policy-making or strategy industrial buildings using of Federal grants. development body. • Baltimore Inner Harbour Development Corporation, Baltimore, The structure of the not-for-profit corporation Maryland. This is a small development cor¬ varied depending on its mission. The most poration, solely responsible to the City common form was to have a Board which was Council which oversees the inner harbour representative of both private and public sector and other major development projects in interests. They might also include small busi¬ Baltimore. Actual redevelopment and con¬ ness, union and community sector representa¬ struction activities were undertaken by the tives. The Board was ultimately accountable to private sector. The strategy plan for the the organisations that owned the corporation, redevelopment was produced by the Greater which might be a foundation, the local council, Baltimore Committee of private business or the chamber of commerce. However, in executives and then adopted by the City practical terms, the Board and the Chief Council. It involves the redevelopment of an Executive Officer were responsible for the abandoned wharf area involving retail and activities of the corporation. hospitality activities, educational facilities and historical tourist attractions. There were various reasons for using this form of organisation but one of the most telling was • North Side Civic Development its acceptability by the private sector. A not-for- Corporation and East Liberty profit corporation stood outside normal public Development, Inc. Pittsburgh, sector procedures. In this way it could deal with Pennsylvania. These corporations undertake private sector and community interests in a development activities which link economic direct fashion and on normal commercial terms development and social development in order outside real or perceived ‘bureaucratic delays’. to undertake neighbourhood revitalisation By having a single mission, it meant private projects. North Side has been involved in sector representatives could become involved in packaging finance from various private and projects they had a real interest in without public sources resulting in the construction having to also spend time on less consuming and operation of a training centre and incuba¬ items thus maximising the effectiveness of their tor centres. East Liberty has concentrated on time. providing support to local enterprises and training for young unemployed people in the For the local councils, benefits from efficiency area and has relied more heavily on local. were also important. The structure also meant State and Federal funding. they could lever in funds from outside sources for projects most particularly by being able to offer taxation benefits to private investors. By Integration of Social and Economic being involved in a not-for-profit corporation to Issues develop an area for example rather than simply selling the land, councils were able to ensure Social and economic problems were perceived developments occurred which were in confor¬ as different aspects of the one issue in the inner mity with their vision as to the future of the city neighbourhoods of these cities. Although dif¬ and to maintain ultimate control over the ferent agencies are responsible for economic process through the Board. development, housing, infrastructure improve¬ ments and employment access programs, they Examples of not-for-profit corporation include: worked together on specific projects. Most importantly, it is recognised that an emphasis

I X Regional Policy and Practice v2.1 on one issue alone would not be able to overcome the massive problems of these The function of these associations was to act as neighbourhoods. the private sector policy input into developing local economic development strategies. They An example of this integrated approach were responsible for undertaking the research occurred in Baltimore in a redevelopment and proposing strategy for issues felt to have project involving the renovation of housing for highest priority in the local economy. The low income families. As part of the renovation, process for setting the agendas for these asso¬ the Baltimore Office of Employment ciations trended to vary among cities. In Development was able to combine small Baltimore, a strategy plan was produced shops/workshops premises and a child-care providing for the staged redevelopment of the centre in the building, creating some employ¬ inner city area. In Philadelphia, the agenda ment opportunities. Training programs were tended to reflect current issues eg. a new provided to single mothers in the project to convention centre, improved cleansing, ready them for return to the workforce while rehabilitation of the rapid transit system, employment access support was given to the improved vocational training. In Pittsburgh adult male members of these households. The where the Allegheney Conference has been City also provided better quality infrastructure in existence for some 40 years, the agenda has and services to the project. sometimes been reactionary responding to immediate problems while at other times a Another example is The Enterprise comprehensive growth strategy has been Foundation in Columbia, Maryland which developed. The agendas tend to reflect was established as a not-for-profit corporation ‘enlightened self interest’ that is, issues felt to by a property developer. The foundation estab¬ be important for general business prosperity in lishes job training and employment centres by the city. packaging funds from local. State and Federal governments and private sponsors. As well as Having decided its priorities, the association assisting people to find jobs, it provides then lobbied local government to accept these volunteer ‘mentors’ to support job seekers both projects. In Baltimore this led to the City before and after placement which has adopting the Association’s Strategy Plan for the dramatically increased retention rates. Inner Harbour Development. In Pittsburgh, it led to an effective partnership between the City In addition, it sponsors low income housing and the private sector where they jointly lobbied projects run by partnerships of churches, the State Government to adopt the Pittsburgh neighbourhood groups, local government and Legislation package which has been instrumen¬ private firms which acquire and rehabilitate tal in the redevelopment of the urban area of the housing and then sell them to low income city in the post-war period. In Philadelphia, the households on a lease-purchase arrangement city has adopted the convention centre proposal. facilitated by low interest loans. However the association has also funded some projects such as vocational training itself. Business Development Committees

Three of the cities visited had business associa¬ tions established in order to promote local eco¬ The agendas tend to reflect nomic development — The Greater ‘enlightened self interest' that is, Baltimore Committee, The Greater issues felt to be important for Philadelphia First Corporation and the general business prosperity in the Allegheney Conference for Economic Development (Pittsburgh). These business city. associations were separate from the Chambers of Commerce, although significant cross mem¬ bership occurred. They were composed of the The associations also act as a channel through Chief Executive Officers of the major finns in which private sector contributions to projects the area. Significantly, the Chief Executive can be accumulated and directed towards those Officers had to attend in person, no substitution projects given priority by its programs. The was allowed. Each member firm contributed a ability to contribute some funding to priority subscription which was used to cover, the projects greatly improved the lobbying capacity operational costs of the association and to fund of the associations and their success in having its projects. projects implemented.

Regional Policy and Practice v2.1 19 Devolution of Local Responsibility Similarly centres established by the Enterprise Foundation in Washington, Baltimore and Some of the Cities visited have devolved, if not elsewhere are largely run by local committees, policy formulation, at least responsibility for and responsible for raising their own funding strategy negotiation and implementation of their which provide training, employment search local development programs to the local neigh¬ assistance, job counselling and individual bourhood level. This approach was encouraged support for disadvantaged people in these by the existing Federal Grants programs which communities. provided few guidelines for projects but rather allocated monies on a needs formulae and left local communities to spend it as they thought appropriate. This was developed into a philoso¬ phy based on the conception that local groups will be more aware of what is needed in their areas than central authorities and what types of projects will bring in local resources such as contributions and investment by local businesses and employment for local people. Tony Sorensen and Roger Epps The federal programs, particularly the (Department of Geography and Community Development Block Grants, Planning, University of New have been used by a number of Community England) have a edited and con¬ Development Corporations established in the neighbourhoods by the City, and local tributed to a forthcoming book churches, activist groups or chambers of com¬ entitled Prospects and Policies merce to undertake projects relevant to their for Rural Australia to be pub¬ areas. In the United States these projects have lished by Longman-Cheshire. The been usually real estate based eg. housing reno¬ vation, office blocks, community facilities, or first section examines significant incubators. The grants can be used to lever in processes and constraints affect¬ private investment via tax credit concessions. ing non-metropolitan communi¬ ties. Several chapters consider A pro-active position in relation to local com¬ munity involvement has been adopted by the economic, social, political, envi¬ City of Pittsburgh. The City has a strong sense ronmental, and regulatory issues. of neighbourhood identification and active The next section focuses on cur¬ resident groups. These have been actively rent problems, developments and involved in the strategy planning process for their neighbours and generally major new policies involving transport, developments are only allowed to proceed if agriculture, mining, tourism, they can demonstrate local support. This towns, and service deliverv. A procedure applies to public sector as well as conluding section considers pos¬ private sector projects. sible policy alternatives and The neighbourhood planning groups are funded responses. by the City. They must show a willingness to negotiate within the agreed strategy for the neighbourhood. The Pittsburgh neighbourhood groups have adopted a pro-development stance but have used their negotiating powers to obtain concessions particularly in the areas of preser¬ vation of housing stock, additions of lower income housing and community facilities. A master-plan for the City of Pittsburgh was suc¬ cessfully negotiated. Problems in ensuring the neighbourhood associations are, and remain representative of the whole community continually arise.

20 Regional Policy and Practice v2.1 COMMUNITY ECONOMIC ANALYSIS TPA is concerned with two concepts, namely potential sales, which is the dollar value of sales Rod Jensen which can be expected to occur in the region or Ann Hodgkinson community, of a particular commodity or group of commodities, and actual sales which is the [Editors Note: This article contains extracts actual dollar value of the sales which takes place from a paper presented by Rod Jensen at last in the region. If actual sales are less than poten¬ December s Regional Science Conference in tial sales, then some escape expenditure or leak¬ Ballarat. While the full paper covered a range of age is occurring, and we can measure the extent possible community economic analysis tech¬ of this leakage. If the potential sales as niques, we have included here those which may estimated are larger than the actual sales, some be less familiar to practitioners but which, we of the market of other regions or communities believe, could be relatively easily adopted in the has been captured locally. So trade potential field without specialist economic training. capture is estimated as: These techniques are particularly useful when analysing issues related to service industries Trade Actual sales of commodity(ies) such as retailing. Professor Jensen is at the potential = - Department of Economics, University of capture Potential sales of commodity(ies) Queensland.] A number of ways of estimating the potential Introduction sales of a commodity exist, from surveys of the population, to modelling to informed estimates. This article provides a brief introduction to One simple method would be to take the Community Economic Analysis (CEA). It is an Australian Bureau of Statistics Household attempt to draw from the experiences of Expenditure survey for average expenditure on analysts working at the ‘small economy’ level, each item and multiply this by the number of which would normally be termed either the households in the region under study. The regional economy or the community economy. number of households is available from the CEA has started from rather modest Census at very detailed levels. If necessary, beginnings, and has progressed to the stage expenditure on each item can be updated using where it is beginning to assume some the consumer price index. Actual sales levels professional form and recognition, as a field of would need to be obtained from local traders. study worthy of interest in its own right. It is not intended as a manual for CEA, but simply to provide some indication of the range of Market area analysis is intended possible applications of CEA and to provide some insights into the potential value of CEA to to identify the main characteris¬ the development practitioner. tics of the local market and make comparisons with other markets Market Area Analysis

Market area analysis is intended to identify the Trade area analysis should ideally be main characteristics of the local market and undertaken for both goods and services, and at make comparisons with other markets, and to as detailed a level as possible. For example if use these characteristics in an organised way to the potential sales of furniture locally is improve the local market. We customarily estimated at $1.5m annually and the actual sales identify three approaches to market analysis. amount only to $1.2m, the trade area capture These are discussed in turn. will be 1.2/1.5 = 80 percent. This means that only 80 percent of local market has been Trade Potential Analysis exploited, and that about $300,000 worth of furniture sales has been lost to the region. Trade potential analysis (TPA) is designed to assess the performance of a community or Trade Area Capture Analysis region in exploiting its own market and the markets of other regions. In other words how Trade Area Capture Analysis (TACA) can effective are the local firms, shops etc at captur¬ provide an estimate of the number of customers ing their own markets and those of nearby actually drawn to a community. TACA essen¬ areas? tially assumes that local people have the same

Regional Policy and Practice v2.1 21 purchasing patterns as the state or national aver¬ lation, and that there could be an opening for a age, provided that income levels are the same, new firm in that industry. If the LQ is greater hut will change if regional income levels are dif¬ than the one, it indicates a level of specialisation ferent for the national average. TACA is carried in the local industry in that it is supplying not out by estimating ‘customer equivalents’ by only the local market but some other markets as dividing local sales of a commodity by the state well ie. that it is exporting. LQs are regarded as or national per capita sales adjusted by relative fairly rough measure for a number of reasons, local income. but could have a use in this type of application if used carefully. LQs have a critical value of Trade Actual retail sales of commodity X one, and require careful interpretation ami = particularly in the range of .75 to 1.25. cafUure State or national per capita purchases of commodity X adjusted REFERENCES for income levels Australian Bureau of Statistics, Cat. No. 6535.0, Actual regional sales will need to be collected Household Expenditure Survey. 1988-89 - from local traders. Average expenditures can be Detailed Expenditure Items. calculated from the Household Survey, updated Australian Bureau of Statistics, 1991 Census of by the consumer price index. The income ad¬ Population and Dwellings, Small Area Statistics justment would involve taking the median (forthcoming). household income from the region from the Hustedde, R., Shaffer, R. and Pulver, G. Community Census as a proportion of median household Economic Analysis: A How To Manual, North income for the State or Australia. Central Regional Center for Regional Development, Iowa State University, Ames, The example provided in simplified form shows 1984. that if the local expenditure on commodity X was $390,000, and adjusted expenditure on commodity X per capita was $78.35, then trade area capture would be $390,000/$78.35 = 4978 Concluding Note: persons, ie. the local retailers have captured the equivalent of 4978 customers equivalents. If This is the age of the enquiry. Enqiries this number is larger than the local population, have or are being conducted into the local centre is capturing customers from regional development policy: through: other areas; if it is smaller, it is losing 1 the H ouse of Representatives customers and leakages from the local economy Standing Committee for Long are occurring. Term Strategies (see the last issue); Self-Sufficiency and Specialisation Analysis 2 the Strengthening Local Economic Capacity (SLEC) programme using Self-sufficiency and Specialisation analysis ‘One Nation’ funds; (SSA) is carried out using location quotients 3 the Industry Commission which is (LQs). LQs are calculate as: looking into impediments to regional development (see the % of local employment in activity A editorial in this issue); and LQ = ---— 4 the NSW Legislative Council % of national employment in activity A Standing Committe on State

These data are available from the Population No doubt you can think of other Census or from the Annual Census of enquiries. There is no doubt that the Manufacturing Establishments for larger regional development game is regions. generating considerable heat. Let is hope that there is as much light at the If the LQ for a particular commodity/industry is end of the tunnel!! equal to one, it is assumed that the local indus¬ try is self-sufficient or that the local require¬ ments for these products of that industry are being met from the local industry. If the LQ is less than one, it is assumed that the local indus¬ try is not suppling the needs of the local popu¬

22 Regional Policy and Practice v2.1

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