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Impact of Drought on Town Businesses in Central West

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Beyond the Dust Impact of Drought on Town Businesses in Central West Queensland and some solutions March 2018 This report was produced for the Western Queensland Drought Committee Author: Dana Kelly Sections 2.4; 3.2 and 3.3 — co-author Vanessa Durand Acknowledgements: Many thanks to all of the residents and business owners in the Central West who gave their time for interviews and meetings, and to the Western Queensland Drought Committee members who contributed to the report. The research undertaken to produce this report was funded through Queensland Health’s Tackling Regional Adversity through Integrated Care (TRAIC) grant program in 2016/17. The views expressed in this report are not Government policy. Cover photo: courtesy of ‘The Guidebook—isango!’ (https://www.isango.com/theguidebook/) For the rain never falls on the dusty Diamantina And the drover finds it hard to change his mind For the years have surely gone Like the drays from Old Cork Station And I won't be back til the droving's done (Written by Hugh McDonald and performed by Red Gum — circa 1980's) 5 Executive Summary Droughts bring dust storms and sometimes despair. However, this study also found stories of hope. Drought and dust affects every aspect of this region, with losses in productivity, income, jobs and population. Rural towns are especially exposed to the risks of drought, with approximately half of the businesses directly linked to agriculture. Town businesses are an important component of regional economies, and provide vitally important social capital. Some town businesses have developed innovative strategies to enable them to survive. Collaborative partnerships formed between government, private business, NGO’s and local communities are helping to solve problems inherent to many rural and remote regions. This project was commissioned by Western Queensland Drought Committee to [1] identify the financial, social and mental issues associated with drought for small town businesses, and [2] explore the appropriate responses to alleviate hardship and build resilient communities across the Central Western region. The project was to assist in providing evidence-based policy advice to influence public, private and NGO services providers. This report presents the results of a survey undertaken in 2016/2017 with 83 respondents; 35 in-depth interviews conducted with small town businesses across the Central West; and a public meeting. Drought, as part of the highly variable climate, is a destabilising factor that overlays all of the other global trends, such as declining rural population and lower terms of trade. If not for drought, the other underlying issues would still exist, although they would not be felt so intensely. If the rainfall was more reliable, there would be more stability in investment, jobs and population. Drought has complex flow-on effects, affecting all of the community. A significant reduction in turnover was reported by almost all town small businesses across the region, linked largely to drought. The impact varies for different business types. Town businesses servicing agriculture face the highest impacts, as they deal directly with graziers and immediately feel the pinch of reduced spending. Shearers and rural workers feel the effects first hand. Main street small business, such as the IGA and clothing shops, face the knock-on effect of the drought. A smaller proportion of their sales are directly with graziers, but their turnover decline is clouded by increases in on-line shopping. Most tourism businesses have not laid off staff, as their business rely mostly on travelers and tourists. Both retail and tourism businesses said that they have trouble finding and retaining staff, due to the reduced local population because of drought. Skilled people have left town because of reduced employment opportunities, and many do not return. People also leave because of reduced live- ability, as many services decline, from a lack of medical practitioners to the local gym closing. Population is declining sharply in the Central West. About 1500 people have left over the past five years, out of a total of about 10,500 people; at least partly due to drought. Rural workers are the first to be laid off, and this reduces spending in town businesses, which in turn also lay off staff. Reform needs to be aimed at overall short and long-term community resilience; including but not restricted to, drought. Government policies that help support people during a drought are frequently criticised for being reactive, for responding to, rather than preventing the impact of a drought. Current policies are aimed primarily at supporting grazing enterprises, and not town small businesses. Yet support for town small businesses is essential if the region is to remain viable and resilient. The findings of this report confirm that decision-makers need to consider four options for providing support for town businesses. Without support these communities will likely face increasing health and social issues, population decline, economic decline, and communities could disappear. The acronym D.U.S.T. is appropriate for a land which is so often dusty. The options for decision- makers are: D Decide to act. U Understand the context. S Support and develop local capacities and local institutions. T Transform regional governance. The “Beyond the Dust” report offers the following guidelines (see Chapter 6 for more detail) through which local communities can make decisions for their own region, and remain resilient: Transform regional governance so as to foster local decision- making Extend infrastructure and services Recognise people-place connections Acknowledge community networks Support the development of diverse and innovative economies Build local knowledge and skill levels. Recommendations for ongoing research and action include a stakeholder workshop to enhance the evidence base for policy, and focus on resilience building (see Chapter 6.3) . Hopes for the future A focus on building resilience has been identified as a contemporary approach towards pro-actively addressing the impacts faced within this region. Rural and remote regions tend to be different to other regions, and it is vital to understand the complexities and nuances of the local context. Supporting and enhancing local governance, ensuring that local people are provided with appropriate opportunity to actively engage in decision making processes, is recommended as a first step in the resilience building process. The high level of adaptability to change in this region means that investment is likely to be well used. When matched with significant local effort with highly motivated volunteers, investment has a significant multiplier effect in these small communities. This report calls on all stakeholders to work together to build resilience in the Central West region of Queensland, and in doing so providing a model for all regional Australia. The many examples of successful partnerships, networks and innovative businesses give hope to this region surviving drought and building resilience to withstand future challenges. 2 Table of Contents EXECUTIVE SUMMARY......................................................................................................................2 TABLE OF CONTENTS.......................................................................................................................4 1 DROUGHT – THE ROOT OF RURAL DECLINE? ..........................................................................6 1.1 Project design .................................................................................................................................................................7 1.2 Report overview ..............................................................................................................................................................7 1.3 Study area........................................................................................................................................................................8 Remoteness.…………………………………………………………………………………………………………………….………….……..8 1.4 Methodology................................................................................................................................................................... 9 Literature review ...........................................................................................................................................................................................10 Survey ....................................................................................................................................................................................................10 Interviews ...............................................................................................................................................................................................11 Public meeting ..............................................................................................................................................................................................11 2. DROUGHT: DEFINITIONS AND CONTEXTS ...............................................................................12 2.1 Definition of drought .....................................................................................................................................................12 2.2 Discourses of drought...................................................................................................................................................12
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