State government failing to plan for regional population boom

The local government areas of Greater Geelong and Moorabool ranked third and fourth in Australia for regional areas with the greatest share of net internal migration according to the December 2023 Regional Movers Index.

The index also showed Greater Bendigo was the top spot in the nation for people moving from other regional areas, recording a four-fold boom in region-to-region net migration for the year.

The quarterly report from the Regional Australia Institute (RAI) tracks population movement throughout the country using Commonwealth Bank data and it showed people consistently moving into regional areas within striking distance of Melbourne

In the case of Moorabool - wedged between Ballarat and Melbourne's western fringe - nearly all of its unprecedented growth came from people moving from the city.

RAI chief economist Dr Kim Houghton said people were moving from Melton to Moorabool, and from Wyndham to Geelong in a consistent pattern that state government planners appeared to be ignoring.

"All due respect to the government planners in Victoria, but their Greater Melbourne Plan that was released a month ago shows a dominant drive towards... growth at that urban fringe," Dr Houghton said.

"What this data's telling is that's fine in theory, but it really doesn't work for people, who aren't valuing that outer suburban lifestyle.

"We've really got to look to Victoria to say let's soften that greater Melbourne plan with a greater Victoria plan that allows for growth in those regional places that are going to grow organically whether we like it or not."

Dr Houghton said Moorabool had seen "outstanding growth" for the past year, with a 65 per cent boom in net migration and that pattern was staying strong.

"It's one of those classic places that's about an hour out from the urban fringe. We've looked at the patterns in previous quarters... and the big feeder areas are those suburbs just inside the urban fringe," he said.

The report showed similar patterns playing out nationwide, with most of the biggest growth areas sitting within 100km of a capital city. Queensland's Sunshine Coast and Gold Coast took out first and second spot on the list, attracting 17.5 and 8.1 per cent of total net migration.

The data showed 25 per cent more people were moving from the capital cities into the regions than back the other way.

An incredible 65 per cent of people leaving Australian capital cities were from Sydney, while Melbourne evacuees made up a further 35 per cent.

By contrast, regional NSW accounted for 36 per cent of all people moving to regional areas, with regional Victoria making up 30 per cent, roughly on par with the same time in 2022.

Commonwealth Bank regional and agribusiness executive general manager Paul Fowler said the exodus out of the cities and into the country was now a three-year trend.

"The lure of the regions has never been stronger," Mr Fowler said.

He put it down to three main factors: employment, cost-of-living, and lifestyle.

High grocery and rental prices in capital cities was encouraging Australians to choose "far more affordable options in terms of both housing but also broader cost of living", Mr Fowler said.

He said the amenities of regional Australia - the space and the lack of congestion - offered a "wonderful lifestyle" that people from all demographics were chasing.

But he also said regional areas had the "really strong employment opportunities" people needed to support themselves and their families.

Around 87,000 regional jobs were available in early 2024 "across a broad range of industries", Mr Fowler said.

As regional businesses expanded, their need for staff would grow in 2024, he said.

Mr Fowler said the report was a crucial reminder more money and planning needed to go beyond the big cities.

"It's absolutely in the nation's interest to ensure our regions are able to fulfil their economic potential," he said.

Dr Houghton it was time governments "got proactive" about the issue.

"We know a lot of the momentum in the housing system focuses on those outer suburbs of the capital cities, but we've been underdone in regional housing for about the past decade, relative to population growth," he said.

"We need to start taking this stuff seriously. This is no longer a post-COVID blip, this is a long running constraint on national economic growth."

While local councils and communities were investing time, money and effort into novel solutions, Dr Houghton said the task needed the power and resources of the higher levels of government.

"Our state governments are doing a good job but they've really underestimated this sustained growth in regional populations," he said.

"A lot of regional communities are feeling the pinch, particularly in social infrastructure, housing, community services, childcare, all those sorts of things have been underdone."