Systemic myopia: Public investment challenges in remote Australia

 

When clouds are seen, wise men put on their cloaks;

When great leaves fall, then winter is at hand;

When the sun sets, who doth not look for night?

Richard III, Act 2, scene 3.

 

My previous post focussed primarily on the social cataclysm engulfing remote communities through the primary lens of social and property violence and the impact of anti-social accelerants such as alcohol. Rather than focussing on spelling out the inevitable and significant implications for families, children, and the social stability of the communities, I sought to argue that there was a shortfall in the capabilities of governments to ensure citizens were able to live peaceful lives, thus raising questions regarding the legitimacy of governments.

 

In this post, I turn my attention to some of the sustained and systemic shortfalls in public investment in remote communities, and particularly capital investment requirements. While it would be foolhardy to argue that adequate public investment is all that is required (sufficient) to meet the complex challenges facing remote communities, I would ague that it is a fundamental prerequisite (necessary) for doing so.  Of course, even so, public investment must be well targeted, sustained, and be well designed. Accordingly, if we turn the proposition on its head, long term absence or under-provision of high quality public investment can be seen as a fundamental precursor, if not a major cause, for ongoing social dysfunction within remote communities. We cannot expect to address the social challenges in remote communities without ensuring that public investment is adequate and high quality.

 

Of course, the overwhelming majority of Australians have minimal experience of the conditions of remote communities. Families resident in remote regions constitute only 2.3 percent of Australian families (link here). While we may complain about the quality of government services, we expect, and mostly receive, a first-world level of government service provision from three levels of government. This is far from being the case in remote Australia.

 

A number of recent reports relating to infrastructure provision illuminate this observation.

 

Infrastructure Partnerships Australia (IPA), a body not previously on my radar, has recently released an extraordinarily useful report titled Remote Communities: Improving Access to Essential Services (link here).

According to its website, IPA is

Australia’s longest standing infrastructure think tank, formed in 2005 as a genuine and enduring policy partnership between Australia’s governments and industry. We exist to shape public debate and drive policy reform for the benefit of the national interest.

Our public sector membership is drawn from Commonwealth, state and territory infrastructure, planning, environment, finance and treasury departments, as well as government-owned corporations.

Our private sector members include major financiers, law firms, contractors, consultants, equity and debt investors, infrastructure technology providers, super funds and operators.

 

The IPA Remote Communities report is extraordinarily accessible, setting out key data points and utilising clear and striking graphics. I recommend readers take a look at it (not least because I cannot do it justice in this brief post). The report seeks to do two things. First, it lays out in stark terms the essential services shortfalls facing remote communities: communities ‘consistently experience poor water quality services’, ‘electricity supply is often unreliable’, and ‘have limited access to telecommunications services’. Contributing factors include ‘isolation’, ‘lack of meaningful engagement with communities for service delivery’, ‘inequality barriers’, lack of resources’ to utilities charged with delivering these essential services; a ‘systematic lack of transparency and reporting’, ‘skills and education shortages’, and inconsistent regulation and poor governance continue to impede improvements’. This is a pretty challenging set of constraints. The report then goes on to identify a range of technological possibilities, noting that ‘There are a variety of established technologies and governance approaches being applied across all jurisdictions — but they are coming at a glacial pace for most remote communities.

The Report’s second aim is to lay out the way forward. It argues for establishing a national minimum service baseline based on government commitments to National Cabinet, and a process whereby governments are accountable for meeting the baseline. It suggests existing Community Service Obligations should be ‘evolved’ or transitioned into Community Infrastructure Partnerships which lock in obligations to innovate, improve transparency, provide a social licence and facilitate collaboration and coordination between sectors. Funding and financing mechanisms for remote infrastructure should be reviewed and updated and regulatory reform undertaken to support community infrastructure partnerships.

 

The report appears to be unaware of the recent moves (yet to be included in the Productivity Commission Information Repository) to establish a new Closing he Gap target for community infrastructure (link here and link here ). The new target is framed as follows:

Target 9b: By 2031, all Aboriginal and Torres Strait Islander households: Within discrete Aboriginal and Torres Strait Islander communities receive essential services that meet or exceed the relevant jurisdictional standard; In or near to a town receive essential services that meet or exceed the same standard as applies generally within the town (including if the household might be classified for other purposes as a part of a discrete settlement such as a “town camp” or “town based reserve”.

 

The new target 9b differs from the IPA recommendation insofar as it accepts current jurisdictional essential services standards (which may in fact require strengthening – see below), whereas the national approach advocated by the IPA Report would ensure both uniformity and reduce the likelihood that some jurisdictions standards will lag national expectations. One would hope that the forthcoming Productivity Review of the National Agreement (link here) would recommend that the Joint Council consider amending target 9b to ensure appropriate/strengthened national standards for remote essential services are applied.

 

The IPA report is an exceptionally comprehensive and far sighted assessment. It proposes an extremely ambitious agenda; one which will be highly susceptible to governments’ reluctance to commit to new expenditures, and governments’ propensity to baulk or fall at the implementation stage. Nevertheless, this is an extraordinarily important report, and deserves wide circulation and attention across the Indigenous policy domain.

 

Notwithstanding the vision and focus the Report’s authors have brought to this analysis, I do have one criticism. The focus on water, power, and telecommunications is in my view too narrow. The policy reforms advocated by the Report should be broadened to include sewerage, roads, cadastral and related land surveys, and most importantly, housing in remote communities. The vast bulk of housing in remote communities is public housing, and it is a core component, a core foundation, for the associated essential services that we normally see as infrastructure. As the largest public housing peak body in the US notes on its website (link here):

Public housing plays a critical role in our nation’s public infrastructure, providing families with a stable home and helping them gain access to other services, including education and health. When we invest in public housing, we help low-income families achieve self-sufficiency and improve life outcomes, but we also generate economic growth, bolster productivity, and positively impact support services while significantly decreasing costs.

 

Of course, the IPA is not alone in Australia in failing to see social housing as infrastructure. Infrastructure Australia was very slow to acknowledge that social housing is infrastructure (link here and link here) and when it did, it never really gained traction within the bureaucracy and beyond.

 

Indeed, in the last year of the former Government’s term, it took steps to explicitly ensure that Infrastructure Australia did not consider social housing. In April 2022, the Shelter WA website reported (link here) that the former Deputy PM and Minister for Infrastructure, Transport and Regional Development, Barnaby Joyce, issued a Statement of Expectations to the Board of Infrastructure Australia (link here) that omits inclusion of social infrastructure such as social and community housing in IA’s list of priority sectors.

 

The Shelter newsletter states:

…As reported by Community Housing Industry Association (CHIA), regrettably, the new statement of expectations removes social infrastructure from the list of priority sectors despite its inclusion in IA’s 2021 Infrastructure Plan, and affordable housing being the most frequently cited infrastructure gap in regional areas. This is step backwards in efforts to treat housing as essential infrastructure.

 

What the Shelter website does not mention is that housing shortages are endemic in remote and regional Aboriginal and Torres State Islander communities, and that Aboriginal and Torres Strait Islanders are over-represented in waiting lists for social and community housing in regional and urban locations. Moreover, if one were to aggregate the outstanding remote community housing needs across regions or jurisdictions and treat addressing them as individual projects, the financial costs would exceed the capital costs of many of the major economic projects that Infrastructure Australia recommends (and the North Australia Infrastructure Facility funds: link here).

 

The failure to gain traction is evident in the recent release of the Independent review of Infrastructure Australia, and the associated Government Response to the Review (link here). The Independent Review recommended (pages21-22) that Infrastructure Australia’s remit be expanded to include social infrastructure, albeit without seeking to define or stipulate just what such a term covers:

The Review recommends that Infrastructure Australia’s remit be expanded to include social infrastructure (where it is relevant to the infrastructure investment project, or place and precinct in question) as well as future investment challenges where Infrastructure Australia’s position as the national advisor best enables it to incorporate those challenges in its advice and analysis.

 

Disappointingly, (particularly given the Government decision to make Infrastructure Australia a more influential adviser on infrastructure matters) the Government Response adopts the Barnaby Joyce approach, and effectively set this recommendation aside:

Support in part. The Government considers Infrastructure Australia’s focus should be on nationally significant projects relating to transport, water, communications and energy infrastructure, in support of Australian Government functions.  From time to time, it may be appropriate for Infrastructure Australia to consider social infrastructure implications where it is part of broader network analysis or place-based project advice. Where required, the Government can request this work through the Statement of Expectations. The Government notes that this approach minimises any duplication with regional and urban policy and program functions within the Australian Government…

For those who require a translation from bureaucratic parlance, this means ‘not on your nelly’!

 

Yet the Infrastructure Australia Regional Strengths and Infrastructure Gaps Report released recently (link here: Overview report) identifies the availability, diversity and affordability of housing as the most common identified gap across regional Australia (page 11) and in relation to Indigenous communities’ concerns, noted (para.4.7.7 page 38):

The availability, affordability and quality of housing was highlighted across consultations as being a key issue for First Nations communities. The 2019 Australian Infrastructure Audit (Challenge 126) identified that housing is not meeting the needs of First Nation communities across remote Australia, exacerbating health, education and well-being outcomes. Overcrowding is leading to poor outcomes for First Nations peoples in Remote Areas, which is also identified on our Infrastructure Priority List.

 

It is worth contextualising these persistent shortfalls. This week, Infrastructure Australia released its 2022 Market Capacity Report which identifies significant risks and pressure on the infrastructure pipeline currently in place across the nation. But more saliently for Indigenous citizens in remote Australia, the report notes that the current 5 year pipeline of major public infrastructure projects ‘is valued at $237 billion - an increase of $15 billion in the last 12 months and equivalent to 6.7% growth’ (link here). Or to contextualise the Commonwealth’s effort in relation to remote housing, where it has allocated $100m for the NT over five years, this represents on my calculation 0.04 percent of the total five year public infrastructure pipeline.

 

Taken together:

• v  the IPA Report outlining the extraordinary remote infrastructure challenge (albeit narrowly focussed);
• v  the current inability of the Productivity Commission’s Closing the Gap Information Repository to provide information on housing progress (target 9) in remote areas — it is listed as future reporting (link here); and
• v  the deliberate decisions to narrow the remit of Infrastructure Australia to exclude advice on disaggregated remote social housing needs  in favour of geographically focussed commercial infrastructure;

all provide a rather pessimistic insight into the longstanding systemic challenges driving under-investment in public infrastructure within remote communities. These challenges are exacerbated by the deliberate decision of the former LNP Government (not reversed by the current ALP Government)  to not continue the public investment in remote housing provision in the 2008 National Partnership Agreement on Remote Indigenous Housing (link here;  link here and link here).

 

Yet the public investment shortfall is deepening as the challenges of climate change are rising (link here).

 

A recent research note in the Medical Journal of Australia by Simon Quilty, Norman Frank Jupurrula, Ross Baillie and Russell Gruen (link here) is titled: Climate, housing, energy and Indigenous health: a call to action. The authors first paragraph states:

Most Australians take safe housing and uninterrupted electricity for granted. Yet in remote Indigenous communities, low quality poorly insulated housing and energy instability are common. Most houses require prepaid power cards, resources are meagre, financial literacy is low, and people often have to choose between power and food. New evidence reveals extreme rates of prepaid electricity meters’ disconnection in these communities, making people with chronic diseases who depend on cool storage and electrical equipment particularly vulnerable. The convergence of excessive heat, poor housing, energy insecurity and chronic disease has reached critical levels in many parts of northern Australia, and a multisectoral response is needed to avert catastrophe. Medical professionals have a key role to play.

 

The article is short and highly recommended. Among other things, it argues for the strengthening of building codes and housing standards in remote settings, not the acceptance of existing standards.

 

To sum up, over the past two decades at least, public funding in core capital investments related to essential services, social housing, and community infrastructure has been severely deficient. This has undoubtedly reduced the levels of recurrent funding by governments in remote settings, and also limited the opportunities for local employment, and stronger economic development and progress. It is undoubtedly one of the key contributors to limiting the opportunities available to the rapidly growing youth cohort within communities. While reversing the sustained under-investment is not sufficient to address all the challenges facing residents of remote communities, it is a necessary element in any viable transition to a more stable future for remote communities. The onset of climate change is making addressing these challenges even more urgent.

 

Yet relevant policymakers appear to be both deaf and blind to the systemic and structural nature of the crisis their predecessors have initiated and for which they have the current responsibility to address. It is past time for the Commonwealth to step up, commit funding and ensure that the states and Territory are focussed on these priorities, which after all are core responsibilities of governments.