You may have heard of the Big Australia policy – a push for Australia’s population to stretch from 22m to 35m by 2050. One of its key advocates is demographer Bernard Salt who yesterday addressed ACPAC, the conference of Australasian public accounts committees, meeting in Perth, which as an FEC member I am attending with chair Craig Foss.
Salt peppered his address with plenty of NZ references. How we parallel Australia in farm aggregation pushing us to increasingly live on or near the coast, how we face a ‘man drought’ – from about age 22 there are more females than males, peaking at age 35 with a 12% disparity. ( A key part of that being more young Kiwi men than women heading to Australia, in particular, for higher paid work. Salt noted that we have around 550,000 NZers living in Australia and if you tote up the rest, the thick end of one million Kiwis living overseas.
Meanwhile, 2011 sees the first baby boomers turning 65 and able to retire with a pension. For Australia that means while last year it had a net gain of 250.000 people coming into the workforce, this year it’s only at best 150,000. Maintaining any net gain of workers vs retirees each year can only be maintained if Australia keeps up its acceptance of migrants.
Salt notes that when Japan’s demographic fault line occured in 1994 – more retiring than starting work – the Japanese economy stalled and has never recovered. Baby boomer Australians can now expect to live till 85 on average; 40 years ago it was 72. NZ figures will be similar. My dad died last year at 91; he had been retired 30 years.
Salt argues that Australia needs to actively boost its acceptance of migration to meet increasing life expectancy, to prop up the tax base, fill gaps in the skills base, meet some humanitarian obligations – and bluntly, because taking 20-somethings that some other country has educated means getting 40 years of work for no earlier costs. (And yes, while this can be seen as “robbing’ third world countries, he maintains that the world is going to get more brutal in competition for resources, and many who chose to live in Australia will repatriate funds home.)
Some big issues here for us to consider. Immigration has long been a key driver of maintaining NZ’s economic growth. I’ve long thought one of the problems is that too many migrants head for Auckland and put infrastructure, the environment and housing costs under further pressure. If there were a mechanism to encourage more migrants into the areas where NZ is depopulating – rural communities, some provincial cities – we would get a win/win; population growth where it’s more needed and better use of public assets at some risk, such as schools and hospitals. I put this to Salt after his address. Turns out he has written recently on the issue and believes there is a case for encouraging migrants who agree to live for a few years in rural/provincial areas. Sure, once they gained permanent residence or citizenship they would be free to live anywhere – but some are likely to have put down roots. Personally there are few parts of NZ which I couldn’t see myself living, if for example, family connections drew me to it.
I’m not convinced we need a ’Big New Zealand’ policy. I’d prefer to see us drawing back some of those near 1 million expatriate Kiwis. We did get a boost when the global recession happened but frankly, it’s a big ask with wage rate differentials of 30% across the Tasman. Migration tailed off as a result of the recession but will undoubtedly pick up at some point.
Steering more new arrivals into areas other than Auckland, especially some of our rural towns and cities, would seem to make sense.