Just as it is odd to call for a sovereign wealth fund to save the benefits of the resources boom, so it is also odd to call for those benefits to be diverted to funding regional development projects. The Cairns Post reported yesterday on such a proposal (Cairns deserves its share of mining riches):
THE mining boom has ”adversely affected” the Far North and the State and Federal governments need to come up with a plan to boost the population and the region’s economy, the co-author of a new report says.
The Australian Local Government Association released its latest State of the Regions report yesterday, and it showed the region was not recovering from the global financial crisis as quickly as other parts of Australia…
…The report’s co-author, economist Dr Peter Brain, told The Cairns Post the Far North’s population growth was “slowing very sharply”, going from an increase of 3.4 per cent in 2007-08 to a projected surge of just 1.7 per cent in 2011-12.
He said higher levels of government support was needed to ensure mineral wealth was spread to “regions that are adversely affected by the mining boom, such as Cairns” by developing a planning framework.
But there aren’t massive amounts of mineral wealth, at least not enough to keep our Government budgets at Commonwealth and State levels in surplus. So a call for extra funding for regional development is as premature as calls for a sovereign wealth fund, which I have discussed in a previous post (Sovereign Wealth Fund not a priority).
The Commonwealth Government has already boosted funding for regional development by $1 billion via the Regional Development Australia Fund, but it appears Cairns missed out. Strangely, the Fund is providing $5 million for the Robelle Domain (Stage 2) Parkland development at Springfield, which, at around only 30 kilometres from Brisbane CBD, doesn’t strike me as a regional area.