Is North Qld under-funded by the State Government relative to the South East?

In Saturday’s Courier-Mail, State Affairs Editor Steven Wardill reported on the unmovable perception among North Queenslanders that their region is under-funded by the State Government, despite official data showing otherwise. Wardill noted:

Facts and figures are dismissed out of hand. Northern Queensland may spend 31 per cent of the state’s revenue and produce only 21 per cent of it, but that kind of detail is cast aside as “bullshit, mate” by those who insist there’s an imbalance.

It’s accepted that the state’s capital commandeers all the cash, even though it’s not true. It’s what’s best described as a “vibe” and it’s venomous.

I am unsure of the source of the 31 versus 21 percent figures, but I am confident that North Queensland is not being under-funded by George St relative to other regions, based on official budget data from Queensland Treasury that I would consider reliable. Figures that I presented in my post-State Budget post show that NQ regions receive significantly more State Government capital works funding per capita than South-East Queensland. That chart was based on data presented in the 2017-18 Budget, and I have now analysed the data in previous Budget papers to determine that regional Queensland typically receives more than its fair share relative to SEQ (see chart below).*

Regional_shares_Chart1

Indeed, if any region should be complaining, it is the Logan-Beaudesert region in SEQ which has been persistently under-funded relative to other regions (see chart below).

Regional_shares_Chart2

If there ever is a separate State of NQ, its residents may well end up wishing they had remained with the rest of Queensland, once they realise just how good a deal they actually had.

*NB. I have included the following regions in SEQ: Brisbane, Ipswich, Logan Beaudesert, Moreton Bay North and South, Gold Coast and Sunshine Coast. I have included the following regions in NQ: Cairns, Fitzroy, Mackay and Townsville. Part of the Outback region lies in NQ, but the part in NQ could not be split out.

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12 Responses to Is North Qld under-funded by the State Government relative to the South East?

  1. cairnseconomy says:

    Thanks Gene. I think that goes some way to validating my previous comment that if Cairns has a problem with funding it is with other regions not SEQ. The data here is difficult to aggregate over the longer periods necessary for infrastructure.

    A point raised in Cairns is the sale of Cairns Airport which was sold at the time to the community as essential to fund the Cairns Hospital expansion. I’m not sure whether or how any adjustment for this should be accommodated. What I am sure of is that this was really poor politics which could only inflame subsequent cynicism.

    Also there is an irony in the comments from Wardill at the C-M. The entire situation has been inflamed in recent years by a “fair share” campaign by the regional publications of News Ltd.

    • Gene Tunny says:

      Yes, thanks Mark. It certainly does validate your comment. I didn’t know they linked the sale of Cairns Airport to the hospital expansion. I’ve never thought it made any sense to link asset sales in any region with infrastructure spending in that region. And you are certainly right about the irony of Wardill’s comments given the fair share campaign.

  2. Russell says:

    Great stuff Gene. Seeing some truth in numbers cuts through the rubbish.
    But having lived in Weipa which is really far north QLD and having interests in the Whitsundays but living in Brisbane I am amazed that people call Mackay and Whitsundays North QLD. Airlie Beach is around 1,100 kms from Brisbane, Cairns is around 1,800km and the top of Cape York is around 2,500km. To me Mackay and Whitsundays are still in the southern half but would be happy with them being included as Central QLD or Central Coast. But I think I am on a losing battle here.

    • Gene Tunny says:

      Thanks Russell. Yes, my definition of NQ may be overly encompassing. I’ll have a go at cutting the data based on some different aggregations.

      • cairnseconomy says:

        This is where the Outback region rather than north-south becomes a problem in regional geography. Outback SA4 stretches from T.I. to Birdsville with disregard of regional links. Cairns will be service centre for Cape. Townsville for Mt Isa. Mackay limited. Rocky is traditional service centre in CQ. Largest inland centre is Emerald. Good luck with reconciliation of that.

  3. Cameron says:

    Interesting post Gene. Is my reading of the budget papers right? Capital expenditures for 2017/18 are approximately $12 billion (spending + grants, from Section 2 of Budget Paper 3). And Operating expenditures for 2017/18 are about $55 billion (from the Budget Strategy and Outlook). Given that Opex>>Capex, our northern brethren may still be justified in their perceptions if the geographical per capita Opex is more concentrated in Brisbane and SEQ. Which it probably would be because departmental HQs are in Inner Brisbane. Are there any estimates of the regional distribution of the government’s operational expenditures?

  4. Robyn Abell says:

    Evidence has never bothered the populists, who by definition are not interested in facts. One Nation seems on track to hold the balance of power in the next Queensland government. And the list of populists is of course not limited to them. The federal government, with the Nationals is the lead, is trying to counter the populists by moving some government departments out of Canberra. Should Palaszczuk consider this? While it might not be economically efficient, anything that helps keep One Nation at bay could be a Good Thing, no?

    • Gene Tunny says:

      Thanks for the comment Robyn. I was once totally against it but I’ve come around to the view that it would be desirable to move one or two government agencies out of Brisbane. My feeling is that WorkCover would be a good option for a relocation.

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