There is more to regional policy than big, well meant dollars and buzz words

Regional development policy doesn't often make the headlines in metropolitan Australia but is of enduring importance for the roughly one third of Australians that live outside the major cities.

Australia has long been concerned about the concentration of its population on the coasts and in the capital cities. The "urban/rural divide" is the stuff of history and folklore. It led to the formation of rural based political parties and new state movements, it underpins much of the raison d'etre of the country independents and it still informs the views of many people who argue the need for decentralisation and a far greater focus on regional development.

But what is regional Australia? Does it actually exist? How should it be supported by government, if at all?

Many city people only see and hear about regions in the context of disasters, extreme weather events, and the riches associated with mining. Life and regional economies and cultures are far more complicated.

Regional Australia does exist. But it makes little sense to talk about it as if it were one undifferentiated mass, contrasted with "the city".

The processes that drive regional development are complex – sometimes local, but often global. They are poorly understood and subject to little effective control either by local communities or by central governments. Rural communities cannot stop their young people from leaving town for the bright lights. Tourism operators can't make Australians holiday locally and can't lower the value of the dollar. Families just don't want to live permanently in remote, inhospitable locations, despite the economic opportunities available. Local councils can't stop manufacturers from leaving town or from closing down in tough times.

Generally, the regional "problem" is that regions lack scale, critical mass and, therefore, broad economic opportunities. The cities have a huge advantage – you can move house in the city and keep the same job, and you can change jobs while continuing to live in the same house.

At the moment, many regional economies are very, very fragile, despite the continuing healthy national economic statistics. This is, indeed, the "patchwork economy" that politicians often talk about.

Governments in Australia have long enacted policies to help regional Australia, or at least to give the impression that they care. Often these policies have merely been siphons to distribute largesse to areas of political, rather than economic, need. Typically governments have tried to solve regional problems that are visible, and where their efforts can easily be seen, but which may or may not actually steer the region towards a better path.

As well, political interest in regional development has been uneven and spasmodic. Policies have often reflected passing fashions and fads, such as growth centres, big infrastructure projects, industry clusters, attracting the so-called "creative class", and so on.

Regional policy has a bad name because it is too often associated with party political motivation, buck passing between levels of government, grandiose schemes or insufficient effort and coherence.

The coming of the rural Independent-supported Government in 2010 was meant to herald a "new paradigm" for regional Australia and for regional policy. However, apart from the highly contentious NBN, much hyped Regional Development Australia committees and substantial new regional infrastructure funding, the new paradigm has actually achieved relatively little change in the way regional policy is conceived and implemented. This is because governments still view regional policy success simplistically, as largely a function of how many dollars they provide to regional Australia.

Despite the current uplift in spending on, and interest in, regional Australia, we continue to lack a sophisticated debate about regional policy in this country.

Policymakers still fail to ask the right "prior questions" about regional development – what is regional policy for? What can it reasonably achieve? Who is responsible for regional development? What drives regional growth and decline? When and where should governments intervene? At which regional scale should policies be enacted?

Spending on infrastructure is a classic example. How do we know that spending billions on regional infrastructure is better than (say) supporting innovation and entrepreneurship in regions?

The answers to these questions are not straightforward, of course. If they were, governments would have nailed them already. But we can do better than simply funding a regional development committee in every region but giving it no real power, or giving every region an infrastructure project every year or so, or banging on endlessly with buzz words like "localism". Addressing these questions properly might even give regional development a better name.

This article was first published in the Newcastle Herald on August 2, 2012.

Paul Collits is an Associate Professor at the University of Southern Queensland and is Research Director of the Economic Development and Enterprise Collaboration at the University’s Fraser Coast Campus.