Australia is a nation of cities

The Property Council believes Australia is a nation of cities.

When I travel overseas, people don't talk to me about my home state Victoria, they talk about Melbourne. I'm sure the same is true for the rest of the country.

Australia's capital cities are the great brand names of this nation.

Please let me make clear that when the Property Council refers to cities we don't simply mean central business districts and we certainly don't mean buildings. We are talking about the people, the capital and the spirit that are a magnet for business and cultural activities.

The Property Council's ongoing research into capital cities shows they are the principal generators of Australia's economic wealth.

Cities are the main home of small businesses. They are also the country's largest employers and offer the greatest opportunities for employment growth. Industries located in cities generate the lion's share of government revenue through taxes on corporate activity, land, tax, CGT, payroll tax, stamp duty and income taxes on city workers.

We believe these facts make our capital cities Australia's greatest asset.

Unfortunately these facts aren't well recognised by federal, state and territory governments.

As a result, they have starved capital cities of funds. They have also confused responsibilities and accountability between different spheres of government, making it much harder for capital cities to satisfy the changing needs of their constituents.

The Property Council believes capital city governments, in particular, deserve the resources needed to act strategically. We believe we can help you obtain these resources.

This task is more difficult today than ever before. State and federal governments seem enthralled by the new myths of the political landscape.

Media sound bites that focus on small business, or rural Australia, or bank bashing and the like are the fast food of today's politics. And yet, after the initial sugar rush wanes, there is a strong desire for something more substantial; something relevant that focuses on the future, something that conveys a sense of optimism.

Once better resourced, Australia's urban environment can satisfy the craving for meaning and confidence.

Another problem is that state and federal governments still want to service our urban areas in terms of traditional public policy departments - the old-fashioned tribes of transport, industry, agriculture, fisheries, mining and the rest are nineteenth century responses to government.

In a post-industrial age, the organisation of urban government around the agencies of a previous era subverts good outcomes.

Any company that loses sight of the customer is going to miss strategic opportunities. It's the same for government. That's why we now confront:

• an inadequate revenue base for capital cities;
• ageing infrastructure;
• loss of autonomy for city government and the power to set strategic directions; and,
• confused stakeholders - whether they be investors, visitors or residents.

The Property divides the problem and solution in two - what we call "software" and "hardware".

First, hardware.

We have inherited an infrastructure designed for the industrial era. We need one that will satisfy the needs of the Nintendo generation that will soon dominate the lives and culture of our cities.

For most of this century, infrastructure was of a vanilla flavour - gas, electricity, water, motorways, sewerage that served everyone in the same way. There were never an intention that infrastructure could be customised - it was one size fits all.

Today the story is different.We need an infrastructure that deals with a society of networks - virtual and real. Transport is one priority. The other is the infrastructure of the information age.

Bill Gates was very keen earlier in the decade to talk about frictionless capitalism, by which he meant a marketplace without physical barriers. His thinking has evolved to talk of doing business at the "speed of thought", which requires what he calls a "digital nervous system".

That's the sort of strategic infrastructure that needs urgent funding.

It's interesting that we have a Federal Minister for Regional Services, but no focus and certainly no budget for co-ordinating the development of vital infrastructure in our major cities.

And yet, both politicians and business have talked about the need for greater international competitiveness for more than a decade. They don't seem to realise that Australia's quickest route to greater global influence is by creating world-class cities.

Not that the Property Council believes federal government should interfere in the running of capital-city government. Nevertheless, federal AND state governments do have important financial responsibilities to cities - especially as that's where most of the taxes are raised.

In short, the hardware solution comes down to allowing capital city governments to develop infrastructure strategies that are properly funded.

Turning to software.

The softer assets of cities are just as important as the hardware. City software involves such things as innovation, strategic direction and learning cultures, all of which require new institutions and organisational strategies if they are to flourish.

People expect modern cities to allow them to make the most of their own talents. None of this works without first-class governance, clear themes and simple organisational processes.

As a first step, that means clearer responsibilities between the major spheres of government. The next step is the creation of exciting city strategies and business plans which are properly funded.

So, Where Are We Headed?

The Property Council believes that a nation, like any well run company, should foster its greatest asset. In the most urbanised nation in the world that means our capital cities and the aspirations they house.

Australia's capital cities are the great marketplaces of the nation. If they are to meet the needs of a changing community they need clear strategies, proper funding and modern infrastructure.

As a recent report by Demos, a leading British think tank, noted:

"… we need a new approach [to urban government] that builds on the central virtues of the city - its role as a place of conviviality, a place where people meet, trade, exchange, share ideas, and an approach that avoids the error of seeking to replace the vitality of the city…."

The starting point is to give city government the resources to act strategically.

It's very interesting that you have to go back to 1972 and Billy McMahon to read a speech by a federal conservative politician about the importance of urban Australia. Federal Labor was readier with the cash but often attached too many strings.

Too often, state governments occupy cities as squatters rather than support them with resources and let city government get on with the job.

This is where the Property Council can help. We can work with you to persuade federal and state governments to confer clearer authority and appropriate resources to capital cities.

For its part, the Property Council has undertaken several tasks:

We have proposed a best practice development control system that we are negotiating with state governments (with the co-operation of the Local Government Association);

We have embarked on a design dividend project - which aims to prove that good design results in higher investment returns.

We are exploring what we call the 'ecology of cities', which ranges from trading in carbon credits and energy codes for buildings, as well as city greening and transforming derelict sites into attractive recreation areas.

We are conducting a series of studies around the country to promote the profile, role, opportunities and needs of our capital cities and their city centres in particular.

The aim is to portray a picture of our national capitals that highlights their vital role in the economic and cultural life of the nation.

From this research, the Property Council will articulate a suite of hardware and software priorities designed to nurture the ongoing growth of cities.

This agenda is most advanced in Brisbane, where the Property Council has released its Brisbane Vision and Strategy documents. Both were developed in close cooperation with Lord Mayor Jim Soorley and take account of the views of many other community.

One area of potential cooperation between the Property Council and the Lord Mayors is in the preparation of a report on the importance of urban Australia and the crucial role played by capital cities.

The idea is that such a report would start a debate that helps re-brand the image of urban Australia as a powerhouse of economic and cultural activity.

Such a report could be released as a marketing document that includes a section on every capital city.

We would anticipate a launch, followed by a media campaign.

The Property Council is also very keen to act as an ambassador for capital cities. Trade shows, like the MIPM conference in Cannes, where every major city in the world was in attendance, is an example where the public and private sectors could work together.

The Property Council's members have a multi billion dollar commitment to Australia's capital cities. We plan to take a more active role in community level debates in the future.