An extra 500,000 people should be "living prosperously" in regional Australia by 2032 to prevent Sydney and Melbourne sprawling into unliveable "megacities", a major new report presented to the federal government has declared.
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The Regional Australia Institute says the current forecast of 10.5 million people living in the regions in a decade should be boosted to at least 11 million to ensure "a more productive and liveable Australia".
The institute will unveil its "Regionalisation Ambition 2032" framework to "rebalance the nation" in Canberra today.
The report identifies 20 targets to strengthen the regions and close the gap between the city and the country in the provision of essential services, skilled jobs and housing.
Economic modelling commissioned by the RAI shows that a regional population of 11 million would drive national output to $2.3 trillion.
"This is $13.8 billion more than under a 'business as usual' scenario," RAI chief executive Liz Ritchie said.
With almost two-thirds of Australia's population now living in the major capitals, the biggest, Sydney and Melbourne, are on a trajectory to more than double to more than 10 million residents each by the middle of this century - "megacity" status as defined by the United Nations.
"Our research tells us that a megacity future isn't the right outcome for Australia," Ms Ritchie said.
"We know as a nation we will be happier, more sustainable and more productive if we alter the path we are on."
Regionalisation Ambition 2032 pinpoints the areas the RAI says are holding back regions, including population size, jobs and skills and "liveability".
Regional Australians had to be on a "level playing field" with their big city counterparts in the provision of housing, education, health, transport and childcare.
"Regionalisation is about delivering on the potential of regional Australia and rebalancing our nation,' Ms Ritchie said.
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The federal government's Infrastructure Australia forecast has highlighted other areas growing strongly: the ACT and Queanbeyan, Brisbane and the coastal strips to its north and south, Adelaide, and Perth.
"As a result of future growth, without continued action, the combined cost of road congestion and public transport crowding is forecast to double to $39.6 billion by 2031," the government body reported.
The RAI, which is hosting a major two-day Canberra summit of economists, scientists, planners, business leaders and politicians, argues that a better alternative would be for regional Australia to take more of the burden.
It calculates that without a change in policy, the current 9.5 million people living outside the big cities would rise to 10.5 million in the next 10 years, but a "rebalancing" could raise that comfortably by an extra 500,000.
"People are voting with their feet and looking for a different life beyond our capitals," Ms Ritchie said of the pandemic-driven shift to regional living.
"But we can't shift the population dial further if the critical issues facing regions aren't addressed."
The institute is calling on industry, government, the private sector and community representatives to show their support by pledging to reach the key targets by 2032.