It’s always a pleasure to return to Melbourne.

As you know, I’m from Sydney.

When we talk about Australian cities, the conversation inevitably turns to the rivalry between these two great cities.

This rivalry is why we have Canberra – although in my view, we have ended up with a splendid national capital.

Sydney versus Melbourne is discussed around BBQ’s, family gatherings, sporting events and boardrooms.

But debate about cities in 2010, is much broader than this rivalry between two great cities.

It varies according to where you come from, where you live now and where you’re going to live in the future in our increasingly transient society.

Perth advocates will argue the beauty of what is the most isolated major city on Earth.

And I know there’s a Prime Minister, a Treasurer and a Governor General who will argue that Brisbane has emerged as a great global city over recent times.

Then there are the thriving regional cities such as Geelong, Newcastle, Wollongong, Townsville, Launceston and the Gold Coast.

It should be of no surprise that Australians are interested in talking about the future of our cities.

The 17 major cities are home to 75 per cent of the population.

These cities deliver 80 per cent of our GDP, 75 per cent of our employment, and are the principal base for 70 per cent of our businesses.

Recently, the world clicked over an important milestone. Today, more people on this planet live in urban areas than rural communities.

What is remarkable is that any national Government could argue it does not have a role in our cities.

The Rudd Government is reengaging the Commonwealth with our cities because it is an essential component of governing in the national interest.

As a national government, we need to make all of our cities the best that they can possibly be.

We have a core commitment to ensure our engagement promotes the three themes of productivity, sustainability and liveability in our cities.

This is not an academic debate.

These issues impact on people’s everyday lives – the time that parents spend in their car getting to and from work instead of at home with their children, whether their neighbourhood has a footy oval or a playground or other social infrastructure, how far they have to travel to get to the doctor, the hospital, and where are their educational opportunities - the local school, TAFE or university.

These are all topical debates in local communities today and increasingly, they are moving to the national stage.

As they should be.

The future of our cities requires national leadership as well as cooperation between all three levels of government, the private sector and the community.

There was a time when our cities were left almost totally to their own devices.

According to the principle of subsidiarity, it was best then that municipalities alone made major decisions about how to grow and evolve.

But the gaps between our cities are narrowing and our cities’ impacts on the rest of the nation are increasing.

What happens in our cities today affects not only their inhabitants, it affects, our economic productivity, our ability to reach international export markets and our climate.

THE STATE OF AUSTRALIAN CITIES

I want you to consider some sobering facts associated with the failure to plan appropriately for our cities, contained in The State of Australian Cities Report 2010, which I released recently.

• By 2050 it is expected the populations of Perth and Brisbane will double, and the populations of Melbourne and Sydney will reach seven million. As our cities use 75 per cent of our energy, and 97 percent of this energy is generated from non-renewable sources, we have a growing emissions challenge on our hands.


• Car use is increasing faster than population growth—in fact it has gone up thirty-fold since 1950.


• Greater distances are opening up between residential and employment zones, further increasing emissions and chewing up more hours of our lives.


• The freight task on our roads is forecast to increase by 70 percent between 2003 and 2020.


• The economic cost of avoidable traffic congestion is projected to rise from $9.4 billion in 2005 to $20.4 billion dollars by 2020 unless action is taken.


• Pressure is being placed on the agricultural land on the fringes of our cities.


• Water security is an challenge, particularly for a city such as Adelaide.

Without planning for the future, our cities will become less productive economically, their liveability will suffer and they will be far less sustainable.

OUR COMPETITIVENESS AND LIVEABILITY ARE AT STAKE

I want you to consider what’s happening to one of our big comparative economic advantages in the world—our famed liveability.

The Economist Intelligence Unit last year placed Melbourne third and all other major Australian capitals in the top 20, on its index of the stability, health care, education, infrastructure, culture and environment of the world’s 140 major cities.

We should be aiming to hold on to this advantage. But there is evidence we may not be.

In Mercer’s world-wide quality-of-living survey, Sydney, Melbourne, Perth, Adelaide and Brisbane all slipped in the rankings in the five years to 2009.

We still have some of the world’s most liveable cities. But Sydney, for instance, fell from fifth to tenth, Melbourne from 12th to 18th.

Take the crucial urban issue of social equity.

Again, our cities are some of the least socially divided in the world. But there is an observable increasing concentration of social disadvantage in the older middle and older outer suburban areas.

When you add to this findings, like the fact that there is only one affordable dwelling for purchase for every 15 low-income households in Sydney, and that Australia lost 90,000 social housing dwellings between 1996 and 2008, our cities are losing their egalitarian flavour.

This is something I worry about and I’m sure you do too. We don’t want our children growing up in divided cities. We’ve seen what occurs with social unrest in other countries.

INFRASTRUCTURE INVESTMENT AND BETTER URBAN PLANNING

The State of Australian Cities report is a wake-up call, as well as an indication of how we can overcome the problem. What it tells us is that the cities that are now out-performing ours are generally those that invest more heavily in infrastructure and have strong urban policies.

It makes the absence of the former Government from the urban policy debate all the more remarkable.

This isn’t a new or startling public policy issue.

In 1961 the author and urban commentator Jane Jacobs published one of the most important post-war books on urban renewal—The Death and Life of Great American Cities. In it she wrote this:

Whenever and wherever societies have flourished and prospered rather than stagnated and decayed, creative and workable cities have been at the core of the phenomenon. They have pulled their weight and more...Decaying cities, declining economies and mounting social troubles travel together. The combination is not coincidental.

That understanding has had an impact on visionary politicians ever since.

On John F. Kennedy, who tried, unsuccessfully, to establish a Department of Urban Affairs in 1962. And on his brother Bobby, who made urban renewal a major part of his tragic campaign for the presidency in 1968.

Barack Obama is now re-engaging the United States Government in cities policy.

And in the early 1970s in Australia, Gough Whitlam and Tom Uren made urban policy a national priority here in Australia. That tradition was continued by the Hawke-Keating Government which established the Better Cities program, led by Brian Howe, to revitalise inner urban communities.

Unfortunately, it was one of the first programs abolished by the incoming Howard Government.

And our cities are paying the price today.

What we need are better cities for the people who live and work in them, as well as those who visit them.

A COOPERATIVE APPROACH

That takes planning, funding, co-operation between governments, partnerships between the public and private sectors and, most importantly, the involvement of the people who live in our cities.

State and Territory Governments and the 155 local governments of our major cities influence their future direction.

Given the Australian Government’s primary role in economic policy, infrastructure provision and social welfare it is clear that a national framework is needed.

It means two things: coordinated planning and smarter investments in infrastructure and services.

A ROLE FOR THE COMMONWEALTH

Well-planned cities are central to the nation's continued economic growth and to the wellbeing of local communities.

In fact, few areas of public policy have the potential to improve the day-to-day lives of Australians as better urban policy.

We will undoubtedly become wealthier on average in the years to come—but whether or not our lives become easier and more enjoyable as a result will depend largely on how we organise urban life.

That’s why we are developing a national urban policy through the Major Cities Unit.

The policy is about creating cities that are more productive and globally competitive, more liveable, and more environmentally, socially and economically sustainable.

It is providing a spatial perspective on the major issues facing Australia: housing, transport, infrastructure, water, climate change, health, education and social policy generally.

And we are already cooperating on better urban planning through the Council of Australian Governments.

One of the problems Infrastructure Australia encountered during its prioritisation of nationally significant infrastructure was an inconsistency between metropolitan land use plans and infrastructure proposals.

This led to the establishment of the COAG Cities Planning Taskforce and to COAG agreeing to national objectives and criteria for future strategic planning of capital cities in December last year.

The goal of those national objectives is to ensure that the planning of our capital cities is long-term and strategic, fully integrated, and coordinated across all three levels of government.

It will ensure urban planning identifies policy and infrastructure priorities, that those priorities are practical, and that they address issues of national importance, including economic growth, population increases and population ageing.

COAG has agreed that, by 1 January 2012, all States will have in place capital city plans that meet the criteria—and that decisions about future Commonwealth urban and infrastructure funding will be tied to those plans.

I want to make it absolutely plain that the Rudd Government will not be shy about following through on this promise.

Change is already happening.

The South East Queensland Plan is best practice in integrating transport, water, energy and services infrastructure planning up to 2030. It provides a pipeline of projects to encourage both public and private investment and is a great example of partnership between state and local governments.

The recent announcement of the new Sydney Metropolitan Development Authority to drive future transit-oriented development and urban renewal is further proof of action from state governments on integrated urban planning. This Authority will include a Commonwealth representative, ensuring a national perspective is applied to the vision of Australia’s largest city.

The Victorian Government’s Investing in Transport Report and the recently announced 30 Year Plan for Greater Adelaide are other examples of planning for our cities.

ASSISTING LOCAL GOVERNMENT

Local government too plays a major role in urban planning.

The partnership between the Commonwealth and local governments we established in 2008 through the Australian Council of Local Government continues strongly, delivering major increases in local government funding and community infrastructure investment in our cities and our regions.

It includes record funding to local governments through the $1 billion Regional and Local Community Infrastructure Program.

And we are also working with local governments to improve their capacity to plan, provide and manage infrastructure and services in their communities.

We have set aside $25 million for a Local Government Reform Fund to improve the sustainability of our local governments and to encourage collaborations and partnerships.

Today as part of this, I want to announce that the Rudd Government will provide nearly $2.4 million for Victorian local governments.

Specialist teams will work with councils to examine their long term financial sustainability and identify areas where improvements can be made.

The project builds on a successful pilot project where ten Victorian councils were able to make better and more informed decisions on community infrastructure and services through better planning and budgeting.

This funding will also improve the management of community assets and infrastructure in regional Victoria.

INVESTING IN INFRASTRUCTURE

Our work on planning and developing a coherent policy framework has not stopped us from getting on with the job of investing in the future of our cities.

This includes a $36 billion investment in vital transport infrastructure, including the largest ever national investment in urban passenger rail.

It includes our investment in a National Broadband Network—recognising that in the digital age, connectivity is about more than cars, buses and trains.

And it includes investment in major urban water infrastructure such as the desalination plant in Adelaide.

These are long term investments which will serve the needs of Australians now and into the future.

All our future infrastructure investments will give appropriate recognition of the role of smart infrastructure.

Smart infrastructure will be a central component of the shift towards a systems approach to infrastructure, planning, design and delivery.

We want our infrastructure to work smarter by utilising new information technologies.

Last November I established an inquiry into the issue by the House of Representatives Standing Committee on Infrastructure, Transport, Regional Development and Local Government.

It held a major conference on the issue just a couple of weeks ago.

CONCLUSION

We are all here today because we are interested in urban issues.

It’s a crucial and challenging area of public policy.

And one whose importance extends far beyond a single policy silo.

It covers the whole range of future issues facing our nation.

The way we run our cities—and how well we run them—will help define how successful a nation we will be in providing a better life for our people.

Cooperation between all levels of government and the private sector is the answer.

Better and more strategic planning is the answer.

And investment is the answer.

This sort of action is now happening.

And what we’re doing here today is part of one of the most exciting and important public policy journeys in Australia.

We—all levels of government and business—have a big task ahead of us and a responsibility to do it well.

I am looking forward to the challenge.

ENDS