Some 43 years after the failed referendum on a new state for northern NSW we are still faced with the issue of whether to combine the NSW North with the Hunter Valley in one state. There is no question that the two regions have a common cause against a common problem, ie, Sydney’s hedgemony, it’s narcissism, and it’s arrogant indifference to regional concerns. And there is no doubting that the folk of the Hunter Valley see themselves more as northerners than metrocentrics. But it does not follow that this common cause should be met with a single solution. The lumping of these two communities together in the proposal for the 1967 referendum has proven to be the critical error in that campaign.
The consequences of that mistake are so absolutely enormous that it is difficult to imagine what the northern region would look like if the new state boundaries in that referendum had been limited to those areas that had already indicated their overwhelming desire for the change. It must be remembered that at the time all the small hill country dairies had just been shut out of the UK market when it joined the Europeans. My Father, a Director of the Banana Growers Federation at that time, could see that the Banana industry was also in serious decline. There was more than a million hectares of land on the coastal strip, and another 2 million over the range that had already been reclaimed, after past compulsory clearing, by young native forest regrowth. And there was at least the same area again that were looking for a new industry. It was also generally agreed in farming circles that this industry was native forestry based on existing and soon to be established native forest on previously cleared land. Plantations were not favoured at the time because the old time foresters knew how to regenerate better quality native forest for much less than the cost of plantations.
In the decade after the referendum the best advice indicated that the supply of high value saw logs could not take place untill a market was found for the hundreds of smaller, bent and multi-branched trees that compete with the fewer straight stems that would eventually grow to full size and occupy the entire area of each hectare. If these bent stems were not removed then the entire forest would be locked in fierce competition for moisture, nutrients and sunlight and, like a classroom with far too many kids, would retard the growth of all of them. That essential market for the bent stems was export woodchips and the feasibility studies recommended a deep water port on the Clarence. This was the very deepwater port that many claimed was essential for a new state, and was the justification for including Newcastle within the new state boundaries.
The numbers at stake were enormous. The conservative estimates of forest growth rates on the coastal strip were from 1 to 5 tonnes/hectare with from 0.5 to 1 tonne/ha over the dividing range. More than half of this growth was in useless bent stems that needed to be culled. The existing private forests had over 100 million tonnes of standing wood with more than 60 million of that needing to be removed over the next 20 years to maximise the growth of the remaining trees. The total volume available for export from new and existing private forests, and from limited state forest harvesting was in the order of 6 million tonnes per annum worth $900 million a year today. On the standard economic multipliers this would have circulated within the region to add $2.7 billion to annual GDP and maintain more than 27,000 additional jobs. A National Party government in the new state would also have had a clear mandate for further value adding through the addition of a pulp mill and on to a full paper mill. If this had diverted just 1 million tonnes to base newsprint at $1150/tonne it would have added another $1billion to the value chain and $3 billion to state GDP and maintained another 30,000 regional jobs.
The existing population of the northern region is about 900,000 which would indicate a GDP of $45 billion. Add just the $5.7 billion lost from Wrans decision and the state GDP would be $50.7 billion, of which 15%, or $7.6 billion would go into state revenue. Some 20% of this amount would cover the regions portion of Sydney head office expenditure which would not re-circulate back to the northern region. But if the new state had gone ahead this $1.5 billion would have been added to the northern regional economy where it would have circulated another 3 times to add another $4.5 billion to the new states GDP, and another 45,000 jobs. The total additional jobs would have been at least 102,000 which would have meant a population increase of 205,000. And most of that population increase would have been diverted from the western suburbs of Sydney, where congestion would not be as bad and house prices would now be more affordable.
A similar population transfer from the 3 or 4 potential new states in NSW would have had a major impact on the growth rate of Sydney and on the capacity of that city state to respond appropriately to the more sustainable rate of change.
However, it is now a matter of record that the outgoing Askin Coalition Government of 1975 delayed the approval of the project out of fear of a green/left metropolitan electoral backlash. And he did this safe in the knowledge that all the northern electorates with most at stake would continue to vote for the Country Party that delivered him government in the first place. The greens waged a furious campaign on the false claim that “old growth forest” would be decimated despite the fact that less than 3% of the private forest estate was found to be old growth. They also implied the moronic assumption that trees, particularly young ones, do not regrow or coppice after harvesting. The government already had full control over what was done in the state forests. And just 9 years after the referendum failed, one of the first things Neville Wran did as the new Labor Premier was reject the project altogether.
This destroyed the last, best, chance for regional agriculture. Instead of 2 million hectares of improved native habitat, and another 2 million hectares of new native habitat, all on private land, we were left with entire landcapes choked with woody weeds as the urban born “alternates” moved in to exploit the depressed land prices as farming families moved out. Some 35 years later the thick Lantana on my place, and farms all over the region, is still preventing trees from regenerating on the old Banana land that we had planned to restore to the original wet forest mosaic. Without a market for what we would grow, there is no justification for the expense of removing the impediment. Governments have blown $millions on tokenistic landcare stunts, all the while lamenting the fact that farmers “don’t have a farm forestry culture”. They have since declared that the cutting of a single tree, by a farmer who might have regenerated 100,000 trees, constitutes “broadscale clearing” and is a serious crime. The fact is, we always had a farm forestry culture and most of us still do. But we will never trust an urban Green/Labor government, or the people who elect them, ever again.
My children, and their children, had a right to inherit the splendid multi species native forest, and to enjoy the profits from a continuous cycle of partial harvests, that should now be present on all my degraded Lantana land. It was the Labor voters of the Hunter Valley that gave Neville Wran the opportunity to deny them that birth right. Our community also had a right to elect a government of their choosing, to govern over a state of their choosing. But in the 34 years since Wran came to power we have had 27 years of urban Labor and 7 years of urban liberals. So it is through this historical prism that farmers all over the NSW North view the need for reform and the prospect of a new state. And it is one thing to look at how Hunter Valley residents perceive themselves as part of the northern region but we also need to look at how they have, and will continue to vote. It is the proverbial Guerilla in the room.
The federal seats (latest boundaries, 2007 results) that cover the two regions reveal some interesting aspects. There are 5 seats on the coast, 2 inland, and 4 in the Hunter. The population of each electorate is not available but at the national average population per seat of 146,000 people (22 million/150 seats), the combined area would have 1.6 million people. That would appear to be 700,000 coastal, 300,000 inland and 600,000 in the Hunter.
The federal electorates are;
Richmond (90,100 voters, ALP 55%)
Page (93,400 voters, ALP 55%)
Cowper (92,760 voters, National 55%)
Lyne (86,800 voters, Independent/Nat 55%)
New England (91,370 voters, Independent 65%)
Parkes (89,770 voters, National 60%+)
Newcastle (93,400 voters, ALP 66%)
Hunter (90,200 voters, ALP 66%)
Charlton (91,100 voters, ALP 66%)
Shortland (93,170 voters, ALP 66%)
The state electorates provide a more detailed picture but only with 2001 census data. They are;
North Coast, (8 State seats, avg pop 64,570, 5 current Federal MPs)
Tweed, (voters 47,416, population 60,887, 2pp vote 54.0% ALP)
Ballina, (voters 47,246, population 65,416, 2pp vote 59.4% LNP)
Lismore, (voters 47,410, population 69,792, 2pp vote 58.1% LNP)
Clarence, (voters 48,074, population 67,722, 2pp vote 55.3% LNP)
Coffs Harbour, (voters 48,330, population 66,259, 2pp vote 61.9% LNP)
Oxley, (voters 47,116, population 64,330, 2pp vote 59.9% LNP)
Port Macquarie, (voters 47,595, population 59,154, 2pp vote 67.0% IND/LNP)
Myall Lakes, (voters 49,063, population 63,004, 2pp vote 63.9% LNP)
Population Subtotal 516,564
Inland (4 State seats, avg pop 70,802, 2 current Federal MPs)
Northern Tablelands, (voters 48,890, population 71,121, 2pp vote 63.1% IND)
Tamworth, (voters 48,457, population 67,100, 2pp vote 69.2% IND)
Barwon, (voters 48,049, population 77,038, 2pp vote 64.6% LNP)
Upper Hunter, (voters 48,369, population 67,952, 2pp vote 57.2% LNP)
Population Subtotal 283,210
The New Northern State population of 799,794 would have 7 Federal MPs and 3.5 Senators
(0.5 Senator = 3year term).
Hunter Valley (8 State seats, avg pop 62,706, 4 current Federal MPs)
Port Stephens, (voters 48,371, population 61,337, 2pp vote 57.2% ALP)
Maitland, (voters 48,357, population 60,526, 2pp vote 60.3% ALP)
Wallsend, (voters 47,350, population 63,108, 2pp vote 69.8% ALP)
Newcastle, (voters 48,120, population 63,167, 2pp vote 65.0% ALP)
Charlestown, (voters 48,175, population 61,015, 2pp vote 63.3% ALP)
Swansea, (voters 49,247, population 61,923, 2pp vote 67.1% ALP)
Lake Macquarie, (voters 48,202, population 64,512, 2pp vote 61.6% ALP)
Cessnock, (voters 48,960, population 66,061, 2pp vote 69.1% ALP)
The New Hunter Valley State population of 501,649 would have 4 Federal MPs and 2 Senators.
Two thirds of voters in the 8 Hunter Valley seats vote Labor, and have done so without fail in every election of the past century. The Northern seats display more plurality, with 1 Labor, 3 Independent and 8 Liberal/National State seats. The choice of government by the two communities is directly at variance with each other. Neither major party could form a majority government in a single state, the ALP with 9 seats, the LNP with 8. Both parties would be reliant on independents to form inherently unstable governments. Neither party would ever have a clear mandate in a dysfunctional unit that could never hope to satisfy either community. And both would have every reason to ask; “whats in it for us”?
The momentum to establish the state capital in Newcastle would be insurmountable. The $750 million in extra GDP generated by the state head office overheads would not re-circulate any further north than Kempsey and Tamworth and the southern population would soon become dominant. A full third of the northern population would simply replace a nine hour drive to an urban/industrial government in Sydney with a seven hour drive to an urban/industrial government in Newcastle. For them, nothing would change from the past 43 years since the 1967 referendum.
Compounding the obvious socio-political dimension is the simple fact that the voters of the Hunter Valley are completely insulated from any adverse economic consequences of any decisions they might make in respect of the northern economy. Their mining and industrial base is not dependent in any way on the economic wellbeing of the north. Their elected representatives would be free to indulge in a repeat of the very worst kind of “cheap thrill politics” that impose burdens, costs and losses on the northern community without commensurate impacts on their own community. This is just as Sydney has done for more than half a century.
These two elements combined would replicate the existing disproportionate development pattern. A shift in development concentration just hours up the road does not constitute real decentralisation. It merely enlarges the existing unsustainable capital sprawl under two entities, not one. And it would do so in a forced marriage of two incompatible partners.
The key conclusion is that both communities have the right to expect to form the governments of their own choosing. The Hunter Valley is a discrete geographical unit that is absolutely clear on the political character of the government they want. And a well devised state structure should be capable of delivering exactly that. In 1967 they rejected a state model that would have left them as a permanent minority vote, with minimal chance for their elected representatives to form government. The same condition is less obvious in the North where the geographic spread of the political divide is nowhere near as marked. But their desire for a government that reflects their own values and interests is no less legitimate. And a structure that is capable of consistently delivering exactly that is no less essential.
The common cause of full regional autonomy does not demand a common response. Both regions have sufficient population and economic momentum to justify full Statehood in their own right. Both regions can best satisfy the legitimate expectations of their own communities with their own state within the commonwealth. The creation of a larger state may serve to meet the rest of Australia’s pre-conceived notions of what a state should look like. But the rest of australia already have their own states and their perceptions have no bearing or legitimacy here. If the state serves the interests of the voters of that state then that is the only perception that counts. If the people are here to serve the state then the bigger the state the better. But if the state is here to serve the people then the size that bests serves the people’s expectations must take precedence.
Ian Mott 4th August, 2010
More recent information from the Commonwealth Grants Commission indicates that the 20% government overheads figure used above is considerably over stated. The actual overhead figure for a Minimum Administrative Structure for a state is $213.5 million in 2008/9. See “The myth of new state duplication costs” on this blog.