The Hunter and the North, 1 or 2 States?

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
 Update 22/09/2010
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.

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A site for informed discussion on the strengths, weaknesses, risks and opportunities to be gained for regional Australians through the formation of new states within the commonwealth.
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10 Responses to The Hunter and the North, 1 or 2 States?

  1. Greg says:

    Ian, I sense that this argument has more to do with politics than anything else – ie labor voting city vs conservative country when we should instead be concentrating on our common northern geography and identity. I also don’t really believe that it is in our best interests to be getting bogged down over state boundaries at this stage. The most important thing is to get people thinking about northern issues in a new way and talking about self government.

    State boundaries should be for the electorate to decide at a referendum. The first question should be “do you accept separation of the northern districts from NSW?”. The second question should be “given that a new state is to be created do you wish your area to be included?”. If we get a “yes” answer to the first question and the path to a new state is firmly established then it is likely that the second question will also result in a strong “yes” in most regions. If some regions decide “no” then that must be respected as their choice but it won’t derail the process for the rest.

    It may well be that separate states would be a long term goal and I am certainly a believer in regional self determination. In fact I believe that northern separation may well open the floodgates of claims for other regions with strong claims (notably Nth Qld and Riverina). But in the short term we have to convince the nation, the state and especially our own districts that the common goal of self government is a viable and realistic option. We will be battling some very ingrained anti-state perceptions, a population that has forgotten it’s northern history and a NSW government that will fight to hold prized territory, it’s people and resources. It will be no small task to convince our people that separation is the way to go.

    Thinking about this from a national perspective, I believe that we should be striving to have our northern state accepted on an equal footing with the original states. Our best chance in this regard is a united north with a population of about 1.6m and a diversified economic base. All of the elements are in place to lay a rock solid claim that the northern districts should be both separate and equal. Each of the existing states would give up one of their senate seats and we would and should have EQUAL representation in the senate as the original states. Divided our case for equal representation is significantly weaker and we have a greatly diluted presence at the national table, not to mention a reason to vote against self-government in the first place (ie. second-class statehood)

    I also don’t necessarily accept the argument that Newcastle would become the new “gorilla in the room”. Where to site the parliament should entirely be a matter for the first parliament of the new state. If Newcastle dominance is a concern then that would no doubt be debated by our first elected representatives in their debate over situation of the capital. Newcastle would be much less likely to exert such a large centre of gravity given that it’s share of the state population would only be about 1/3 of the total. By comparison Sydney is nearly 2/3 of NSW even with the north included.

    The discussion of boundaries and capitals is interesting, but I believe that this is a matter for the voters and the first parliament respectively to decide. It may be counter productive for us to be trying to pre-empt the proper process.

  2. Jack Arnold says:

    Wonderful analysis that explains many local events over the last forty (40) years of local Armidale and New England politics.

  3. I understand your perspective, Greg, and in a perfect world would agree with you entirely. But the big issue in the Hunter Valley is, “what will be the ALP’s response’? And on that topic I can speak with considerable experience. The article may give the impression that I have been an entrenched National Party voter all my life but, in fact, I spent 15 years in the Qld ALP and served on Federal Minister Con Sciacca’s, and Deputy Premier Tom Burns’, District Executives. I was about as ‘right’ as one can get in a leftist party, and saw my role as leading from inside. It is the compounded mistreatment of farmers over the past decade, seen first hand from my position on the national executive of Australian Forest Growers, that has produced my enduring mistrust of both the ALP and the urban Liberals. So I do know how the Labor party works.
    The problem for secessionists in the Hunter Valley is that no local MLA’s preselection is assured if he strays from the Head Office view from Sussex Street Sydney. Rock solid Labor seats are a keenly sought prize in any political party but even more so in the ALP. And without the visible support of Head Office, the local Unions, and the local MLA, the majority voters will NEVER vote contrary to the ticket.
    And that becomes a critical weakness for the cause in the Hunter Valley. You can take all the encouragement from general day-to-day statements of support from people who may vote for either end of the political divide, but that is not how it will show at the ballot box.
    But let me also add that nothing would please me more than for you to show us polling that is capable of demonstrating, first, majority local support for secession, and second, that this support is bi-partisan.
    In the mean time we must always adopt plans and strategies that consider the self interests of potential opposition and anticipate their reactions. We must also avoid, at all costs, any situation that gives the opponents an opportunity to delay, frustrate or impede our progress. Because they will grasp every such opportunity that we give them.
    It would be very interesting to do a survey of the people at your meeting on the 7th to see what their voting background has been. Especially if you can also get a before and after assessment of their grasp of the issues to measure the results of their attendance at the gathering. Good luck.

  4. Greg says:

    Ian, that is precisely why I believe that we must resist the temptation to bring political allegiances into the debate. We must focus on the issues of concern to the north not the voting patterns of districts. Many of the issues and grievances are common regardless of whether you reside in Hamilton, Uralla or Lismore.

    From a Hunter perspective I see a major issue if the Hunter is deemed separate. It would be the most city-centric state in the Commonwealth. Of the approx. 650,000 people in the Hunter Valley approx. 500,000 live in Greater Newcastle. That is more than 75%.

    Also returning to party politics for one moment – the ALP dominance in Newcastle would almost guarantee that the Hunter would only ever be governed by one party. That is unhealthy and would no doubt cause resentment in the rural and marginal districts. These are genuine arguments against the Hunter becoming a separate state in it’s own right.

    Also without the Hunter the north would have little industrial base. That may or may not be of a concern, but there is no doubt that the north would benefit by having a diverse economy with a strong industrial and service base in the south.

    By contrast Hunter/New England combined represents an approximation of the nation. A government would have to perform exceedingly well or face change at an election. The north would become the nation’s “bell-weather state” because of it’s fine balance between city and country, primary and secondary industry, left and right. This would probably attract even greater national attention than it’s population alone would dictate.

    Also by demanding and receiving equal representation in the Senate the north would be able to give a better account of itself in defending state rights than two states with diluted Senate representation.

    All arguments aside, I remain convinced that the issue of boundaries and capital city is ultimately for the electorate and the first parliament to decide.

  5. Greg says:

    Ian, if you want an indication of the depth of public sentiment in Newcastle then please check out this link to an article in the Herald about a high speed rail proposal. People are very disillusioned.

  6. Thanks, Greg. I would love to see a clear mandate for self government from folks in the Hunter Valley. And if there is any way I can assist then you need only tell me what to do. And I agree that the boundaries of states should be left to the people who actually want to live in that state. But I also recognise the basic self interest that people will always favour an option for governance that is most likely to deliver them the kind of government they favour. An option that will deliver them a lifetime of political opposition for the party they favour is the least likely to win support.
    And this means that in the Hunter Valley the voters who will be least enthusiastic for change will be the 1/3rd of the population that does not vote Labor. But if there are institutional reasons why the Labor vote will not support self governance, as there was in 1967, then there is very little real prospect for change.
    The opposite is the case in the rural North where it is the Labor minority that will face the prospect of seeing their elected representatives in opposition and the conservative voters who will have the best prospects of having a government of their choosing. Conservative voters in the north have not even had an urban Liberal Party government, let alone a National Party one of their own choosing, for 80% of the past 34 years. In contrast, Hunter Valley Labor voters have had governments of their choosing for the same 80% of the time.
    I don’t think the political implications could be quarantined from the public debate for very long at all. So there is little point in trying. Clearly, the delivery of the most appealing message to each of the two market segments demands the delivery of two distinct messages to each.
    I also think there is a serious problem is starting with the view that a larger state with both communities is the ideal or the benchmark because it would imply that anything less is a failure or is substandard. The better approach would be to start with the absolute minimum viable option and then add as much as we can to it. The proper implementation of National Competition Policy, and the advent of marketing on the world wide web, makes the need for an in-house industrial capacity redundant. The same applies to the rural sector’s past need for priveleged access to a metropolitan market. That privilege no longer exists so the political compromises that were made by the bush in exchange for that market access are no longer necessary.

  7. Jack Arnold says:

    A wonderful article … NOW I understand the stance of the ALP and the weird action by Carr after the retirement of Member for Clarence Harry Woods about 1999 in locking up the Clarence forests and giving away the Clarence electorate to the streetfighting signwriter Steve “Can’t Do” Cansdell.

    Indeeed, I HAD (and know the whereabouts of) a letter written and signed by Carr stating that he would lock up the northern forests into National Parks because they were not Freehold but rather Permissionary Title and Crown Leases of mainly forested areas used principally for forest grazing by pastoralists (predominantly members of the Notional Party, the party you have when you don’t want representation).

    It also explains Premier Neville & Jill Wran visiting Armidale ( to see his former WW11 service mate Bill McCarthy MP for Northern Tablelands) and declaring the Wild Rivers National Park at the end of our road. Pretty but steep gorge country full of good straight timber and wonderful dam sites for hydro-electricity power generation.

  8. Thanks, Jack. The scale of this betrayal of the very people who could contribute most to restoring degraded habitats cannot be overstated. From that moment on farmers knew that the native forest they had previously regarded as an asset was hence forth a serious liability. From that point on the clearing of native vegetation became a key preventative measure in maintaining their existing grazing operations. Wran turned native trees into weeds and created the circumstances that subsequently justified the implemetation of clearing controls.
    Ironically, since that time another 14 million hectares of less productive native regrowth has taken place in NSW. Its average age is about 15 years and most of it is less than 30 years. And that means the average increase in forested area has been around half a million hectares each year. This did not prevent the Carr government from claiming that there was 150,000 hectares of annual clearing as its justification for clearing controls. But, for the record, the Landsat scans subsequently established that the actual area cleared each year was only in the order of 12,000 hectares. So not only were the government claims exagerated by 1200%, they completely failed to mention the 4000% offsetting forest expansion. One can only conclude, from the scale of the misrepresentation and fraud involved, that Sydney has completely squandered its right to govern regional NSW.

  9. B.W.Baker says:

    the ideological divisions that divide the nation can not divide the movement we are on a mission to be the guiding light for the rest of the nation, we must be a land of noble and principled people who place duty before self interest. in 2013 their are local council elections now is the time to act and flood our councils with people are prepared to act. i am ready to do my duty to my motherland and people. united we stand divided we fall

    • Ian Mott says:

      There is nothing wrong with ideological divisions, BW, but one of the key indicators of the need for new states is when a particular geographic community is consistently subjected to an ideology that it does not share.
      The whole point of a federal system is to allow for greater diversity in both government structures and governing policies. At the moment in Australia we have a monotonous conformity where each metropolitan makority imposes its will on a number of regional minority communities.

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