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STANDING COMMITTEE ON INFRASTRUCTURE, TRANSPORT, REGIONAL DEVELOPMENT AND LOCAL GOVERNMENT
30/04/2009
Impact of the global financial crisis on regional Australia

CHAIR —Welcome. I am pleased you were here for that previous discussion, because I am sure there are some things that have come out of that you would like to talk to us about as well. The committee does not require you to give evidence under oath, but I do need to remind you that these are formal proceedings of the House of Representatives and should be treated with respect. It is customary for me to remind witnesses that giving false or misleading evidence is a serious matter and may be considered a contempt of parliament. That being said, you are most welcome here today and we are looking forward to hearing your evidence. Do you have an introductory statement that you would like to make?

Mr Punch —Yes, I do. But I will be very succinct and mindful of the committee’s time. I certainly do not want to duplicate anything that has been said before, so please stop me if I do repeat myself. Would you like me to proceed with the introductory statement?

CHAIR —Yes, please.

Mr Punch —The South West Development Commission is a statutory agency. It is responsible for the economic and social development of the southwest area, which is defined by the 12 local governments of the southwest. We have been well supported both by the current government and the previous government. We have been in existence across a number of changes of government and from that point of view there is a recognition on both sides of politics about the importance of the commissions for regional development.

We are a high growth, strong region. It is probably one of the undiscovered secrets of Australia because we sit here on the southwest corner, but our GDP has grown consistently over the past 10 years. It is currently sitting at around $9.87 billion, and we have one of the most diverse regional economies. As we are a small region, export is very important to us and we figure prominently in terms of the state’s export agenda. The local domestic markets are not big enough for us and neither is the national market, so the survival and the growth of our business is reliant on good trade links, and as such the commission also represents the Commonwealth’s interests through Austrade and TradeStart in the region.

As to the strength of the region’s economy and its diversity, mining and mineral processing accounts for around $2.29 billion; retail around $1.63 billion; building approvals, $803 million; agriculture, $550 million; and tourism at $569 million. I am sure that the previous witnesses would have mentioned that the port of Bunbury’s total trade is $13.66 million tonnes. We account for roughly 20 per cent of container volume that goes through the Fremantle port. That container volume will be travelling on the Perth-Bunbury Highway and currently travels up the normal freight route direct to Fremantle.

We are also a very vulnerable economy. The vulnerability arises from the fact that because we are small we have to be highly efficient on the world and local agenda. Most of our trade is in premium quality product, whether it is wine, food or timber craft, but also in the mineral and mining sector. All of our mining sector is operating at world’s best practice, so the cost structures for groups like Alcoa and Worsley are in the top one per cent to two per cent of alumina producers. Similarly with coal, because we have widespread international competition, coal is a very important aspect for us and operates at world’s best practice in terms of their cost efficiencies. They are vulnerable to changes in terms of trades, foreign exchange and cost imposts that arise within the state.

I would like to just go through some of those with the mining and mineral processing sector. I will just step back a moment. The vulnerability is starting to show forward in those companies that have not anticipated the tight downturn or which were vulnerable before the downturn in terms of their balance sheets. For example, places such as Harvey Beef, Pinetec, which has recently announced employment losses, and Iluka, which is a mineral sands company that had difficulties last year through foreign exchange issues, are downsizing because of cost impacts. They were all vulnerable pre the global financial crisis.

CHAIR —One of the things that has been an issue is the speed at which this has hit. Many people, whilst they were vulnerable, had some capacity to potentially trade out of that vulnerability. Would I be correct in saying that has been where the real problem has been for some of those?

Mr Punch —Yes. Their capacity to withstand the change on the balance sheet has considerably eroded and as a consequence they are fast tracking, downsizing and cost cutting. We are seeing the flow-on implications of that. Other companies such as Worsley, which is continuing with its expansion, and Alcoa, have taken significant steps towards managing their internal business operations so that they can withstand the downturn, preferably without loss of employment, but it has meant that they are not employing so the growth of our employment agenda, linked to our population growth, is probably going to slow. The vulnerabilities in this first stage really are coming out in terms of those companies that are at risk and as a consequence are reducing their scale or in fact closing. We expect over the next 12 to 18 months that those resilient companies will considerably slow their new employment. At this stage they are indicating a commitment to ongoing training, particularly for young people, but the reality is that is probably at risk as well.

Some sectors of our economy, particularly tourism, which is dependent on discretionary expenditure, the wine industry, which is largely based around the premium wine market area, are particularly vulnerable as well. The southwest cannot be thought of a homogenous economy either. There are three very distinct subsets. The Bunbury Wellington area, which the previous shire presidents represent, is dependent on the mining and mineral processing area. That is its major driver, together with strong engineering and manufacturing sectors. This area, the Capes to Capes, is dependent on tourism, agriculture, premium wine production and a recent trend towards the creative industries area, with small businesses that are highly specialised and highly professional—medical diagnostics, architecture, construction design. They are dependent on high-capacity broadband to survive. That is a big vulnerability for the Capes area in terms of its future growth. Small high value businesses that are choosing to locate here because of lifestyle are restricted in growing their business due to high-capacity broadband. Again, that is largely on the world market.

The Warren-Blackwood is dependent on timber, particularly out of the native timber industry and plantation timber. With plantation timber, in particular, the margins are quite low at the moment and it is dependent on freight of that product out. It is also dependent on tourism. Both of those two sectors, together with agriculture, support the small business sector in the Warren-Blackwood. That is the most vulnerable area for us, because it is always the low growth area.

That is a brief description of where we see the region. In terms of the approaches at a Commonwealth level to address that, a lot of that activity has been based out of an area of 24,000 square kilometres, much of which is national park and restricted in terms of access to land. Our actual land usage to drive that economy is quite small. Links between the areas or loads of activity are important. The shire president has mentioned the issue of road, particularly, the port, and the premium importance of the port; rail to an extent, particularly in the northern part of the region; and the airports agenda.

In terms of stimulus measures to address the crisis, there has been a number of areas that have had an impact in terms of confidence. The ad hoc feedback that we are getting is that certainly confidence issues are impacting the retail sector and the credit squeeze has impacted and terminated a number of building projects in the construction area. There is some uncertainty in the mining and mineral processing sector and they have raised the emissions trading scheme as a key issue. In our southwest we are reliant largely on coal powered energy sourcing. The gas pipeline from the northwest starts to get quite restricted as it moves into the Bunbury area. There is approximately 2,000 to 2,500 megawatts of generating capacity in the southwest and that is driven by coal. The size of our system is not really going to accommodate any other alternatives that we can foresee at this stage. Alternative energy sourcing technologies such as wave, wind and solar are really going to make a contribution at the margin in the foreseeable future in terms of the base load requirements for industry in this area, so the ETS agenda is particularly important for us as well.

The short-term measures of the stimulus package have had an impact in relation to the retail sector. The value of the Perth-Bunbury Highway cannot be underestimated and I would like to thank all of those who have contributed to supporting that piece of infrastructure. That is there for two reasons. It builds a linkage back with Perth that is much more efficient and it also makes it much more efficient for our container trade, particularly in our freight volumes that are moving out of the south-west. From that point of view, although that has huge local and state significance, it is a road of national significance.

The comments that were made earlier in relation to the planning and the development of that road with its link through Bunbury and into the broader southwest are important not only for the economic efficiencies of freight out of the Warren-Blackwood, which is a vulnerable area, and the wine agenda out of the Capes to Capes area, but it is also particularly significant in reducing bottlenecks into the port. The two sources of bottlenecks that will happen with the port are vehicle traffic, in terms of road haulage for plantation products and mineral sands products, but also the rail blockage.

The present rail planning for the port with its current forecast activity, including the urea plant, means that with the current 15-minute trip from the town of Brunswick into the port the train movements that will occur will require a movement every 17 minutes. We will have a two-minute window between movements in terms of getting freight into the port. Rail breakdown or any sort of bottleneck problem amongst the various users of the port will have a critical flow-back effect. When we are looking at a company like Alcoa, which is really working at the margin now in trying to maintain its cash flows from the Wagerup plants or Worsley, those sorts of bottlenecks and the consequent flow-on implications for holding up shipping are huge in terms of their cost structure. Not only will it have an impact on whether or not they choose to expand—and those decisions are being made based on efficiencies in the past—it will have an impact in terms of whether they can maintain the scale of their existing operations. Once they start to scale back, the flow-on implications in terms of confidence in investment in the southwest, particularly the upper part of the southwest, will be pretty significant.

The comments that were made by the shire presidents in relation to efficiency of access into the port, the second stage of the port access route, and the second stage of the Bunbury bypass are significant for us in terms of that overall bottleneck issue. Linked to that is the infrastructure commitment that we will need to flow from the private sector, the state and the Commonwealth in addressing any potential rail bottlenecks into the port. Again, they are critical for the export agenda for the southwest.

In this Capes to Capes area the most significant contribution, aside from the road agendas that the shire presidents spoke about, is broadband. Broadband will provide a very important stimulus to the small and medium high value sector in this region. That is typically in the professional services sector, from engineering to design and through to the creative industries sector. That is really the future of this region, together with tourism and wine. We cannot see the economics of large scale industry, the environmental constraints and the societal constraints that exist down here supporting large scale industry.

It is a similar situation with the Warren-Blackwood. Tourism is a critical issue from their point of view. Broadband infrastructure will have a role to play, but the efficiencies in the agricultural sector, particularly in high value niche products, are very important for that area. They have gone through enormous change in terms of downsizing of the native timber industry. They have moved from traditional potatoes, carrots, onions and cabbage-type growing into green tea, avocadoes and truffles. They are very high value product that has to be managed well and transported well. The freight routes that currently exist out of the Warren-Blackwood area require very careful management of that product, in terms of vibration and damage to the product on the way out of the Warren-Blackwood. Unless we can address that freight logistics point of view in a constructive way that meets the needs of that freight agenda, that area is at risk as well. After that brief overview, perhaps I can answer questions from the committee.

CHAIR —Thank you. It is very helpful to get your views on what is happening. In terms of how the commission works with the local, state and federal governments, I am interested in the relationships between and how you work to promote all of those things. Obviously, funding from all levels of government is required if any of those things are going to be realised. How do you, as a commission, go about doing that, and is there any advice you can give the committee about the sorts of models in relation to those relationships that might work in other regional areas across the country?

Mr Punch —The answer is very simple in one respect. I hate to quote George Bush, but it a coalition of the willing. The more that we can build a groundswell that says that this piece of infrastructure is required or this action is required, and create the climate within the community, in our contacts with state and federal bodies and locally, then the better chance we have of actually succeeding with that.

CHAIR —What role does the commission play in doing that?

Mr Punch —Planning. We are not a regulatory body. Our skills are around planning, research, informing and educating. We do build coalitions. We founded the Bunbury Wellington Economic Alliance that was mentioned earlier. There is a second alliance that exists in the Warren-Blackwood called the Warren-Blackwood Strategic Alliance. We try to build that consensus between local governments so there is not a conflict over particular local projects. We have also undertaken a number of planning documents that coalesce the agendas locally into what are the strategic issues for the region.

As a commission we have articulated three priorities for the region. One is investing in people and that is really the key social infrastructure that is required. The second is in relation to infrastructure in place. I mentioned earlier the land size issues of the southwest. When we are planning infrastructure it is very difficult to plan that in isolation from the environmental constraints that exist within the region, and those constraints are not going to get easier as time goes by, particularly as more people move into the region and have a different set of values about the use of that land. The third is investing in knowledge enterprise and innovation. As a region we are seeing the future really moving into higher value industry. We are not seeing the same potential for the mining and mineral processing sector in 20 years time than exists at the moment. We have to use this period to transform the region’s economy.

CHAIR —Can you tell me a little about that? What are some of the projects or things that you are doing in relation to that? You have given evidence about the downturn in some industries. I am really interested in what is happening with those workforces. Where are they going and what assistance are they being given to transition and find other work or are they leaving the region entirely?

Mr Punch —There are two parts to that question. The first is in relation to what we can do. We also provide a considerable amount of money in grants. Under the Royalties for Regions scheme we are currently administering $4.4 million in grants funding to transform the region’s economy. A good example of that is the alliance that we have built with the city of Bunbury, and then worked with a private media imaging sector. We are now looking at developing the Australian Centre for Digital Innovation in the public library of the city of Bunbury occupying the ground floor. That will provide high-capacity computer operations in the region, capable of servicing the mining sector in terms of all of their digital imaging of mining structures and underground workings, but it is also linked in to view technologies, which is digital animation, so we would be moving into the digital media production area. Their most recent work was a documentary on the history of aviation in Australia, which was largely digitalised. The emergence of the entertainment industry and digital techniques is very important.

We provided seed funding to build the infrastructure in the library, the back-up power generators and the air-conditioning systems to support the high capacity computing networks that need to operate there. That is triggering interest in providing higher capacity broadband links into the Bunbury area. That is an example of how we have made a strategic financial investment to achieve particular outcomes. I have lost track of the second part of your question.

CHAIR —I was asking: what is happening with the workers who have been made redundant?

Mr Punch —The research is very hard to pick up on the current workforce. What we found out of the timber industry restructure was that quite a large number of mill workers were displaced and they were very quickly picked up by a market that was in high demand for labour. They had a reputation for being hard working and committed, and virtually all of those people were placed. We are not getting the same sense of pick-up in the current market as people are being displaced, but I think it is too early to really be definitive about that. What we are picking up is a strong commitment to retaining apprentices and trainees within existing industry. I think industry has learnt from the experience of the last few years and where possible is maintaining a commitment to training to look at the future options for being able to pick up on labour supply.

CHAIR —Thank you. Mr Neville.

Mr NEVILLE —I have a couple of things leading from that question. Have you experienced a drain of tradesmen to the mines that has been experienced further north in Western Australia and Central Queensland. A lot of young guys are going up and taking tradesmen jobs at the mining sites or, alternatively, just going to do the mining thing and get the big money—$130,000 to $140,000. What is your experience of that in the southwest?

Mr Punch —That was a very clear trend last year, particularly at the height of the mining boom in the northwest. A lot of the medium sized companies here were struggling to maintain comparative wages. On the other side of the equation, we also have one of the best lifestyle options for people to settle in the area and have families, so fly-in fly-out from this region is very popular. We have found that a lot of people in the 40s or 50s who have been in that game for quite a while are returning back to the region reasonably well off and choosing to work part time or look at opportunities in the region or just operate on a fly-in fly-out basis as required. It has been a bit of a mixed bag for us. The quality of lifestyle in this region, compared with areas of the northwest or the wheat belt areas is—

Mr NEVILLE —As mining turns down a little are these people coming back into the region or do you think that a lot of them did not leave this area in the first place?

Mr Punch —A lot of people have their families based here. It is too early to tell whether people are returning on a permanent basis with the downturn. Ad hoc evidence would suggest that it is a possibility, but there is nothing definitive to back that up.

Mr NEVILLE —One of our prime terms of reference is the effect of the downturn on regional communities. We need to try to get our finger on that pulse. How are the training facilities in the southwest? I heard about universities from the last witnesses, but what about TAFEs, general training and apprenticeships?

Mr Punch —We have a very good TAFE network in the southwest. I can provide the details of the enrolment trends if you require it, but it is certainly much more significant this year than it was last year. We are seeing a return to education, with people moving into vocational training, which is really a reflection that the workforce opportunities are not there.

In terms of the infrastructure of the TAFE network, it is suffering from financial cutbacks and there are certainly some opportunities to improve the facilities in the Warren-Blackwood area and in the Busselton area. Currently the largest scale infrastructure is in the Bunbury area so we have to have people travelling to Bunbury, and while there is a low cost transport network operating to take them to the Bunbury TAFE, it is a pretty inefficient way to operate for them.

Mr NEVILLE —Is the university model linked to one particular campus as the umbrella or mentoring campus or is it a multifaceted model?

Mr Punch —It is linked to Edith Cowan University.

Mr NEVILLE —Is it a proper regional campus?

Mr Punch —It is a proper regional campus.

Mr NEVILLE —It is not multipurpose or accredited to three or four universities?

Mr Punch —No. It is operating solely to ECU. There is a multipurpose facility in Margaret River, the Centre for Wine Excellence, which has Curtin, ECU and TAFE operating from it.

Mr NEVILLE —Is that a university centre as distinct from a campus?

Mr Punch —Yes. I am not an expert in relation to the Commonwealth formula on funding of universities, but Bunbury just falls outside the scope of being regarded as a regional campus and it really depends on the goodwill of ECU in terms of their placements.

Mr NEVILLE —So would you miss some of subsidies?

Mr Punch —Yes.

Mr NEVILLE —Have you put a case to the new minister in the last 18 months to have that corrected?

Mr Punch —We have not. As a commission we have not, but that is not to say that ECU would not have addressed that.

Mr NEVILLE —I see what you mean. Lastly, you talked about the importance of the efficiency at the port of Bunbury and that you only have two-minute windows.

Mr Punch —Potentially.

Mr NEVILLE —What are the greatest single contributors to increasing that efficiency? We heard evidence before about the area to the north and the south of the port area. In other words, it is not just a matter of around the port proper and the ring-road but the feeders to the ring-road as well. What is the significance of rail from Collie and so on? Where do you think the priorities are to make the port more efficient and facilitate better movement of traffic around the port and around Bunbury?

Mr Punch —In terms of the value of exports and the contribution to the region as a whole, rail is a singularly important issue, because we have alumina operating on rail. We have caustic soda that goes back to the alumina plants on rail. It is a vital artery for both Worsley and Alcoa, and both of those are major employers and contributors to the region.

Mr NEVILLE —Forgive my lack of knowledge of geography, but where does that train line come from?

Mr Punch —It runs northeast out of the port to the town of Brunswick. That particular line shares the Australind passenger service as well. At Brunswick we have the linkages coming in from the Collie coalfields and Worsley alumina, which is to the east, and the linkage from Alcoa at Wagerup, which is to the north. Brunswick essentially is a pinch point where those lines come together, and the rail linkage from Brunswick into the port is the one most at risk in terms of bottlenecks.

Mr NEVILLE —Can you give us a one-pager on that? This is no criticism of the councils, but everyone was speaking as if we knew the intimacy of the geography, which of course we do not. Mr Randall might.

CHAIR —There is a map at the back here.

Mr NEVILLE —I would like a one-pager as a supplementary submission on how that all works.

Mr Punch —I am happy to do that. I would also stress that it is very difficult to separate out that rail infrastructure from the road infrastructure. It is a bit like saying if you can have half a lolly or one lolly, in a sense. That road infrastructure is very important for those southern parts of the region. It is fine for Bunbury to get the Perth-Bunbury Highway, which will address a lot of issues in relation to Bunbury, but the broader growth of the whole of the southwest, which Bunbury is dependent on as well, with road access through Bunbury and around the freight linkages into the port is critical for their future. I have mentioned the issues particularly of the Warren-Blackwood with their agricultural product, which really is Perth-Fremantle based and not Bunbury port based.

Mr NEVILLE —If I remember rightly, that is the point that you put to us last time we were here with the ports inquiry.

Mr Punch —Yes, that is right.

CHAIR —Thank you. Mr Raguse.

Mr RAGUSE —I would like to go back to the statement about the broadband and its necessity as a major project. It was interesting listening to earlier evidence about the range of projects and priorities. As a member from South East Queensland I found interesting the mention about the area’s development and some of the success we have had there. I note that obviously during intense economic development when you have this growth with certainly the private sector and government there is a lot more risk taking and a lot more borrowings for a whole range of projects that are simultaneously developed. Of course, a downturn means that a lot of that intensity lessens and the risks are not taken. It therefore says that when you are in a high period of growth there are all of these other things that you are trying to bring together to have a final outcome.

This is probably more of a statement than a question. I note that broadband is what you see as being probably a major piece of infrastructure that the federal government can come on board with, given that governments of all persuasion can certainly support and invest in private sector projects. But when we have a limited source of funding our priorities suggest that we have to look at a major infrastructure project. I know that you have already stated this in different forms, but that broadband rollout and the requirement to have that sort of infrastructure in place over everything else would be important; am I reading that right?

Mr Punch —Yes. It is underestimated how important that is to the future of the southwest. We worked pretty hard with Main Roads to ensure that when the Perth-Bunbury Highway was built conduit was put in to allow for optic fibre linkage and backhaul. In the discussions that we had with telcos and particularly Telstra, two years ago they would say to us, ‘If you get a megabyte then what more would you need?’ It was a put-downish sort of view. Our vision, as a commission, has been one to 100 megabytes for domestic use and one to 10 gigabytes for business and wireless right through the region. That was something that Telstra said, ‘You really are dreaming in relation to those sorts of figures. There’s no need for it’, but on a comparative basis those are the figures that we get in Europe and Canada. If our designers, architects and musicians, who are all adding value to our regional economy and want to live in the Capes to Capes area particularly, want to compete with those areas they have to have that sort of access.

Some of the business stories that we have heard that have come out of the Vasse area where people are overcoming some of those difficulties are extraordinary. They are paying an enormous amount of money to do it. There is a complexity of architectural designs that are being transmitted as CAD drawings over the internet. We have an engineering firm choosing to operate out of Bunbury, Geographe Enterprises, that is producing designs and drawings, and has a wide network internationally. One of its biggest cost drivers is the cost of communications and broadband. In an environment like we have where those businesses become vulnerable on the cost agenda, that is when it really sharpens up for them.

Mr RAGUSE —I think that is probably more important. It is certainly the case in South East Queensland. One of the things that is not quite understood is the development of infrastructure, road building and everything else that has been put into South East Queensland is on the basis that 12 to 15 years ago fibre optics went through and that whole corridor was opened up. The area of Bromelton, which is a major expansion area in my electorate, can only survive with the notion that there is large data communication transmission available because of that. Data communications is something that the broader community have not quite understood the importance of. It perhaps could be highlighted that broadband is a major part of your future growth, and it is up to our ability as a government to get on board with that.

Mr Punch —Behind all of that, our strength as a region has been diversity and resilience across a number of industry sectors. The freight agenda for commodities or the intellectual agenda in terms of broadband and transmission of intellectual property are both very significant to our future.

Ms PARKE —We have heard a lot of evidence today about the critical need for port road and rail infrastructure and also about broadband infrastructure. You have identified one of the priorities of the South West Development Commission as investing in people. What sorts of social infrastructure do you believe are necessary here, and in particular what would you like to see put in from the federal government on this?

Mr Punch —This is probably a shade of grey between federal and state responsibilities. One of the biggest unseen issues in our region is alcohol and drug abuse. The region needs linked into its health services an alcohol and drug abuse treatment facility. In all of our discussions with the human services sector through the region that comes out as one of their No. 1 priorities. Linked to that, which is probably a Commonwealth agenda, is the Supported Accommodation Assistance Program, which is grossly underfunded in the state. That flows back into the region in terms of the ability to target accommodation services and issues for domestic violence in those areas. We are in a growth region. The current growth figures put us around second or third nationally. Some of those services have definitely not kept pace with that growth.

Ms PARKE —Are you seeing a large number of migrants coming into this area?

Mr Punch —Yes. It is a very desirable place to live, so people are looking at a whole range of options. Previously it has been driven by employment opportunities. Interestingly, the last figures that we have for Bunbury show unemployment still trending downwards at three per cent. Previously it was 3.6 per cent, 3.3 per cent and three per cent. It will be interesting to see what the figures show in the next round. People come here for lifestyle choices. If you are unemployed would you live in Wyalkatchem or Northam or would you choose to live in Bunbury or Margaret River? Those are some of the options that we are faced with and they bring social problems with them.

From a Homes West perspective, in terms of state accommodation, we find that towns such as Boyup Brook, which is one of our inland communities, if it has surplus accommodation families relocate out of Perth to access that accommodation and that brings with it social issues associated with isolation and the capacity of that town to meet that need. I have probably gone off your point a little bit.

Ms PARKE —No, it is all relevant. Are childcare and aged care facilities an issue down here?

Mr Punch —They will be. The fattest segment of the population growth for us is in the above 50s bracket and I think that reflects a comment I made earlier about many people who have been in the workforce on a fly-in fly-out basis or mobile workforce are retiring to the area. There is a considerable amount of pressure, particularly in the smaller communities, for aged care accommodation. In some instances, particularly as people start to fail their driving tests at the age of 75, they are having to relocate out of communities to other communities where they lose all of their social connection. That is due to the lack of aged care facilities.

One of our priorities is an active ageing strategy within the region to improve the quality of life for older people. We are not only targeting the provision of aged care accommodation but also urban design and planning so that when the planning commission looks at developments they take into account the needs of the growing older population. Rather than having large suburbs with an aged care accommodation facility with a wall around it in the far corner of a suburb that is a mile or two miles from a shopping centre, what can we do to promote local commercial nodes that are accessible by older people who can walk to those nodes and not be dependent on vehicles?

From our point of view, urban planning and development is critical to addressing the issue of ageing in our region and looking at how we can support communities to build resilience to look after their elderly. There is a fantastic story to be told out of Balingup, which is a very small community south of Donnybrook, where they have done just that in a mix of the community getting behind developing facilities for people with particular needs, including the ageing, but also looking at a network of community services to support people to stay in their homes for as long as possible. That is the sort of resilience that we need to model across the rest of the region.

Ms PARKE —Thank you.

CHAIR —What sorts of things would you suggest that this committee recommend to the Commonwealth government that assist you and development commissions across Western Australia to meet the agendas of your regional communities? I am asking you to step back a little bit from the individual needs of this particular region, because we are obviously not able to visit every single region and it will be very difficult for us to recommend individual projects from every single region. We are looking at the policy incentives or parameters the Commonwealth might put in place or whether there are things they are doing currently that may work to assist you.

Mr Punch —That is a question on notice.

CHAIR —I know it is a big question, but it is the answer that we are looking for.

Mr Punch —From a policy point of view, we have had a very good relationship with the South West Area Consultative Committee as it previously existed. There has been a hiatus in terms of the policy link at a departmental level with the changes through Regional Development Australia, the structures and how they might work. In that sense we as a commission are a little more disengaged or dislocated from the delivery arm of the Commonwealth government. I think the linkages at a political and a policy level are very strong and there is very strong representation of the southwest needs in Canberra, but I certainly think once you get it to an agency level—and I picked this up with our relationship with TradeStart, where we have a contractual agreement—people have very little knowledge of regional Australia and certainly regional southwest Australia. Perth is a long way from anywhere and the southwest is a long way from Perth.

I know I have answered that question in a very general way, but the more that we can forge a link that builds a closer relationship at a departmental level with the key agencies at the Commonwealth level and can inform them about our region, then decision making will probably better reflect the needs of the region.

CHAIR —Thank you for the evidence that you provided today. Are there any concluding comments that you wish to make?

Mr Punch —Thank you very much for the opportunity.

CHAIR —You will receive a proof transcript of the Hansard. I understand we have asked for a page on the rail issue, so if you could provide that to the committee that would be most helpful. If we have any further questions we will write to you about that as well. Thank you, again, for appearing today.

[11.22 am]