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Select Committee on Regional Development and Decentralisation
09/10/2017
Regional development and decentralisation

BEILHARZ, Ms Linda, OAM, Chair, Regional Development Australia Loddon Mallee

BUCKINGHAM, Mr Daryl, Chief Executive Officer, Mildura Regional Development

JOSE, Mr Gerard, Chief Executive Officer, Mildura Rural City Council

LIACOS, Mr Stan, Executive Director, Regional Development Australia Loddon Mallee; and Regional Director, Regional Development Victoria

[14:43]

Evidence from Mr Buckingham and Mr Jose was taken via teleconference—

CHAIR: I now welcome our guests to the Bendigo Town Hall to give evidence to our Select Committee on Regional Development and Decentralisation. I'll run through some formalities to start with. I need to state that, although the committee does not require you to give evidence under oath, this hearing is a legal proceeding of the parliament and therefore has the same standing as proceedings of the House of Representatives. The giving of false or misleading evidence is a serious matter and may be regarded as a contempt of parliament. The evidence given today attracts parliamentary privilege.

Would you like to make an opening statement—one of you, some of you or all of you are welcome to do so—before we proceed to questions from the committee.

Ms Beilharz : We will make an opening statement, certainly to invite conversation but also to put a context around the role of the RDA and what we think our current work is. I am sure that we could spend the whole time talking, so if you have questions please interrupt us. I will explain how we have made up the group to do the presentation today. I am the chair of the voluntary committee of the RDA. In Victoria, the RDA is combined with RDV, which is Regional Development Victoria. So the funding from RDA sits within and is administered by the RDV office, and the staffing for that RDA work is combined with the RDV team. They do have separate roles and jurisdictions within that, but we work with the benefit of having both Victorian and national interests combined. This is why Stan is wearing two hats. He has a very senior role in RDV but he is also known as the executive officer for RDA but will soon be known as the strategic development officer for RDA under its new charter.

We work very closely with local government. The RDA committee comprises community members, but included within that are local government representatives, and Gerard Jose, as the CEO of Mildura, who represents an important end of the region—the other end of the Loddon Mallee Region to the end at which we are sitting. Loddon Mallee is large. It starts at Gisborne, just north of Melbourne, and then goes all the way up to Mildura, which is on our South Australian/New South Wales border. I know our local members will know that well. So it is a large region and we have committee members across the whole region geographically and across the region from different sectors.

I will just explain the role of it. I do know that RDA looks different in different states. Because we are integrated with RDV we are able to use our resources differently. Again, obviously we all reflect the local priorities of our region. We have four different areas we work in: developing priorities, developing partnerships, providing regional advocacy, and, sometimes, directly supporting projects. There is a long pipeline of projects that eventually make their way to funding. When they make their way to funding it is through a process of applying for funding from national, state and local government, usually together. We facilitate engagement with all of those different levels so that a project can be supported through the different levels.

Articulating priorities requires doing a few different jobs. We have used our Regional Strategic Plan as a mechanism to talk to people across the region in the different locations and through different sectors. So we do develop a plan, but it is very much an engagement strategy as we go. Our local governments use that plan to centre their council planning around, so you will find that all the council plans drop down or refer to the Regional Strategic Plan. We make it a tool for advocacy, and from that we also then develop things like an investment prospectus that we can use a highlight projects at a point in time where that is relevant.

We also work with organisations in the region. We had Sam here talking about his area of work. He is an example of somebody the RDA would work with in order to link where he is going between the different government departments and in the different directions. Maybe Stan will give an example of that at some point.

We have things like the Railing Ahead group, which operates to look at all the rail projects across the region, which are obviously not just of regional interest. They are actually of statewide or national interest. We have a group here that takes leadership in that area.

There is developing partnerships. If there is a priority for the region but there is no leadership group we work to pull that together. There is work being done at the moment in the southern part of the region to bring the voices together about the Tracks and Trail Strategy, so that there is a group of people, certainly from local government and maybe some from the private sector, depending on the example, to come together to provide that leadership for that area. We actually don't foster projects if we cannot get local buy-in and leadership on it, because we know it won't have legs.

The advocacy we do is a little bit like sitting here at this table speaking on behalf of the region. Where we can, we meet regularly with the MPs who cover our area to let them know what projects are coming up ready for investment and about some of the issues that might be occurring that they can help with. And we support and nurture groups. We have recently given some funding to the Railing Ahead group, because they needed to develop a business case for a particular area of work. Sometimes it is a bit of research.

We have the wonderful example in this region of Sea Lake, which is a destination for tourists that has emerged out of nowhere. It is not anything we would have put on a plan. We are finding that busloads of Chinese tourists, and probably other Asian people, are arriving in Melbourne and hopping on a bus to go up to Sea Lake, which is 200 kilometres north of here. It is very open. Sea Lake is the town and Lake Tyrrell is the lake. They are hopping out of the bus and taking photographs on the mineral lake, which gives you lovely reflections in colours. Then they are hopping on their bus and heading back home. On some websites we have seen that they had: destination—Paris, France, and Sea Lake. The Chinese tourist bureau. The little town that was finding itself getting these visitors had no infrastructure there. They had no social structure to develop a plan or do something about it. So we support a group with $10,000 to get some of that basic information going, which they've now used to leverage further funding to now get some boardwalks, toilets and stuff that stops the visitors driving into the lake and getting bogged; it just supports the visit. So you can see how that kind of thing could grow, but we're able to use a particular amount of our funding at our discretion, either on problems and opportunities that we see or to progress the long pipeline of work that occurs.

I guess our strength is that we work with the regional bodies, particularly the local government areas. Shortly we'll get Gerard to comment on what that looks like from the Mildura area. We have 10 local government areas in the region. They've all signed off on our strategic plan and use that well. I might just throw to Stan and see if he wants to talk about some specific examples.

Mr Liacos : Maybe when you finish I'll say a few more words.

Ms Beilharz : Yes. I was just getting to the end of my bit there.

Mr Liacos : Mr Chair, I'm conscious that you're probably keen to get into some questions. There are just a few high-level things. I speak not only with a Regional Development Australia hat on but as part of Regional Development Victoria and with many years of involvement at a local level. Damian and Lisa know me very well from the City of Greater Bendigo for a long time, so I also understand the local government sector.

One of the things I want to indicate to an inquiry such as yours is that the norm these days is particularly skin in the game when putting infrastructure projects together, so it's often federal funds, state funds and sometimes, if it's localised, local funds. Among big-ticket projects that are currently in progress or about to start, the Echuca-Moama bridge is a classic example of two levels of government. The upgrade of the Calder Freeway, which has revolutionised Bendigo, involves two levels of government. Also currently underway is the Murray Basin rail upgrade in the Mallee and associated districts, a classic example where two levels of government have contributed, I think, pretty much equal shares.

But, in a smaller sense, projects that are of vital importance to regional communities are often around things like aquatic centres, theatres, airports or road upgrades. Often when it's localised it's three levels of government, and that's hard. All I wanted to indicate to you, as a person who's lived and breathed that, is that it takes a long time to assemble funding from three levels of government.

So why is this relevant to you? In particular, what would be prudent is that federal regional development programs align to the best of their ability with state programs, because local government finds it very hard to extract resources and pool them together if the criteria are dramatically different. That is just some food for thought. Lisa and Damian would know we've had some great successes locally with three levels of government. The City of Greater Bendigo can often do it because it's a large municipality. Sometimes the smaller, more outlying municipalities don't have the financial resources.

The other thing I wanted to particularly indicate was the notion of the personalisation of dealings with the federal government. In local government, at a regional level, we often deal with the state government. It's very easy to get strong, personalised, positive relationships. It's very hard to engage with the federal level. You're often dealing with mystical department representatives who are in Canberra, and it's often difficult to get engagement. If I had a magic wand and were trying to improve things from a federal perspective, I would try to get more representatives from the federal government to have a presence in either the states or the regions, at high level, just so there's a very powerful conduit. Again, larger municipalities can often assemble a project and travel to Canberra to advocate, but it's harder for other parts of regional Australia. I hope that makes sense. There's often that impersonal nature in dealing with Canberra, whereas I've found over years in local government that it's very easy to deal with the state. You can travel to the capital city, you can meet halfway and you can develop relationships. So it's really a question of how you personalise that.

The final thing I wanted to indicate is the notion of private sector support. It was interesting when Sam was speaking before. Sam at the moment is working very closely with the state government on the potential to attract a very significant business to the community. The state government has funding programs and jobs funds where we can team up with the private sector to encourage them to come here. I don't think the federal level does, and it might be something for the committee to consider. There could be a pool of funds that are used to help provide that little extra incentive for companies to consider relocating to regional locations. Again, that is food for thought.

On decentralisation, in our case we have had two excellent examples in recent times—state based. Rural Finance moved to Bendigo out of Melbourne. And that was, essentially, a great success. More recently, State Trustees moved 100 jobs out of Melbourne. Again, it was a great success. So it's more question wise. I have personal experience of how decentralisation can be very powerful in economic and social impact. That's probably all I wanted to say.

CHAIR: Thank you. Gerard and Daryl, a Mildura perspective?

Mr Jose : Thank you, John. We will be short and, hopefully, succinct in way of explanation to your committee members as part of our submission. The Mildura area comprises about 10 per cent of the state of Victoria. We're one of those 10 local government areas referred to. Interestingly for us, we work on a tri-state issue, obviously, very closely with Wentworth and Broken Hill in New South Wales and Renmark on the South Australia border—in terms of working in that collective impact approach to making things happen.

For us, the opportunity to be part of encouraging consideration by the Commonwealth about decentralisation is important. We're what is considered a small regional city but in a large geographic mass. We believe that the future does require a shared approach by state and Commonwealth to not only decentralising public agencies but helping facilitate private companies, also, to relocate here.

I will stop there because I assume there are a lot of questions to go on with. And if Daryl wants to add anything—he's shaking his head at the moment. We will leave it there and move on to questions from the committee.

CHAIR: So you're right, Daryl, are you?

Mr Buckingham : Yes. I'm good.

CHAIR: I'll throw to committee members. I'll start with Mr Drum.

Mr DRUM: I'm looking at the regional strategic plan, or plans. I'm just wondering if there was anything specifically that you put in the plans that now better position the Loddon Valley region for a decentralisation project? Have you put specific parts of the plan together so that you deliberately position yourself well for a decentralisation project?

Ms Beilharz : I think the most recent plan was written about two years ago prior to us considering decentralisation specifically as a strategy. However, we continue to look at communication. Connectivity would be a key issue. Connectivity means transport and digital. There have been investments in airports. We know that that is really helpful if you have people who have moved from some other centre and have relationships with their workforce that are elsewhere. So Mildura is highly used. I think it has the most air movements in Victoria. Bendigo's airport has also been increased. So we have put major investment into those, which just makes it a more attractive place to come to and easier for people to move back to where they came from, or wherever their home base might be.

Mr Liacos : Probably not highly specifically but probably Mildura and Bendigo are very known because they are the larger urban bases. So, pragmatically, I think it's hard to receive services out of Canberra unless you have a reasonable degree of critical mass. So I think it is really implied, given the scale, nature and growth of Bendigo and Mildura, that they're the best served. And with the connectivity issue, as Linda was saying, we're relatively close to Melbourne/Melbourne Airport. Mildura is outstandingly located with accessibility from an air point of view. I fly in regularly from Mildura. People are often quite surprised that there are six, seven or eight flights a day in and out of Melbourne, Adelaide and Sydney. It's an extremely accessible community, Mildura.

Mr DRUM: I want to ask a follow-up question on the conversation about how hard it is to get funding from three levels of government—and I agree with that. When we originally had the RDA set up, I remember Minister Crean and Minister Ryan, between the federal and state, seemed to have this agreement. But it also seemed that there was a really strong membership of local government sitting on the RDA, as well. One or two CEOs would find their way onto the RDA. They seemed to be very well balanced in Victoria, and when projects came through they seemed to be able to wear all three hats. But it doesn't seem to be the case lately.

Ms Beilharz : We certainly have the strong local government presence, so that has not changed. We certainly get that buy-in, and each of the local governments has its own capability for connecting separate to us, but there is certainly support through the RDA to do that.

Mr DRUM: I also say that it still seems to work much better in Victoria than it does in New South Wales and Queensland.

Ms Beilharz : Yes, I understand but do not know specifically that that's the case, because we have almost a structural connection and a built-up history of doing that, so there's no tension around it. It's an understood way of doing work. I think that the region has given the authority to the RDA to develop the planning. We provide the structure for the prioritisation, and then others work to that. So that's also understood and works to enhance how that works.

We've had less of an engagement at the federal level in recent times because the role of the RDA hasn't been brought into some of the funding rounds in the same way. We used to have a role in supporting projects to apply and we used to provide comment on those projects at a greater level than we've been invited to in recent times. In the most recent round we were actually asked again to do some of that, but I guess what was understood as the value we could bring to assisting the grant makers to understand or learn about the projects had really dropped off. It now seems to be on the build gain, so I'm hoping that we can look forward to that being better.

The new charter for the RDA does talk about a more active relationship between RDA committees and Canberra, but at the moment we've got no architecture for that. We've got initiative and goodwill, but we haven't got architecture, so we need to structure in something that facilitates that better.

Mr Liacos : When local communities submit for regional development funds in Victoria, there are often no surprises, because it takes many months—sometimes years—but there's engagement at senior executive level. Applications are done together in many ways, and you can sound out and get early reaction about the plausibility or otherwise. With the federal level, particularly in recent times, it's a guess. Local communities submit, but it goes into the black hole. There's no personal engagement, feedback and mentoring.

Ms McGOWAN: Can I follow that up? That's certainly our experience over in north-east Victoria, and it's totally undesirable. We've described the problem. What can we recommend in this report to build on the very good work we've got at local government and the excellent relationships you have with Victoria to address the gap we have with the Commonwealth? Not only do we not have people you can work with; we've currently got two departments, and there's no connection at all. We want to change that, so what would work? You've been around R&D for a very long time, so can you give us a feeling? If we could design the architecture to make it long lasting, what would be the three components that you would build into it? Maybe you can take this on notice for us.

Mr Jose : My take on that is that I would move from a project-bid type of arrangement—I think that's what Stan was referring to earlier—to one with much more strategic investment between the three spheres of government about future-proofing regional communities and the big-ticket investments needed to provide better outcomes rather than trying to get a bit of skin in the game project by project. That's one of my observations.

Mr Liacos : If I had a magic wand, I would endeavour to provide an element of decentralisation of the regional development portfolio at the federal level. So I would have senior representatives assigned to various state/regions so that we knew the human being to work with to develop trusting relationships. At the moment it's just the generic logon online. There is no personalisation to it. I'd have senior people assigned—even if the headquarters were in Melbourne in our case. It's fine: at least we know how to deal with—

Ms McGOWAN: A bit like in Health: they have regional managers of departments but it's based in Melbourne—or Education.

Mr Liacos : Yes, that' right; at a federal level. The state is clearly decentralised well across Victoria in our case, but I'd decentralise representatives to be the people we liaise with.

Ms McGOWAN: Linda, what would you do?

Ms Beilharz : I have one more suggestion, and that is that there is a point within Canberra which can look at a whole-of-government response to the project concepts or ideas that are emerging or the place-based needs. We're starting to experience that more at a state level where we're able to say: 'We don't know who the owner of this project is. It actually belongs to several people.' We are getting inquiries here about some of the social-services-funded streams where there are changes. There's actually nobody within this region with the remit to look at that. Our plan does cover some of those areas because the community is interested in health and wellbeing. It's not strictly the RDA role, but there's an expectation that, as the door to communication with Canberra, we would be able to talk about that or assist that. It's not something that we can do, really. So, if there's a way for us to talk about place-based needs through a whole-of-government approach, that would be helpful. That would be transformative, really.

Ms McGOWAN: Can I just follow that up. Linda, that's a really good idea. Have you seen the architecture? Have you seen that happen? Is there a model we could pick up and explore more?

Ms Beilharz : There are probably a few, but the one that the state government here is using is a special committee within the Victorian Department of Premier and Cabinet that looks at regional needs from a place-based level. It's not taking requests or conversations through the silos of the departments; it's liaising with those as they go. But it's actually taking it more centrally, looking at it from a central point of view, saying, 'Okay, which policy program does this belong to,' and bringing them together.

Unidentified speaker: May I cut in from Mildura. There is actually a live model within our region up here called Hands Up Mallee which is a collective-impact model involving 51 agencies. That includes state and Commonwealth reps who are really trying to focus on how you change the community health and wellbeing outcomes to work collectively together and combine programs, projects, funding, resources and people. That, to me, is a very real example of how you can create systemic, long-term change by using a collective-impact model.

Ms CHESTERS: I have two questions. I want to pick up, Stan, on your comments about decentralisation. We heard earlier from the City of Greater Bendigo about the success of State Trustees for the benefit of the people from the committee. There are about 400 to 450 people employed by State Trustees, but this was about bringing a hundred positions to Bendigo. It would be good to just get best practice and your experience of that, because, at the federal level, we've had something slightly opposite. The Bendigo tax office, for example, was run down to 10 employees and eventually closed. Then, there were jobs transferred to Gosford. Losing those salaries by the time it got to 10 may not have had a big impact, but there was a missed opportunity in our region where we could have had a bigger footprint from that tax office. So we are learning, from the success at a state level, what worked and what didn't work. At a federal level, should more of those frontline agencies, like Centrelink and the ATO, be who we look to in terms of growing public-sector jobs in the region? That's my first question.

Mr Liacos : There are two state examples. Fundamentally, it works really well. Rural Finance moved approximately 13 years ago, and State Trustees moved around five to six years ago. Both are excellent examples. They had, roughly, about a hundred jobs each, so they were jobs that moved out of Melbourne to here. They, fundamentally, went very well. Why did they go well? Essentially it was because, in this particular case, their focus was around serving regional communities, so they were closer to where they needed to be. Rural Finance—why would you have Rural Finance based in Melbourne?—actually went out to a central location in Bendigo and served their rural constituency better. It was the same with State Trustees. The other thing, too, is that there are far lower costs of operations. Your rent is lower, and the average wage might be slightly lower too than when operating out of a CBD—Melbourne in this case. Also, what they've actually found is they have more loyal staff and far less turnover.

If I look to the future, if I had a magic wand, I would move small component agencies of the federal government, in whole, to regional environments, probably regional cities, that have a natural bent—particularly in the case of Mildura, that may be in an agri-business sense. In the case of Bendigo, I think we have always seen ourselves well placed, particularly in finance and general administration. But also I'd consider moving parts of the operation of certain departments that in many ways could generically be done anywhere—to some extent, back of house. A lot of tax office operations are back of house. I'd move small agencies in full or components—say 100 jobs—out of entity X of the federal government to a regional city where there was critical mass in a livability and economic sense.

Ms CHESTERS: Picking up on that last point about livability: you cover an area where there are pockets of real disadvantage; some of our poorest communities are in the Loddon Mallee. How can we help those areas?

Ms Beilharz : We've recently done a project about the effectiveness of the collective impact projects that are in our region. We have three local governments that are each running one. There are two that have been underway for a long time. Hands Up Mallee is one that Gerard was talking about. The collective impact projects are bringing together a whole range of organisations to address inequities in service level access and development resources and so on for local populations, often focusing on kids first, in a way that you can't do with a funded program. You need that collaboration so that you have everyone working together on the same issues.

Our small report talked about some key gaps that those projects struggled with over time. One of them is leadership. One of them is evaluation and research so that we can prove that complex change is occurring over time. So those things affect sustainability. When I say 'leadership', it's because it is a different way of working and we do need to have specific leadership around that way of working that allows people to change in that space. The leaders who are currently there step into it quite willingly, but we need extra additional resources to support that way of working. I think there was one other, and I am struggling to remember that.

So we have those sorts of issues. Each one of them, even though the models were different, had those particular challenges. So if you were to look at them beyond the iteration of their first initial investment, or maybe a second round, you would need to address those areas. So through leadership, through capability building around collective impact work and through supporting the development of that measurement and ability to notice change, and then also using the change for further development and planning, that kind of area would then be transforming those place-based efforts that people are already participating in.

Ms SWANSON: You mentioned that there were 10 local government areas that you have reached consensus on within your strategy, which is working well. How have you achieved that? In my experience it can be fraught. Have you come up with priorities? Could you speak to that briefly.

Ms Beilharz : The process of developing that has taken a few iterations over time. Damien, I think you have been involved in some of that over the years. Certainly, it started off with consultative workshops bringing people together around the regions, sometimes in local government areas and sometimes in sectors—the ag sector, the water people or whatever—to identify the issues. And then, obviously, you do the consultation to get agreement. What we are doing is looking at the common themes. We are not saying everybody has to be the same. We're saying, 'What's common and what can we strategically develop together across the region or in patches of the region?' The north is different from the south; so there are some different things, but we can put them in. The plan is made up of those common or strategically relevant ideas and the local governments have had the chance to think through that. We're now at the point where we've done that for a few cycles, so they're very familiar with the opportunities there. We talk to them all the time in different ways, so there's a lot of knowledge and information and intelligence about what's changing. With each process, I suppose, that is refreshed and the intelligence is put there. It's certainly done with the local governments and it's checked with the local governments before it's signed off anywhere.

Mr Jose : By one of example, local governments work for local areas already. Damien would be very familiar with this. Local governments got together and said the priorities for bridges across the Murray in our area are Echuca Moana followed by Tooleybuc and then Swan Hill. So we're able to support endeavours for the region, not just for our own local government geographic areas. We see an overriding need for local investment.

CHAIR: Thank you, everyone. I will ask a final question as we wrap up this part of our hearing. I have heard loud and clear in your evidence this afternoon as a group, and in other evidence today and at other times, the theme of collaboration across regions—across communities, not just one local government area. For example, collaboration between industry and the three levels of government, and collaboration and conversation across the three levels of government. Stan, particularly from your experience with RDA and RDV, you mentioned earlier that Commonwealth government programs should perhaps try to align better with state programs and state government objectives, given each level of government has its own charter, with the Commonwealth's being an Australia-wide charter, quite obviously. Equally, how do we balance state objectives needing to align with Commonwealth objectives at the same time? Is it a two-way street? How do we achieve that two-way street?

Mr Liacos : I can see it's a two-way street. It's not easy to do because Australia is a big and diverse place. Maybe there need to be points of discussion and collaboration at national COAG type meetings. I don't know whether regional development gets much of a play across state agreements, but, if it doesn't, perhaps it's warranted, given that every state has a substantive part of their population based in regional locations. So it's probably a broad alignment. I accept that it's not easy to do because it's such a diverse country. The needs of a place like Victoria are very different to, say, the north of Australia.

CHAIR: Perhaps a two-way street is a scene for us all to consider. Members of the committee present today are from Queensland, New South Wales and Victoria, and our colleagues come from South Australia, Western Australia et cetera. In terms of regional development and decentralisation, we are very keen to hone down on local examples to learn from, such as we have had here in Bendigo today, and look at opportunities going forward, but how do we develop and learn from best practice as its applied right across the country?

Mr Liacos : A lot of the funding programs the Commonwealth has in regional development are public sector orientated. I would urge you to consider perhaps having a private sector orientated fund for the state. There's an entity that Gerard and his team and my team have worked on. It will be publicly announced. A major entity is moving to Mildura with 100 new jobs. We've done that through local collaboration, but also with a little bit of financial support from the state.

CHAIR: Certainly. I accept that point very strongly. Local government input today, for example, has been well and truly met—perhaps even exceeded—by the likes of Be.Bendigo, Hofmann Engineering et cetera. It's very fertile territory for further discussions. Linda, Stan, Gerard and Daryl, thank you for your attendance and participation here this afternoon. Was there a question on notice from Cathy?

Ms McGOWAN: Yes. I'm a bit interested in that architecture. If you wanted to give some more thought to how that could actually work, I'd be really interested. Stan, picking up what you were just saying about the two-way street and the COAG: we haven't explored that. To my knowledge, there is no COAG about regional development. I have never heard of it being on the agenda. So it would be really useful if you could come back to us with some practical ideas on that. That would be a relatively easy recommendation to make.

CHAIR: With that in mind, we would ask that any material the committee has asked of you through Ms McGowan be forwarded to the secretariat by Friday, 20 October. The secretariat is obviously available to chat to you about that process and that specific request. You will be sent a copy of the transcript of your evidence. You will have the opportunity to request corrections to any potential transcription errors when you receive that. On behalf of the committee, I thank you very much for your presentation and participation this afternoon. It has been very valuable input and we really appreciate your time.

Committee adjourned at 15:26