ALGA Conference

1
ALGA Conference

• Chris Richardson
• ACCESS ECONOMICS
• 7 November 2004

2
What does ageing meanfor local government?

• As Australias population ages there are a number
  of key questions for local government
• What will be the effect on council revenues?
• What implications are there for spending?
• What are the planning/building implications?
• In terms of revenues and spending there are
  challenges ahead, as Federal State budgets feel
  the pinch, and as more services are needed to
  match the expectations of ageing boomers.

3
Quantities will change (more retired ratepayers)
4
Underlying price drivers will change too
5
Most wealth gains have gone to boomers older,
not Gen X or Y
6
Though high house prices and rates can put the
brakes on popn gains
7
Ageing migration populations on the move

• Retirement is a time when many choose to move
  Historically, retirees have favoured certain
  types of communities, especially on the coast.
• As the baby boomers retire, these retirement
  flows can be expected to pick up.
• That means some LGAs will be growing faster than
  others, but also ageing more rapidly.
• Implies different needs for the built environment
  any mistakes will be long-lived.

8
Older Australianshave favourite spots
9
Meaning that we may continueto crowd our
coastline ...
10
and desert the bush
11
That means that some areasare better placed than
others

• Australia-wide, local government will need to
  deal with the effects of ageing. Communities
  which attract higher numbers of retirees will
  need a much greater focus on these issues.
• Councils who get it right may see a payoff from
  increased migration, and an influx of wealthy
  retirees (albeit with lower incomes than when
  they worked).

12
And some may be less well-placed

• But there is a risk that some local government
  regions will face greater challenges
• more net migration out as ageing populations
  retire elsewhere (with many impacts, including on
  the potential to raise rates), and
• a risk that those left have less wealth and lower
  incomes (and, for example, less of an ability to
  renovate their homes to age-in-place).

13
And the built environment will need to change

• This affects both the type of public
  infrastructure needed, the private
  infrastructure needed.
• For example, the many 4 bed/2 bathroom/2 car
  homes (like mine) which dominate suburbs may see
  declining relative demand.
• And the component shops in retail malls may
  change too less sports stores, more book stores.

14
Retail sectors aimed at the young may do poorly
in the coming decade
15
As the spending power of older Australians boosts
other areas
16
So there are a number ofchallenges over coming
decades

• While local government is better placed than
  either the States or the Feds, revenues will be
  squeezed as grants dry up if rate caps are
  maintained.
• Maintaining improving services levels for older
  people will require additional spending.
• And local planning will need to maximise the
  benefits that older people can bring to both
  councils and communities.