For some reason, the powers that be appear to believe that adding one million people to Australia’s population every three years is sustainable.
It will be hard enough reducing carbon emissions to target levels with a stable population let alone runaway growth in population. Not to mention pressures on endangered species, water supplies and so on.
But the story below shows that Tanya Plibersek feels that:
The immigration story is very important for economic development … it’s
not sensible to suggest then that immigration is the problem
What she means of course is that it is not polite or palatable to suggest that immigration is a primary contributor to several problems, rental vacancies being one of them.
Immigration may increase the size of the economic pie, but then more people need a slice of that pie. Surely, a no win game. When we look around the globe, there are very few countries with high population growth rates that might be considered well-off. Let’s dispel the myth that immigration makes us wealthy. Jared Diamond commented recently in Pacific Ecologist that every time a person migrates from a developing country to America, Europe or Australia, their consumption levels increase by a factor of 32. Surely an argument against runaway immigration to the so called first world.
Rental crisis linked to migration boom
JESSICA IRVINE ECONOMICS CORRESPONDENT
25/09/2008 12:00:01 AM
AUSTRALIA’S biggest migration boom is exacerbating the rental crisis, while house prices are overvalued by between 5 per cent and 15 per cent, the International Monetary Fund has said.
Immigration added a record 199,064 people to Australia over the year to March – the biggest annual rise in history, figures released yesterday by the Bureau of Statistics show. This surpasses the boom after World War II, which peaked at about 149,000 people in 1950.
“The inflow of migration is putting pressure on the housing rental market,” the IMF said in its latest report card on the Australian economy.
The proposition is supported by new evidence showing rental vacancy rates are lowest in suburban areas where most new migrants tend to settle, such as the western suburbs of Sydney.
The IMF said twin booms in migration and mining added to the risk that the economy might grow faster than desired, sparking inflationary pressures.
On the downside, higher interest rates and tighter credit conditions flowing from the global finance crisis were likely to restrain consumer spending.
The Treasurer, Wayne Swan, said that since the report was completed, these risks had shifted even further to the “downside”. He said the report had given the Government a “very big tick” for its first budget, which the IMF described as “prudent” and “contractionary”.
The IMF also concluded that while Australian banks were profitable and well capitalised, the global financial crisis had exposed some “vulnerabilities”, including the high indebtedness of Australian households, and banks’ reliance on offshore funding, which had become more expensive since the credit crunch.
These higher costs have had a direct impact on mortgage holders as lenders were forced to lift interest rates outside the Reserve Bank and restrict lending to less attractive borrowers.
Banks could suffer a “significant fall in profits” if they lost access to funding from offshore markets, which accounted for a quarter of their total funding, the IMF said. But banks’ exposure to highly indebted households was less of a concern. While house prices were moderately overvalued, it would take a huge increase in loan defaults to cause problems for the banks.
The Reserve Bank will today release its report on the health of Australia’s financial system.
In its report, the IMF revealed a doubling in the migration-to-population ratio over the past three years had coincided with a trebling in the pace of growth in rents.
More immigrants settle in NSW than in any other state or territory, the ABS figures show.
But the federal Housing Minister, Tanya Plibersek, said it was wrong to blame higher rental prices entirely on higher immigration. She said increased housing demand came from many sources, including higher divorce rates and older people staying longer in their own homes.
Immigration was also important to fill skills shortages, particularly for tradespeople. “The immigration story is very important for economic development … it’s not sensible to suggest then that immigration is the problem.”
The Government introduced legislation for its National Rental Affordability Scheme in Parliament yesterday.