As the preceding discussion showed, there are no constitutional barriers to national urban policy in Australia. Neither has urban policy been completely embraced or completely opposed by either end of the national political spectrum. Federal Labor Governments have undertaken the boldest urban policy interventions but have also demonstrated lapses of commitment to this policy setting. The record of conservative governments is far more modest yet several have produced a range of policy interventions that have shaped urban development directly and indirectly (Table 5.1). All national governments are surely also mindful of the indirect influence they inevitably bring to bear on urban development. As Parkin pointed out, ‘No Commonwealth Government, not even one devoutly committed to ‘non-interference’, can avoid its activities having an urban impact’ (1982:117).

What, then, are the prospects for Commonwealth urban policy in the future? Whilst theoretical (i.e., constitutional) opposition to national urban policy lacks credibility, there remains a practical objection that has the capacity to stymie development of any future federal urban agenda. The next barrier might simply be the position that while federal urban policy is possible, it is simply not needed: the States and local governments are readily equipped to handle the task.

There are two classes of rationale, in my opinion, which make urban policy an essential, not optional, feature of the federal agenda. The first is the unyielding need for a nation of cities to have a national urban policy framework. Urban living is a national trait, and therefore must be a preoccupation for any national government. The love of urban life appears thus as a national value and needs to be recognised as such by national governments. Recognition of this national value does not dictate the form of Commonwealth commitment to urban affairs, but underlines the need for federal policies that safeguard the welfare, productivity and sustainability of Australia’s cities and urban regions.

Then there are a range of fiscal reasons why the Commonwealth should assume part of the responsibility for safeguarding the health of our urban regions. The national government raises the lion’s share of tax and excise revenue, a vast amount of it generated and collected in the cities. The wealth generated by the cities flows from their innate urbanity not from the mere aggregation of economic activity in particular places. This ‘productive urbanity’ derives from the capacity of urban structures to supply opportunities for social and economic advancement that cannot be offered outside cities. For example, the efficient concentration and connection of high order educational, industrial, commercial and recreational opportunities is a form of productive urbanity possessed by most successful global cities (Property Council of Australia 2002). The chances for economic success are greatly diminished when this productivity is compromised by urban dysfunction – for example, an ineffective transport system.

All governments, including the Commonwealth, therefore, are obliged to spend part of the ‘tax take’ in ways that protect the uniquely productive qualities of urban areas. A range of commentators (e.g., Forster 2006) and lobbyists have pointed to the recent and continuing failure of state governments to manage Australia’s urban regions adequately. Arguably however, the increasingly manifest urban management problems besetting state governments reflect more than simple incompetence. The failings of urban management also highlight the inability of state governments to fund the constant improvements that cities need.

Sydney, for example, is a vastly important national asset. As a second-tier global city it generates a large share of national income and a host of other positive externalities for the nation (Property Council of Australia 2002). Efficient circulation of people and capital is critical in global cities. In the context of environmental pressures, our urban circulation systems also need to be highly ecologically sustainable. It is increasingly evident that Sydney’s circulatory systems need dramatic improvement and renewal, to make them more effective and more sustainable (Newman 2006). This essentially is a nation-building task, beyond the capacity of a state government alone. There is a clear case for Commonwealth investment in this great task of urban renovation. As the Sydney Morning Herald pointed out in 2005:

The failure of the Commonwealth to assume this responsibility perhaps partly explains what the Sydney Morning Herald has termed ‘The Great Carr Crash’ (Davies, 2006). This refers to a decade of controversial and crisis-prone urban governance coinciding with the tenure of the Carr State government (1995-2005). In particular, transport management during this era was characterised, amongst other things, by use of a range of increasingly impulsive governance mechanisms that attempted to overcome a lack of funding for urban improvements. These included the Public Private Partnerships (PPPs) used to build roads projects; many of which proved to be expensive and controversial. These unconventional mechanisms, especially PPPs, are harder to extend to public transport and partly explain why it has fared the worst during an era of general under-investment. Peter Newman, urban scholar and former Sustainability Commissioner for New South Wales, sees federal funding as the key to reducing state government reliance on PPPs in Australian metropolitan management:

The second and more contemporary rationale for federal urban policy derives from the external pressures and opportunities that have manifested in the last 30 years. The most important of these are economic and cultural globalisation and global ecological breakdown. The global economic system that has emerged in the past few decades is essentially urban. Cities are the pivots and the engines of the global economy. They have also, to varying extents, decoupled themselves from their national and regional economic contexts and compete directly as discrete economic entities. This urban economic competitiveness occurs both within nation states – think of the tussle between Sydney and Melbourne for urban supremacy – and across national boundaries.

Cities also connect, and not simply compete, in complex ways across national boundaries, outside the normal currents of diplomacy. A key example is the circuitry of global finance, which acts simultaneously to connect cities and set them in contest. It is important therefore from a national perspective that cities are supported and sustained as key engines of economic and cultural opportunity in a challenging global environment (Property Council of Australia 2002).

This idea is well understood by the urban development industry – though it appears not to have been grasped by the present federal government. This position is supported by most leading business lobbies that may have in the past been sceptical of most urban regulation, let alone national urban intervention (see Dennis 2006; Property Council of Australia 2002).

The emergent conventional economic wisdom on federal urban policy sees it as a vital national policy function in the global age. What this perspective does not tend to embrace, however, is the further rationale for national urban policy arising from globalisation – the need to manage the cities in the national interest and ensure that some of the fruit of their new productivity is redistributed to less economically potent regions. There is nothing essentially radical about this idea, which sees a role for urban policy in the maintenance of national cohesion. The tendency of some super city states in the new globalism to see themselves as apart from, and without particular commitment to, their regional and national contexts also needs to be checked. Urban imperia always seem to collapse at some point, and need to be protected from themselves.

Finally, global ecological dysfunction is a new and pressing rationale for national urban policy. Much of this dysfunction is sourced in the growth feast unleashed by globalisation and in its urban pivots. There is simply no prospect of Australia addressing global and regional environmental problems without intervening in and reshaping the course of urban development. Happily, the 2005 federal parliamentary enquiry into sustainable cities demonstrated bipartisan recognition of this issue, at least amongst the political ranks if not hierarchies. The report produced by this inquiry very firmly stated that urban policy was a federal responsibility (House of Representative 2005).

As McManus (2005) argues, Australia’s cities urgently need a vast environmental renovation if they are to be made sustainable. This task of ecological renovation can align with many pressing social imperatives in our urban regions. For example, the extensive commutes forced upon many households in Sydney by increasingly disconnected housing and labour sub-markets are a major source of social stress (Flood and Barbato 2005). This stress is doubtless at least partly responsible for the out-migration of professional and key workers from major metropolitan regions, especially Sydney. It is also a profound cause of ecological stress, with lengthy commutes driving up average vehicle journeys and thus greenhouse emissions. This is a complex problem that will need well resourced and decisive intervention across a range of fronts to achieve better jobs-housing balances across urban subregions, by improving housing affordability and public transport services and coverage. It is a task that surely extends beyond the competencies of state governments.