Perth has to start planning for when it becomes the size of Melbourne, a report out today warns.

Compiled by Infrastructure Australia, it says Perth has to avoid a suburban sprawl that would make life miserable for most residents.

The report into the nation’s four major cities says they must invest in public transport and urban job centres and consider council mergers.

Tax incentives for businesses to move out of central business districts, road tolls and congestion charges on vehicles, plus financial advantages for investing in green space, should be examined.

The report looks at how Perth, Sydney, Melbourne and Brisbane will absorb an expected 8.5 million residents over the next 30 years. Perth’s population is forecast to reach 4.4 million by 2046, from two million now, overtaking Brisbane, whichwill be home to almost four million people.

Sydney and Melbourne, each with about 7.3 million residents, will be equivalent to cities the size of New York and London.

According to Infrastructure Australia, which provides advice to Federal and State governments, the economic success of the country depended on the successful development of the nation’s four major population cities.

“The growth and development of Sydney, Melbourne, Brisbane and Perth will create exciting opportunities for Australia,” the report said.

“But to effectively capitalise on these opportunities, the structure and operation of these cities will need to change.”

It said public transport was crucial to improving accessibility. In a direct challenge to Perth, the agency said the merger of councils with a major central council would help planning.

Private enterprise should get tax incentives to move jobs to “strategic urban centres” with public transport used to link people with jobs.

Road tolls or congestion charges on trucks and passenger vehicles should be phased in over the next decade.