MELBOURNE'S population is on track to reach 4 million in December. Brisbane tops 2 million this month. Australia will reach 22 million people in November, and it is adding a million every 2½ years.

Since 2005, Australia's population growth has taken off. The Bureau of Statistics estimates net migration last year soared to a record 253,415, up from 106,425 in 2004. That lifted population growth to a record 406,083, up from 240,250.

Now, Treasury has upped its forecast of Australia's future population, predicting it will have more than 35 million within 40 years - just two years after it forecast 28 million in that time. Should we be excited? Worried? Or sceptical? Prime Minister Kevin Rudd is excited. ''I think it's great that our population is growing, because so many countries around the world are shrinking, and that poses a real problem in terms of having a strong tax base for the future and a strong economy,'' he told Fairfax radio yesterday.

What's driving Australia's population growth is primarily immigration, backed by increased longevity and more babies. Increased longevity is great, unless you're a government that has to pay for the doctors' consultations, hospital care, pensions and the costs of looking after people in old folks' homes. That costs serious money, which requires you to raise taxes and cut other services - or recruit more taxpayers.

That is why Rudd and Treasurer Wayne Swan like immigration. Not only does it raise your economic growth - more people spend more money - but Australia accepts only young migrants, who are likely to spend years in the workforce paying taxes. And that helps finance an ageing population.