It is an alarming scenario: in the absence of big ongoing spending on infrastructure, Australian cities will become so choked with people the cost of congestion will double to almost $40 billion in just 12 years.

The culprit for this huge loss of productivity, according to a report released this week by Infrastructure Australia, is population growth.

Alan Tudge, the Federal Minister for Population, Cities and Urban Infrastructure, sought to hose down these concerns by claiming the Government had lowered overseas migration to ease the pressure.

"Since this report was written, we've dropped the migration rate to ease the population pressure, particularly on Melbourne and Sydney, which have just been growing like gangbusters," Mr Tudge told ABC radio.

The comment reflected a Liberal Party policy document released in the lead up to the May election, which promised the Coalition would "freeze immigration levels" at an annual intake of 160,000 over the next four years. This would help "ease the pressure on the big capitals".

Whether or not the migration rate is being "dropped", as opposed to "frozen", the federal government is keen to get the message out that it is working to ease the strain on our overburdened cities by slowing Australia's annual intake.

But is this the reality?

Australia's population growth has indeed been strong. As Fact Check noted recently, Australia has experienced one of the highest rates of population growth in the developed world, ranking fifth among 36 OECD countries.

In 2018, our ranks swelled by 404,800 people, an increase of 1.6 per cent over 2017.

And the average annual growth for the past decade has hovered around 1.5 per cent, according to Val Colic-Peisker, an associate professor of sociology at RMIT.

Most of that growth has come in the form of overseas migration.

In 2018, for example, 61 per cent of the annual population increase came from net overseas migration. The year before, it was 63 per cent; the year before that, 61 per cent.

By contrast, in the early years of this century, net overseas migration accounted for less than half of the increase.

It is important to note at this point that anyone who has lived in Australia for at least 12 months is counted in the Australian Bureau of Statistics population estimates, regardless of their immigration status.

In other words, temporary and permanent visa holders are counted, including the tens of thousands of foreign students, workers and backpackers who swell our ranks but do not necessarily intend to stay in Australia long-term.

This brings us back to Mr Tudge's assertion that the Morrison Government has "dropped" the migration rate.

It has certainly imposed a freeze on the level of permanent migration over the next four years.

In the most recent Federal Budget, Treasury confirmed that the "planning level" for the permanent migration program over the next four years would be lowered from 190,000 places a year to 160,000 places from 2019-20.

Yet, Treasury's own forecasts suggest Australia's total migration levels will continue to boom.

The 2019-20 budget predicts an annual average of 268,600 new arrivals over the next four years.

This represents a hefty 17 per cent increase over the previous (2018-19) budget forecast, when net overseas migration was expected to run at an annual average pace of 228,700 over four years.

Population growth is straining infrastructure in Australia's major cities. ( ABC News )

Temporary vs permanent

This suggests that, even if the Morrison Government delivers its plan to cap permanent migration, this would be more than offset by a surge in temporary migrants.

As experts are quick to note, the Australian economy is dependent upon an uncapped flow of temporary foreign workers and the income generated by foreign students.

Peter McDonald, a professor of demography at the Melbourne School of Population and Global Health, told Fact Check that the demand for labour could not be met through domestic sources alone.

In fact, about 75 per cent of recent employment growth in Australia can be attributed to immigrants, Professor McDonald said.

So, total migration can be expected to remain high for the foreseeable future.

You can speculate about the rationale for such high numbers. Fact Check recently examined a claim by One Nation Leader Pauline Hanson that the budget was "built off mass migration".

Whether this amounts to hyperbole is open to interpretation. It is certainly fair to say migration levels have a significant influence on the budget bottom line.

Prime Minister Scott Morrison has previously warned against cutting the permanent migration intake to Australia on the grounds that it would hurt the budget.

In February 2018, as treasurer, he said a proposal by former prime minister Tony Abbott to cut the annual intake by 80,000 would cost the budget $4 billion to $5 billion over four years.

This week, the Government announced an inquiry into migration in regional Australia, to be conducted by the Joint Standing Committee on Migration. Among other things, it will examine the current settings for "relevant migration policy".

Whether the Government is actually prepared to lower migration to the extent it has a negative impact on the bottom line — and a positive impact on our congested cities — is open to question, particularly since it has placed so much emphasis on returning the budget to surplus.

What is clear is that, in the short term at least, our trains and roads are likely to remain overcrowded, despite the Government's rhetoric.



