Spotted by DNAse in The Grauniad:
... as of Friday, the state government of New South Wales will pay residents A$7,000 (£4,500) to leave [Sydney]. It's part of a new scheme to boost the population and economy of country areas.
"Regional NSW is a great place to live, work and raise a family – these $7,000 grants will provide extra assistance," said the NSW deputy premier, Andrew Stoner.
The one-off grants to move to country areas will be payable to individuals or families provided they sell their Sydney home and buy one in the country. The country home must be worth less than $600,000 (£390,000), something that won't be hard in most rural areas. It will cost the taxpayer up to $47m (£30m) a year.
As much as boosting regional areas, the scheme is also about making Sydney more liveable. The city's population is 4.5m and predicted to grow by 40% over the next 30 years, putting unprecedented pressure on infrastructure and housing.
The immediate point is that this is a subsidy to rural land values - the price of a country home will merely go up by $7,000 because yer ex-Sydney household has $7,000 more to spend. And of course, it's only Sydney homeowners who get the bribe if they move, not Sydney tenants, so indirectly it must be a subsidy to Sydney homeowners as well.
But why encourage people in Sydney to sell their houses? How does this get the population down - won't they sell their houses to, er, somebody who wants to move to Sydney?
Slapping Sydney homeowners with Land Value Tax would be a much more sensible way of going about things - such a tax tends to increase the population, of course (because small households will be replaced with larger households who are more able to share the cost), but they expect the population to increase anyway, so why not cash in?
This gives the government the money to pay for infrastructure improvements in Sydney, if appropriate, or they can spend the money on making the countryside a more attractive place to live, or paying for resettlement grants or a Rural Citizen's Basic Income or something.
Wednesday, 29 June 2011
They've not thought this one through either.
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6 comments:
"won't they sell their houses to, er, somebody who wants to move to Sydney?"
Ha ha - quite likely I'd say. Some rural person who wants to live nearer to their place of work for example.
Presumably those who take the bribe become out of town commuters unless they change jobs too. If so, they'll soon spend the bribe on extra travel costs.
You put yer left leg in, yer left leg out, in out, in out and shake it all about.
Seven thousand smackers,
and you turn around.
That's what it's all about.
AKH, yes, but presumably people who currently live in country homes commute into Sydney as well, so it's a straight swap.
Anon, that was my first thought. This is as insane as the idea of bribing illegal immigrants to go back to their own country.
"won't they sell their houses to, er, somebody who wants to move to Sydney?"
What about the other (country) house? Unless it's sitting empty (unlikely) then the owner of that house will be moving somewhere else, like Sydney perhaps. Of course, that country house could be part of a rural housing development that has remained unsold up until now....ah, I see who this move is designed to help out. Now it makes sense.
So people moving from Sydney to NSW will have $7,000 more to spend than they otherwise would. People moving from Melbourne, Brisbane, UK, etc to NSW won't. Neither will people moving from one part of rural NSW to another, although they will at least benefit if they can manage to sell their houses to one of the few Sydneysiders who may be tempted by this offer. So the Sydneysiders will be more likely to out-compete the others and house prices may rise by up to $7,000 although it will probably be less since the grant is not available to all buyers. As a result the rural population density may fall slightly. At best it will stay the same but the population mix will change slightly to include more Sidneysiders and fewer others.
Now what was the aim of this NSW government grant again ?
Pssst. It's not a Government grant, it's redistribution of Australian's hard earned dosh.
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