Transitioning Regional Economies

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94.D.3 Functional economic region maps and comparisons with other regional definitions

This section contains maps of the FERs constructed for this study, and comparisons with other regional boundaries, including ASGS Statistical Area Levels, FERs developed by CofFEE, RDA regions, and regions used by State and Territory governments.

95.Comparing FERs with ASGS Statistical Area Levels

The boundaries of all FERs and their constituent SA2s are shown in figure D.1. FERs tend to be centred around larger cities and towns, and incorporate surrounding areas that might also include smaller urban centres. FERs also tend to be larger in more remote areas, reflecting the smaller population sizes and fewer urban centres in these areas.

The FER boundaries were compared with the boundaries of SA3 and SA4 regions of the 2011 ASGS (figure D.2). SA3s are clusters of SA2s that have similar regional characteristics, administrative boundaries or labour markets, while SA4s are designed for the output of Labour Force Survey data and reflect labour markets and population sizes (ABS 2010). There are 333 geographic SA3s and 88 geographic SA4s across Australia.

When compared with SA3s, there are much fewer FERs in urban areas but some rough boundary alignments in regional and remote areas. This reflects how SA3s are constructed: ‘SA3s are often the functional areas of regional towns and cities with a population in excess of 20,000 or clusters of related suburbs around urban commercial and transport hubs within the major urban areas’ (ABS 2010, p. 25).

There is a similar number of FERs as SA4s, but there are large differences in their composition. Notably, there are more regional and remote FERs and fewer metropolitan FERs compared with SA4s. This is because SA4s were created specifically for the release of regional labour force data. As a result, the population sizes of SA4s have to be large enough to guarantee the quality of data from the labour force sample survey (ABS 2010). This means that SA4 boundaries in more remote areas can be quite large, while metropolitan areas tend to be split into multiple SA4s.

Figure D.1 FERs and constituent 2011 SA2 regions

this map shows the boundaries of each functional economic region (fer) and the constituent statistical area level 2 (sa2) regions. there are 89 fers compared with 2196 sa2s.

Sources: Productivity Commission estimates; ABS (2010).

Figure D.2 FERs compared with 2011 SA3 and SA4 regions

this map shows the boundaries of each functional economic region (fer) and compares them with the boundaries of statistical area level 3 and 4 (sa3 and sa4) regions. there are 89 fers compared with 333 sa3s and 88 sa4s.

Sources: Productivity Commission estimates; ABS (2010).

96.Comparing FERs with CofFEE FERs

The FERs developed for this study differ to those produced by CofFEE (figure D.3). Although both use the Intramax procedure and journey to work data at the SA2 level from the 2011 Census, there are some key points of difference. The CofFEE FERs were not developed with a focus around governance or regional responsibility, so there are a greater number of CofFEE FERs (159 in total) and they include some that cross state boundaries along the east coast and at the Victoria and South Australia border (Stimson et al. 2015). CofFEE FERs around capital cities are also not restricted to GCCSAs. Furthermore, unlike in the construction of the CofFEE FERs, the FERs developed for this study consider some additional steps beyond the analysis of journey to work flows in allocating SA2s to FERs (section D.2). This means, for example, that some SA2s that constituted selfcontained labour markets that were aggregated to a FER for this study remained as individual SA2s in CofFEE’s FER structure.

Figure D.3 FERs compared with 2011 CofFEE FERs

this map shows the boundaries of each functional economic region (fer) and compares them with fers constructed by the centre of full employment and equity (coffee). there are 89 fers compared with 159 coffee fers.

Sources: Productivity Commission estimates; CofFEE (2015).

97.Comparing FERs with RDA regions

The RDA initiative aims to bring together all levels of government to help support regional planning and development. RDA regions were created by the Australia Government Department of Infrastructure and Regional Development to support this initiative (DIRD 2017c). RDA regions are generally built from LGAs, with some exceptions (for example, some RDA regions in South Australia are defined by the SA Government’s previously existing regional boundaries) (DIRD 2017c). They are updated as LGA boundaries change. Prior to changes to the RDA structure announced in August 2017, there were 55 RDA regions.40

There are some rough alignments between RDA regions and the FERs produced for this study (figure D.4). Similar to the FER structure, most states have a separate RDA region representing the capital city and a number of RDAs representing regional and remote areas. However, Tasmania and the Northern Territory are each represented by a single RDA region, whereas there are seven and nine FERs representing these areas respectively.

98.Comparing FERs with State and Territory government regions

Most State and Territory governments have their own regional boundaries for planning (table D.3). These are often aggregations of LGAs. In some cases, different government departments use different regional boundaries.

The FERs for this study were developed in part by considering the numbers and boundaries of regions already in use by State and Territory governments. The total number of FERs created (89) is within the range of the total number of regions used across all State and Territory governments (63–97). In most cases, the number of FERs within each state and territory is also similar to the number of regions used by each government.

Differences between FER boundaries and existing State and Territory government region boundaries can arise for a number of reasons. First, FERs were created by aggregating SA2 regions, whereas most State and Territory government regions are based on LGA boundaries. Second, the analysis of journey to work flows do not necessarily correspond to existing regional definitions, which may be based on nonwork considerations as well. Third, State and Territory governments have different ways of allocating their capital city into regions. For example, Hobart is grouped into the larger southern region of Tasmania, whereas Adelaide is separated into four different regions. Most State and Territory governments consider the capital city to be a single separate region, which is consistent with the approach taken in the creation of FERs. Fourth, as mentioned above, there are a number of islands that have not been allocated to a mainland FER, but that are part of a mainland region in State and Territory government definitions.

Figure D.4 FERs compared with 201516 RDA regions

this map shows the boundaries of each functional economic region (fer) and compares them with the boundaries of rda (regional development australia) regions. there are 89 fers compared with 55 rda regions.

Sources: Productivity Commission estimates; DIRD (2017c).


There are differences but also similarities between this study’s FERs and existing regional definitions, which result from the different purposes for which each were created and the different considerations and methods used in developing them.

The FERs presented here were designed for the specific purposes of the study and are not considered to be definitive regions that should be used for regional planning. The appropriateness of each FER for planning could be investigated with further analysis and consultation between governments and communities. The concept of basing planning and development around FERs remains useful and should be considered by State and Territory governments. Links between FERs and differences in areas within FERs should also be recognised.

Table D.3 State and Territory government regions

State or territory

Number of regionsa

Brief descriptionb



Regional growth plans across 10 regions (including Sydney) have been developed (NSW DPE 2017). Regional NSW is working on creating new FERs and developing Regional Economic Development Strategies for each of them. 34 potential regional FERs (excluding Sydney but including some parts of Victoria, Queensland and the ACT) were identified in preliminary analysis (NSW Government, sub. DR71, p. 12).



Regional Development Victoria (2016b) maps local government areas into nine regions (excluding greater Melbourne), which can be further grouped into five larger regions. Regional growth plans have been developed for nine regions (including Melbourne) using slightly different boundaries (Vic DELWP 2017c).



The Department of Infrastructure, Local Government and Planning has offices across 10 planning regions (Qld DILGP 2017a). The Department of State Development has offices across 11 regions (Qld DSD 2017). Prior to the move to new planning legislation in 2017, regional plans had been developed for 11 regions with different boundaries (Qld DILGP 2017b). All regional definitions include Brisbane.



The SA Government (2016) has 12 regions (including four metropolitan Adelaide regions) to facilitate planning, monitoring and service delivery across all departments and agencies. The regions align with local government boundaries, except for the separation of Enfield from the Port Adelaide Enfield Council (SA DPTI 2017).



There are nine WA regions (excluding Perth), each with their own state Regional Development Commission that facilitates and monitors economic development (WA DPIRD 2017). The Wheatbelt Development Commission (nd) has further separated its region into five subregions, each with their own economic planning strategies.



The Tasmanian Planning Commission (nd) separates the state into three regions. The Tasmanian Department of State Growth (2017) also has offices across three regions.



The NT Economic Development Framework separates the territory into seven regions (NT DTBI 2017). Some of these regions do not align with local government area boundaries.



The ACT has no separate local governments. The ACT Government collaborates with the NSW Government on developing the ACT and surrounding areas of New South Wales (ACT Government and NSW Government 2016).

Other territories


Four other territories are represented by separate 2011 and/or 2016 Statistical Area Level 2 regions (Jervis Bay, Christmas Island, Cocos (Keeling) Islands and Norfolk Island). These are administered by the Australian Government Department of Infrastructure and Regional Development (2017d).



a Includes a region representing the capital city if not explicitly covered by the state or territory regional definition. b Regional definitions are based on aggregations of local government areas unless otherwise stated.

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