The 'doughnut effect'

May 27, 1992

By Peter Boyle

Like many cities in the United States, Australian cities have been subjected to the "doughnut effect": the city centre becomes "hollow" as population moves from inner suburbs to the outer suburbs in search of newer, larger or more affordable houses.

If there is no significant increase of residential densities in Australian cities, about two-thirds of all population growth between now and the year 2030 is expected to occur on the fringes of the five largest cities, according to the National Population Council. This growth in fringe population will total 5 million — greater than the population of Sydney, the country's biggest city.

Even in Sydney, the one capital city in which there has seen some movement in the opposite direction with inner-city settlement by migrants and the gentrification of some former inner-city slums, the inner-city population fell from 730,000 to 679,000 between 1966 and 1986.

In the US, the "doughnut effect" has combined with widening income gaps and industrial restructuring to create city centre replicas of the Third World surrounded by a ring of more affluent suburbs. While this process is not — yet — so apparent in Australian cities, the "doughnut effect" is having a serious effect on the urban environment.

A 1991 Economic and Planning Advisory Council report on Urban and Regional Trends and Issues estimated the annual cost of pollution and congestion in major Australian cities at $4 billion. And the two biggest causes of urban pollution were identified as the spread of low-density outer suburbs and related problems with transport systems.

In most cities, adequate public transport runs out well before you hit the real 'burbs. If you live out there, you've got to have a car or remain in virtual home imprisonment. Not only has the number of motor vehicles grown, but the average vehicle kilometres travelled (VKT) per capita has increased in all cities. Perth has the highest VKT per capita increase at an average of 4% per annum between 1979 and 1988.

The federal Labor government's National Housing Strategy urges a shift to medium density housing and a new push to inner-urban renewal. Most state governments are using these same buzz words, but their motivation seems less a concern for the environment and/or quality of life of residents than a desire to save money.

Particularly in Sydney and Melbourne, governments are worried about the increasing cost of providing infrastructure like water, sewerage, power, telephones, schools, hospitals and transport for outlying suburbs. The provision of the same services works out at about $50,000 per housing lot in Sydney but only $30,000 per lot in Perth, and costs arply in Sydney.

The main reason for this is that the larger cities have been expanding without making sufficient provision for the day — which has now arrived — when further expansion requires further big investments infrastructure. In effect, developers of residential blocs on urban fringes were given big subsidies by not being charged fully for the cost of services provided by governments.

As a result, further urban sprawl is likely to be even more poorly serviced than outer suburbs are at present. The outer edge of the "doughnut" can be as uninviting, in its own way, as the "hollow centre".

With governments at all levels cutting expenditure and holding back from borrowing for capital investment (in theory to free capital for the private sector to borrow), plans for urban renewal now seem mired in endless discussion about schemes to entice private capital into housing and infrastructure development — with new subsidies and tax breaks for big investors, ignoring the fact that past subsidies are a major cause of the current crisis.

Further, the market conspires against the development of affordable new and medium density inner-city housing. Prices remain high enough (even in the midst of recession) to exclude low income earners.

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