Regions being cheated by income inequality

INCOME inequality is slowing regional growth, researchers say.

The authors of the annual State of the Region report believe targeted investment will help bridge the divide between well-off metropolitan cities and struggling rural economies.

This rising inequality is putting the brakes on growth across regional Queensland and NSW, economist and report co-author Dr Peter Brain says.

Dr Brain said new investment would be "pivotal" in bridging the employment fallout, particularly from the slowing mining boom in low income regions.

He said councils would play a huge role in reversing the trend and improving the Australian economy.

"The report identifies a need for policies and investments to be implemented on a region-by-region basis to decrease the existing inequality across Australian regions, which was expedited by the mining boom," Dr Brain said.

"Local government is strategically placed to coordinate job-creation policies at the local level to improve Australia's economic performance and hence make an important contribution to national economic growth."

ALGA president Troy Pickard said the impact of some programs were being felt outside of the country's capital cities.

A regional infrastructure program in 2008-10 and the on-going Roads to Recovery initiative showed how local, state and federal governments could work together, he said.

However, Cr Pickard said now was not the time for politicians to drag their feet on boosting local economies.

"The State of the Regions report reinforces the ALGA's call to support regional economic development through diverse infrastructure investments determined by regional priorities in partnership with local government," he said.

"Every year's delay in the adoption of this approach imposes significant costs on the national economy by limiting the growth potential of both country and metropolitan regions."

National Economics compiled the report for the Australian Local Government Association and launched at the Regional Cooperation and Development Forum on Sunday. - APN NEWSDESK

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