Fiscal policy and mobility: The impact of multiple residences on the provision of place-based service funding

Abstract

The propensity for Australians to move about more often and over greater distances as part of their employment, recreation and social life presents challenges for governments in the design and management of equitable fiscal policy to fund infrastructure, education, health and welfare and other services traditionally predicated on place-based criteria. The acquisition of second homes, ostensibly for recreation purposes, is a widely cited example in the debate about who pays how much for locality-based services. Other examples can be found in health service funding, education provision and transport infrastructure. While most people who use two or more dwellings have the financial security and personal wherewithall to live across multiple dwellings there are others who have much less choice and live between different places because personal circumstances dictate this. This paper suggests that fiscal policy predicated on place-based criteria persists because it is administratively simpler for public managers already operating in complex public policy environments. Nevertheless, we argue that place-based and social mobility criteria are not mutually exclusive. Recognition of the growing trend of social mobility may lead to better policy decisions. The paper aims to provide policy makers and public managers with a more accurate understanding of population mobility such that they can begin to effectively factor such trends into place-based fiscal policy.