2016 Annual Report
Western Downs
Western Downs (Dalby, Chinchilla, Miles, Wandoan)
2016 Western Downs Summary
The changes occurring in the region continue to differ town by town. That said, despite such local idiosyncrasies, it is possible to observe overall trends across the region’s towns:
1. Larger towns coped better - Dalby and Chinchilla appear to have been able to traverse better with the sharp and rapid ‘boom and bust’ cycle of the CSG construction period. With larger populations, more business and social services, and more available housing, the influx and departure of incoming workers (resident and non-resident) seems to have been accommodated better by these towns.
Other research reports similar findings (e.g., Jacquet 2009, 2014 on boomtowns; Walton et al. 2014 on resilience). However, more specific research is necessary to establish and explain the potential links between town size, the scale and pace of resource development, and the impacts on ‘social capital’ and aspects of other community character and wellbeing.
2. Better off on average - Employment and businesses seem to be better off than before CSG construction, even though the CSG construction boom has ended. That is, the number of wage earners and average income are higher, and the number of businesses and total business income for the towns are higher than before CSG development. Some local businesses have clearly benefitted as total business incomes remain 3-5 times higher than pre-CSG levels in most towns (based on 5-year averages). More can be read about this in the Opportunities and Challenges section.
Our use of total business income per postcode as an indicator does not provide information about the distribution of benefits among businesses. We were told in interviews that it is likely that some businesses are doing very well and others very badly. More specific figures on how many businesses are suffering and how many are thriving would be revealing. One can also look at private and business debt levels and interview business owners about the consequences of the boom and bust ‘shocks’ and any ongoing uncertainties, such as uncertainty about future CSG business.
3. Social challenges - Economic gains among some wage earners and some businesses may be offset partly by social issues. For example, an oversupply of housing has occurred, especially in the smaller towns, which we noted last year. High numbers of new development applications (DAs) and building approvals signalled large investments in property. The oversupply resulted in a decline in rents to below the historic trend, and the low rents attracted families on low incomes, quite a few on government payments – again, as we noted last year.
House sale prices have remained low this year, with few houses being sold. Local interviewees attributed the fall and continued low prices to bank foreclosures and forced sales. They noted that those who invested in property with the expectations of receiving high rents defaulted on loan repayments.
These towns now feature relatively low housing costs, more abundant conveniences (such as 24-hour fast food, major retail outlets and supermarkets) and low unemployment rates. That has made them attractive to low-income people and families who might be seeking work or a lifestyle change. Local interviewees reported noticing a 'new wave' of inward migration - the non-resident workers for CSG development being the first wave.
These new-comers are seen by some with an element of wariness and distrust, which is similar to initial perceptions of non-resident workers employed by the CSG development.
These changes in the economy of the towns, the make-up of their populations, and how one type of resident views another can be seen as 'cumulative', 'post-boom' impacts, which interviewees report are significantly affecting social cohesion and sense of community identity. Such impacts have been seen before in boom town studies. The complex and dynamic relationships between 'newcomers' and ‘old timers' are well researched in social psychology and sociology.
4. Crime rates are up - Crime and offence rates continue to fluctuate across the region and over time. It appears that total numbers are rising sharply since 2014. That is particularly for drugs and traffic offences, which are becoming a serious problem in some towns. The extent to which this upturn is linked to housing oversupply, post-construction economic declines for some resident and businesses, and other factors is currently being investigated by the UQ research team.
5. Trending back toward pre-CSG levels - Towns in the Western Downs experienced significant effects during the construction period for coal seam gas development in 2011-2013. Housing affordability and availability changed, the local population changed, and business diversity grew. Since completion of the CSG construction period, a number of these aspects of community life are trending back toward their pre-CSG level.
To recap the overall trends noted in last year’s report, median rental costs in Chinchilla at the peak of the construction period were $450 per week. This figure was higher than the Queensland median. By 2015, the figure had decreased to $200 per week; lower than the Queensland median, and just below the level in 2008, before the CSG construction period. The drop in demand for housing - reflected in decreasing rental prices - has resulted in oversupply in some towns, with the number of vacant houses mentioned in interviews.
Dalby appears to have experienced fewer and less pronounced effects on the cost and supply of houses. However, anecdotal evidence suggests that figures may differ for apartments. The moderation in Dalby’s house market can be attributed to the town’s more diverse economy – agriculture, government, some manufacturing, as well as the resource industry. This economic diversity and Dalby’s relative size can be seen to have buffered the town from the acute changes felt in Chinchilla, Miles and Wandoan.
Population growth in the Western Downs is expected to continue its gradual increase. However, population projections were revised downward in 2015 from 2013 predictions. The number of non-resident workers associated with the CSG industry has decreased sharply since the end of the CSG construction period, as one would expect. Projected numbers indicate a slight and constant decline over the coming decade. That said, the figures could change significantly if international markets cause the demand for natural gas to rise.
The number and diversity of businesses in the Western Downs increased dramatically during the CSG construction period. However, in most towns, our indicator of business income (from ATO tax data to 2014) has shown a slight decrease after 2013, though not the dramatic drop that our interviews would have led us to expect. There are some expectations that business activity will continue to slow as the CSG industry completes its transition into the operational period.
Crime rates in the Western Downs have varied depending on the crime and on the town. The number of crimes reported per 1,000 residents showed a general increase during the CSG construction period, while the overall Queensland rate gradually declined. The rise in the Western Downs has been attributed by those interviewed to the influx of CSG workers. Additionally, there was a change in the policing regime, which led to an increase in offences reported. In several of the towns, there has been a rise in crime rates after the end of CSG construction, which has been blamed on new arrivals in lower income families.
Dalby was considered to have ‘done well’ overall in relation to CSG development. However, the rate of change and uncertainty felt in the Western Downs more broadly caused concern for many of those interviewed. With the CSG industry now in its operational period, stability is expected to return to the region. Such stability would be evident in indicators returning toward their pre-CSG levels. That trend has been observed since 2013 in population and housing costs.