NIMBY! Aligning regional economic development practice to the realities of the 21st Century

John Tilston & Associates

PO Box 538, Terrigal

NSW, Australia 2260

JOHN TILSTON

NIMBY!

Aligning regional economic development practice to the realities of the 21st Century

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John Tilston is a professional economist who consults on regional economic development to all three levels of government in Australia. He is the author of four previous books, including Australia’s Scramble for China. He has also worked as a financial journalist. His articles have appeared in a wide range of publications, including the Australian Financial Review, The Sunday Times, Business Day, Business Week, Investors Chronicle, Silicon Fen Business Report and Dow Jones Newswires.

He was formerly the Director of the Economic Development Division in the Queensland Department of Premier, Economic & Trade Development, Principal Economist at national consulting firm Kinhill and Melbourne Bureau Chief for the Australian Financial Review.

Foreword

I have been involved in economic development in one way or another since the mid 1980s and have been struck in more recent times by a disconnect between the people who formulate and implement public policy and those that are affected by it; between those who ‘do’ policy and those who are ‘done by’ policy.

I have sat around in ‘dialogue’ with people while we develop policy and implement 'strategic visions' and been struck by the fact that it is a conversation of insiders. Federal and state Government specialists, industry and environmental peak body representatives and local government officials who often know each other quite well. This is effectively a closed shop that leads to sub optimal outcomes, maybe not for the people around the table, but for the communities we serve.

This is, of course, a sweeping generalisation, and there are examples too of excellent policy-making. But it is a key reason for the rise of community-based Not In My Backyard (NIMBY) politics.

There are people working as economic development practitioners in the field who are trying to do things better – to change NIMBY to WIMBY. In 2007, a New York politician said about the location of a proposed marine transfer station:   This is not a NIMBY case, this is not ‘not in my backyard. This is a WIMBY case, ‘where in my backyard?’ There is a big difference between the two.

This book considers the practice of regional economic development from above the silos we operate from that seem to so often obscure common sense. It is also an attempt to do this on the basis of evidence, rather than through a personal or even ideological lens. It looks for best practice.

The fact is that the cosy model of a coherent world in which economists’ imaginary ‘rational man’ takes decisions on the basis of a clear cut cost benefit analysis of the issue at hand has been shattered. So too has the notion that markets will highlight and thus solve all problems.

The fracture has been building a head of steam for a while, but the Global Financial Crisis lifted the lid and let the truth out. As renowned investment fund manager Jeremy Grantham wrote in his regular newsletter in 2009: we have all lost some confidence in the quality of our economic and financial leadership, the efficiency of our institutions, and perhaps even in capitalism itself.

It is clear now that no-one has all the answers, not even economists, much less the politicians who think they are running the show. Sound bites don’t cut the mustard. A ‘rational’ view of the world is a mirage. It is clear the world writ both large and small is too complex for a ‘rational’ view to be valid. It might be said that the 'new rational' view is that it is irrational to suppose that anyone has all the answers and always acts in a world of cold hard facts.

Central to the debate about how we move forward is the critical need for community engagement; for engaging citizens in decisions about our future. Enlightened government and corporate leaders see this. Disparate groups of citizens increasingly understand their power. Often that power is evoked through 'Not In My Backyard' protests.

Ultimately, the NIMBY syndrome and complaints about NIMBYism are a symptom of politicians’ and policymakers' intellectual laziness and lack of rigour, but the now widespread NIMBY syndrome also says something about societies’ failures to fully engage with our futures. Too many of us have our heads in the sand, often denying reality.

The logjam has to be broken. Economic development practitioners are as well placed as anyone to broker a better approach.

There are many people I have worked with over the years that I thank for helping me frame my understanding of these issues. I have read widely on this subject and acknowledge the influence of those authors and experts, most of who are to be found in the references in this book. I would particularly like to thank Rosemary Jennings for her support and forbearance during the time this work came together.

John Tilston

North Avoca, New South Wales

December 2011

Contents

SECTION ONE - The 21st Century environment

1 The Rise of NIMBY        9

It shows up in some surprising places

2 What triggers NIMBY?       19

Not always what you expect

3 Journey to best practice economic development    27

Moving towards WIMBY

SECTION TWO - The seven key elements

4 Regional Leadership        35

Who's herding the cats?

5 Education, skills and attitude        43

When the Sun comes up, you'd better start running

6 Productivity and innovation        49

The pot of gold at the end of the [economic] rainbow

7 Clusters         58

What's in it for my firm?

8 Buying Local         63

God helps them who help themselves

9 Places and placemaking       70

Designing third places

10 Stimulating investment        77

Have I got a deal for you!

SECTION THREE – A coherent approach to economic development

11 Community engagement      86

We’re all in this together

12 Creating employment       96

Where do the jobs come from?

13 A coherent approach to regional economic development   103

Pulling the threads together

References            108

Section One

The 21st Century environment for regional economic development

Chapter 1

The Rise of NIMBY

It shows up in some surprising places

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T

imes have changed for economic development. Back in the not-too-far-off good old days, announcements of a new factory setting up in town or of the approval granted for a new large apartment block would have been widely accepted and even applauded by communities.

Now mostly they are not.

NIMBY has become the standard cry. Not In My Backyard now extends to so many areas beyond nuclear power plants, mines and waste dumps, including to some that at first sight seem just plain puzzling. On the Central Coast of New South Wales, in the opulent little beachside suburb of Avoca Beach, a savvy lobby group of locals created a big stink about the State Government's proposed scuttling of a former Royal Australian Navy battleship 1.2 kilometres off the coast as an artificial reef and tourist dive location. It was estimated that the dive site would add about $20 million a year to the local economy.

The New South Wales Government had for five years been planning the scuttling of the former HMAS Adelaide vessel and had conducted extensive community consultation. Everyone, it seemed, thought it a wonderful idea. Even the local environmental group – the well-organised Community Environment Network - supported it because it could see merit in having an artificial reach just off shore that would help the community learn more about and hence appreciate the marine environment.

However, when the day of the scuttling drew closer and a yellow buoy was placed above the eventual underwater grave of the ex-HMAS Adelaide, some of the locals of Avoca Beach realised it was much closer to their beloved beach than they realised. In fact, they had thought it was to be scuttled off nearby Terrigal, a scant 500 metres to the north, from where the divers would set for the dive site.

With some commendably speedy organisation they launched a ‘no shop’ campaign[1] that quickly gathered some local - though not regional – support. Two days before the scuttling event in March 2010, which had been planned and prepared for as a major occasion involving road closures, food stalls, VIP tents, special barbeques and countless lunches on the decks of houses overlooking the sea from the bucolic hillsides of North Avoca and Avoca Beach, the No Ship Action Group managed to secure a court injunction ordering the postponement of the scheduled scuttling while evidence was presented.

There was much anger generated in the rest of the community and within the Central Coast by what was seen as a minority NIMBY group. It was epitomised by the battle of the shirts, with pro-scuttlers in blue T-shirts and no shippers in red T-shirts at opposing rallies. No definitively reliable counts were made but it was estimated there were twice as many 'pros' - about 700 - as 'nos' at the two rallies. Perhaps symbolically, the ‘pros’ assembled at Terrigal and the ‘nos’ paraded their indignation at Avoca Beach.

The subsequent full hearing of the Administrative Appeals Tribunal took place over five days three months later in July 2010.

The Tribunal released its findings a further three months later, which, subject to a bit more cleaning of the vessel, allowed the scuttling to proceed. It said:

There are benefits to the environment from the resulting marine habitats generated, as well as more general benefits to the community. The level of pollutants now aboard the ship is low, and those that remain are either in very low quantities or inert and unlikely to cause any environmental problem especially after the further conditions for removal of the PCBs and lead are complied with.

But there was a sting in the tale of the judgement, or so it seemed, relating to the No Ship Action Group changing the grounds of its complaint on a couple of occasions.

It would have been easy to reach the conclusion that the [No Ship] Action Group was taking an opportunistic approach to a goal of stopping the scuttling at all costs. We have not come to such a conclusion, but it is worth noting, for the benefit of those seeking review of decisions, that such an approach may be a legitimate course when dealing with decision-making at the political level, but before this Tribunal what is required is grounds and evidence and it is inappropriate to object first and look for evidence afterwards – particularly where, as here, cost and delay may result.

This seemed to me to be a case of a court showing much sympathy to NIMBY but acknowledging that, sadly, evidence needs to be considered and the law adhered to.

The scuttling, in a much lower key event, took place on April 13th, 2011, almost 13 months after the date originally planned and, in berthing fees alone, had reportedly cost the government an additional $1.5 million.

The message is clear: even when NIMBY doesn’t get its own way, it can cause considerable disruption and extra cost.

There is of course the larger question of whether NIMBY is wrong. The term is undoubtedly used pejoratively but who is to say what a community should accept in its backyard, if not the community itself? 

The term NIMBY was first coined in 1980 by writer Emilie Livezey[2] in a Christian Science Monitor article, and was popularized by British Conservative Party politician Nicholas Ridley, who was the UK Environment Minister at the time.

In the 30 years since then, the NIMBY syndrome has grown stronger and stronger.

'Not in my backyard' sentiments pose one of the biggest obstacles to good planning and infrastructure development, Queensland's then deputy premier and member of the Australian Labor Party Paul Lucas said more recently[3].

NIMBYism is one of the greatest opponents of building infrastructure and of appropriate planning, he said, reflecting the fact that there is a bi-partisan view on this issue. Politicians of all persuasions see NIMBY as a ‘bad thing’: as something that gets in the way of progress.

One might expect that as we all get more sophisticated in our analysis and in the planning tools available, as we as a society become more aware of the implications and effects of what we do, that the quality of decisions would improve and that people would understand and appreciate this.

Clearly, though, this has not happened. People are more sceptical than ever. There are several trends that account for this.

These trends have as their backdrop a perhaps unprecedented period of upheaval and changes in Australian society. Sociologist Hugh Mackay has said that the past 25 or 30 years has been a time when most of the cultural reference points we used to take for granted as defining what kind of place Australia is have either disappeared or undergone significant change.

In a speech a couple of years ago[4] Mackay neatly captured a