While cynics may see the latest Intergenerational Report (IGR) as a futile exercise because projections, by their nature, never come true, it’s one of the most important economics documents the government produces. Only the budget beats it.
The IGR is crucial because it forces us to project forward from what we know of Australia’s past and present. In doing this, it helps us to confront what is already happening below the surface and what might happen in future. And if it reveals something we don’t like, the time to start making policy changes to address it is now.
We can sum up the IGR report’s conclusions in just seven words: bigger, older, hotter, richer, loaded with debt.
Starting with population, by 2063 we’re expecting it to be 60% bigger. Australia is now home to 26 million souls; in 20 years, by 2043, it will be home to 35 million and 20 years after that, in 2063, it will be home to 41 million.
To get this big – which will still make Australia a small country – our population will grow by 375,000 each year. That’s the equivalent of two Tasmania’s being squeezed into Sydney, Melbourne and Brisbane every three years.
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