Nillumbik Economic Development Strategy 2011-2016

Nillumbik Economic Development Strategy 2011-2016

Prepared byNillumbik EDS Community Reference Group andTim Nott economic analysis & strategy

Human Rights Charter Compatibility Statement

In accordance with the Charter of Human Rights and Responsibilities Act2006, the Nillumbik Economic Development Strategy is assessed as beingcompatible with the human rights protected by the charter. This assessmentis based on a Statement of Compatibility of the Human Rights protected by theCharter that are relevant to the Policy.

Executive Summary

In 2003, Nillumbik Shire Council adopted its first Economic DevelopmentStrategy as the basis for economic development in the Shire. This revisedStrategy applies to the six year period 2011 to 2016.

Council, through its Council Plan 2009-2013, is committed to sustainableeconomic development in the Shire as one of its four key Goals, “OurEconomy”. The Council Plan has nine specific objectives relating to the areasof Economic Development, Commercial Precincts and Townships and GreenWedge Tourism and Agriculture. These objectives, together with severalstrategic indicators, have been addressed in the appropriate sections of thisEconomic Development Strategy.

To achieve sustainable development Council’s economic actions are guidedby the need to complement Council’s other programs. Council’s economicdevelopment activities can make a significant contribution to key social,environmental and governance objectives.

This Strategy is designed to enhance the wellbeing of our community byencouraging the development of a vibrant and sustainable local economy thatis based on our key advantages, including our magnificent environment andthe high level of skills and abilities of our residents and business people.

Council acknowledges the many stakeholders (listed in theacknowledgements section) who have contributed to the developmentof this Strategy and thanks them for their contributions.

A Vibrant Local Economy

Performance measures for a vibrant economy include:

Increase the number of Nillumbik residents working locally throughthe creation of employment opportunities and a reduction incommuting
Increase the presence of high-skill sectors that will generate incomefor the area
Improve local services for residents and businesses
Grow the rate of business formation
Increase the rateable value and number of commercial and industrialproperties.

This Strategy is organised into five inter-linked themes:

Activity Centres – revitalise our commercial heart:Maximise retail spending and reduce leakage, increase jobs andimprove living opportunities in Nillumbik’s activity centres.
Business Development – focus on success and growing the base:Assist business formation, longevity and networks.
Tourism – nature, culture, food and wine:Develop our attractions and improve visitor infrastructure, crosspromotion and networks.
Arts – celebrate our creative heritage:Capitalise on the creative heritage of our Shire and position it as acontinuing centre for the arts.
Rural / Green Wedge Economy – make the most of our greenwedge environment:Create opportunities for sustainable agriculture and improvedbushland management. Support “smart green” industries moregenerally.

Priority Actions

Council operates in an environment where the delivery of services to thecommunity is largely determined by the availability of resources. To enableCouncil to deliver the actions outlined in its Economic Development Strategy,it must therefore set priorities that will be established each year and set outin an Annual Implementation Plan.

The Implementation Plan will identify: the timelines and resources requiredto implement actions; external funding opportunities; and the consultationthat is necessary with stakeholders and the community.

The Major Projects and Business Services Unit of Council will be responsiblefor managing the Implementation Plan and undertaking many of the actions,including coordination with other Council departments, external stakeholdersand the community.

Based on the actions outlined in this document, the initial priorities are:

Establish an Economic Development Advisory Committee andreporting process as outlined in this Strategy.
Continue to support business organisations in the Shire includingtraders associations, Nillumbik Tourism Association and the HomeBiz/SmallBiz Network.
Continue to support tourism and business development programssuch as Farmers’ Markets, the Artists Open Studios and rebuildingbusinesses affected by bushfire.
Undertake a study to assess the feasibility of establishing a regionalart gallery in the municipality, including potential opportunities tosupport the role of Monsalvat.
Assist with the development of new tourism products such as highquality eco accommodation that is integrated with tourism relatedoffers, including the potential for a landmark eco hotel.
Continue to implement Major Activity Centre Structure Planrecommendations for Eltham and Diamond Creek.
Work with property owners, developers and business associationsto encourage investment in retailing, offices and housing in Eltham,Diamond Creek and Hurstbridge as well as appropriate investment insmaller townships and centres.
Establish a Green Business Network that is consistent with thedelivery of Council’s economic sustainability goals and objectives.
Continue to develop agribusiness networks and improve connectionsbetween rural producers, their industry groups and customers.
Ensure that any review of the Planning Scheme and the developmentof Township Strategies, considers existing impediments tosustainable economic development and appropriate tourismrelated activity in rural areas, and identifies land for the potentialestablishment of additional light industrial activities.
Develop a program that enables Council to provide information andsupport to enterprises seeking to invest in the municipality, includinga strategy for promoting Nillumbik as a preferred place to dobusiness.
Explore funding opportunities that are available to develop tourism,the arts, and agribusiness on a local and regional basis, includingpotential marketing alliances with adjoining municipalities andregional organisations.

These actions are expected to generate the largest number of jobs inthe short and long term based on a strategic assessment of economicopportunities in the Shire.

1Introduction

1.1About this Report

This Economic Development Strategy (EDS) for Nillumbik Shire Council hasbeen prepared to guide Council’s work on economic development over thenext six years.

The Strategy provides:

A discussion on Council’s role in economic development
Identification of objectives for economic development which arecompatible with Council’s overall goals
Issues and opportunities for local economic development
Actions that are necessary to deliver economic development.

An economic profile and an assessment of opportunities for economicdevelopment are provided as appendices to this Strategy.

1.2What is Economic Development?

“Economic development” can have a variety of meanings. For firmscompeting in the global marketplace, it means an improvement in thefactors of production and better returns on investment. For those withoutjobs, it means employment growth; for working families it means betteropportunities to build a secure future; for many others it may simply meanan improvement in community goods and services.

In the context of a local economy such as Nillumbik, economicdevelopment means a sustainable increase in the general level ofresources commanded by households, businesses and the community asa whole.

The level of available resources is determined by:

The level of income from wages, investments and benefits
The level of general prices
The distribution of resources amongst the community.

A sustainable increase in resources involves:

Encouraging local investment
Recognising the importance of “place”
Consideration of environmental issues.

1.3Why should Council undertake Economic Development?

After all, doesn’t economic development happen as a result ofinvestment mainly by the private sector and policy decisions ofState and Commonwealth governments?

It is certainly true that Council works within a broader economic and policycontext. However, Council is the only agency with a mandate to work for theNillumbik community as a whole and to exclusively look after Nillumbik’sinterests. Whilst many in Nillumbik enjoy good levels of prosperity, the localeconomy has a number of challenges that require attention if the area is tobe sustainable and prosperous into the future.

These challenges include:

Recovery from bushfires by supporting affected businesses tore-establish and reducing risk for businesses located in thegreen wedge
High levels of commuting, which are financially and socially expensivefor families and contributes to an outflow of retail and other spending
A rapidly ageing population in which the population aged 60 or more isgrowing at 5% per year compared with 0.5% for the Shire populationas a whole
Rural lands that have capacity to increase economic output in theareas of tourism and agriculture.

Many of these and other challenges need to be addressed by the communityas a whole and therefore by Nillumbik Shire Council.

Council does have an impact on economic development, deliberately orotherwise. For example, because of the decisions it makes on investmentand development approvals. Furthermore, through its information systems,business support programs and advocacy, Council has the opportunityto positively influence outcomes through supporting local initiatives andadvocacy to higher levels of Government. It is therefore appropriate forCouncil to ensure that its decisions are consistent and lead to desiredoutcomes overall.

“Sustainable economic development generates increased resourcesfor the community as a whole that can be used to conserve andenhance the environment. Without local economic development,resources to provide community support services, conservespecies and ecosystems, to manage pests and to tackle landscape degradation will be diminished.”

1.4The Roles of Council in Economic Development

Council is the largest employer in the Shire and across its whole range ofprograms is a significant investor in the municipality. However, its mostimportant roles in economic development are:

Leadership and strategic planning

Council has a unique capacity to bring together diverse community interestsand exercise leadership for the benefit of existing and future residents. Insome cases, this is a statutory responsibility, as in the development of theCouncil Plan, land use planning and development controls.

Strategic planning for economic development should provide clear directionsfor all investors in the municipality. Council should assist a reasonable levelof confidence that factors under local control will be secure for investors atthe householder and enterprise level and instil confidence that these factorswill improve over time.

Attracting and retaining investment

As the local community leader, Council is able to undertake and coordinateactions that will attract new investment and assist in the retention of investors.There is a balance to be struck between improving the existing economicactivities and encouraging new activities that should be part of the strategicplanning process.

Examples of ways in which Council can assist existing businesses include:

Facilitation of networks and alliances which can lead to better supplychain management, the spread of new technology and techniques,better market information and improvement in skill provision
Infrastructure improvements to reduce costs and open up new profitpossibilities
Facilitating appropriate development that enables growing businessesto remain in the Shire
Advocating to other spheres of government for investment and policy change
Facilitation of business skills development (particularly for small business)
Attraction of new skilled residents through the creation of attractiveplaces to live and recreate
Council can also have a role in attracting new enterprises throughpolicies to encourage new investment in a number of forms:
Background information and promotion establishing the benefits of Nillumbik as a preferred location for investment
Providing “One Stop” advice and assistance to enterprises that haveexpressed an interest in investing in Nillumbik
Proactive sourcing of investment in strategic target areas.
Improving the asset base

An improving base of physical assets (infrastructure, buildings andenvironment):

Reduces costs for businesses (for example, by reducing travel timesthrough road improvements)
Increases sales (by potentially increasing the number of visitorsto the area)
Generates higher property values and gives many in the community theability to leverage more resources for investment and consumption
Encourages investment, because the rate of capital growth is acriterion for most investors.

An improving base of human capital is also attractive to investors. Humancapital encompasses:

The technical skills of the labour force
The entrepreneurial ability of residents and business people
The vibrancy and adaptability of social networks.

Council can facilitate many aspects of developing human capital. Howeveran important issue for Nillumbik is that a large proportion of its existinghuman capital leaves the Shire each day to work elsewhere.

Provision of community goods

Economic development has been defined here to include an improvement inavailable resources for residents bearing in mind that more than half of alllocal residents such as retirees, welfare recipients and children are not in theworkforce and may not benefit directly from job creation.

Therefore, it is important to understand that actions, which improve the assetbase, may in some cases have other effects such as higher rents and prices.Although State and Commonwealth Governments are mainly responsible forwelfare payments, Council does use some of the resources at its disposal toensure access to public goods and services.

These have traditionally included free and/or subsidised services such aslibraries, swimming pools, community transport, home and communitycare, community centre services, immunisation, community festivals andevents etc. Council can also respond to particular areas of local need, andthese could include support for community housing initiatives, older people’srecreation needs, arts access, mental health support and so on.

In summary, this discussion on the most important roles in economicdevelopment serves to illustrate that economic development initiativescover the entire range of Council services and that a strategic approach toeconomic development will involve the whole of Council.

2Council Objectives

The Economic Development Strategy is just one facet of Council’s overallprogram to deliver its vision for Nillumbik. Council has a range of otherpolicies and strategies to achieve environmental, social and governanceobjectives. These are guided by the Council Plan 2009–2013 (Nillumbik ShireCouncil, 2009).

The diagram below illustrates how the four key objectives of the Council Planinteract to produce sustainable development.

Image of how the sustainable development works with all of the social economic environmental and governance council objectives

Actions on the local economy need to be integrated with other Councilprograms to deliver sustainable development. This means that Councilwill invest and encourage investment by others in creating a vibrant localeconomy that is based on our key advantages including our magnificentenvironment and the high level of skills and abilities of our residents andbusiness people.

Council’s economic development effort will therefore engage in activitiesthat are consistent with Council’s key social, environmental and governanceobjectives.

Robust community discussion about proposed activities and investments willcontinue since the weight and interpretation we place on these objectives willvary over time. However, our sustainable Economic Development Strategyprovides a framework to guide our decision making; for reaching acceptablecompromises and working towards win-win outcomes.

3Strategic Directions

3.1The process

In a situation of constrained resources, Council must focus its attention onthe key economic issues facing the municipality. The process that has beenundertaken in determining the key issues and opportunities has included:

Statistical review of the current state of the Nillumbik economy
Review of existing regional policies and programs
Meetings of a community reference group formed to provide inputto the Economic Development Strategy comprising councillors andrepresentatives of traders and other business organisations
Discussions with a variety of individual business operators in Nillumbik
Analysis of the opportunities arising from strengths, weaknesses andthreats of the local economy
Discussion of key opportunities and development themes at aworkshop attended by a wide cross section of stakeholders earlyin 2010.

In this way, a range of stakeholders have been involved in the development ofthis Strategy. The Economic Profile of Nillumbik is provided as Appendix 1 tothis report. Appendix 2 provides the SWOT analysis.

3.2The Strategy

A vibrant Local Economy

Performance measures for a vibrant economy include:

Increase the number of Nillumbik residents working locally throughthe creation of employment opportunities and a reduction incommuting
Increase the presence of high-skill sectors that will generate incomefor the area
Improve local services for residents and businesses
Grow the rate of business formation
Increase the rateable value and number of commercial and industrialproperties.

In addressing these economic measures, Council is mindful that itsactions should be compatible with and will contribute to the delivery of itsenvironmental, social and governance objectives.

The Strategy is organised into five inter-linked themes:

Activity Centres – revitalise our commercial heart:Maximise retail spending and reduce leakage, increase jobs andimprove living opportunities in Nillumbik’s activity centres.
Business Development – focus on success and growing the base:Assist business formation, longevity and networks.
Tourism – nature, culture, food and wine:Develop our attractions and improve visitor infrastructure, crosspromotion and networks.
Arts – celebrate our creative heritage:Capitalise on the creative heritage of our Shire and position it as acontinuing centre for the arts.
Rural / Green Wedge Economy – make the most of our greenwedge environment:Create opportunities for sustainable agriculture and improvedbushland management. Support “smart green” industries moregenerally.

These themes are described in more detail in the following sections. Eachtheme has a set of actions for Council and others involved in economicdevelopment in Nillumbik.

4Activity Centres

4.1Existing Situation

Activity centres are where most of the jobs in Nillumbik are located. Activitycentres provide shopping, commercial and community services. They aremeeting places for the Nillumbik community and often showcase themunicipality to the outside world. It is likely that investment in activity centreswill make the biggest impact on the local jobs deficit.

Two of Nillumbik’s centres have been designated Major Activity Centresunder the metropolitan planning strategy (Department of Sustainability andEnvironment, 2004):

Eltham

24,800 sqm of retail space including three supermarkets and a wide range of specialty shops
12,000 sqm of office space
A primary trade area with over 23,000 residents and a main tradearea (primary and secondary trade areas combined) with over 50,000residents
Retail escape spending from the main trade area of 64% (in 2004).

[Figures from Essential Economics, 2009]