Divide in wellbeing between urban and rural New Zealand - report

Economist Brad Olsen discussed the report on The AM Show on Tuesday. Credit: File.

There is a stark divide between the wellbeing of Kiwis living in urban New Zealand and those residing in rural or regional areas, according to a new report.

On Tuesday, Infometrics released their report titled Regional Wellbeing, which looked at outcomes for Kiwis living in provincial areas compared to those in the cities.

It found wellbeing in metropolitan centres far exceeded that in the regions for seven of nine considered areas - environment, health, jobs, knowledge and skills, income, safety, and social connection.

In urban parts of the country, the report stated there was a greater mix of skilled employment opportunities, office-based work, and higher pay. They were also safer places to live due to a lower rate of crime.

Provincial areas only outperformed urban areas in housing and civic engagement/governance. Rising house and rental prices, particularly in Auckland and Wellington, were behind urban centres' lag in the area of housing.

Senior Infometrics economist Brad Olsen told The AM Show that the results suggested more power needed to be given to local communities to deal with their own issues, rather central Government being the only major player.

"Wellbeing in provincial parts of New Zealand is really being neglected and what that means is that we have got quite a stark divide coming through between those who are living in urban parts of the country and those who are living in more regional, rural parts of New Zealand," he said.

"There is no one solution, but probably what we need to do first, is let local communities take hold of their own problems and start really creating their own solutions."

Olsen said these societal problems have been around for decades and haven't been solved by successive Governments.  

Areas of particular concern were Northland and Gisborne, which the report said featured near the bottom in most wellbeing domains.

Those are two areas which have be given substantial help by the Provincial Growth Fund (PGF), which was allocated $3 billion to invest in regional economic development by creating new jobs and helping struggling economies.

While Olsen said the PGF had a lot of opportunities, the focus should be on more than just generating jobs.

"Jobs are really important, but we also need to look at the fundamentals of what New Zealanders care about," he said.

"Some of our housing and health outcomes are really, really poor, particularly in rural areas, and that's an issue we need to address just as much as the economics behind it."

Olsen said central and local Governments should focus on not just one area - such as housing or jobs - but in ensuring the "entire package" was available. That meant addressing issues of education or crime, and not just hoping fixing one area would have a flow on effect.

Coming in from a national perspective and thinking that all regions have similar problems was not the right way of addressing wellbeing, the report said.

"We are letting central Government do a lot of the work, or we are waiting for them to do a lot of the work... we are over, the wait is over. We really need to get back to those local communities."

Click here for the full report.

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