Treasury population centre puts spotlight on Australia's population

Population Minister Alan Tudge detailed the new 20-strong centre on Friday, headed by Victoria Anderson and based in Treasury. It is tasked with more accurate population forecasts and an annual population statement.

Mr Tudge pointed to sometimes wildly inaccurate population projections from the Australian Bureau of Statistics. The bureau had projected an extra 500,000 people for Melbourne between 2014 and 2018 when the actual number had been 1.3 million.

The bureau says Australia's population will increase to between 37.4 million and 49.2 million people by 2066 - a range of 12 million from the low to high-growth option.

But Prof Booth says populations don't grow in the way the numbers assume. If there is a high birth rate, the migration rate is reduced, and vice versa - so the numbers were bound to be wrong. More sophisticated forecasts were needed.

Prof Booth said Australia also needed better planning, based on economic, environmental and social sustainability. Most of the country could not sustain significant numbers, and more than 90 per cent of the population now lived in major cities.

That brought social challenges as people lived in more and more crowded housing in cities. And the new thinking on economic sustainability, that economic growth did not depend on population growth, undermined the need for "going head over heels to populate the country", she said.

"I think that this office needs to be taking all of these issues on board and really giving some direction to the future of the country," Prof Booth said.

Australia's population was growing at 1.6 per cent a year, with migration accounting for 1 per cent of that.

While Australia still had a youth culture, it must also plan for an ageing population - one of the biggest challenges the country faced.

"We need to grasp that we are in a changing situation and that it's actually permanent," she said.

Mr Tudge said projections made by state, local and federal government differed, sometimes drastically.

The new centre would take over responsibility for forecasting net overseas migration and would improve reliability.

It would also analyse factors that influenced where people chose to settle and why they moved.

In Sydney, nearly all the population growth was from overseas migration, with more local people moving out of Sydney than moving in.

"Australia is a fast-growing population. We've done very well out of that but it also put immense pressure on our big capital cities and so we need to manage that better," he said.

The government has reduced permanent migration from 190,000 to 160,000 a year, and is trying to push temporary migrants, including international students, to areas outside Melbourne and Sydney.

ANU research this year showed it hasn't worked so far. While migrants entered on visas for working in regional areas, within five years, more than 60 per cent of them had moved, the research found.

The bureau of statistics said its projections were not forecasts or predictions, but "illustrations of growth and change in the population that would occur if assumptions made about future demographic trends were to prevail".