Housing and skills shortages have been identified as areas that need to be addressed if the region is to benefit from the Inland Rail project.
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Speaking at the first hearing of the NSW government's inquiry into the Inland Rail project and regional NSW, Chair of Regional Development Australia Central West (RDA) Ruth Fagan said the region had been "caught short" when it came to new housing developments.
"The vacancy rate in the region is 0.6 per cent at the moment, so there are very few houses," she said.
"That is a major problem, although we have investors coming from Sydney and other areas who have bought into towns.
"I feel that we have been caught short, I think, in that developing the infrastructure for these developments is a really big thing and councils do not have the money to invest in huge amounts of infrastructure."
It has just caught us a bit on the hop, I think.
- Chair of Regional Development Australia Central West (RDA) Ruth Fagan
Using Cowra as an example, Cr Fagan said council would only have around $500,000 to spare in its budget.
"We have to organise that in a way that we can cap grant funding for things," she said.
"Local government has not got the money to do the infrastructure development that is required to open up the land and put the blocks on the market.
"We do have the land available but we just have not got the infrastructure and the money to spend on that.
"That is a big problem, plus the worker shortage of getting somebody to build a road or put in electricals or do some posts or roads or anything, is just a really difficult thing at this time.
"We are not finding people to get quotes for anyone to do any sort of development and infrastructure.
"It has just caught us a bit on the hop, I think, this whole development and infrastructure, and I think we are a bit behind the eight ball at this stage."
On the topic of skills in the region, Cr Fagan said the region had "more jobs than people".
"There are so many jobs out here that we can take skilled migration as well as local input," Cr Fagan said.
"The situation at the moment is that we have a massive backlog of employment vacancies in the regions for skilled people.
"We have a real skills shortage here of people like craftsmen, builders and construction workers across the regions. So, we need both, we need skilled migration and we need local pathways.
"We do have a lot of skilled people but we need more. We seem to be running out of people."
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