EXCLUSIVE

AUSTRALIANS must prepare for a fundamental shift in the way we live because the country cannot afford to cope with 36 million people.

Economic modelling produced for the Herald by PricewaterhouseCoopers shows the task of building the new roads, houses, schools, supermarkets and recreation facilities needed by 2050 will be so great that the nation's current pool of savings will struggle to cover it, even with the help of foreign capital.

As a consequence Australians will have to make major lifestyle changes.

These range from dramatic increases in housing density and an end to our reliance on the car, to the creation of self-sustaining urban communities capable of generating their own energy to avoid the need for new power stations.

Planning experts say we must also consider whether population increases will be accommodated in larger regional centres rather than allowing cities such as Sydney to grow.

''The bottom line is 'prepare for change','' the PWC economics and policy team leader, Jeremy Thorpe, said.

''The task of providing this infrastructure is a very significant one and at the moment we don't have the savings to cover it. Governments have to make a decision about what trade-offs they want to make to maintain a standard of living.''