Australia’s population will reach 25 million for the first time on Tuesday, according to official estimates.

The milestone, driven significantly by migration, has magnified debate about the merits of a “big or little” Australia, and congestion in cities.

The most contentious aspect has been migration: is it growing too fast, or will it continue to benefit the nation? As urban sprawl worsens in Sydney and Melbourne, the government wants people to look at alternative places to live.

Australia’s population is concentrated around its coast – Sydney and Melbourne alone account for about two-fifths of people.

A majority (67%) live in state and territory capital cities, according to the Australian Bureau of Statistics. The only exceptions are Hobart (44% of Tasmanians) and Brisbane (49% of Queenslanders).

Despite much of Australia being uninhabitable – officially 20% is classified as desert – the government says it has a “distribution problem”.

“There are other regions in Australia which are crying out for more people,” Citizenship Minister Alan Tudge said on Tuesday.

Australia grew by 388,000 people, or by 1.6%, in the last annual measurement. Of those, 62% were migrants and 38% was a natural increase (births minus deaths).

In this century, the largest number of migrants have come from India, China, Britain, Philippines and South Africa.