24 October 2010
Local councils should embrace the near-to $1 billion loan fund offered by the NSW Coalition, says the Urban Taskforce. The Taskforces chief executive, Aaron Gadiel, said the fund appeared to be about providing high priority urban infrastructure.
New local roads, roundabouts, bridges and playgrounds are necessary to help manage population growth and demographic change, Mr Gadiel said.
The Sunday Telegraph is today reporting that the Coalition will move to free up the cash for councils by giving them interest-rate concessions and allowing them to borrow against their assets to improve their facilities.
The rate would apparently be half of the NSW government bond rate at a cost of $70 million over four years. The Coalition is also promising a statewide audit to identify infrastructure projects across local council areas.
Mr Gadiel, said the fund could be an opportunity for high-population growth areas to secure infrastructure investment for the future.
This program could leverage unspent development levies held by local councils, as well as council assets, he said.
NSW wont get the housing supply in needs unless local government pulls its weight on infrastructure provision.
That inevitably will require councils like other levels of government to finance infrastructure investment by borrowing money.
Mr Gadiel said the scheme would leave local councils with no excuse for sitting on the development levies theyve collected from home buyers.
Councils have previously claimed that they could not spend up to a $1 billion in development levies because the money was tied to specific projects, and they lacked the cash to fully fund their construction.
Mr Gadiel said it should be mandatory for councils to participate in the fund.
When the NSW government launched a $200 million local infrastructure loan fund last year, only six of Sydneys 41 councils made successful applications, he said.
Its a great idea to propose this policy, but there should be both a carrot and stick.
Councils should be required to participate and also should be required to accommodate the extra housing NSW desperately needs.
The Urban Taskforce is a property development industry group, representing Australias most prominent property developers and equity financiers.