Social and Economic Crisis Looming, Developers Warn

14 February 2008

The reform the State’s planning laws needs to be more radical if a new system is to save NSW from a social and economic crisis, according to the Urban Taskforce.

The Taskforce today released its submission to the NSW Governments planning reform process: A planning system in gridlock how to save NSW from a social and economic crisis. It contains 63 recommendations for major reform.

The Urban Taskforces chief executive, Aaron Gadiel, said the system needed to encourage the integration of housing, workplaces, shopping and recreation areas into compact, pedestrian-friendly neighbourhoods.

 Building figures for NSW were at their lowest levels in 50 years, Mr Gadiel said. The production of new houses in NSW stands at less than half of both Queensland and Victoria. Despite our differences in population, Queensland is producing almost as many new apartments as NSW.

Sydneysiders are feeling the pressure on home ownership like never before. Our production of new homes is at record lows, but our State’s population is at a record high.

Without more far-reaching reform NSW will slip further behind the rest of the country.

 “The NSW property development industry is not just sick – it’s currently having a near-death experience.

Sydneys population is anticipated to grow by 1.1 million people by 2031.

This means Sydney needs 640,000 new homes, 7,500 hectares of extra industrial land, 6.8 million square metres of additional commercial floor space and four million square metres of additional retail space.

 This cant be delivered under the current planning laws.

The NSW planning system makes getting a development approval a highly risky and expensive proposition, Mr Gadiel said. Developers are simply unable to profitably produce enough new homes to satisfy the needs of Sydney and NSW.

Mr Gadiel said the Taskforce supported the proposed new joint regional planning panels. The discussion paper proposes that only projects of value $50 million plus will go to joint regional panels for their development approval.

Only 24 projects would have been considered by the regional panels had they existed in 2005/2006, Mr Gadiel said.

Much of the value in the property development industry is created in the $5 – $30 million development range. This job generating sector of the economy will not substantially benefit from the reforms as currently proposed.

The Taskforce is calling new rules to tackle long delays in development approvals.

Development consent should be deemed to be given if no refusal has been issued in a ˜deemed-tocomply period, Mr Gadiel said.

Deemed-to-comply periods are a vastly superior method of ensuring that consent authorities allocate the necessary resources to their development assessment responsibilities.

Without deemed-to-comply periods, councils lack incentives to quickly deal with development applications.
The government should also introduce deemed concurrences for State government agencies. This means that when a development application is referred to a government agency for concurrence and theres no response – the development application should be deemed to have the support of the agency, Mr Gadiel said.

Mr Gadiel said there wasnt enough competition amongst shopping centres.

Under the NSW planning system, supermarkets and shopping malls are one of the most heavily regulated sectors of the economy, alongside mines, casinos and brothels, Mr Gadiel said.

The current planning system allows a development application for new retail premises to be refused because it will take trade away from existing businesses.

The Taskforce said changes were essential to deal with the wide range of strata buildings that are nearing the end of their useful life.

Strata schemes should be able to be terminated when 75 per cent of votes cast by the owners are in support.”

The Urban Taskforce congratulated the government for starting the planning reform process.

We recognise that the governments discussion paper is a significant step forward in the debate, Mr Gadiel said.

But more far-reaching reform is essential. A copy of the Taskforces submission is available here.

The Urban Taskforce is a property development industry group, representing Australias most prominent property developers and equity financiers.

The NSW development industrys annual turnover is $35 billion and employs 180,000 people, accounting for six percent of the States total employment. It is the fifth largest contributor to the State economy.

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