PIA response: “Making up the rules in the planning game"

1st Feb 16

Chris Johnson, a lobbyist for the Urban Task Force, complains about making up the rules in the planning game in an article in the Telegraph (Dec 17th).

Contrary to interpretations that might result from the article, the public can be assured that there is integrity, guidelines, legal safeguards and logic in the planning system. The idea of value capture is not a new concept and has been spoken about for a few years, including in the review of the local and state infrastructure contribution system. The concept in principle could involve, for example, when a government provides a new train station in a suburb the value of land goes up around that train station by several hundred percent. The landowners suddenly receive a windfall gain. For example, a large lot of land on the Old Northern Road next to the proposed Castle Hill Train Station increased in value from $2.2m to $6.2 million after the site of the station was announced by the Government.

In the case of Sydney’s two newest public transport routes – a light rail route through Sydney Olympic Park and the new Metro route to Bankstown, the Government is asking for a contribution from landowners of $20,000 per “apartment” to help fund the public infrastructure. This is a small fraction of the increase in their value as a result of the Government (i.e. taxpayers) funding. This cost is likely to ultimately get added to the price of an apartment – as the apartment price including all cost to development, which forms the housing market price.

As our cities continue to grow we are going to require large injections of public infrastructure. Let’s use a range of strategies to help fund them so we can continue to enjoy living in some of the best cities in the world and do it on the basis of equity between landowners, the development industry and the taxpayer.

Gary A Shiels LFPIA CPP

NSW Vice-President, Planning Institute of Australia

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