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Urban Taskforce | Media Releases
Planning system suffering from overload, creates inefficiencies and is impacting on competition: Productivity Commission
25 February 2011
The Urban Taskforce said the case for reforming Australias system of town planning and development levies has been strengthened, following todays release of a draft research report by the Productivity Commission. The Taskforces chief executive, Aaron Gadiel, said the wide-ranging report validated serious concerns regularly voiced by the development industry.
Australias lumbering town planning laws and its inefficient development levies are a key cause of housing supply crisis, Mr Gadiel said.
Theyre causing urban congestion by preventing new homes and new workplaces being built where theyre needed.
Theyre also preventing competition amongst retail landlords, leading to over-crowded shopping centres and less consumer choice.
The report has found that the planning system suffers from objectives overload.
People are expecting the town planning to solve the worlds problems, when in truth; it is nothing more than a system for prohibiting and permitting development, Mr Gadiel said.
The report also said that inflexible rules create a need for ad-hoc ˜fixes to the planning and zoning system, resulting in increased uncertainty, inefficiency and an anti-competitive unlevel playing field.
This is the message we have consistently given to government, Mr Gadiel said.
So many prohibitions are just arbitrary and they dont stand up to scrutiny.
Many often need to be varied.
Planning authorities should be imposing less prohibitions and have more sensible rules up-front.
The report found that planning laws impact adversely on competition. It said that a new entrant's effects on existing businesses should be eliminated as an appropriate planning consideration.
This is yet further evidence that the lack of competition amongst Australias retail landlords is a consequence of town planning laws.
The report said that development levies need to be applied against better criteria.
We welcome their finding, that any ˜system-wide infrastructure upgrades necessary for infill development should be funded by government out of borrowings rather than development levies, Mr Gadiel said.
Theyve also found that broadly dispersed social infrastructure should also be funded from government through general revenue, not development levies.
If implemented by governments, this would be a significant step forward.
Many existing levies - which are stopping new projects getting off the ground - would not pass the tests proposed by the Productivity Commission.
Mr Gadiel said the Productivity Commission had an important message for those who want state government to refrain from making planning decisions.
The Commission said that no single local council or group of citizens can be expected to adopt the overarching perspective needed by state and territory governments and that leadership will be required at the elected political level.
Whether its ˜Part 3A in NSW, ˜priority development projects in Victoria or the work of the Urban Land Development Authority in Queensland, there is clearly need and a role for state government leadership in the planning process, Mr Gadiel said.
Without, local councils are free to block development to satisfy the demands of their existing residents, at the cost of the broader communitys need for housing and well-located jobs.
Mr Gadiel said that todays report would help the push for a more flexible planning system.
The community cannot continue to bear the huge social and economic costs being imposed by the current approach, he said.
The Urban Taskforce is a property development industry group, representing Australias most prominent property developers and equity financiers.
Note: A series of direct quote from the report, sorted by topic appear in the PDF below.