Planning reform could provide a $5 billion productivity boost

The NSW Property Council has welcomed the release of a new Productivity Commission White Paper.

The announcement: 

NSW Executive Director of the Property Council, Jane Fitzgerald, today welcomed the release of the Productivity Commission White Paper 2021 as a critical launchpad for the post-COVID conversation to create a more productive, prosperous and harmonious NSW.

Ms Fitzgerald said Productivity Commissioner Peter Achterstraat AM had delivered a comprehensive, challenging and thoughtful report which contained 60 opportunities to boost productivity.

“We welcome today’s report as an important milestone for NSW as we emerge from the COVID-induced recession,” Ms Fitzgerald said.

This comprehensive list of recommendations includes some important boosters set to untie the knots in the planning system and speed up processes to deliver benefit to the economy and release the homes our state so desperately needs.”

While many recommendations are welcomed as in train by the government, others should be urgently adopted. A number of recommendations will require significant community debate and dialogue if they are to be progressed at all.

“Critically, the Productivity Commissioner – and the NSW Treasurer Dominic Perrottet at today’s launch – acknowledge that to address the housing affordability crisis the NSW planning system needs to do better,” Ms Fitzgerald said.

The White Paper says “strict constraints on the location, nature and density of housing are limiting choice and leaving people with less income to spend on other goods and services.” (p40).

“Housing affordability is a dire challenge that is causing distress for people right across NSW and the White Paper rightly calls for local housing delivery processes to be scrutinised and for the State to step up to ensure a strong pipeline of housing,” Ms Fitzgerald said.

“The White Paper steadfastly acknowledges that there is still a great deal to do to ensure the NSW planning system is efficient and effective and producing the high-quality development we all deserve.

“Whilst the Report says this could take up to another four years, with a fully implemented date of 2025, we would urge the government to get this done much more quickly.”

The White Paper also endorses a tax reform plan to replace stamp duty with a broad-based land tax.

Ms Fitzgerald thanked Mr Achterstraat for his work to date to lift the State’s productivity and Treasurer Perrottet for having the political courage to take the debate forward.

Ms Fitzgerald said the paper outlines opportunities across seven areas that include:

Improving our schools’ ability to provide the education that the people of New South Wales need to reach their potential.

Ensuring we invest in the right workplace skills for a globally competitive and adaptive workforce.

Regulating in ways that support innovation and competition.

Ensuring reliable, sustainable, and productive supply and use of our water and energy resources.

Gaining more from our infrastructure.

Planning for the housing we want and the jobs we need.

Modernising out tax system to help our economy grow.

Key recommendations to improve the NSW planning system include:

Developing and implementing a system of long-term housing targets underpinned by strong evidence and governance (including an Urban Development Program, a Housing Supply Council and incentives for local governments to deliver on targets).

Reviewing the proposed Design and Place SEPP including apartment design regulations to ensure benefits justify costs and accommodate consumer choice.

Identifying the causes of long assessment times in NSW and opportunities to bring them in line with best practice.

Planning for greater housing and business activity in areas where there is spare infrastructure capacity.

Progressing reforms to rationalise employment zones and evaluate alternative ways to manage industrial land and urban services.

Implementing all recommendations of the Review of Infrastructure Contributions to deliver a reformed contributions system.

The Property Council will consult with members and provide further advice to the NSW Government on priority recommendations.

Source: Property Council press release

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