The ACT Government lost up to $15 million by allowing the private sector to develop the Gungahlin suburb of Palmerston, according to three academics who won a planning award for their work last night.
The academics say that, alternatively, the Government could have cut the cost of land by about $9000 a block.
The academics agree with the ACT Government’s position of taking a greater role in greenfields development by moving from privatisation to more joint ventures. But they say the Government could take the whole thing over.
That would result in better returns to government for turning rural land to urban or alternatively could result in lower prices. It could also help improve housing quality.
Steven Bourassa, Max Neutze and Ann Louise Strong, of the urban research program in the School of Social Sciences at the ANU did a detailed study on Palmerston to make their case as part of a study on leasehold in general. The study won them the 1994 Royal Australian Planning Institute prize for planning scholarship.
The academics said that even accepting a 10 per cent lower costs for private-sector development, they said the Government would still be nearly $8 million better off doing its own development.
The ACT Government has a stated policy of moving to total Government land development will public auctions for single blocks, but it has not got beyond joint developments.
The academics agreed joint ventures were a step in the right direction, saying that the Government (or consumers) would have been between $3 million and $6 million better off if Palmerston had been done that way.
They said that private developers were getting a “”generous” return for little risk.
They acknowledged that the Government had achieved its aim of higher densities in Palmerston but at a financial cost and cost in quality, acknowledged by the Government itself. They said that if the Government took over greenfields development it would be in a better position to ensure quality.
They also called on the Government to change betterment tax rules. (Betterment tax is levied when a leaseholder gets a change in lease purpose.) The academics argued that present rules gave developers a large across-the-board discount, especially for residential redevelopment.
They said that if the Government wanted to encourage redevelopment with financial incentives it should do so in an open way with direct subsidies.
The Government has announced last week a review of betterment for multi-occupancy developments following its response to the Landsdown report.
Other awards went to: Yarrowlumla Council for rural planning; the National Capital Planning Authority’s Russell Master Plan for urban planning; Roger Davis for a student project on affordable housing; and to the five public-sector partners in the Jerrabomberra Valley project for community planning. The five are the NCPA, the ACT Departments of Environment, Land and Planning and Urban Services, ACTEW and Queanbeyan City Council
The ACT Legislative Assembly’s Planning, Development and Infrastructure Committee is to bring down a report on Red Hill today (TUESDAY) giving conditional approval to multi-unit development on some Red Hill blocks in the Old Red Hill large-block area.
The Old Red Hill Preservation Society and the Save Our City Coalition say if this is the case and the Government accepted it, it would fly in the face of the Government’s response to the Landsdown report.
Coalition president Jacqui Rees said if the Government accepted such a report it would be contrary tot he recommendations of a highly respected landscape architect, Professor Ken Taylor.