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Wednesday, 8 February 2017
Page: 408

Mrs SUDMALIS (Gilmore) (12:26): It is not often that I rise in the House to speak on the outcome of a committee inquiry, so let me just say this one has captured my imagination and passion for regional development well before it became a topic for a committee inquiry. Early in 2016 our backbench committee, chaired by John Alexander, the member for Bennelong, was briefed by a number of groups presenting some very forward-thinking concepts for delivering much needed infrastructure and regional development at little or no cost to the government. We were asked: what if 26 to 28 per cent of residents in Melbourne and Sydney who love the city life but really hate the daily drag of driving to the city, paying tolls, finding parking, looking for long day care for their children were given an opportunity to live in a city environment without the hassles of city life? What if a digital, environmentally sustainable city could be built with a range of housing models, most of which would resolve the affordable housing issues, and enable employment? What if that could happen?

This is a visionary possibility and it relates to the core of the inquiry. That information was presented by the consortia with development and very fast travel front and centre of the concept. It is a forward-thinking change of planning and yet it is an achievable goal. The initial briefings were prosecuted by the committee to raise these to inquiry level, and the result is that the Standing Committee on Infrastructure, Transport and Cities initiated this inquiry, entitled Inquiry into the role of transport connectivityon stimulating development and economic activity.

In Gilmore, my residents, businesses and entrepreneurs know and are concerned with the lack of transport connectivity. We know this is hampering business growth, employment and potential development, but the concepts of value capture for land zoning and consequent development go well beyond the local regional level. The first paragraph in the committee report says:

Transport connectivity is one of the pressing issues of the 21st Century. Australia is facing challenges of growing populations, urban congestion, changing patterns of settlement and the need for enhanced accessibility to employment and markets. These challenges need new and innovative solutions to the development of transport infrastructure. Solutions must also be found for integrating transport and land-use planning, financing transport infrastructure, and putting in place effective governance structures.

One of the primary motives included the potential for high-speed rail to act as a catalyst for economic and social transformation in regional development. You actually cannot have regional development unless you address the transport issue. The inquiry also investigated the economic benefits, the wealth creation that comes from improved transport connectivity.

There were significant factors to consider, and these included the benefits gained from 'value creation' and 'uplift'—terms we will talk about later—the role of the government in coordinating improved transport connectivity, the role of value capture and other economic instruments, and delivering infrastructure. We need to improve this transport connectivity to get better employment, to get product to markets. There have got to be cost savings in terms of reduced transit times, less traffic in the cities and reduced transport costs. Just imagine a string of cities between Sydney and Melbourne connected by very fast rail, with these cities being as big as Canberra and you being able to travel from one of these regional cities in less than half an hour. It is absolutely inspiring.

The committee found that the key benefit in improved transport connectivity is its transformational effects, making the regions more accessible, more liveable and providing opportunities for regional development which at this time we can only dream of. Carefully planned, multifaceted housing, transport systems that work and sustainability promise to make cities more efficient and liveable.

Improved transport connectivity is also critical to regional development. It provides opportunities for decentralisation and ultimately, instead of having these heavily weighted cities in our nation, we will have settlement outside of that where people can actually have a really good quality of life. Greater connectivity will promote the development of regional areas, making relocation to them more attractive and reducing the growth pressure in major cities—not to mention the cost of housing when everybody is trying to live in the city and there are not enough cities to live in. The key to this, especially in regional areas, is the development of high-speed rail, particularly from Sydney to Melbourne, where the population growth is enormous.

We have to allow the creation of these new centres. We need to seek expressions of interest for the development of high-speed rail in eastern Australia. Let me tell you that that expression of interest is already there. They wish to have that. They need to have the connectivity. They know they can do it if these new cities are built. We recognise that there needs to be ongoing investigation.

Good planning for this value creation—because that is what it is about: the more you develop the land, the higher its value. The basis for improved transport connectivity will improve the overall gain from the development strategy. We believe value capture has the potential to make a considerable contribution to the cost of the new transport infrastructure. In fact, they have modelled it to do exactly that. With very little input from the government, they believe that their economics stacks up in building these brand new, digital cities. It is just amazing. The owner of the land that is re-zoned will, of course, be the beneficiary, and that is how they are going to fund it. That is how they are going to build these new cities. Then there is another part of this equation where another group will come in and build the very fast rail, because, if you have got eight cities between Sydney and Melbourne all about the same size as Canberra, there is enough population there to sustain, support and make a profit from a very fast rail system.

We have to highlight the integration of transport and land use planning to make it viable to these potential developers who want to come into our country and make a massive difference. This is not pie in the sky. These guys have developed cities in other parts of the world. They are demonstrable, they are successful and they are working. We need some of that here. We need to have overlay zoning initially so that we have got short-term land use with long-term land use planning, and we need to make sure we get this happening very quickly.

The role of the Australian government in providing bipartisan leadership on this issue is particularly important, as its ability to leverage outcomes through control of funding is also important. With the idea of setting up a master fund, you have the creation of a single bucket of money you can draw down for a whole range of different projects. You have planning, development and benefit in there. It all has got to have an overarching picture.

Labor, the Liberals and whomever else wants to join in this party of a visionary future for regional Australia need to have this on board and need to follow it through with a 20-year plan—although, if we can get the zoning changes done in a fairly quick way, we are assured that one of these brand-new cities can actually be built within three years. It is amazing.

A broad range of value-capture mechanisms could be applied in an Australian context, although the different mechanisms are best applied by different levels of government and a high degree of coordination is needed. If you have land that is owned by the state government, they are going to want to be part of that uplift. If it is a private landowner, they are going to want to be part of that uplift. But we need an overarching policy that pulls it all together so that there is not one single factor that jumps in and pulls this apart. We need it to happen.

There is also a potential for the Australian government to develop a toolkit for the potential value-capture mechanisms, and I suspect that we should actually be developing that now. This inquiry was an exercise to investigate a decentralisation process where there could be private-public sector investment rather than a massive hit on the taxpayer. Governments, as a rule, are not very good at getting big infrastructure projects going unless it is roads, because nobody else wants to do that, because there is very little commercial return. There will be commercial return on the uplift value for this, and that is why it will work, so trying to get investment coming in from the government is going to be self-defeating possibility. This private-public sector possibility has got so much merit.

A really important part of this visionary process is that the Department of Infrastructure and Regional Development, in conjunction with state and territory governments and councils, develops a toolkit of value-capture mechanisms that can be applied by all levels of government, taking into account the different conditions in the various states, territories and local council areas because they all have their own little differences. The use of mechanisms in that toolkit should be a requirement in cases where the federal government is going to contribute funding towards major infrastructure projects, some of which are already in the pipeline. We must have a regional master plan perspective rather than a project-by-project approach. We need to have priorities so that, if there are better values, we put them as a priority project. We need to draw on the proposed value-capture toolkit to find the value-capture mechanisms and determine the amount of uplift that can be captured, because the three tiers of government can get financial leverage from doing that. In doing so, the Australian government should be prepared to act as a single point for the collection of value-capture revenues and the allocation of the project money. I suggest we start doing this now. Thank you.