Fears Reforms Would Deliver NSW Developer ‘Slush Fund’

New changes to the affordable housing strategy will deliver a “developer slush fund”, according to the Australian Institute of Architects. 

The AIA is the latest entity to throw in their hat in the ring on the sweeping changes to NSW planning.

A proposed 30 per cent uplift for residential apartment projects with 15 per cent affordable housing provisions could be an opportunity for land banking, according to AIA NSW president Adam Haddow.

The swap in state government for the first time in more than a decade has led to huge changes for housing targets, infrastructure funding and approval agencies.

Two announcements were made in regards to affordable housing this month. For private developments there were incentives for those who could reach 15 per cent affordable housing in projects over $75 million in capital investment value.

These projects would gain access to the State Significant Development planning approval pathway and get a 30 per cent floor space ratio boost and height bonus of 30 per cent.

State-owned housing corporations will also be able to access the planning pathway for projects with 75 homes or more than $30 million in capital investment. Landcom would also be able to access this pathway for projects with at least 50 per cent affordable housing.

As well, reforms will allow self-assessment powers up to 75 homes and three storeys, and a reduction of the minimum lot size to 400sq m for dual occupancies in the public sector.

While the AIA supported the uplift, the association did not support legislation that identified an affordable housing provision limited to a 15-year tenure. 

They added affordable housing provisions should last longer, be managed by registered not-for-profit providers and should have a time limit on development approvals to combat land banking.

“These changes are essential if this important piece of legislation is to have a significant impact on the long-term viability of housing in this state,” Haddow said.

“Without these changes the legislation effectively delivers a 15-year developer slush fund.

“We would also like to see a time limit on the 30 per cent uplift projects achieving development consent of five years—to the issue of an occupation certificate from the date of the principal approval—to ensure actual delivery of housing to combat land banking.”

The Property Council of Australia backed the changes from the state government.

▲ AIA NSW president Adam Haddow.

PCA acting NSW executive director Anita Hugo said these projects, once completed, would boost overall housing supply in an incredibly tight market.

“The government’s new planning rules are a big endorsement of the density agenda and will play an important role in addressing our housing affordability crisis,” Hugo said.

“The change to planning rules will see a positive increase in applications, so the government should ensure that projects that apply under the SSD pathway don’t become stuck in the system by directing more resources to speedy assessment.”

Hugo said the government should consider a range of other planning measures to deliver on commitments under the National Housing Accord.

The NSW government also announced the redeployment of 350 staff from the Greater Cities Commission and Western Parklands City Authority to the Department of Planning and Environment.

NSW Premier Chris Minns said the move would streamline processes and help rebalancing population and housing growth for all 43 local councils evenly.

“There’s no point having housing targets if you can’t deliver the housing,” Minns said.

“This is about ensuring we have the right team in place to deliver the housing and infrastructure we so critically need in this state.”

The Environmental Planning and Assessment (Housing and Productivity) Contributions Bill passed the NSW Legislative Council on Wednesday night.

This aimed to address housing supply shortages by dealing with an infrastructure bottleneck, providing communities with high levels of housing growth access to more funding.