Developers’ levy off the agenda

THE WA Parliamentary Accounts Committee will head to Broome this week as it continues its examination of developer contributions to infrastructure costs associated with land development.

The committee is examining developer contributions to both greenfield and in-fill development, and aims to deliver its report to parliament at the end of June.

Developers and industry organisations are concerned that the committee may recommend introduction of a developers’ levy, and have made it clear that any such impost will be passed on to consumers.

Planning and Infrastructure Minister Alannah MacTiernan, who said her primary objective was to obtain information from the committee on the cost of growth as part of a dialogue on the development of the city.

She rebutted claims that new levies would be introduced.

“I have told industry time and time again that we have no intention of implementing developer levies,” Ms MacTiernan said.

“It has always been my stance that we would never do anything like that without a broad-based consultation process.”

Ms MacTiernan acknowledged that the report may recommend the imposition of developers’ levies, but made it clear that the Government would not adopt such recommendations.

Committee chairman John D’Orazio said there were many competing interests and that the committee was looking at benchmarking and standard conditions in relation to developments.

“The problem is that each development is different. Councils on the fringe say that the demand to provide infrastructure is far beyond their capacity, whereas developers are saying that they already provide substantial contributions,” he said.

“Sydney has a huge developer contribution, and that is never going to happen here. It is not appropriate to unnecessarily take money off people.

“The question is, should the State have to pay for the jumping of the urban front?”

Australand general manager Chris Lewis, who gave evidence to the committee, said he felt the committee’s agenda was to report back and recommend to parliament on what amount should be charged and how to administer the levy, rather than focusing on the question of whether there should be a levy.

“Developers already pay considerable scheme fees and voluntary contributions and any further tax would simply be a further erosion on affordability as the cost will be passed on to the consumer,” Mr Lewis said.

Property Council research officer Geoff Cooper, who also gave evidence to the committee, believes the committee will recommend developers’ levies.

“The committee seems set on the path of introducing levies; it just seems a question of how much it is going to be,” Mr Cooper said.

Urban Development Institute of Australia executive director Marion Fulker said the possible implementation of a developers’ levy was of great concern to the industry.

“People value the choice of where they live, and a levy would only make land more unaffordable,” she said.

“Coming into an election it would be political suicide to introduce levies.”

Benchmark Projects managing director Chris Carman said developers paid for all basic infrastructure and pre-fund services in frontal developments.

“Developers already pay a headworks charge for water and sewerage, a power and gas connection fee,” Mr Carman told WA Business News.

“They pay for common trenching, roads, drainage, decorative lighting, landscaping of public open space, which they ultimately have to give up, planning fees, supervision fees, and the list goes on.

“It is inequitable to be thinking about imposing levies.”