Sweeping review of developer contributions aimed to boost economy amid coronavirus downturn

ABOUT TIME: Johnson Property Group chairman Keith Johnson has welcomed a sweeping review of developer contributions in a bid to stimulate the economy.
ABOUT TIME: Johnson Property Group chairman Keith Johnson has welcomed a sweeping review of developer contributions in a bid to stimulate the economy.

HUNTER councils could be required to publish how much has been collected in developer levies and show where it has been spent, under a series of changes proposed by the NSW government.

Planning Minister Rob Stokes announced a wide-ranging review of developer contributions and levies on Wednesday in an effort to unlock new housing supply and deliver vital community infrastructure in the face of a severe hit to the economy from the coronavirus pandemic.

NSW Productivity Commissioner Peter Achterstraat will head the review of infrastructure contributions and make recommendations for a new system aimed at less red tape by the end of this year.

Johnson Property Group chairman Keith Johnson, who has long been campaigning for an overhaul of the system, welcomed the review.

"If ever there was a need to get things moving, it's in this climate where so many people have been impacted," Mr Johnson, who is developing Watagan Park, Lake Macquarie's largest new residential subdivision, said.

"Every new home being built is nine new jobs and we want to do 250 homes a year, so that's 2200 jobs."

The Urban Development Institute of Australia, which represents the property industry, calculates that councils in Newcastle, greater Sydney and Wollongong are sitting on $2.7 billion in unspent local infrastructure contributions.

Mr Stokes said reform of the system had been "stuck in the too-hard basket for too long" and more transparency was needed so ensure "everyone is clear about who pays for what".

Mr Johnson, who is in dispute with Lake Macquarie City Council over a voluntary planning agreement (VPA) that sets out how much JPG must pay in developer contributions for Watagan Park, said councils needed to start spending developer contributions instead of "hoarding them".

He said JPG signed onto the VPA to pay $25,000 per lot at Watagan Park in 2008, but changes meant he was now paying $36,000 per lot.

"Neighbouring developments only have to pay $21,000, the whole system is a mess and it's holding back development and job creation," he said.

"At the end of the day it's the mums and dads who are buying the land that are getting lumped with these extra costs, the whole system needs to be fixed."

Mr Johnson said Watagan Park accounted for about a 25 per cent increase in population in the Morisset development contributions area, but was required to deliver about 55 per cent of the infrastructure in the catchment.

"It's a terrible mess and I'm calling on the minister to come and take a look at what's happening up here to make sure the whole system gets sorted out," he said.

"I am very pleased that the government has recognised there is a problem and is taking action.

"They must take a look at the whole system, including existing VPAs."