Page 1772 - Week 06 - Thursday, 19 May 1994
Next page . . . . Previous page . . . . Speeches . . . . Contents . . . . Debates(HTML) . . . . PDF . . . .
The market change which followed the introduction of Burmah in Kingston has been a convincing endorsement of this policy approach. If objective proof is needed, look at the March quarter inflation figures. On average, petrol prices in other capital cities dropped 0.22 index points; whereas in the ACT petrol prices dropped 0.4 index points, which had a significant effect on Canberra's inflation rate.
In order to further this recommendation, the ACT Planning Authority has now identified a number of sites as being available immediately for the development of service stations. These are Hume, block 23 section 2, at the corner of the Monaro Highway and Sheppard Street; Belconnen, part of block 1 section 14, the corner of Coulter Drive and Luxton Street; and Phillip, block 1 section 53, being the corner of Hindmarsh Drive and Athllon Drive, the old depot site. In implementing recommendation 11, we propose to lease the sites as part of a direct grant process under section 161 of the Land (Planning and Environment) Act 1991. We have chosen this path, rather than release the sites by auction, because we do not believe that raising revenue should be the sole determination in this situation. With lower petrol prices, consumers will save money which, in turn, will be injected back into the ACT economy.
In its report the working group identified the high land prices previously paid for sites under Commonwealth policies as a significant factor in Canberra's high petrol prices. The Government is concerned to ensure that this situation does not continue. The chair of the working group recently sought advice from Mr John Coubrough of Joco Property Marketing Services, an independent consultant to the oil industry and local government throughout New South Wales, who has an intimate knowledge of the ACT industry, having had 24 years' experience in marketing and property management with Mobil Oil (Australia) in the ACT. Madam Speaker, the extensive quote that I will read is part of the report that Mr Moore asked about, and I would expect, in due course, that the rest of it will be published. Mr Coubrough advised that:
Foremost ... is the lowering of land prices levied in the ACT for service station outlets and the outrageously high returns expected by developers on their investments. Major oil companies, Shell, BP and Caltex are paying rentals which are 2 or 3 times what they would be in other States and represent returns to the investor of up to 40 per cent or more on purchase and building costs at sites in Kambah, Kaleen, Chisholm and Tuggeranong. These incredible returns are being funded by the petrol buying public of Canberra. As an example, the average return expected from gilt edged commercial property in all parts of Australia, including the ACT, is around 10 to 11 per cent.
The Government sees no reason why the cost of land for service stations in the ACT should be higher than that payable for comparable sites in other capital cities. No-one involved in the petroleum industry can argue that high entry costs are in their best interests. The Government will order a proper market survey of the interstate capitals, especially Sydney, and set the prices for the new sites accordingly. The Government has not taken this decision lightly and is fully cognisant of the effect on the valuation of existing sites and the resultant possible loss in some government revenue through reduced land taxes and rates. However, the gains far outweigh the losses. While a reduction in the valuation of a service station of, say, 10 per cent will result in a $190,000 reduction in
Next page . . . . Previous page . . . . Speeches . . . . Contents . . . . Debates(HTML) . . . . PDF . . . .