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Legislative Assembly for the ACT: 1999 Week 9 Hansard (2 September) . . Page.. 2772 ..

MR SMYTH (continuing):

This Bill implements in part the Government's response to the Rural Policy Taskforce report, which was released in December 1997. One of the issues raised in the Government's response was the need to clarify the application of the Lands Acquisition Act 1994 to the acquisition of short-term rural leases. Rural leases on the fringe of urban areas have in recent years been short-term leases. This is because the long-term planning of Canberra's development may eventually require many of these areas for urban development or uses associated with urban development. One of the disadvantages of this need to balance the rural and development needs of the ACT has been the uncertainty created for those rural lessees in short-term lease areas. The Government responded to these issues in other elements of the response to the task force report.

A new rural lease term map has been developed which identifies the maximum lease terms available to rural lessees, many of whom now have the opportunity to obtain 99-year lease terms. Some rural areas are still under investigation, but as those studies are finalised the rural lease term map will be updated.

For many sound planning reasons, there are a number of rural blocks that will remain on short-term leases as they are in areas identified for future urban expansion. The existing rents were calculated to take into account that these leases are short term, and the new rent provisions have been calculated on the carrying capacity of the properties, with a 15 per cent discount, as specified in the Government's response to the task force report. Should the Government need to acquire these leases prior to the end of their lease term, the appropriate legislative mechanism will be the Lands Acquisition Act. It is a requirement of the Act that the lessees be compensated on just terms.

Experience highlighted a problem with the current provisions of the Act where a position was argued that it could be assumed that a further lease would be granted on application. This would then mean that compensation for a short-term lease would be calculated assuming guaranteed long-term tenure, which would result in inappropriately high compensation values being assessed. By being in a short-term lease area, it is clear that the likelihood of a grant of a further lease cannot be assumed. In fact, it would be more appropriate to assume that a further lease may not be granted as the areas are identified for future urban expansion. Mr Speaker, for this reason the Government, in its response to the Rural Policy Taskforce report, flagged its intention to amend the Lands Acquisition Act to limit the amount of compensation for these short-term leases to the remainder of the term in the existing lease.

Section 45 of the Lands Acquisition Act deals with matters that can be considered for assessing compensation. Paragraph 45(1)(d) identifies the likelihood of a grant of a further lease under the Land Act 1991 as a matter to be considered in assessing compensation. That paragraph has been amended to subject it to the provisions of section 50, which deals with matters to be disregarded in assessing compensation. Section 50 has been amended to specify that where a rural lease has been granted for a term of less than 21 years the right to apply for a further lease is not to be considered when assessing compensation. This means that only the remaining term of the existing lease can be taken into account.

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