Page 225 - Week 01 - Wednesday, 15 February 2012
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which we have no control, take some action. I wonder whether it is out of order under the standing orders.
MR ASSISTANT SPEAKER (Mr Hargreaves): Mr Smyth, I would understand that that is part of the substance of the debate on whether you wish to or wish not to support the motion. I do not think the motion is out of order in that it can ask for something to occur. Whether it does occur or not is another matter. I will allow Ms Porter to continue. Ms Porter, please continue.
MS PORTER: Yes, but I did not quite hear what was supposed to be—
MR ASSISTANT SPEAKER: Mr Smyth was asking whether or not the matter was in order because it seeks to get the following Assembly to take a particular course of action and we have no right to direct another Assembly to do that. I ruled that that is for the Assembly to do in the context of the debate. The floor is yours. Resume the clock.
MS PORTER: My motion today, regarding the lease variation charge, goes to the heart of the territory’s land and planning system. As we know, developers make large profits when allowed to redevelop land, and it is only fair that they put something back to ensure Canberrans continue to have a great place to live. The ACT is the only Australian jurisdiction with a leasehold land tenure system. In effect, the land belongs to the community as a whole. In such a system, the community has expectations about how the land will be used.
Of course, the community has an interest in any change in the rights attached to a lease. For instance, the granting of additional development rights will almost always add value to land. It makes sense. If you can do more with the land then it is worth more. But this value does not come from any hard work on the part of the leaseholder. It comes from the legal rights. We have long recognised this. Betterment charges, the change of use charge in place in the territory for more than 40 years, and now the lease variation charge all seek to capture this additional benefit for the community that has come about not through the hard work of leaseholders, but through a legal change.
The capture of gains from a lease variation, these unearned windfalls that attach to land owned by the community, is a fundamental principle of our system. It is only fair that the government recovers some of this windfall gain to the leaseholder and distributes it to the community. Otherwise, all of this unearned value would sit with a few at the expense of many. That, I think you would all agree, would not be a fair outcome for the community.
It is correct, and it is important, to charge the market value for the additional development rights. Otherwise, the community will lose out. The lease variation charge, or LVC, is only fair. It is right and it is just. It means that the government can take some of the proceeds of the changes to the lease and reinvest it in the community. It makes sure the community as a whole gets a fair share and gets tangible benefits from what is, essentially, a technical legal change.
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