Page 3020 - Week 10 - Tuesday, 15 September 2015
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The best way to bring vitality to town centres across Canberra, whether they be Gungahlin, Belconnen, Woden or Tuggeranong, is to get people there, and the best way to get people there, of course, is to encourage and improve parking at these centres, to improve and encourage public transport usage and to improve and encourage residential development in these town centres.
Increased density in the town centres is important to maintain their viability. Another benefit of increased density in the town centres is that the character of our suburbs can also more easily be maintained. Every residential development that takes place in a town centre is a development that does not need to be placed in our suburbs. It makes sense to locate high density developments close to the services at town centres including the transport, health and social services that already operate in these precincts.
Last week the Canberra Liberals announced that if we are elected in October next year we will remove the lease variation charge in Civic and the town centres for four years. The lease variation charge is counterintuitive and is unfair. It discourages development and penalises those who are trying to increase density, which supposedly is this government’s mantra. Ultimately the lease variation charge leads to less development in town centres and more development elsewhere in Canberra and also increases the cost of projects that do happen to go ahead. These increased costs are passed on to homebuyers, particularly first-home buyers.
There is a furphy being propelled by those opposite that the lease variation charge is simply paid by developers. The truth is that the lease variation charge is paid by the people who purchase residential units in those developments. The lease variation charge is passed on as a cost and is embedded in the unit prices of the residential units that are sold. If there was not a $50,000 tax on a unit, the developer can get the same profit with a $50,000 reduction in the sale price of that unit.
The lease variation charge is genuinely counterintuitive to every single aspect of what we want our city to be. Not only does the lease variation charge stifle development; it does not bring revenue to the government either. Why? Because it is stifling development and therefore is not even generating the revenue that they claim is warranted. The government collected less than $5 million in the last four years from development in town centres and the city. The lease variation charge is a failure in every sense.
The lease variation charge, some might argue, is actually an instrument designed to prop up the LDA. It is an instrument which encourages greenfield development. Given the LDA does in effect have a monopoly on residential estate development here in the ACT, by encouraging more greenfield development and pushing density out of the town centres, out of the city and out of other built-up areas, it is of course propping up the LDA. And there are many people in Canberra who firmly believe that this is part of the rationale the government sticks to with the lease variation charge.
Removing the lease variation charge for developments in the city and the town centres for four years will encourage development and redevelopment across the territory. It
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