Page 239 - Week 01 - Thursday, 11 February 2016
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This is the difference from other land rent lessees who are able to sell their land rent lease to another person who is eligible for land rent to support the broader affordable housing objectives of the government. Another important difference is that the sale of the remediated blocks is occurring under the loose-fill asbestos insulation eradication scheme.
One of the objectives of that sale is to sell remediated blocks at the market value to defray some of the cost to the territory. Even after the resale of the remediated blocks, there will still be an estimated cost of $400 million to the territory from the eradication scheme. So it is nonsense, absolute nonsense, to say that the government is making money out of this.
The current land rent scheme gives land rent lessees the option to convert from the land rent lease to a nominal lease calculating the conversion rate based on either market value or unimproved value. This is because the land rent scheme was designed for greenfield estates in new suburbs where there is little difference between market value and unimproved value.
The likely incentive of this scenario is for lessees to opt for market value where the market prices of blocks may have fallen. However, enabling former affected blocks to be converted to standard leases at an unimproved value would create an inconsistency in the way that remediated blocks are sold and would be inequitable to other former affected owners not eligible for the land rent and new purchasers of remediated blocks.
This was very clearly flagged in the explanatory statement and during the debate for the Building (Loose-fill Asbestos Eradication) Legislation Amendment Act 2015. In passing that act last October, this Assembly has already noted and acknowledged the intention to ensure that the application of the land rent scheme was suitable for the circumstances of former affected owners.
The disallowable instrument Planning and Development (Land Rent Payout) Policy Direction 2015 (No 1) was notified on 12 November 2015. The instrument simply gives effect to the intention and direction that was first expressed when the act was presented to the Assembly as a bill in 2015.
The land rent scheme has operated for a number of years as an entry level housing affordability scheme designed to assist prospective home owners who meet the eligibility criteria. Land rent has only been available for blocks in new suburbs. Extending the land rent scheme to permit it to be offered on remediated blocks is another way in which the government is supporting affected home owners. Offering the land rent lease on remediated blocks without conditions in place fails to recognise specific circumstances of former affected blocks and their former owners.
I will speak once again to the individual that Mr Coe raised during his conversation in respect of the buildings left on the block. It was a request of that owner to leave those buildings on the block. By offering land rent with specific conditions targeted to remediated blocks, we have found a way to address the individual circumstances of
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