Master Builders welcomed the opportunity to respond to Infrastructure Victoria’s Draft Options.

With Melbourne being Australia’s fastest-growing city, the Bureau of Statistics projects that by 2051, its population could double to nearly 7.7 million, requiring construction of up to 1.6 million new homes, including 480,000 apartments. In the context of Melbourne’s significant anticipated growth, Master Builders commends Infrastructure Victoria for presenting options that address three of the state’s major challenges:

1. Establishing a clear and consistent planning system;
2. Investing in, and building, key public infrastructure;
3. Investing in future skills and technology;
4. Investing in appropriate, sustainable and quality social infrastructure.

Master Builders has called for these reforms in a range of our publications, including our State Budget document Master Builders Priorities 2016-17: Building for Growth, our submission to the Residential Zones State of Play; and our planning policy paper Planning for Growth. These submissions can be found here.

Master Builders strongly supports Infrastructure Victoria’s consideration to address major challenges in the Victorian planning system. The current planning system is characterised by a disconnect between overarching strategic state planning policies and what Councils are delivering. For example, in Plan Melbourne Refresh, the State Government is considering ‘locking down’ the Urban Growth Boundary and accommodating population growth through a policy of a 70/30 split (requiring 70 per cent of new housing to be built in existing suburbs). However, an analysis of how residential zones have been applied in established areas demonstrates that, in some instances, restrictive zones are being applied broadly to prevent housing growth in established areas. For example, in the City of Glen Eira which is seven kilometres from the city, over 80 per cent of municipality is subject the most restrictive zone, Neighbourhood Residential Zone (NRZ).

Excessive red tape in the current planning system is delaying the delivery of building and construction work, and costing the economy. The Victorian Competition and Efficiency Commission (VCEC) 2010 report Local Government for a Better Victoria: an Inquiry into Streamlining Local Government Regulation found that the total costs to business of complying with land-use planning and building regulations are between $500 million and $875 million per year. This includes a cost of around $180 million each year due to unexpected delays in planning decisions. As well as council delays, the scope for objections in Victoria is vast and means that planning gets further entangled in VCAT appeals: Victoria 1 in 10 planning applications are appealed, compared to 1 in 83 in NSW and 1 in 1000 in Queensland. These delays and costs impact the state’s efficiency to build new houses, roads and other key public infrastructure.

That is why Master Builders strongly supports the Infrastructure Victoria option to introduce a centralised planning scheme (CPS1) , and through that a focus on urban development in established areas (UDC), and residential and commercial property densification (RCP). These options are much needed solutions to the issues in delivering infrastructure and housing caused by delays and inconsistencies in the current planning system.

As part of the much needed investment into in Victoria’s road network, a pipeline of work that is certain is extremely important for Victoria’s economic growth as it gives both investors and businesses an important level of confidence. That is why Master Builders supports the option for school infrastructure funding certainty (SIF) that would remove decision making from short-term budgets and require the governments to publish a proposed plan for school capital works (new and upgrades) against a proposed time line for delivery. Master Builders also supports options for a range of other key infrastructure commitments.

A thirty-year infrastructure plan is a unique opportunity to invest future technologies and the knowledge industry. Master Builders supports the education and medical research precincts linking with the private sector (SEP) option that seeks to established new precincts that bring sectors together, driven by private sector demand for increased collaboration with the tertiary education and the vocational training sector. Master Builders considers that this option has potential to invest in learning and developing construction technologies such as BIM.

As well as an effective planning system that can deliver housing, roads and transport infrastructure, delivery of social infrastructure must be included in the discussion about Victoria’s thirty-year plan. As stated in the Options Paper, ‘infrastructure across a range of sectors, from health and education to transport, is struggling to keep pace with demand’ and therefore solutions to the increased pressure on social housing, health and education facilities and environmental issues must be addressed.

Master Builders’ entire submission can be found here.

Infrastructure Victoria’s Draft Options can be found here.