I rise to present the opposition’s contribution on the Planning and Environment Amendment Bill 2021, and I move:
That all the words after ‘That’ be omitted and replaced with the words ‘this bill be withdrawn and redrafted to address concerns about the potential tax liability for landowners resulting from the recovery of costs for precinct structure planning whilst still providing for the heritage measures in the bill’.
The opposition supports a great number of the measures imparted in this bill, particularly the measures regarding heritage protections. I have talked a lot about heritage protections since I have been the Shadow Minister for Planning and Heritage, along with Shadow Minister for Housing and Shadow Minister for Local Government. I did so largely because of an outrage that was committed against the Victorian people and indeed those of us who over the years enjoyed an ale or two at the Corkman hotel, near my alma mater, the University of Melbourne. That hotel was demolished illegally in 2016 illegally. It is terrific to see the member for Burwood in here, who was the lobbyist for the two crooks who went to jail for contempt of court in connection to that outrageous cultural crime against our city.
I do support the measures in this bill that will strengthen local heritage protections through disincentives to deter unlawful demolition of buildings that have been given heritage protection by essentially banning future development on that site for a period of up to 10 years. I think that is a good reform. But in making a bipartisan commitment to improving heritage protections, particularly at the local level, I do wish to detail for the house the shemozzle that was the ongoing enforcement process for those two crooks and how essentially they will still make quite a fortune from their illegal activity.
It is important to note that when they knocked that building down and illegally dumped asbestos near a childcare centre, certain undertakings were given by the member for Burwood’s firm on behalf of the developers—or, for want of a better description, cowboys. That was embraced by the Minister for Planning, who gave an undertaking that that pub would be rebuilt. It is 2021; there is no pub. In fact the undertaking that subsequently was given by these individuals was that they would begin the process of constructing a park, and that is why they went to jail—because they did not do that either.
But if we can return to the role of the government here, of course I am not blaming the government for these two crooks knocking down the pub. I wish they could have gone to jail at the time, but the law did not provide for that, unfortunately. The courts that heard a number of these cases made the case that had the law been available to them to send these individuals to jail, they would have been sent to jail. The minister did boast at the time that the Corkman hotel would be entirely rebuilt, but it never was. My question has always been: why didn’t the Minister for Planning make his interim controls, which required the full restoration and reconstruction of the Corkman hotel, permanent? Why did he then, along with the City of Melbourne, give these crooks a windfall gain by rezoning this land to give them an ability to make quite a significant profit by allowing a building of up to 40 metres on the site? Now, that is a very important question, because I have constantly said that that site should have been rezoned to nothing or compulsorily acquired by the state so that these thieves, which is what they are, could not make a cracker from their crime.
So the minister introduced planning controls on 18 October 2018 which allowed for a 40-metre or 10- to 12-storey development on the site. Why did the minister change the rules for these two? Why did he not rezone the site to zero height, or why was it not compulsorily acquired so that very lucrative site just near the law school at the University of Melbourne could be used for something productive, whether that be social housing or a public park, or even potentially sold to the university? That would have been appropriate, because what we had was rubble. I understand that some efforts have been made for a park to be constructed there, but at every turn this government has been laughed at by two very crooked individuals who were formerly represented by the member for Burwood.
Ms Green: Oh, pipe down.
Mr T SMITH: I hear—I suspect—the member for Yan Yean. These are matters of public record, so she can disagree with that statement, but unfortunately the facts speak for themselves. So that is the sorry tale of the Corkman, and the government’s response has been, now, finally, an introduction of a power for the minister to make an order, published in the Government Gazette, that prohibits for up to 10 years the use or development of land on which a heritage building has been unlawfully demolished and the person—maybe the owner or the developer or perhaps another person, such as a builder or demolisher—has been found guilty of an offence under section 126 of the act. We support that. We think that is appropriate, but what of the many other cases that I have seen in my time as Shadow Minister for Planning and indeed going way back to when I was mayor of Stonnington, where heritage buildings have been demolished lawfully? What is the government doing to protect Marvellous Melbourne—beautiful properties in heritage suburbs, established suburbs, throughout our city that unfortunately have seen the wrecking ball on far too many occasions? There was Forres in Kew, which was a beautiful Federation-era property in Edward Street that was demolished in 2016; the debacle of planning amendment C299 throughout Boroondara, which basically allowed heritage properties to be demolished on a whim; and the farce that was the Currajong property on Auburn Road in Hawthorn East, which received much media attention, where a number of Victorian-era properties had been demolished on one side of the road. Thankfully interim controls were placed over Currajong and 337 Auburn Road. Now, as I understand it those interim controls are still in place and that building remains intact. This is an important part of protecting our cultural and built-form heritage in Melbourne.
I have said it time and time again on various planning and heritage issues in this place, but my predecessor as the member for Kew, Dick Hamer, was the first Premier in Australia to bring in heritage protections for heritage buildings in Australia, and that early heritage act in the early 1970s set the standard across our country for the protection of heritage buildings. Melbourne has lost some absolute gems, and that is to our great shame. Now, thankfully, we have a state heritage protection regime that has largely protected buildings of our significant history. We were in one of the most important buildings in our city this morning, and there have been moves over the last 120 years for the demolition of the Royal Exhibition Building. Thankfully that never came to pass, and if it had it would have been a cardinal sin against the heritage not just of this city but of this nation. It is that built-form heritage that Dick Hamer started to protect after a number of significant Victorian-era buildings were demolished in the central city, and thankfully over the years we have stopped a lot of that wanton cultural carnage from going ahead. But it is now seeping into the suburbs. There is that fundamental clash between the need to accommodate an ever-growing city and the very great need to protect its built-form livability as well as its environmental livability, and that goes to our streetscapes and indeed our canopies, which are so important for, particularly in summer, keeping our suburbs cool and as livable as possible.
This is where I suppose there is that fundamental contradiction between the property market, which is a fundamental of our economy, and I suppose a more conservative urge to conserve and protect our heritage clashes. It is an issue that I think as members of Parliament of Victoria and as former councillors we have dealt with on many, many different occasions. It is a case-by-case basis, and obviously sometimes it is actually quite subjective. What I might regard as a heritage building and a beautiful building that was built in the late 19th or early 20th century others might not think has too much heritage value at all, but equally I might think that something built in the 1950s or 60s is a dog’s breakfast while others think it has tremendous architectural value. I am not often persuaded by that line of argument, but that is not really for me to say. We do need, I think, a far stronger regime for heritage protection in our suburbs, and this bill goes some way to doing that. But there is always that contradiction between the roles of councils and state government.
There are some hidden nasties in this bill, particularly with regard to costs, particularly costs on precinct structure planning. I have a letter here from the Housing Industry Association and their CEO, Fiona Nield, and I am going to read some of these sections out to the house because I think they are important for an understanding of some of the implications in this bill, particularly part 5 of the bill:
HIA strongly objects to the proposal to establish a funding system for structure planning costs. It is understood such funds are to be sourced using a portion of monies contributed to an Infrastructure Contributions Plan (ICP) and these funds will be allocated to the Victorian Planning Authority (VPA) to cover the costs of preparing structure plans. HIA submit it is inappropriate and unjust that such funds are used to supplement the fiscal requirements of a state government agency such as the VPA. The operation and function of state government agencies must not rely on funds of this type in full or in part. Alternative sources of funding, such as drawing from broader tax bases would be more appropriate. A funding system such as this would be to the detriment of ICPs and the delivery of required infrastructure paid for developers/landowners.
There are other industry bodies who have made similar contributions. The property council on this point says:
Our primary point of clarification relates to the ability of the Victorian Planning Authority (VPA) to recover certain costs. Our position is that this should result in a more equitable position between landowners and encourage the VPA to continue to streamline the Precinct Structure Plan (PSP) process so that it is efficient and provides the property industry and the community with full confidence in the rigour of the planning and approval process.
Increased efficiency on the part of the VPA will … minimise costs to both the property industry, and the end homebuyer. It will also serve to deliver Victoria’s critically important supply of new homes and improve housing affordability across Victoria.
The property council seek clarification on:
The level of transparency in respect of how the proposed fees are calculated, collected and utilised.
And that is a fair point they make because this bill is rather opaque about how this cost recovery mechanism for precinct structure planning will be applied. It is a great shame that we do not go into consideration in detail in this place all that often, but in the committee stage in the other place these issues hopefully will be answered most fulsomely by the government. The property council continues:
Is there a risk that this may delay new PSP commencements? For example, third party funding agreements can commence the process when the VPA does not have sufficient budget. Is this proposal, in effect, that the VPA can pre-fund PSP costs and then recoup from ICPs?
These are questions that the government will need to answer which I cannot ask here because we do not go into committee.
Can third parties still cashflow early PSP work and recoup via ICP credits?
Now, the Master Builders Association of Victoria have said something similar:
MBV understands the importance of having funding towards precinct structure planning done in a way that is transparent and equitable.
But they want to see more information on how this would be conducted so that it is transparent and equitable. These are legitimate questions from three major industry bodies who wish to see how property owners will be essentially taxed further under this proposed change.
Now, the HIA make a number of other observations, and these regard public acquisition overlays (PAOs). Part 3 of the bill talks about compensation amendments. The bill makes amendments to the planning compensation scheme for planning blights. The intent of these amendments is described as addressing issues and risks related to the operation of that scheme. Now, the risk primarily exists where structure plans or similar documents in the planning scheme propose a public use in the future without a public acquisition overlay. The proposed changes seem to ensure that compensation is not available to an owner of land unless the relevant provision of the planning scheme—that is, to reserve the land as a result of the proposed amendment—expressly states as a purpose to reserve land for a public purpose and it is contained in a public acquisition overlay.
Now, there have been no successful claims for compensation before an express reservation is made, so this proposed legislation may be of little impact apart from acting as a delay mechanism for a landowner’s right to claim some return for their land, which now has a more restricted use attached to it. These changes lock in an extremely unfortunate position for landowners who are on notice that their land may be required for public purpose but do not have certainty in the planning scheme expressly reserving the land for a public purpose through a public acquisition overlay. We are going to seek further clarification from the government in the other place on these matters because, for example:
It is HIA’s view that, identifying ‘land reserved for a public purpose’ confirms in planning that there is a reservation in the planning scheme and the purpose is clear. There may not be a PAO on the land for a variety of reasons such as slowness to apply a PAO through a Planning Scheme Amendment but the absence of a PAO should not preclude a claim for compensation.
Now, I think these issues regarding property rights are vital. They are important questions that need to be asked. The industry is vital to Victoria’s economy. I have got three major industry bodies that have got legitimate questions. As I have already foreshadowed, these questions will be asked in the other place, and I expect amendments in the other place to try and remove some of these nasties or indeed clarify what they are going to actually entail for those landowners.
I return to the original theme of what a large part of this bill is setting out to achieve, which is a greater protection of heritage. That is something that the opposition supports, but I note that over the last five years there has been that one issue of the Corkman, where there was an unlawful demolition which caused a huge amount of controversy and the jailing of two individuals that were represented by the member for Burwood. That should never, ever have occurred, and the fact that it did is a great shame, as is the fact that it took so long for those individuals to essentially face justice. But more to the point is the fact that the various undertakings that the government gave with regard to what those individuals had to do, particularly boasting that that pub would be rebuilt, were nothing but lies. The other point is that this planning minister gave those two crooks a windfall gain of a 40-metre height limit—10 to 12 storeys—on such a lucrative site that no matter how many days they spend in jail they will profit from their crime. These criminals were represented by the member for Burwood. That these people will profit from their crime is an absolute disgrace. We said time and time again that that property should be rezoned to literally zero, to nothing, so they could not make a cent—or, better yet, compulsorily acquired. Now, the government will say, ‘Oh, you can only compulsorily acquire a property at its highest and best use’. Well, guess who sets that highest and best use?
Mr Hodgett: Who?
Mr T SMITH: The planning minister, in conjunction with Melbourne City Council. If you can understand this, Acting Speaker, they gave these two crooks a massive windfall gain where they will profit from their crime for years and years to come. If they had simply rezoned this to virtually no height whatsoever or rezoned it to compulsorily turn it into a park or social housing or something productive, where these two individuals could not profit from the heinous cultural vandalism that they committed on our city and indeed committed on that precinct around the University of Melbourne, then we would have been far better off for it. But I suspect the minister was given some fairly shoddy advice. I do believe that his intentions on heritage matters have been pretty reasonable; hence we can see that reflected in this bill. But the response by this government to that outrage in Carlton has been shambolic at best, and unfortunately these measures, as much as they are supported by this side of the house, have come far too late in the piece.
To summarise, there are some aspects of this bill that we quite like. There are some questions that need to be answered. There appears to be quite a tax grab with regard to structure planning. There needs to be greater clarification with regard to compensation around public acquisition overlays and the like, which we will obviously cover further in debate in the other place where we can go into committee—because that never happens here. And on that note, I will sit down.