NSW Productivity Commission releases issues paper on infrastructure contributions

The NSW Productivity Commission has released an issues paper on the NSW infrastructure contributions system and is currently seeking public submissions by 5 August 2020.

Snapshot

• The NSW Productivity Commission has released an issues paper titled Review of Infrastructure Contributions in New South Wales (Paper) as part of its Infrastructure Contributions Review.
• The Paper explores a broad range of issues relating to infrastructure funding and delivery in NSW.
• Stakeholders and members of the public can make submissions on the Paper to the Productivity Commission until 5 August 2020.

Background

As we explored in an earlier post, in May 2020, the NSW Government announced several short-term reforms to the NSW infrastructure contributions system. Additionally, the Productivity Commission was asked to review and recommend longer-term reforms.

The Productivity Commission has now published the Paper to identify the issues in the current infrastructure contributions system in NSW. The aim of the Paper is to encourage the community to provide feedback on how best to address these issues.

General issues in infrastructure funding and delivery

Chapter 2 of the Paper explores the general issues relating to the funding and delivery of infrastructure. These include:

• how should the balance be struck between the competing objectives of efficiency, equity, certainty and simplicity;
• whether there are broader funding avenues than those in the existing infrastructure funding mix; and
• how infrastructure contributions can better support the integration of land use planning and infrastructure delivery.

Specific issues in current infrastructure contributions mechanisms

Chapter 3 of the Paper identifies some specific issues arising from the infrastructure contributions mechanisms under the Environmental Planning and Assessment Act 1979 (NSW). These include:

• what roles should planning agreements and the Planning Agreements Practice Note have;
• how can the contribution plans system be simplified;
• how should contribution rates be calculated;
• whether special infrastructure contributions should be applied more broadly; and
• whether the contributions system is an effective part of the solution to the housing affordability issue.

Further issues

Chapter 4 of the Paper explores further issues, such as:

• what would be the best value capture mechanism;
• whether and how should direct land dedication requirements be implemented;
• whether infrastructure contributions are an appropriate way to fund open public spaces;
• how should the infrastructure contributions system become more transparent and accountable; and
• whether developers should be able to provide works-in-kind or land instead of infrastructure contributions.

Next steps

If you would like to make a submission to the Productivity Commission, you can send your submission to ICReview@productivity.nsw.gov.au. Submissions close on 5 August 2020. If you would like any assistance to make a submission, please get in touch with us.

Following the close of submissions, the Productivity Commission will hold roundtables with stakeholders including NSW Government agencies, local governments, industry groups and community groups. These roundtables will take place in August 2020.

After the stakeholder roundtables, the Productivity Commission will prepare and publish a final report later this year. The final report will recommend reform options for consideration by the Minister for Planning and Public Spaces.

By Peter Briggs, Partner, Tom Dougherty, Senior Associate and Zhongwei Wang, Solicitor.

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