Federal Treasurer, Joe Hockey’s release of the Deloitte Access Economics report on red tape reduction reinforces the need to minimise restrictive regulation in the property industry, says the Urban Taskforce.
“The key findings of the Deloitte Report indicate that red tape in the public sector is costing $94 billion a year and that this is stifling innovation and holding back productivity,” said Urban Taskforce CEO, Chris Johnson.
“The planning system across Australia, and particularly in NSW, is filled with rules and regulations that create a minefield that applicants for new buildings must pass through.”
Mr Johnson says in NSW, for instance the recently released draft State Environmental Planning Policy 65 for apartment design with its design guideline has large sections that address environmental performance while the government has also produced BASIX as another set of environmental performance criteria.
To confuse applicants further most councils produce their own well-meaning requirements for environmental performance.
An applicant for a new apartment will need to comply with three different sets of rules. The Apartment Design Guide for instance calls for the maximum amount of sunlight into living rooms while BASIX calls for shading to reduce heat build-up.
“Clearly we need only one regulation on the environmental performance of apartment buildings rather than three,” Mr Johnson said.
“Some planning regulations begin as well-meaning guidelines but in an environment where many councils are risk adverse, these guidelines get converted into formal rules and the courts reinforce this through determinations.”
“The proposed planning reforms for NSW did simplify the multitude of rules and regulations but unfortunately the reforms have not been implemented.”
Mr Johnson said another example of red tape adding costs and affecting productivity is the fact that the current draft State Environmental Planning Policy (SEPP) for apartment design must be considered by an approval body as well as the existing SEPP for apartment design.
So an applicant will need to produce two check lists, one for the existing policy and one for the draft-planning instrument.
“The new policy changes many issues from the existing policy so applicants are left in a confused state with approval bodies able to choose which rule they would like to apply,” he said.
“The federal government is correct in raising the enormous impact that our complex regulatory environment has on productivity and in driving cultural change throughout the public service.
“In the hands of regulators who do not support growth and the development of new buildings a complex, overlapping series of regulations provides an easy excuse to avoid supporting new projects.”
Mr Johnson says we must all encourage a reduction of unnecessary regulations and support government proposals to drive cultural change so that productivity is lifted.