Suburban Rail Loop
Evan MULHOLLAND (Northern Metropolitan) (13:39): (945) My question is to the Minister for the Suburban Rail Loop. Minister, the property industry says it is not financially viable to build new apartments in your SRL precincts because the funding model discourages property development. Max Shifman of Intrapac Property says the industry would not be able to deliver the number of homes promised by the government. Victoria’s Housing Industry Association executive director Keith Ryan said the value of living in an SRL precinct may not be sufficient to justify the additional costs and that consumers and the industry would elect to build elsewhere. Minister, if the industry are saying they will not invest in your SRL East precincts, how on earth can you meet your 70,000 homes target?
Harriet SHING (Eastern Victoria – Minister for the Suburban Rail Loop, Minister for Housing and Building, Minister for Development Victoria and Precincts) (13:40): What a treat it is, Mr Mulholland, to get a question from you on the Suburban Rail Loop, particularly when you work the points of view of a couple of people from industry into your contribution. I have had the benefit of discussions and engagement with the HIA and the property council, and that is part of ongoing work that this government continues to do. What I would say to the points that you have raised in the first instance to Mr Shifman – you do not need to hire a private investigator to understand that the Suburban Rail Loop is necessary as a nation-building project, that it is necessary to address the chronic shortage of housing, that it is necessary to develop precincts that do not require people to go into the centre of Australia’s largest city and that it is necessary and appropriate that in the course of developing that business case and the investment case that builds upon Plan Melbourne, the very issue that was identified from the outset by the former leader of the coalition –
Evan Mulholland interjected.
Harriet SHING: I will take you up on that interjection there, Mr Mulholland. I did think it was Matthew Guy’s idea, but then I went back and I had a look, and all Matthew Guy ever did was to describe the problem. All he ever did and all you have ever done is describe the problem. And what you have failed to do – and there we go.
Renee Heath: On a point of order, President, I would just ask you to bring the minister back to answering the question rather than debating and reflecting on the opposition.
The PRESIDENT: I will rule on the point of order. Interjections are unruly, and the minister should try not to respond.
Harriet SHING: I will try to ignore the commentary from those opposite, particularly as it has failed to yield any solutions to the challenges of growth, affordability and availability of housing. Now, when we talk about value capture and when we talk about the work that we are doing in partnership with industry, it is important to note that the model that is set out in the business and investment case yielding a return on the business case ratio of 1.1 to 1.7 is about making sure that we have an allocation of funding commitment from a range of different sources. This is not new. The Sydney Harbour Bridge was developed using value capture amongst other parts of the state. The city loop – you go to Paris, you go to London, you go to Sydney. The work on the Metro in Sydney was developed in part using value capture. Now, when we talk about these models it is easy to understand the fact that you do not actually buy into this because you never delivered a major project while you were in government. That is why it is left to us to make sure we are partnering with industry and to make it clear that value capture measures will be targeted at commercial property developers, who will receive windfall financial gains from the project. The measures will not be targeted at current home owners or residents. This is not something unique to the Suburban Rail Loop. You would be well advised to tell stakeholders that that is in fact something that continues to apply across the board.
Evan MULHOLLAND (Northern Metropolitan) (13:43): Minister, I am glad you mentioned the modelling in the business and investment case, given your 2021 business investment case and the modelling behind it says that the SRL lease will only lead to an extra 25,000 dwellings, not 70,000. Does this mean the business investment case is out of date? If so, will the government be releasing updated modelling?
Harriet SHING (Eastern Victoria – Minister for the Suburban Rail Loop, Minister for Housing and Building, Minister for Development Victoria and Precincts) (13:44): Thank you, Mr Mulholland. Again the business and investment case does set the framework for delivery of Australia’s largest housing project, the largest infrastructure project that we have and a project that will ensure that in the delivery of orbital rail we are in a position to address some of the challenges of congestion and of growth that we know that other major cities around the world have already done and done so with significant success. Now, what we have done in the modelling that we have delivered is also built upon precincts, Mr Mulholland. It is unfortunate that you had not actually addressed that to me in my capacity as minister for precincts or indeed as housing or as building. This is a combined effort. When the portfolios were allocated at the end of last year it was with –
Evan Mulholland: On a point of order, President, the minister has not gone near the question of why the business case says 25,000 homes – the government is now saying 70,000 – and if the business case is out of date. Which one is right?
The PRESIDENT: I think the minister was relevant to the question. As she was saying, the modelling was added upon from precedence, so I think she was very relevant.
Harriet SHING: Mr Mulholland, you may not want to know about precincts, but we are certainly delivering the work to facilitate them. So 70,000 homes represent the net growth of households to 2056 within the declared planning areas, and that includes precincts around SRL East stations within a 1600-metre radius of those stations.