Waverley Council seeks answers about reforms to developer contributions

10 October 2021 | Media Release

10 October 2021

Waverley Council continues to seek assurances from the NSW Government that councils and communities are not left worse off by the government’s infrastructure contributions reform agenda.

The Council is opposed to the Environmental Planning and Assessment Amendment (Infrastructure Contributions) Bill 2021 in its current form and welcomes the government’s recent decision to withdraw the Bill from parliament and release it for consultation.

The Bill proposes to change the way development contributions are paid with the state government taking these funds from Councils to use them elsewhere.

Developer contributions are paid by developers to Council at the commencement of a development and contribute towards the cost of local infrastructure projects that will meet the additional demands it generates and benefits from. Councils use these contributions to help pay for local infrastructure projects such as playgrounds, sports fields, libraries and parks. These contributions are set at a percentage of the cost of the development and this is based on a long-standing principle of the existing planning system.

Mayor of Waverley, Paula Masselos, argues that developer levies should be spent where they are raised and wants the government to consult councils before making changes to the Bill.

“This proposed levy change could have a detrimental impact on our community if funds raised in Waverley are diverted elsewhere at the government’s discretion,” Mayor Masselos said.

“This could result in the delay or removal of projects from council’s plans creating a significant shortfall in local infrastructure. This is another example of the state government cost shifting on to our rate payers. And it is unacceptable.

LGNSW, the peak local government body, has found that small LGAs could lose about $3 million per year while more than $1 billion could be lost for large government areas. Waverley Council stands to lose up to $40 million over the next 10 years if the Bill is adopted in its current form.

In July this year, Local Government NSW made a draft submission into the Parliamentary Inquiry into the Bill, which was introduced into NSW Parliament with the NSW Budget.

In its submission, Local Government NSW said: “Councils have led their communities through the previous 18 month’s raft of disasters, headlined by the COVID pandemic. Ensuring councils have access to ongoing funding through infrastructure contributions will empower councils to drive a locally led economic recovery and help them create tens of thousands of new jobs for their communities”.

“This resonates with us at Waverley, given we are one of the most densely-populated local government areas in Australia and have been a focus of much of the pandemic,” Mayor Masselos said.

“We also share the view held by Local Government NSW that councils need clarity on the many aspects of the Bill and the regulatory changes that will follow, which are currently unknown.

“Of significant concern is that the state government is proposing that these contributions are to be paid after the development has been built. This exposes Council to a great risk of default by developers, meaning we may never see the money

Worse still, Councils will be dictated to on what and how they can spend local contributions by unelected government bodies. The state government has initiated a separate process for IPART to review the essential works list and benchmark the costs for those particular works.

‘To further empower IPART – an unelected, government appointed quango – to review and veto what constitutes ‘essential infrastructure’ across LGAs, and how much can be spent on these woks, is yet another weaking of elected representatives’ ability to make decisions for, and in consultation with, their communities”

Councils across NSW are extremely worried about the implications of this Bill with 23 Sydney Councils writing an open letter to the Planning Minister last month in the Sydney Morning Herald.

The Council will continue to update the community about the reforms.

Media inquiries: media@waverley.nsw.gov.au or 0416 075 532.