Elections, taxation and building quality have dominated the public policy agenda in a big year for the Property Council’s advocacy team, as chief executive Ken Morrison reflects on the highs and lows.
It’s been another busy year for the Property Council’s advocacy teams around the country with a full slate of policy and regulatory issues to shepherd on behalf of members.
The year kicked off with the federal government’s response to the Hayne royal commission into banking and financial services. The Property Council welcomed the measures announced by the government in the interests of supporting a strong, stable and well-functioning financial system.
“Access to credit is the lifeblood of our industry, and it was vital that the government took steps to restore confidence in the financial system in a way that didn’t do further damage to the economy at a critical stage in the property cycle,” Morrison says.
In March, the Berejiklian Government in New South Wales was re-elected, paving the way for some focused engagement with industry on issues around state planning reform and managing Sydney’s growth. The year was book-ended with a strong statement from the NSW Government on its priorities for an overhaul of the state’s planning laws in 2020.
The dust had barely settled from the NSW state election when the rest of the country went into full federal election mode which saw the Coalition Government, led by Scott Morrison, returned to office.
“There were some clear policy differences between the major parties on negative gearing and capital gains tax which would have had significant impacts on our industry,” Morrison reflects.
“We took an evidence-based approach in the lead up to and during the campaign to support an informed debate and kept both sides of politics closely engaged on industry views.”
A post-election survey of voters in marginal seats showed that negative gearing was a vote changer for a significant proportion of voters, while economic modelling prepared by Deloitte Access Economics revealed the scale of the economic cost of Labor’s policy change: a $1.5 billion cut to GDP, a $766 million hit to construction and 7,800 full-time jobs lost.
One outcome from the federal election was a bipartisan commitment to help first home buyers bridge the deposit gap when buying their home. The new scheme kicks off on 1 January 2020 and will provide loan deposit guarantees for up to 10,000 eligible first home buyers. The Morrison Government also appointed a Federal Minister for Housing, a key advocacy objective for the Residential Development Council.
While tax uncertainty at the national level was largely settled by the federal election result, our advocacy teams had to go to work in South Australia and Queensland to turn the tide on regressive changes proposed by their state governments.
Our South Australian team’s very effective campaign against the Marshall Government’s proposed changes to land tax mobilised property owners and investors across the spectrum, and led to a significantly better compromise outcome that delivered big tax reductions for the majority of property owners.
In Queensland, the state government announced a more expansive foreign land tax surcharge exemption framework than originally proposed in state budget. This followed strong advocacy by the Property Council, with more work ahead in the new year to finalise the framework.
Affordable housing, red tape reduction and advocating for improvements to the planning scheme was on the radar of our Victorian office.
In Western Australia, the Property Council’s advocacy secured a 75 per cent rebate on stamp duty for off-the-plan apartment buyers, extending the concession which was previously only available for house and land purchases. The measure was designed to help housing affordability and support the state government’s urban growth plans while also stimulating the construction sector.
Our NT division championed the revitalisation of the Darwin CBD, campaigned for the delivery of a Darwin City Deal, while supporting investment and economic growth for the Territory.
In Tasmania, housing affordability and building height limits in Hobart dominated the local policy landscape.
Our ACT division secured transitional arrangements for members impacted by City and Gateway Urban Design Framework, ensuring that projects predicated on existing planning rules could be delivered in this important corridor. Significant improvements were also secured for the ACT’s lease variation charging regime.
The Retirement Living Council has helped retirement village operators prepare for the full implementation of the Retirement Living Code of Conduct. About 1,000 retirement communities have signalled their intent to formally commit to the Code. A new single unified industry accreditation scheme was also launched during the year.
A highlight for our Capital Markets Division was confirming super funds and managed investment schemes would not be required to disclose their property asset operating costs under the updated version of the RG97 fees and cost disclosure requirements. This had been an advocacy priority since 2017.
Building quality issues, including combustible cladding, featured strongly throughout the year, attracting significant media attention and a range of regulatory responses from different governments.
The July meeting of the Building Ministers Forum was preceded by a unified call from across industry for governments to show leadership and deliver on the 24 recommendations of the Shergold Weir Building Confidence report.
“The Commonwealth, state and territory governments have a shared responsibility to get the job done
on building regulation compliance and enforcement, as well as develop consistent guidelines on cladding rectification for residential and commercial property,” Morrison explains.
“Many of our members are getting on with the job themselves, but we really need governments to step up as well if we are to achieve a truly national and effective response.
“This will continue to be a strong focus for us going into 2020,” Morrison concludes.