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                    [post_date] => 2017-07-17 22:40:11
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                    [post_content] => 

Deloitte Access Economics’ Chris Richardson sees a few worrying trends and signs on the horizon for Australian governments.

The world is motoring. Growth in the US, Europe and Japan is near 2%, with China and India doing the heavy lifting to raise overall global growth above 3.5%. But China has been tightening the screws, which will see its growth slow during 2018, with flow-on effects for the wider world. And there are structural headwinds for the medium term: the developed world is ageing, with its potential growth sapped by rising retirements. That’s true of China, too. And, at the same time, the business world has been reluctant to invest for a decade, spooked by rising political and economic uncertainty, as well as fears of regulatory and technological developments – creating an additional headwind.

Both the world and the Reserve Bank have been doing Australia favours, with China throwing red meat at those bits of its economy that buy big from the Lucky Country, and with the RBA’s 2016 interest rate cuts revving up housing prices. Despite that, production growth has been weak, as big gas projects finish construction, as the big home building boom of recent years starts to peter out, and as Cyclone Debbie took a toll. Yet our stuttering pace of production was still enough – thanks to higher commodity prices – to see national income chalk up a gain of near $100 billion in 2016-17. That brought an emphatic end to five years of ‘income recession’, though to date it has been profits rather than wages that have benefited, while the pace of home building is set to shrink further amid increasing evidence that gravity may soon start to catch up with stupidity in housing markets. And the gargantuan Chinese credit surge is finally easing back, suggesting the global economy won’t be doing Australia quite as many favours from 2018 onwards. Yet those are merely caveats on an otherwise solid outlook. Relative to the rest of the rich world, Australia’s economic outlook may not be quite as impressive as it once was, but we are still kicking goals.

Consumer price inflation remains a dog that isn’t barking, both locally and globally. And although global and local leading indicators of inflation are stirring in their sleep, they don’t look like getting out of bed any time soon. We see wage growth set to climb from 2018, as inflation lifts a tad, as retirement among boomers restrains growth in potential workers, and as the ‘income recession’ of the post-2011 period gives way to more settled gains in national income (and workers get their share of that). Even so, the pick-up in inflation and wage gains is likely to be both modest and slow.

The past decade saw a growing global gap between economies and interest rates, but the US Fed is continuing a slow grind towards closing the gap. The rest of the world will eventually follow, with Australia’s turn starting during 2018. Yet as J. Paul Getty so neatly put it: “If you owe the bank $100, that’s your problem – if you owe the bank $100 million, that’s the bank’s problem.” Australia’s heavily indebted families are now the Reserve Bank’s problem, which is why, although interest rates will indeed rise in the next few years, they won’t rise sharply. On the currency front, Australia will sit more towards the back of the queue for global interest rates normalisation, and there’s the risk of further price pain on commodities. That combination will weigh on the Australian dollar, but not by much.

Australia is within a hair’s breadth of a current account surplus for the first time since bell-bottomed jeans were all the rage. However, just like bell-bottoms, Australia’s dash for cash looks set to be very short-lived. We got close courtesy of spikes in coal and iron ore prices, but those same global commodity prices are once again curled up into a ball and rocking. That will increasingly show up as lower export earnings over the next year or so, cementing a return towards our customary deficits.

Job growth in the next couple of years will be solid: not as good as 2017 to date, but not as bad as 2016, either. There’s good news in the better gains in national income of late, but overall macro trends aren’t really giving a strong signal either way on job prospects. And while the bugaboos of the moment (disruptive technologies and new business models) grab the headlines, they do more by way of generating churn at the level of individual businesses than they do to ruffle the surface of overall job numbers.

The Federal Budget saw the Coalition abandon Plan A (a return to sustainable fiscal finances via spending cuts) to Plan B (tax and spend, amid increases to the Medicare levy, a bank tax, and Gonski2.0). Given Plan A spent years going nowhere, we see great sense in Plan B. But it’s a real worry that a conscious shift to the centre still didn’t unleash much bipartisanship in Canberra. That says official figures (which assume stuff passes the Senate) remain at risk. And, speaking of risks, commodity prices could yet spell trouble for the Federal, WA and Queensland Budgets, while – a little further out in time – housing markets may yet do the same for the NSW and Victorian Budgets.

The tussle at the top

Among industries, it’s still a tussle for the top of the growth leader board, as mining output rides the crest of earlier investment decisions, while health care rides a demographic dividend topped with technological treats. Both sectors look set to keep growing rapidly, with mining seeing huge gas projects ramp up their production levels (to meet export contracts, and to keep the home fires of domestic markets ticking over), and with health demands marching ever-upwards. But the prospects for both also come with caveats, as mining’s fortunes remain chained to China’s, and health to Canberra’s.

Like Manny Pacquiao, the reign at the top of the pops for finance has been long and gloried, but it’s looking a little long in the tooth as the cost of credit finally gets back off the canvas. That said, there’s a long tail of growth still left in finance, and its return to the growth pack may take a few years.

Challenges loom for property services too, where a slowdown has already commenced.

Similarly, the $A -fuelled rise of fast growth in recreation (thanks to more tourists) and education (thanks to more students) may soon start to moderate from here – the $A’s fall was a while ago, and its benefits are starting to fade. But at least the education sector has the lift in the birth rate over the last decade or so to provide better base demand via extra kidlet numbers.

Construction and manufacturing are both bumping along the bottom, but for construction it may be a relatively brief spell in the doldrums, whereas manufacturing’s challenges look rather more structural.

Question marks lie over the utilities, where balancing divergent aims (power that’s clean, reliable and cheap) is hard, but becomes even harder now that Hazelwood has closed and with the nation’s onion-eaters arguing the toss on Finkel. That suggests investors may stay sidelined, which is where they’ve already been for an awfully long time. Add in rising prices, and this sector – a pathway to growth for many other industries – is left reliant on population gains to generate much by way of growth.

It’s just a jump to the south and east

On the State and Territory front, the jump from a China boom to a housing price boom sent the nation’s money and momentum from its north and west towards its south and east. Yet although the ‘sunbelt’ – WA, Queensland and the Top End – is feeling pain as a result of that, much of the drama for those regions already lies in the rear view vision mirror. Their next phase will be one of recovery, albeit not quite yet.

And don’t forget that today’s heroes – NSW and Victoria – have clay feet. A house price boom borrows growth from the future, and both NSW and Victoria will have to pay back some of that in the years ahead as today’s housing prices gradually reconnect with reality.

Luck’s a fortune, and NSW has it in spades amid the shift to lower interest and exchange rates since 2012. But storm clouds are building, as the housing price boom has artificially supported retail and home building. There’ll be an eventual butcher’s bill to pay as those supports reverse.

Victoria has benefited as key cyclical drivers – exchange and interest rates – moved in a ‘Victoria- friendly’ direction in recent years. And this State is experiencing its strongest population gains for many a decade. Yet, relative to other States, its population and housing cycles may be near their peaks.

The key headwind to Queensland’s economy for some years now has been falling engineering construction, but that pain is increasingly history. While Cyclone Debbie and slowing housing construction are current negatives, Debbie’s impact will be temporary and gas exports are lifting.

South Australia has benefited from favourable shifts in interest rates and exchange rates. In fact, and despite popular opinion, the State economy’s growth actually picked up of late. Even so, some big challenges remain, given both demographics and an unfavourable industry structure.

The construction cliff is still weighing on Western Australia. This state saw a virtuous circle of reinforcing growth drivers during the boom, but it has been seeing a vicious bust for a while now. But there has been better news recently out of China, and even vicious cycles run out of steam.

Tasmania has been one of the bigger beneficiaries of the lower Australian dollar and lower interest rates, and the state economy’s growth is currently looking pretty good. But structural negatives on the longer-term outlook remain entrenched, suggesting caveats on current conditions.

The Northern Territory’s economy isn’t a one-hit wonder, but recent years saw a Gangnam-style blockbuster hit the charts. As construction on the Ichthys project increasingly winds down and its export phase ramps up, the Territory’s challenging conditions won’t disappear for a while yet.

The good news for the ACT is that, after the cutbacks and public sector hiring freezes of recent years, the Feds are returning to more of what might be considered business as usual. On top of that, the impact of lower interest rates on the ACT’s economy remains a powerful positive.

 
                    [post_title] => Gravity is starting to catch up with stupidity
                    [post_excerpt] => There are a few worrying trends and signs on the horizon for Australian governments.
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                    [post_content] => [caption id="attachment_27577" align="alignnone" width="300"] The WestConnex project has not been immune to land preservation issues.[/caption]

Infrastructure Australia has launched a new policy paper urging Australian governments to act to protect vital infrastructure corridors and avoid cost overruns, delays and community disruption when delivering new infrastructure.

The third paper released as part of Infrastructure Australia’s Reform Series, Corridor Protection: Planning and investing for the long term shows that protection and early acquisition of just seven corridors identified as national priorities on the Infrastructure Priority List could save Australian taxpayers close to $11 billion in land purchase and construction costs.

These corridors are: East Coast High Speed Rail, Outer Sydney Orbital, Outer Melbourne Ring, Western Sydney Airport Rail Line, Western Sydney Freight Line, Hunter Valley Freight Line, and Port of Brisbane Freight Line. 

“Meeting Australia’s future growth challenges requires long-term vision. As our cities and regions undergo a period of considerable change, strategically important infrastructure corridors need to be preserved early in their planning to avoid cost overruns, delays and community disruption during the project delivery phase,” said Infrastructure Australia chairman Mark Birrell.

“Australia’s governments have an immediate opportunity to deliver an enduring infrastructure legacy to future generations.

“If we protect infrastructure corridors we will reduce project costs and especially minimise the need for underground tunnelling, where the cost to government and therefore taxpayers can be up to ten times higher than it would have been,” he said.

Protecting seven of the corridors identified on the recently revised Infrastructure Priority List could save close to $11 billion. This is the equivalent of more than two years’ spending by the Australian Government on land transport such as major roads, railways and local roads.

“State and territory governments historically have shown leadership in protecting infrastructure corridors, but more needs to be done now. Experience clearly shows that planning the right infrastructure early, timing delivery to meet demand and ensuring it is fit for purpose enhances economic opportunity and delivers the best community outcomes,” Mr Birrell said.

He quoted the M4, M5 and M7 motorways in Sydney, the M1 and EastLink motorways in Melbourne and the rail line to Mandurah south of Perth as examples where the protection of infrastructure corridors allowed the construction of vital links.

Mr Birrell said the most urgent priority for protection is the east coast high-speed rail corridor, as this critical corridor faces immediate pressure due to its proximity to major population centres.

He highlighted the cost of tunnelling in comparison to the cost of land acquisition, pointing out that recent tunnelled motorway proposals are expected to cost in the order of $100 million per lane kilometre to build.

The Australian Logistics Council (ALC) has supported the policy paper from Infrastructure Australia (IA), saying it demonstrates the importance of corridor protection in preventing cost blowouts, project delays and community disruption on infrastructure projects.

“ALC has consistently worked to highlight the necessity of corridor preservation as part of a consistent and coherent approach to developing Australia’s national freight infrastructure,” said ALC managing director, Michael Kilgariff.

“Good planning leads to good infrastructure outcomes for the community. Preserving corridors to accommodate the infrastructure needed to meet our future freight task lies at the heart of responsible planning policy.”
                    [post_title] => Don’t sell the land
                    [post_excerpt] => More action needed to protect vital infrastructure corridors.
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                    [post_date] => 2017-06-06 05:00:58
                    [post_date_gmt] => 2017-06-05 19:00:58
                    [post_content] => 
Who is going to rush to the rescue of renters?

 

I am a single parent with two school-aged children earning a decent income but around 60 per cent of my pay every month goes on rent; childcare takes a good chunk of the rest.

I pay $650 per week for a small two-bedroom flat in an apartment complex in Petersham in Sydney’s Inner West. Ten years’ ago the same apartment was leased for $390 per week. In that time the flat’s value has more than doubled and it is now estimated to be worth around $885,000.  

This puts me squarely in the category of Sydney renters paying ‘extremely unaffordable rents’, according to the Rental Affordability Index (RAI), produced by National Shelter, Community Sector Banking and SGS Economics, and well above the definition of households in housing stress, defined as being a household paying more than 30 per cent of income in rent.

May figures from the RAI showed that pensioners and working parents have been priced out of the rental market in all metropolitan areas across Australia and that rental affordability dropped over the last quarter in all metropolitan areas, except Perth.

For me, it is an unsustainable situation and part of the reason I’m moving back to the UK and to my family this month after 12 years in Australia.

But there are thousands of other Sydney and regional NSW renters who are also paying a fair whack of their wages in rent and it appears that there is little help in sight for them.

Census 2011 figures show that just over one-quarter of NSW households rent privately and a further 5 per cent rent in social housing. In NSW, 76 per cent of lower-income renter households, that’s those in the bottom 40 per cent of income distribution, were considered to be in rental stress in 2013- 14.

National Shelter's and Choice's report Unsettled: Life in Australia's private rental market says that 49 per cent of  renters in metro areas personally pay more than $301 a week rent versus roughly a quarter in regional areas and 42 per cent of renters overall. This rises to 55 per cent for renters in Sydney and Melbourne. 

The house price boom has not only hurt first home buyers it has also hurt renters.

As more and more middle income earners are priced out of home ownership they swell the ranks of renters and they can often afford to pay higher rents, effectively pushing lower income households further out of the rental market as landlords charge what they can get away with.

While the most vulnerable groups are pensioners, single parents, people with disabilities, students and anyone on benefits, single people and couples on low wages or where one partner doesn’t work are also in the firing line. That's a lot of people (and a lot of voters).

But the situation is unlikely to be eased by NSW Premier Gladys Berejiklian’s housing affordability reforms announced last week, which focused mainly on expanding stamp duty concessions for first home buyers and slugging foreign property investors with higher duties and taxes.

Tenants NSW says the NSW government needs to remember renters 

Tenants NSW Senior Policy Officer Ned Cutcher is underwhelmed by the NSW measures.

"It’s not an increasing affordable housing package, that’s an access to debt package," Mr Cutcher says. “It is disappointing. Clearly there are a lot more people for whom home ownership is more of a dream than an aspiration and they’re doing it tough." 

“We would have liked to have seen something more direct tackling the issue of rental affordability [although] the government has left it open to have a look at housing affordability targets.”

The government needs to look at what’s driving rising rents and pay more attention to renters, he adds.  

Indeed, the new reforms could aggravate the situation for renters as the government steers first home buyers towards new apartments and shifts investors away from them.

Instead, he suggests there needs to be a raft of reforms and at least some of these should address negative gearing and capital gains tax discount, perhaps limiting negative gearing to new properties (as the Opposition has suggested) and reducing capital gains tax discounts, hoping to encourage long-term investment.

“The combination of negative gearing and capital gains discount encourages investment churn: buying and selling properties because they’re interested in gains rather than yields,” Mr Cutcher says.

Changes to negative gearing and capital gains discount would be significant because they could ‘change the way investors consider how and why they’re borrowing large amounts of money and investing in property’.

But he cautions: “People [investors] aren’t going to give this up lightly but it isn’t sustainable.”

Changing these price signals would enable landlords to continue to make money out of leasing property but could shift their attitudes to viewing rentals less as bricks and mortar that goes up in value and more like somebody’s long-term home.

“It’s all about keeping things going the way they [have]been going - helping a few people out on the margins - but if you’re not actually looking at the systems in place, we’re going to be here in another three or four years’ time having the same conversation about stamp duty concessions and first home buyers’ grants. It’s not a very imaginative solution.”

He also backs affordable housing targets for new developments to help increase supply and introducing a broad-based land tax to encourage investors to make the most effective use of their land, reducing vacant blocks and ensuring density and development where land is more valuable, for example in employment hubs.

He is an advocate for new social housing being built and the government offering more Commonwealth Rental Assistance for those on benefits, especially where it has not kept pace with the private rental market.

At a federal level, Mr Cutcher says Treasurer Scott Morrison’s idea of a bond aggregator model has legs.

This is where investors - companies or super funds for example - buy government bonds and the government loans the money cheaply to community housing associations to create relatively affordable rental housing.

He says renters would also benefit from having stronger legal rights in NSW because at the moment landlords can put up rents and terminate tenancies fairly easily.

Ultimately, he believes that the growing army of renters will force the government’s hand, at state and federal level and prove the catalyst to more decisive action.

“We need to be hearing from people raising families who have been renting for ten or 15 years but who don’t know where they’re going to be living next year. Increasing the visibility of people who rent, that’s going to drive these decisions."

Economist and Mosman Mayor Peter Abelson says low income households under rental stress and first home buyers struggling to scrape together a deposit are the two critical housing problems in NSW.

“People at the lower end are really suffering from high rents. There are real problems.”

Long waiting lists for social housing, for example there are 40,000 households on the list in Sydney, and the widening gap between Commonwealth Rent Assistance and rental levels make the situation worse.

He suggests developers pay an affordable housing levy of 1.5 per cent of house sale value on new units. This is preferable to rent controls, Abelson says, which can be an administrative headache (for example, if tenants’ incomes change or they sublet) and reduce capital values with minimal impact on the affordable housing available.

The centrally-controlled fund could then subsidise rents for low income households.

 
                    [post_title] => OPINION: Renters left behind in NSW housing reforms
                    [post_excerpt] => Tenant body urges action.
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                    [post_content] => 

 

 
The 35-year lease to run the NSW's profitable  land titles registry has been sold to a consortium led by First State Super and Hastings Fund Management for $2.6 billion, in a move heralded by NSW Premier Gladys Berejiklian as a ‘massive infrastructure boost’ and by almost everyone else as a bad idea.

The only profitable part of the state’s Land and Property Information (LPI), the land titles registry, which currently makes about $130 million in net profit annually, was bought by Australian Registry Investments (ARI), a consortium made up of 80 per cent Australian institutional investors.

Investors include First State Super, investment funds from Hastings Funds Management and a 20 per cent stake held by the Royal Bank of Scotland Group’s pension fund, also managed by Hastings.

The winners beat off competition from three other consortiums: Borealis and Computershare; the Carlyle Group and Macquarie’s MIRA and Link Group.

The NSW government called it a 'phenomenal result' for NSW.

“Once again today's result has significantly exceeded expectations,” Ms Berejiklian said.

“It means even more funding for the schools, hospitals, public transport and roads that people depend on every day.”

The government will drop $1 billion of the sale proceeds on upgrading Parramatta and ANZ Stadiums and refurbishing Allianz Stadium, while the remaining $1.6 billion will be invested into other infrastructure projects under its Restart NSW fund, which often funds roads and public transport projects.

The Premier has promised that at least 30 per cent of the total proceeds will be spent in regional NSW.

But while the government has argued that selling the lease to operate the land titles registry to the private sector would spur ICT investment and speed up the system, scores of real estate agents, surveyors, lawyers, unions and community groups have slammed the sell-off and called it a disaster.

They have argued that it will imperil the quality and reliability of the service, make it more expensive for ordinary people and push skilled staff out the door.  Opposition to the sell-off spilled over into a public rally in Sydney’s CBD in March.

Land titles  defines the legal ownership and boundaries of land parcels and is integral to buying and selling property, as well as taking out and paying off mortgages, leasing and inheriting property.

Despite the majority of people being blissfully unaware of the system until they need it, land titles underpins billions of dollars spent in the NSW economy and a $1.2 trillion real estate market. 

The Public Service Association (PSA) called it a 'a recipe for disaster for millions of property owners across NSW'.

“It is hands down, the most appalling fire sale decision yet by a Government with a strong track record in that area”, said PSA General Secretary, Stewart Little.

“The government trumpets its efforts on ‘life-changing projects’ but what could be more life changing for millions of people across NSW than to lose the security on their own property?

“Just as the PSA feared all along, ultimately the personal property records of the people in NSW will be held offshore given a portion of the successful consortium is based in London.”

But NSW Treasurer Dominic Perrottet defended the lease arrangement and said it had ‘rigorous legislative and contractual safeguards’ in place to ensure the continued security of property rights and data.

He said any increases in price were capped at CPI for the entire length of the lease and the government would continue to guarantee title, with the Torrens Assurance Fund compensating landowners who lost out due to fraud or error on the register, as happens now.

A new external regulator has been established – the Registrar General – to monitor ARI’s performance and resume control, if necessary.

Mr Perrottet praised ARI and said the company had prepared ‘a technology roadmap’ as part of its bid, helped by Advara, the private company that runs Western Australia’s land titles service.

He said Advara had introduced ‘world-leading titling and registry technology’ to WA and added that the Registrar General would review and approve any major changes to LPI’s IT system in NSW.

“This is an industry on the cusp of huge technological advances, and today we have partnered with some of Australia’s most reputable investors who will make sure the people of NSW get the benefit of those advances,” Mr Perrottet said.

“Combined with the tight regulatory framework we have established, the investment, innovation and experience ARI will bring mean citizens can expect a better experience.”

He said the ARI consortium had received approval from Commonwealth regulators including the Australian Taxation Office, the Australian Competition and Consumer Commission and the Foreign Investment Review Board and the transition to the new operator was likely to be finalised over the coming months. LPI staff have a four-year job guarantee as they transition to the new operator.

More to come.

 
                    [post_title] => NSW land titles lease sold to consortium for $2.6 billion
                    [post_excerpt] => Massive infrastructure boost or recipe for disaster?
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Time is running out for opponents of the land titles lease sell-off.

 

As the minutes tick down on the deadline for private sector bids to run the NSW land titles registry opposition to the sale is intensifying.  

The Berejiklian Government’s plans to flog the only profitable part of the Land and Property Information (LPI) agency have met with widespread anger from surveyors, unions, property developers, real estate agents, community groups and lawyers, who argue that it will debase the quality of the service and make it more expensive for ordinary people, as well causing skilled LPI staff to run for the door.

Land titles currently makes a net profit of about $130 million a year. The government will rake in $2 billion by giving the private sector a 35-year lease to operate the registry but Labor has argued this dwarfs the revenue forfeited over the same period. The windfall is earmarked to rebuild Parramatta Stadium and for renovating ANZ Stadium.

Despite the majority of people being blissfully unaware of the system until they need it, land titles underpins billions of dollars spent in the NSW economy and a $1.2 trillion real estate market.

Land titles define legal ownership and boundaries of land parcels and they are integral to buying and selling property, as well as taking out and paying off mortgages, leasing and inheriting property.

A public rally protesting against the sell-off on Tuesday in Sydney’s CBD was followed by a last ditch attempt by Labor to introduce a private member’s bill into NSW Parliament to repeal the previous legislation, which allowed the lease.

NSW Opposition Leader Luke Foley said he hoped to shut down the privatisation before bidders had to finalise their bids with the government, which he said was tomorrow (Thursday).

Mr Foley  warned that allowing the deal to go ahead could throw the system into jeopardy and possibly hand control and access to NSW property records to an overseas-based consortia.

He said it would push up conveyancing and land title fees, force home owners to take out title insurance and move 400 jobs offshore.

Labor maintains that the sell-off will forfeit the $4 billion revenue which would be generated over 35 years that could instead be channeled towards essential services.

“The only people that want this sale to go ahead are the Premier, the Treasurer and a handful of bankers and lawyers who stand to receive a fat pay cheque once the sale goes through,” Mr Foley said.

“Among the bidders are consortia that are based offshore, which means they can avoid paying tax, make a buck and can shrug off their responsibility to the people of this state.”

But NSW Premier Gladys Berejiklian and NSW Treasurer Dominic Perrottet appear to be pushing on.

They have said the new private provider would invest in new technology and faster processing times could be expected, improving the service for consumers and for industry.

Moving to reassure Australians, Mr Perrottet said the data would remained owned by the government and not be stored offshore.

Ms Berejiklian has said the state would continue to guarantee any title and compensate any claims through the Torrens Assurance Fund.

But a gaff over GST on LPI fees has proved a headache for Mr Perrottet. GST is currently not payable on these fees but this will change if the service is privatised.

To protect consumers from price hikes, Mr Perrottet has instructed potential bidders to take 10 per cent off the fees, whereas fees had previously been capped at the CPI.  

Shadow Finance, Services and Property Minister Clayton Barr has argued that this is an oversight and slashes the land titles registry’s value from between $200 million to $250 million to potential buyers, yielding less for the taxpayer than was originally forecast. 

Greens MP Justin Field said the government should abandon the sale of the ‘world-class land titling service’.

"The more we find out about the sale of this monopoly and essential service, the more opposition grows,” Mr Field said. “The community is right to be concerned about increasing risk of fraud, misuse of personal data and increasing costs of property purchases as a result of the privatisation.

"The NSW Governments should listen to the experts, LPI staff and the community and stop the sell-off of land titles," he said.

Mr Field has launched a community petition to stop the privatisation here.

Opponents to the sell-off include the Law Society of NSW, Institute of Surveyors NSW, the Concerned Titles Group, LPI Staff Union, the Public Service Association of NSW and the Real Estate Institute of NSW.

 
                    [post_title] => The last stand: Land titles sale
                    [post_excerpt] => Time running out for opponents of sale. 
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                    [post_content] => 

The land titles registry sell-off could make it more expensive 
to put a roof over your head in future. 

 




 

The NSW government’s plans to privatise the profitable land titles registry have been condemned by lawyers, surveyors and real estate agents at a forum convened by Shadow Minister for Finance, Services and Property Clayton Barr earlier this week (Wednesday).

NSW Premier Gladys Berejiklian is planning to lease the part of the Land and Property Information service (LPI) that deals with defining land boundaries and keeping property records to a private company for 35 years.

But experts say it’s a stupid move that will undermine the integrity of the system, push costs up for house buyers and sellers and decimate the LPI’s skilled workforce.

The Public Service Association website, The Secret Sell-Off, points out that the land titles registry gives people “an iron clad guarantee from the NSW government that your home belongs to you”.

In the US people take out insurance to guard against fraud and mistakes in property title.

Don Grant, who was Surveyor General of NSW from 1986 to 2000, said the LPI underpinned the NSW property system and the integrity of the state’s land titles registry, which gave the public confidence.

John Cunningham from the Real Estate Institute of NSW said the decision did not make financial sense. The land titles registry at the LPI is estimated to net the government around $70 million a year.

“You can understand it in terms of the reality of economic management and business that are not performing but the LPI is one of the best performing businesses in NSW,” Mr Cunningham said.

“It’s a very effective and safe system and has worked brilliantly for many years. It’s an innovative government department on the cusp of great things.”

He believed the public wanted to know the registry was safe in government hands, not private.

A recent survey by the Institution of Surveyors NSW found that 70 per cent of people were unaware of the proposed sell-off.

“I’m perplexed. The government talks about open and free data but they want to sell it off, which means it’s going to cost more,” he said.

President of the Institution of Surveyors NSW, Michael Green, said there was a lack of transparency from the government about the sell-off: “it’s like a veil has been drawn”.

The government appears to have gone to great lengths to downplay the sale and dismiss it as merely administrative to slide the lease through.

“They don’t want to tell the public that they’re selling what is a good public service but which will become a private monopoly,” Mr Green said.

He said similar moves in Canada, which were currently being resisted by some provinces or territories, had led to a quadrupling in fees for home buyers and sellers.

The UK recently abandoned plans to privatise its land registry, citing concerns about rising costs to consumers and allowing a private entity to run a monopoly.

Mr Green said the impact would also be huge for the 400 LPI staff. Although full-time workers’ jobs were guaranteed for four years those on contracts could be let go early. Also, full-time staff were likely to look around for other jobs.

Privatisation would mean new staff would be less likely to be trained up and the loss of corporate memory from people leaving would also be damaging.

“People will disappear slowly but surely in the next four years.”

It was also a risk that the service would be returned in worse shape once it was handed back to the NSW government after 35 years, “You’ve got a winner. What are you going to get back?”

The other four sections of the LPI are understood not to make a profit.

Former Law Society NSW President Margaret Hole said the land titles section was funding the other four-fifths of the department and selling it would harm the registry's impartiality, whether real or perceived.

There are fears that privatising the service could lead to a dip in quality of service, especially where a private company would be more concerned with profit and shareholder dividends.

“Once it happens, a private body would have no control over the behaviour of a private company,” Ms Hole said.

President of the Law Society of NSW, Pauline Wright said the yield of $1.5 billion from offloading the land titles registry seemed large but it was a ‘negligible’ return from an asset that consistently delivered profit.

“It’s already among of the world’s best land registries and [there are] few benefits to be gained from privatising it,” Ms Wright said.

Ms Wright said the privatisation would not create the capital investment the government was forecasting because there was little incentive for a private company running a monopoly to invest.

“It’s a fundamental duty of the government to manage and protect the security of its land titles in the state,” Ms Wright said.

“You could say [it’s] the asset that underpins the whole of the NSW economy is under threat.”

Mr Barr called for an inquiry to force the NSW government to be open about the tender process and produce the documents that went with it.

You can watch the forum here on Facebook.

 
                    [post_title] => Experts say NSW land titles registry sell-off a disaster
                    [post_excerpt] => Will home buyers and sellers need insurance against fraud?

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                    [post_content] => 

 

 

By Anthony Wallace

New research from the Institution of Surveyors NSW Inc  (ISNSW) has revealed the unpopularity of the NSW Government’s move to privatise the land titles registry.

The exclusive poll of 1,000 homeowners aged between 25 to 65 years and above, revealed that over 70 per cent were unaware of the NSW Government’s intentions to sell off the NSW Land and Property Information (LPI).

Over 80 per cent of respondents have called upon the NSW Government to scrap its decision to handover the self-funded world-class registry which made $130 million in profit in 2015-16, to the hands of private corporations. A resoundingly minute 6 per cent of respondents back the controversial move.

 

Read more here.

this story first appeared in Spatial Source. 
                    [post_title] => Home owners oblivious to NSW land titles privatisation
                    [post_excerpt] => House price pressure possible. 
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                    [post_date] => 2016-11-18 10:34:38
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                    [post_content] =>  

 mike-bradford_opt
Landgate CEO Mike Bradford.



 

Landgate WA, which runs the state’s land registry, has managed a bit of a coup. The agency has been making a profit and cutting costs while making its customers happier.

The agency decided to act after grappling with ageing ICT systems and observing major changes to the land registry sector, including the advent of e-conveyancing and the increasing privatisation of land registers.

Local challenges had also tightened the screws on government spending, including diminishing revenue from mining and a softening WA property market.

Instead of sticking its head in the sand, in 2013 Landgate went all-in and opted for a multi-tenanted, cloud-based land registration system (LRS) to support e-conveyancing and automate processes, both paper and electronic.

The agency put in place a new land registration system and the first national digital property exchange, PEXA (an e-conveyancing platform), which meant registering mortgages and discharges, transfers, caveats and withdrawing caveats could all be done digitally, the first time a complete property transaction could happen electronically.

The new LRS slashed processing times from up to seven days to 23 seconds and improved the integrity of the data by automating validation and error correction.

It also led to a reduction in staff - something not everyone would have been happy about – and the introduction of flexible work practices.

Landgate CEO Mike Bradford said: “We had to disrupt ourselves. We said ‘let’s be the most efficient land registry in the world and leverage advantage into other markets’. It was a radical review of people, processes and systems using a low cost, innovative business model."

He said that although land titles and property valuations may not be uppermost in people's minds, when things went wrong the WA economy could be in serious trouble and grind to a halt, so it was a critical thing to get right. 

 

The agency, which also deals with land titles, property valuations, aerial and satellite imagery and location information, created new company -  Advara - to maximise the commercial opportunities for its new LRS.

There are 37 Torrens title jurisdictions globally and Mr Bradford said all of them were using old systems built around 2000 and most were looking to replace them.

“We built the world’s first cloud native, multi-tenanted system so it could meet the needs of other jurisdictions," he said.

The system went live in June 2015 and every land title for the last 15 months has been processed through it. Landgate already has other Australian, North America and European land registries interested in buying its software solutions.

The wins
  • $52 million savings over five years
  • Customer turn around dropped from 7 to 10 days to 1.5 days
  • Processing time fell from 30 minutes to 23 seconds
  • Workforce reduced from 950 to less than 600 people
[post_title] => We digitally disrupted ourselves: land registry [post_excerpt] => E-conveyancing spreads. [post_status] => publish [comment_status] => open [ping_status] => open [post_password] => [post_name] => digitally-disrupted-land-registry [to_ping] => [pinged] => [post_modified] => 2016-11-18 11:20:28 [post_modified_gmt] => 2016-11-18 00:20:28 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.governmentnews.com.au/?p=25589 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) [8] => WP_Post Object ( [ID] => 23202 [post_author] => 671 [post_date] => 2016-03-01 12:47:44 [post_date_gmt] => 2016-03-01 01:47:44 [post_content] => Bubbles   New figures released by Airbnb reveal the ‘sharing economy’ juggernaut so loved by tourists could be having a more serious displacement effect on traditional city residential rental markets than policymakers and local regulators had first thought. Data released to the New York State Assembly and Senate by the company in February shows that ‘Hosts’ with two or more listings for entire homes account for a whopping 38 per cent of Airbnb’s revenue – despite the same people with multiple listings accounting for just 6 per cent of people who are offering whole homes up to stay in. It’s a statistic so lop-sided that it jars badly with Airbnb’s user friendly public image as a platform that enables people who might not otherwise travel the opportunity to stay in an established home where people normally live, but occasionally rent out to make a little extra income on the side. The meteoric rise and truly global scale that Airbnb has achieved is undeniable, but there now some hard questions being faced by those charged with running cities and they are not going away. Authorities and policymakers in densely populated cities, where there is natural pressure on rental accommodation, have for at least a year been querying to what extent opportunistic landlords could be bypassing traditional leases to make far more money by exploiting demand for short term accommodation, where rates can be manipulated on a daily basis. In the case of New York, the data released by Airbnb is part of its efforts to strike a ‘Community Compact’ with elected representatives there “to develop rules for home sharing that will strengthens [SIC] cities” and keep the company and its hosts on the right side of the law and regulations. There are similar public policy efforts in other cities too, where signs of friction are emerging. And it’s not always going to plan either. Airbnb’s efforts to influence policymakers to view it as a positive and open contributor to the local economy in New York came embarrassingly unstuck late last year after it was confirmed the company purged more than 1000 Entire Home listings from its platform – just before it released a statistical snapshot. Critics – more on them a little later – claim that the weeding exercise artificially pushed down the proportion of hosts with multiple listings for Entire Homes in New York from around 19 per cent to just 10 per cent. For policymakers and councils, the big question going forward is whether there will soon be a natural encroachment into the traditional residential rental market by speculative property investors and professionalised Airbnb hosts.   The Local Effect The so called Airbnb “effect” on rental availability and pricing is an issue that’s also starting to burn in Australian cities like Sydney and Melbourne as councils, strata companies and the property industry – as well as state legislators – try to figure out what is actually happening on their doorsteps, especially in unit developments. In New South Wales a Parliamentary Inquiry into Adequacy of the regulation of short-term holiday letting in New South Wales has already attracted more than 200 written submissions and will commence public hearings in early March. A real concern among councils and fire authorities is when flats are effectively converted into unlicensed short stay hotels, the number of people crammed into a unit can be far above permitted occupancy levels, like when as many as 8 people regularly bunk down in a two-bedroom apartment. Thanks to the online and highly distributed and nature of Airbnb host’s activities – remember there are no actual addresses handed out until you book or contact a host – the biggest challenge for authorities and regulators is just getting an accurate picture of what’s going on. But that could be about to change. Big time. The same organisation that detected and exposed the manipulative purge of more than 1000 of Airbnb’s multiple listers in New York has set its sights on the NSW Inquiry and Australia and could soon flush out the data councils and policymakers here now find so difficulty to glean. Founded by ex-pat Australian and now New York resident Murray Cox, ‘Inside Airbnb’ describes itself as an “independent, non-commercial set of tools and data that allows you to explore how Airbnb is really being used in cities around the world.” Obviously Airbnb won’t tell you everything, but Cox maintains that there’s enough publicly available rich data out there because Airbnb’s listings themselves produce a pretty sophisticated snapshot of what’s happening.   The data transparency debate One of the biggest challenges councils and regulators face is building a picture from what would otherwise be thousands of pieces of fragmented information floating around in a particular point in time. Cox, who lives in Brooklyn New York, says he started Inside Airbnb as a self-funded project when he first started noticing debate about the impact of the platform. What irked him was that despite all the passionate arguments, there was a paucity of actual data . So he started digging. “I discovered that there might be data available that might tell the story about how Airbnb was being used in the city, and potentially impacting residential housing,” Cox told Government News. Cox says he doesn’t charge for the data he compiles if it’s being fed into a public interest or transparency issue or debate. But if the data is being used for clearly commercial purposes, he uses that opportunity to fund the project and offset his infrastructure and other tech costs. He argues that part of the problem for policymakers is that without access to data on Airbnb – and indeed other sharing economy platforms – the real evidence base for decision making can be opaque and thin. “Often without the data you are relying on lobbying and sometimes marketing campaigns,” Cox says. “I saw that there was no real data available in Australia or Sydney, I thought that my tool and my data could provide an impact on the debate and help forming good policy.” Cox also maintains that communities, policymakers and regulators need to be up for an informed discussion about what effects so-called ‘sharing economy’ platforms could have on the mainstream economy including where and when undesirable market distortions occur. In the case of the mainstream rental market, it can mean that properties – whole houses or units – in areas of high demand on Airbnb can become unregistered holiday accommodation where landlords and owners cash in on much higher nightly rates than traditional leases.   Sharing and caring … the algorithmic approach While Murray Cox might be making a small amount of money slicing and dicing Airbnb data to offset his project costs, his venture pales in comparison to some of the highly sophisticated online services that feed off Airbnb’s success – and potentially exposes its underbelly. It’s all very well being an occasional host who washes their own sheets, cleans and makes the bed but when you want to make the most out of your property, it can pay to go to the experts. One of the companies raising eyebrows in cities is AirDNA, which tracks and analyses demand and pricing data across the world. While that’s not an issue in itself, some of AirDNA’s marketing pitches certainly aren’t directed at owner occupiers. Under the heading of ‘Target Real Estate Investments’ AirDNA’s promotional material notes that: “Many savvy real-estate entrepreneurs are buying up homes and condos in prime tourist locations to rent them full-time as vacation rentals. Verify how much short-term rentals are earning in over 4,000 neighborhoods across the globe and calculate how much profit they can generate over the course of a year. Property managers stand to gain with greater income and more reliable bookings.” Another testimonial on the site from ‘David M’ is even more upbeat about buying investment properties based on Airbnb rentals. "I bought the Vegas report even though we have 5 props there just to see how it compared to my 2015 income data and it's pretty ******* accurate,” David M’s testimonial says. “Based on that we're gonna move forward on the investments that you recommended! Great work dude!” Another company, Beyond Data, specialises in dynamic pricing – that’s where rates rise and fall based on demand – for Airbnb and other sharing platforms and spruiks increases of as much as 40 per cent when its algorithms are used to manage pricing. That’s great news for hosts looking to maximise their returns, but it also puts Airbnb listings on a similar footing to hotels and airlines that use sophisticated pricing engines to maximise yield.   Transfixed by technology Murray Cox reckons that what he calls the “ecosystem” of service companies feeding off Airbnb is evidence that the platform is now at a size and scale it could well be having residential property market impacts. Some of the effects he’s concerned about is a more heated housing market causing the evaporation of affordable properties and the depletion of stock as investors chase ever bigger returns. Politicians and policymakers are meant to help the community deal with managing or controlling the consequences of such issues, but instead often find themselves standing next to tech companies to try and look relevant and up-to-date for voters. Cox is naturally sceptical about how some politicians appear to want to harness to coolness factor that tech marketers appear to be able to imbue in the media. “Embracing new technology is, for a lot of politicians, what they need to do to be relevant to their constituents,” Cox says. “You can get a situation where companies have a negative impact on cities – but politicians are really trying to support that business.” It’s something legislators sitting who are sitting on the Inquiry into Adequacy of the regulation of short-term holiday letting in New South Wales might keep in mind when taking evidence. Public hearings for the Parliamentary Inquiry commence on 7th March 2016, in Tweed heads, with another public hearing in Sydney on 14th of March 2016. [post_title] => Is Airbnb fuelling an Australian apartment bubble? [post_excerpt] => New data reveals distortions. [post_status] => publish [comment_status] => open [ping_status] => open [post_password] => [post_name] => is-airbnb-fuelling-an-australian-apartment-bubble [to_ping] => [pinged] => [post_modified] => 2016-03-01 16:43:53 [post_modified_gmt] => 2016-03-01 05:43:53 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.governmentnews.com.au/?p=23202 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) [9] => WP_Post Object ( [ID] => 22305 [post_author] => 671 [post_date] => 2015-11-30 20:30:59 [post_date_gmt] => 2015-11-30 09:30:59 [post_content] => Paddo   The days of real estate agents sitting on fat cash deposits from tenants for residential rental properties look numbered after the New South Wales state government moved to let renters deposit their bonds directly and online with NSW of Fair Trading. It’s an eviction of sorts that’s been a long time coming. The stand by the state government finally lets renters bypass the frequently loathed scenario of handing over what can often amount to amounts to tens of thousands of dollars in surety to agents and landlords who then often string out the deposit and return of trust funds for their own financial benefit. Dubbed ‘Rental Bonds Online’, the new facility from Fair Trading lets tenants voluntarily opt out of the archaic system that produced 540,000 paper-based lodgements a year in favour of transferring monies directly into a government-held trust account via BPAY or MasterCard and Visa cards. “We are doing away with this cumbersome process by cutting out the middle man and enabling tenants to lodge their bond directly to NSW Fair Trading through an electronic transfer system,” Minister for Innovation and Better Regulation Victor Dominello said. People may not always trust the government; but they trust it more than the real estate industry. A major problem for residential tenants across Australia is that many unscrupulous agents and landlords often sit on bond money for as long as they legally can – sometimes longer – to skim off interest or temporarily reduce their own interest payments. Now the state government is helping to remove financial temptation for investment property owners, with Mr Dominello hailing NSW’s online bond facility as the only scheme in Australia where tenant bond money is deposited directly to the government. “The new scheme provides tenants with greater confidence that their bond money is securely held in trust, from the moment the payment leaves their account,” Mr Dominello said. The state government is also keeping crucial transactional data from bond deposits and releases, a move it says will allow tenants “to record and save their bond history online, which they can opt to use to support future tenancy applications.” That data could potentially challenge the notorious market in residential tenancy databases that have historically created headaches for renters and regulators alike because of their questionable accuracy and exorbitant fee structures that can gouge more than $5 per minute for phone enquiries. The NSW Government is initially selling the online bond facility to the property industry and landlords as a carrot rather than a stick, pointing to the success of a pilot that started in July. According to Mr Dominello, around 2,000 real estate agencies and private landlords have signed-up to the new service with more than 7,000 active accounts set up and more than $5 million in bond money lodged. But behind the positive message are conspicuous examples of what’s known as ‘trust fraud’ where money simply disappears. One of the worst recent examples of real estate trust fraud hit NSW courts in September after an Illawarra agent pleaded guilty to two charges of fraudulently converting money as a licensee, relating to money taken from the company's rent trust account and sales trust account. The sting to the agent’s clients was a hefty $789,000, with Fair Trading uncovering “numerous deficiencies” in the real estate agents’ rent and sales trust accounts in addition to “falsified corporate book keeping records created to disguise and hide the fraud.” “Investigators also established the defendant had engaged in a type of ‘kite flying’ - manipulating the monthly rental trust account reconciliation by drawing cheques for the payment of fictitious disbursements at the end of each calendar month in order to give the false appearance the account was balanced - to cover up for her unauthorised withdrawals,” a statement from NSW Fair Trading at the time said. The case prompted Fair Trading Commissioner Rod Stowe to warn the consumer protection agency would “continue to crack down on real estate agents who commit serious fraud such as trust account misappropriation.” Mr Dominello may yet not give them the chance. [post_title] => NSW cuts real estate agents out of rental bonds market [post_excerpt] => Online deposits to hit rorts and red tape. [post_status] => publish [comment_status] => open [ping_status] => open [post_password] => [post_name] => nsw-cuts-real-estate-agents-out-of-rental-bonds-market [to_ping] => [pinged] => [post_modified] => 2015-12-01 10:55:02 [post_modified_gmt] => 2015-11-30 23:55:02 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.governmentnews.com.au/?p=22305 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) [10] => WP_Post Object ( [ID] => 21118 [post_author] => 671 [post_date] => 2015-08-20 22:57:38 [post_date_gmt] => 2015-08-20 12:57:38 [post_content] => 512px-John_Gorton_Building_March_2014 There’s a long list departments whose staff and unions the Abbott government appears ready and willing to pick a fight with staff, but the Department of Finance headed by the indomitable Jane Halton isn’t one of them. After a token dalliance trying to marginally ratchet back the pay and conditions of the Commonwealth’s chief number crunchers and cost controllers, reports have surfaced that Finance has offered its staff a 1.5 per cent per year pay rise exclusive of an attempt to lengthen the working day by six minutes (or half an hour per week) while preserving the Christmas shutdown period. The revised offer to staff is the latest in a string of APS enterprise bargaining offer revisions that have forgone a previous highly dogmatic formula of trying to extract labour cost savings – or increased hours for the same pay in the form of lengthened work hours – under the guise of productivity increases. The rollback of the demands for boosted hours in return for a nominal pay increase by Finance (and Ms Halton) is likely to be seen as an important sign that the Abbott government now feels it should be seen as at least open to entertaining measures of productivity over and above those of pugilistic clock-punching. A major hurdle to date in getting new enterprise agreement offers over the line to both staff and senior management has been the perception that a bid to limit the power of the Community and Public Sector Union by playing hardball will forfeit smarter, cheaper and faster ways of working that would otherwise meet little or no resistance. Many of those productivity gains stem from the inevitable automation of back office and transactional functions that allow agencies to redeploy staff into areas in which they would otherwise have been constrained. Meanwhile Finance appears to have confirmed it will finally relocate from its cramped and outwardly disintegrating Stalinesque headquarters of the John Gorton Building that has required extensive remedial work to preserve its sandstone façade. Although at the chilly and cramped legacy end of modern workplaces available in the Parliamentary Triangle, new public sector occupants (willing or otherwise) could soon be arriving in the form administrative refugees from Parliament House on Capital Hill which is running out of room. As revealed by Government News this week, the Department of Parliamentary Services issued a tender for experts to start scoping for a new precinct and accommodation masterplan that lists relocation of some Parliamentary support personnel to make room for growing numbers of political employees, more than 100 of whom are languishing in a basement. In the event that DPS staff are ultimately shifted to the John Gorton Building, some still may not make it to above ground offices; the building retains what is arguably Australia’s most historically significant bunker which was previously the secure communications centre for the Department of External Affairs and later Foreign Affairs. Commissioned by the Whitlam government, the fit-out of the subterranean the facility was far from an afterthought, with major contemporary artworks commissioned to make up for the lack of natural light. Bunker3 Finance’s own heritage register lists the pieces as “significant as examples of the fifty purpose-designed art works commissioned to combat sensory deprivation”. “The Centre has significance for its association with the nation's 'cold war' activities and the real fear of spying demonstrated by its steel sheathed dense concrete construction designed to obstruct spying on communications, and by the single access point,” Finances documents say. It should, at least, be leak proof. [post_title] => Finance and Halton soften on staff pay offer [post_excerpt] => Increase in work hours goes by wayside. [post_status] => publish [comment_status] => open [ping_status] => open [post_password] => [post_name] => finance-and-halton-soften-on-staff-pay-offer [to_ping] => [pinged] => [post_modified] => 2015-08-25 10:59:37 [post_modified_gmt] => 2015-08-25 00:59:37 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.governmentnews.com.au/?p=21118 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) [11] => WP_Post Object ( [ID] => 21067 [post_author] => 671 [post_date] => 2015-08-18 10:00:12 [post_date_gmt] => 2015-08-18 00:00:12 [post_content] => Parliament House Parliament House in Canberra might appear to be one of the biggest buildings in Australia, but the nation’s politicians, their minders and a small army of support staff ranging from cleaners to security personnel will soon be out of room and could need to annex nearby buildings. Documents recently released to the market by the Department of Parliamentary Services reveal that the agency is now seeking advice on timelines and costings around when the giant edifice will be too small for requirements and need to send some functions away. When completed in 1988, it seemed that Australia’s most physical representation of participatory democracy – which covers 32 hectares – would be easily sufficient to accommodate those working in and around federal government for the foreseeable future. But population growth within the machinery of politics and government could soon require an accommodation upsize, and going up isn’t an option. In documents provided to the market Parliamentary Services has called for a ‘Precinct Masterplan’ and an ‘Accommodation Masterplan’ “that sets out the ‘how, when, why, and at what cost’” for changes needed to keep things running in the year 2040. More specifically it wants to know about “the provision of additional accommodation” and what “activities or functions that have or will be accommodated off-site.” Nearby buildings appear to be firmly on the potential shopping list, perhaps providing a clue as to why a push to sell-off Parliamentary Circle property holdings following the Commission of Audit – like the Treasury Building – were nipped in the bud. One line in the call for a new Masterplan asks for the “consideration of asset options within proximity to APH, through Commonwealth property portfolio, Commonwealth lease options, and private sector leasing.” The big squeeze and eventual eviction for some will come is also a matter of ‘when’ rather than ‘if’, as the call for an ‘Accommodation Masterplan’ DPS bluntly spells out. “Timelines for key events such as when might APH run out of space for various functions and departments once all options to improve the utilisation of the existing built asset are exhausted,” the documents say. The document also canvasses the provision of recommendations “on an improved work place environment for all occupants” that include the Ministerial Wing and Executive Government, House of Representatives and Senate members’ suites, committees, the Parliamentary Library, media and DPS’ own “requirements for accommodation and future service demands noting the current disparate layout and quality of work space.” While space for staffers and the press gallery has always been at a premium as their numbers increase, it’s DPS’ own staff whom appear to be doing it the toughest in terms of being given the worst offices – if you could call them that at all. Indeed the very department whose job it is to run Parliament House seems to want out, thanks to their windowless subterranean digs. “DPS would prefer accommodation that allows all its Divisions to be co-located. Over 100 DPS administrative and technical staff are located in basement office accommodation,” the documents state. Contributing to the population pressure is a growing number of political staffers as well as an increase in the number of Parliamentary Secretaries who also need a better cut of office than your average Member of Senator. There’s also the problem of making sure people, whether workers, visitors or tourists, can get in and out of Parliament House without languishing in long queues at the front door before passing through security. According to DPS a routine day has around 3000 workers and visitors coming into the building which can balloon to 10,000 on busy sitting days, with “main entrance queuing and capacity improvements” specifically cited as an area of attention. [post_title] => Parliament House Canberra runs out of room, mulls nearby land grab [post_excerpt] => Basement dwellers beg to be released from the Big House. [post_status] => publish [comment_status] => open [ping_status] => open [post_password] => [post_name] => parliament-house-canberra-runs-out-of-room-mulls-nearby-land-grab [to_ping] => [pinged] => [post_modified] => 2015-08-20 23:07:15 [post_modified_gmt] => 2015-08-20 13:07:15 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.governmentnews.com.au/?p=21067 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) [12] => WP_Post Object ( [ID] => 20436 [post_author] => 664 [post_date] => 2015-07-02 16:36:50 [post_date_gmt] => 2015-07-02 06:36:50 [post_content] => The Rocks Architecture   Sydney’s hyperbolic property market is never short of big calls and bold claims ‑- and no location does it better than the city’s ionic waterfront where the New South Wales government gets to play prime landlord thanks its substantial holdings through the Sydney Harbour Foreshore Authority (SHFA). Yet as the city’s overheated residential market continues to worry the Reserve Bank of Australia, those eagerly watching the state government’s own massive rationalisation of its property holdings could be forgiven for finding the experiential side of the selling process just a little surreal. Take The Rocks, where the SHFA owns and manages the historic 26 hectare precinct and is spruiking it to potential lessees in language that would qualify for the ‘most creative’ award at any real estate promotion contest. “SHFA’s vision is to make The Rocks one of the most envied heritage destinations in the world,” the body gushes in its latest promotional blurb in an effort to entice a better class of retail tenant. And how’s this for hipster talk that approaches the burlesque: it wants “the creation of a curious, savouring and intimate environment that offers a sensual experience that online shopping cannot.” It’s easy to laugh off, but the government’s attempt to revive The Rocks is a serious campaign that clearly wants to move the area away from heavily sanitised souvenir shops. To do this it’s appealing heavily to the trendy digital and professional services set that SHFA as sensed is searching for something a little cooler than the clean glass lines of the north of the city. One catalyst for the SHFA’s purple prose appears to be a landmark decision by heavyweight professional services firm Boston Consulting Group (BCG) to take out a mammoth ten-year lease over premises in 80 George Street, right in the heart of The Rock for its high tech Digital Ventures arm. Dominic Perrottet , the NSW Minister for Finance, Services and Property, isn’t shy about putting BCG company up as just the kind of switched-on and cashed-up rent payer that can fill restaurants, cafes and boutique designer outlets. It could also be a world first in terms of a government getting money from BCG, rather than vice versa. Talking-up the lease, Mr Perrottet said BCG was a “perfect fit for the iconic and much loved area” and would boost the NSW government’s plans for the district. Just how ambitious and transformative those plans are plans comprise become apparent in a remarkable glossy sales brochure recently released by the SHFA. Dubbed the ‘The Rocks 2015/16 Leasing Direction’ the document is publicly available and can be downloaded here (PDF). “With commercial and retail interest in The Rocks so high, we are not only securing the future of this treasured heritage area, but also attracting welcome private investment to go towards better public spaces and improved maintenance,” said Mr Perrottet. BCG Digital Ventures is in on the act. “Our new office will combine the latest in workplace design and a significant investment in technology with a celebration of the building’s heritage architecture,” said the company’s Asian head Michael Priddis. “Sydney is an important hub for our work in Asia, and we look forward to collaborating with some of the region’s most progressive companies in our new space, and enjoying all that The Rocks has to offer.” 'The Rocks 2015/16 Leasing Direction' document positions The Rocks as a “vibrant world-class retail destination for Sydneysiders, domestic travellers and international visitors alike.” Some quotes will provide a window into its flavour and intent: “The Rocks is an iconic location, situated between the two most recognisable symbols of Australia: Sydney Harbour Bridge and Sydney Opera House. The precinct comprises prime access to the CBD and all modes of transport. It adjoins Sydney Harbour and is home to much loved cultural institutions,” the document says. “As well as being Australia’s most significant historic precinct, The Rocks is a vibrant and contemporary space, well placed for future growth. SHFA’s vision is to make The Rocks one of the most envied heritage destinations in the world – an alluring precinct and a leader in retail experience internationally. To achieve this The Rocks welcomes businesses:
  • with a passion and style, who understand the market, care for the environment and look to the future
  • who embrace the best of Australian retail innovation
  • who offer excellent personalised customer service
  • who deliver truly amazing retail experiences
  • who educate, entertain and enrich the retail experience
  • with a unique product that captures the consumer’s imagination
  • that add to the overall success of The Rocks
  • that are vibrant and fit with the preferred retail mix for The Rocks.
The Leasing Direction document goes on to examine key trends in retail globally, making the argument that “the rapidly changing retail environment is becoming increasingly more complex, with savvier consumers, shifting demographics and new channel formats all playing a part in the retail revolution. “The future success of the retail industry lies in tailoring the offering to highly defined target markets, rather than the mass-market approach of the past. As a result heritage precincts are now developing into premier retail locations.” It then neatly characterises the The Rocks precinct’s three target audiences: ‘Leisure Suits,’ ‘Sophisticated Tourists’, and the ‘Curiously Creative.’ It says for The Rocks to achieve its vision it must appeal to these target audiences. It has identified “three retail categories have been identified as the pillars of demand for these groups.” They are ‘Food Experience’, ‘Fashion, Arts and Creativity’, and ‘Health, Beauty and Wellbeing’. You and I might call these restaurants, boutiques and art galleries, and other stuff. The document goes on about how they need to ‘be about more than food’ and the like, but it is hard to get away from the impression that the maybe hype itself is being overhyped. And you thought The Rocks was just a place where tourists went to buy Ugg boots and opals. Not so!   [post_title] => NSW hypes The Rocks as new digital and retail Mecca [post_excerpt] => Boston Consulting Group leads hipster influx. [post_status] => publish [comment_status] => open [ping_status] => open [post_password] => [post_name] => nsw-hypes-the-rocks-as-new-digital-and-retail-mecca [to_ping] => [pinged] => [post_modified] => 2015-07-02 21:21:55 [post_modified_gmt] => 2015-07-02 11:21:55 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.governmentnews.com.au/?p=20436 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) [13] => WP_Post Object ( [ID] => 14159 [post_author] => 671 [post_date] => 2014-03-11 09:26:32 [post_date_gmt] => 2014-03-10 22:26:32 [post_content] => [caption id="attachment_14160" align="alignnone" width="650"]lightrailchurch2 Image: City of Parramatta.[/caption] The City of Sydney’s historic status as the state’s central business hub is once more under direct challenge from the metropolis’ West. The literally up-and-coming geographic and commercial centre of the City of Parramatta has publicly revealed it is hunting for a new Director of Property Development to help spearhead a $2 billion bid to shift the centre commercial activity away from Sydney’s increasing crowded coastline and closer to where the bulk of the city’s population live. The big push by Parramatta to attract investors for big new commercial and residential property projects comes as crowding and a shortage of stock push up prices and the relative difficulty in getting new projects up in the CBD. Successive state governments have for decades lauded the potential for Parramatta to be Sydney’s real commercial centre; however property investors and big developers have historically chased opportunities closer to the 2000 postcode as sizeable tracts of once industrial land were opened up. A real issue for prospective commercial property buyers and lessees is that the seemingly insatiable demand for inner-city apartments is now putting unprecedented pressure on developers to rebuild or convert existing offices – especially those with views – into residential blocks that offer a higher return. The City of Sydney has similarly made no secret of its ambitions to create a living downtown metropolis where people live, eat and work as opposed to an office dominated precinct that shuts after 6pm. At the same time, Sydney’s notorious traffic congestion and chronically over-crowded public transport system is making it progressively harder and slower for workers to commute from the West, prompting employers to scout for tenancies closer to where people live. A key example is the New South Wales Police Force that relocated its administrative headquarters to Parramatta from College Street in the city, allowing the building with water vies overlooking Hyde Park to be redeveloped into luxury apartments that sold for well over $1 million a piece. As the push by the O’Farrell government to turf entire government departments and state corporations from increasingly valuable CBD real estate continues, interest from big commercial property investors like GPT is steadily increasing. “Parramatta City Council is embarking on one of the largest public infrastructure and community renewal projects in NSW with a portfolio valued at around $2 billion,” the local government stated in its casting call for a director of property development, adding that the role “will play a pivotal role for all phases of project development and management.” One big project Parramatta City Council wants put the state government’s approval of is a proposed light rail link that links neighbouring suburbs and infrastructure like Westmead Hospital. The council has been agitating for the government to support the new line, which could be be trunked through existing corridors starting at Westmead and going to Parramatta itself and then onto Eastwood and then to the technology and the business hub of Macquarie Park. The new line would help cater for cross-suburban train travellers who have been left partially stranded because of the historic focus on trunking heavy rail into the CBD. Parramatta Lord Mayor Cr John Chedid applauded “confirmation that the State Government is seriously considering the Council's proposal for a Western Sydney light rail network as a 2015 election commitment.” "As Lord Mayor, I have been campaigning for this project for several years. Our Council has conducted a detailed feasibility study which shows the project is viable at a total cost of $1.7 billion,” Cr Chedid said. "The network will link two of the nation's fastest growing CBDs, Parramatta and Macquarie Park, and also the Hills district, which supplies 60 per cent of Parramatta's workforce. “It will address the two main challenges facing Western Sydney: creating jobs and catering for a fast growing population. By 2031, the network will support 180,000 jobs and 50,000 homes. Randwick Council successfully persuaded the O’Farrell government to push its new CBD and Eastern Suburbs light rail extension out as far as Kensington and the University of New South Wales that are now serviced by buses. Those light rail services will run on separate corridors originally used for Sydney’s trams that were stopped in 1961. [post_title] => Parramatta starts hiring to lure developers from City of Sydney and wrest CBD crown [post_excerpt] => A casting call for a new head of property development in the West has cast a spotlight on the renewed battle to lay claim to the real centre of Sydney. [post_status] => publish [comment_status] => open [ping_status] => open [post_password] => [post_name] => parramatta-starts-hiring-lure-developers-city-sydney-wrest-cbd-crown [to_ping] => [pinged] => [post_modified] => 2014-03-14 10:36:35 [post_modified_gmt] => 2014-03-13 23:36:35 [post_content_filtered] => [post_parent] => 0 [guid] => http://www.governmentnews.com.au/?p=14159 [menu_order] => 0 [post_type] => post [post_mime_type] => [comment_count] => 0 [filter] => raw ) ) [post_count] => 14 [current_post] => -1 [in_the_loop] => [post] => WP_Post Object ( [ID] => 27617 [post_author] => 670 [post_date] => 2017-07-17 22:40:11 [post_date_gmt] => 2017-07-17 12:40:11 [post_content] => Deloitte Access Economics’ Chris Richardson sees a few worrying trends and signs on the horizon for Australian governments. The world is motoring. Growth in the US, Europe and Japan is near 2%, with China and India doing the heavy lifting to raise overall global growth above 3.5%. But China has been tightening the screws, which will see its growth slow during 2018, with flow-on effects for the wider world. And there are structural headwinds for the medium term: the developed world is ageing, with its potential growth sapped by rising retirements. That’s true of China, too. And, at the same time, the business world has been reluctant to invest for a decade, spooked by rising political and economic uncertainty, as well as fears of regulatory and technological developments – creating an additional headwind. Both the world and the Reserve Bank have been doing Australia favours, with China throwing red meat at those bits of its economy that buy big from the Lucky Country, and with the RBA’s 2016 interest rate cuts revving up housing prices. Despite that, production growth has been weak, as big gas projects finish construction, as the big home building boom of recent years starts to peter out, and as Cyclone Debbie took a toll. Yet our stuttering pace of production was still enough – thanks to higher commodity prices – to see national income chalk up a gain of near $100 billion in 2016-17. That brought an emphatic end to five years of ‘income recession’, though to date it has been profits rather than wages that have benefited, while the pace of home building is set to shrink further amid increasing evidence that gravity may soon start to catch up with stupidity in housing markets. And the gargantuan Chinese credit surge is finally easing back, suggesting the global economy won’t be doing Australia quite as many favours from 2018 onwards. Yet those are merely caveats on an otherwise solid outlook. Relative to the rest of the rich world, Australia’s economic outlook may not be quite as impressive as it once was, but we are still kicking goals. Consumer price inflation remains a dog that isn’t barking, both locally and globally. And although global and local leading indicators of inflation are stirring in their sleep, they don’t look like getting out of bed any time soon. We see wage growth set to climb from 2018, as inflation lifts a tad, as retirement among boomers restrains growth in potential workers, and as the ‘income recession’ of the post-2011 period gives way to more settled gains in national income (and workers get their share of that). Even so, the pick-up in inflation and wage gains is likely to be both modest and slow. The past decade saw a growing global gap between economies and interest rates, but the US Fed is continuing a slow grind towards closing the gap. The rest of the world will eventually follow, with Australia’s turn starting during 2018. Yet as J. Paul Getty so neatly put it: “If you owe the bank $100, that’s your problem – if you owe the bank $100 million, that’s the bank’s problem.” Australia’s heavily indebted families are now the Reserve Bank’s problem, which is why, although interest rates will indeed rise in the next few years, they won’t rise sharply. On the currency front, Australia will sit more towards the back of the queue for global interest rates normalisation, and there’s the risk of further price pain on commodities. That combination will weigh on the Australian dollar, but not by much. Australia is within a hair’s breadth of a current account surplus for the first time since bell-bottomed jeans were all the rage. However, just like bell-bottoms, Australia’s dash for cash looks set to be very short-lived. We got close courtesy of spikes in coal and iron ore prices, but those same global commodity prices are once again curled up into a ball and rocking. That will increasingly show up as lower export earnings over the next year or so, cementing a return towards our customary deficits. Job growth in the next couple of years will be solid: not as good as 2017 to date, but not as bad as 2016, either. There’s good news in the better gains in national income of late, but overall macro trends aren’t really giving a strong signal either way on job prospects. And while the bugaboos of the moment (disruptive technologies and new business models) grab the headlines, they do more by way of generating churn at the level of individual businesses than they do to ruffle the surface of overall job numbers. The Federal Budget saw the Coalition abandon Plan A (a return to sustainable fiscal finances via spending cuts) to Plan B (tax and spend, amid increases to the Medicare levy, a bank tax, and Gonski2.0). Given Plan A spent years going nowhere, we see great sense in Plan B. But it’s a real worry that a conscious shift to the centre still didn’t unleash much bipartisanship in Canberra. That says official figures (which assume stuff passes the Senate) remain at risk. And, speaking of risks, commodity prices could yet spell trouble for the Federal, WA and Queensland Budgets, while – a little further out in time – housing markets may yet do the same for the NSW and Victorian Budgets. The tussle at the top Among industries, it’s still a tussle for the top of the growth leader board, as mining output rides the crest of earlier investment decisions, while health care rides a demographic dividend topped with technological treats. Both sectors look set to keep growing rapidly, with mining seeing huge gas projects ramp up their production levels (to meet export contracts, and to keep the home fires of domestic markets ticking over), and with health demands marching ever-upwards. But the prospects for both also come with caveats, as mining’s fortunes remain chained to China’s, and health to Canberra’s. Like Manny Pacquiao, the reign at the top of the pops for finance has been long and gloried, but it’s looking a little long in the tooth as the cost of credit finally gets back off the canvas. That said, there’s a long tail of growth still left in finance, and its return to the growth pack may take a few years. Challenges loom for property services too, where a slowdown has already commenced. Similarly, the $A -fuelled rise of fast growth in recreation (thanks to more tourists) and education (thanks to more students) may soon start to moderate from here – the $A’s fall was a while ago, and its benefits are starting to fade. But at least the education sector has the lift in the birth rate over the last decade or so to provide better base demand via extra kidlet numbers. Construction and manufacturing are both bumping along the bottom, but for construction it may be a relatively brief spell in the doldrums, whereas manufacturing’s challenges look rather more structural. Question marks lie over the utilities, where balancing divergent aims (power that’s clean, reliable and cheap) is hard, but becomes even harder now that Hazelwood has closed and with the nation’s onion-eaters arguing the toss on Finkel. That suggests investors may stay sidelined, which is where they’ve already been for an awfully long time. Add in rising prices, and this sector – a pathway to growth for many other industries – is left reliant on population gains to generate much by way of growth. It’s just a jump to the south and east On the State and Territory front, the jump from a China boom to a housing price boom sent the nation’s money and momentum from its north and west towards its south and east. Yet although the ‘sunbelt’ – WA, Queensland and the Top End – is feeling pain as a result of that, much of the drama for those regions already lies in the rear view vision mirror. Their next phase will be one of recovery, albeit not quite yet. And don’t forget that today’s heroes – NSW and Victoria – have clay feet. A house price boom borrows growth from the future, and both NSW and Victoria will have to pay back some of that in the years ahead as today’s housing prices gradually reconnect with reality. Luck’s a fortune, and NSW has it in spades amid the shift to lower interest and exchange rates since 2012. But storm clouds are building, as the housing price boom has artificially supported retail and home building. There’ll be an eventual butcher’s bill to pay as those supports reverse. Victoria has benefited as key cyclical drivers – exchange and interest rates – moved in a ‘Victoria- friendly’ direction in recent years. And this State is experiencing its strongest population gains for many a decade. Yet, relative to other States, its population and housing cycles may be near their peaks. The key headwind to Queensland’s economy for some years now has been falling engineering construction, but that pain is increasingly history. While Cyclone Debbie and slowing housing construction are current negatives, Debbie’s impact will be temporary and gas exports are lifting. South Australia has benefited from favourable shifts in interest rates and exchange rates. In fact, and despite popular opinion, the State economy’s growth actually picked up of late. Even so, some big challenges remain, given both demographics and an unfavourable industry structure. The construction cliff is still weighing on Western Australia. This state saw a virtuous circle of reinforcing growth drivers during the boom, but it has been seeing a vicious bust for a while now. But there has been better news recently out of China, and even vicious cycles run out of steam. Tasmania has been one of the bigger beneficiaries of the lower Australian dollar and lower interest rates, and the state economy’s growth is currently looking pretty good. But structural negatives on the longer-term outlook remain entrenched, suggesting caveats on current conditions. The Northern Territory’s economy isn’t a one-hit wonder, but recent years saw a Gangnam-style blockbuster hit the charts. As construction on the Ichthys project increasingly winds down and its export phase ramps up, the Territory’s challenging conditions won’t disappear for a while yet. The good news for the ACT is that, after the cutbacks and public sector hiring freezes of recent years, the Feds are returning to more of what might be considered business as usual. On top of that, the impact of lower interest rates on the ACT’s economy remains a powerful positive.   [post_title] => Gravity is starting to catch up with stupidity [post_excerpt] => There are a few worrying trends and signs on the horizon for Australian governments. 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real-estate

real-estate