Housing Supply Reform: From Policy to Delivery

Australia’s housing challenge is not simply a question of how much land is zoned for housing. It is also a question of whether our planning, development assessment and infrastructure systems are calibrated to turn that capacity into homes.

Infinitum Partners has prepared a submission in response to the Productivity Commission’s Interim Report into Housing Supply Regulation, drawing on our experience working across government and the private sector throughout Queensland and Northern New South Wales.

The Interim Report provides an important opportunity to examine the regulatory barriers affecting housing supply. In our view, meaningful reform needs to consider the entire development cycle, from planning policy and development assessment through to infrastructure delivery, asset dedication and the long-term responsibilities of local government.

Planning is a Cycle, Not a Linear Process

Planning policy does not end once a planning scheme or regulatory change is adopted.

Policy influences development assessment. Development creates infrastructure and public assets. Those assets are ultimately maintained by local government, and the financial and operational consequences can influence future infrastructure planning and policy decisions.

Understanding this cycle is important when considering housing reform.

Growth outside planned infrastructure areas, for example, may require a developer to fund infrastructure upgrades and pay infrastructure charges. Once roads, parks and other infrastructure are delivered and dedicated, however, councils inherit responsibility for maintaining and depreciating those assets.

Those long-term costs can influence where and how local governments are willing and able to support growth.

Housing reform therefore needs to consider not only whether development can be approved, but whether the broader system enables growth to be delivered sustainably.

Creating Capacity Where People Want To Live

One of the clearest opportunities is to reconsider whether existing planning controls are unnecessarily limiting housing capacity in locations where demand and infrastructure already exist.

Our submission identifies potential reforms including increased building heights, greater medium and higher-density development in appropriate well-serviced locations, and reconsidering minimum lot sizes where subdivision and built form are assessed together.

Changing individual controls, however, is only part of the solution.

Planning schemes need to be tested as integrated systems. A policy intended to increase housing supply can be undermined by another requirement elsewhere in the planning framework.

Regular calibration can help identify these inconsistencies and determine whether the combined policy settings are actually producing the outcomes governments intended.

Improving Development Assessment

There is also significant opportunity to improve the development assessment process.

Fast-track pathways, better pre-lodgement processes and more efficient administration can reduce unnecessary delays, but lasting improvement requires investment in the systems and people responsible for delivering those processes.

Digital transformation should form part of that response.

Accessible and transparent data, e-planning, workflow management systems, online administrative functions and appropriately deployed AI all have the potential to improve efficiency while supporting good governance and accountability.

Rather than leaving digital transformation to individual councils, Federal and State governments can play a greater role in coordinating, funding and supporting implementation.

Connecting Infrastructure and Housing Delivery

Opening a new growth area can require infrastructure investment beyond that covered by standard infrastructure charges.

If that gap is not clearly understood and addressed, land may technically be available for development while remaining difficult or uneconomic to bring to market.

Our submission proposes a more transparent approach to identifying the actual infrastructure cost associated with new growth fronts, together with consideration of a Growth Area Charge and Growth Area Fund to help address the funding gap.

This brings land use planning, infrastructure planning and housing policy into the same conversation.

From Reform To Delivery

There is no single planning reform that will resolve Australia’s housing supply challenge.

What can make a practical difference is ensuring the different parts of the system work together, interrogating existing policy settings for impediments to housing supply, creating capacity in appropriate locations, improving assessment processes, investing in digital transformation and better coordinating infrastructure with land use planning.

Importantly, reform also needs implementation support.

If governments want planning systems to facilitate more housing, local authorities need the resources, systems and incentives required to implement those changes effectively.

The opportunity presented by the Productivity Commission’s work is therefore bigger than regulatory reform alone.

It is an opportunity to better connect policy, assessment, infrastructure and implementation - and translate housing reform into more homes, sooner.