The Liberals plan to offer cheaper land and more of it to boost housing and the bottom line. Photo: Ian Bushnell.
The ACT’s bottom line will be buoyed by a $1.3 billion windfall from accelerated land sales of more than 6000 blocks under a Liberal government, the party has estimated.
Opposition Leader Elizabeth Lee has said that land sales will bring in $900 million in her first term, boosting revenue overall.
But the party estimates project out to the 2028-29 financial year, beyond the 2028 election date.
Land sales have assumed importance as a key element of the Liberals’ economic and fiscal policy, which includes increased spending and four major infrastructure projects – a city stadium, convention centre, northside hospital and lyric theatre – as well as rates and tax relief.
The Liberals will cap the growth of general and commercial rates at the long-term Wage Price Index rate of 2.2 per cent for the next term of government, as well as cut the payroll tax rate from 6.85 per cent to 5.45 per cent for wages up to $5 million. They have also committed to a review of the Lease Variation Charge.
Labor has attacked this as “magic pudding economics”, claiming it would blow out the budget deficit, services and programs would have to be cut to cover the shortfall, and government employees’ wage rises would not be able to be met.
However, Ms Lee has said savings would also be made by not proceeding with some Labor projects, such as the proposed entertainment pavilion and, of course, light rail Stage 2B.
She also said that the cost of the infrastructure projects could be ameliorated through a variety of approaches, including public-private partnerships, Commonwealth contributions, and offsets through land sales, such as the current convention centre site.
However, the land sales – including cheaper blocks for first-home buyers – remain integral to the Liberals’ plans, and the estimate does not include any stamp duty, rates, or land tax that could be applied, lifting revenue further.
They plan to first auction off unsold blocks in Jacka and Whitlam, retaining 10 per cent for first-home buyers to sell at 75 per cent of the over-the-counter price. This is expected to reduce the current over-the-counter value by 10 per cent.
This initiative is estimated to generate around $120 million.
The second initiative involves accelerating land release by 6050 blocks and reducing the gross profit margin on the blocks from the current rate of 60 per cent to 40 per cent to improve affordability.
The Liberals have identified sites in Macnamara, Whitlam, Kenny, and future Molonglo Valley stages, as well as new greenfield developments.
But they do not include the former CSIRO Ginninderra site, which the ACT is waiting for the Commonwealth to release, and Symonston.
These will provide further opportunities to release land for housing and add to the government coffers.
The Liberals have factored in the cost of an accelerated land release program, estimating that the cost per block to prepare for sale will rise by 4.5 per cent a year, as requested by Treasury. The cost of production is based on Freedom of Information documents with a significant contingency (20-plus per cent) for land that may be more expensive to develop.
These land sales could provide additional revenue of more than $1.16 billion, the party says, bringing the total revenue from land sales to almost $1.3 billion through to 2028-29.
The Liberals have long called for the government to release more and cheaper land for housing, accusing Labor of deliberately choking supply to maintain prices.
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