Growing communities need more infrastructure - it's time developers paid their fair share.
As our communities grow, developers are making massive profits from booming house prices. But Labor and the LNP refuse to make them pay a fair share to fund the new public services and infrastructure we need.
Infrastructure charges are one of the few ways Councils can make developers contribute towards things like pedestrian crossings, parks, flood mitigation, public transport, and community facilities. But in 2011 the Labor State government introduced a statewide cap on how much councils can charge developers, and the costs of land and infrastructure have grown faster than the cap, leaving Councils struggling to keep up.
That's why I've introduced the Planning and Other Legislation (Make Developers Pay) Amendment Bill 2023, to remove the state-imposed cap on infrastructure charges.
You can find the bill here, and the Explanatory Notes here. My bill has been referred to the State Development and Regional Industries Committee of Queensland Parliament for consideration, and submissions are open until 13 December 2023. You can find the committee inquiry page with more information on making a submission here.
In addition to removing the cap in State legislation, the Greens are calling for Brisbane City Council to make developers pay their fair share, starting with scrapping the LNP’s tax cut for big developers.
By removing the cap on infrastructure charges and making developers pay their fair share, we can give Councils the flexibility to charge developers for the real cost of building infrastructure as land values and construction costs rise. We can get big city-shaping projects built much quicker, including finally getting on with the Toowong to West End Green Bridge, and give residents in the growing medium and high density neighbourhoods more services within walking distance.
Will developers just pass these costs onto buyers?
No. Economic research shows that infrastructure charges are not generally passed on to home buyers, but instead borne by developers, reducing their profit margins, which is why developers argue so strongly against them. This is because home prices are set by the market, not by the costs of developers or builders. If house prices really were determined by the costs to developers instead of the market, then no developer would ever go bankrupt or lose money.
Big developers lobbied the State Government to cap infrastructure charges in 2011, and they don't want them to increase - that’s because it will cost them money. If they could simply pass on the cost to home buyers, they wouldn’t mind at all. Developers charge the maximum the market will pay, and will even hold back housing supply to keep prices artificially high (this is why we also need a vacancy levy to stop landbanking!).
Construction costs are actually very high at the moment - shouldn’t we be encouraging developers to build more homes?
Yes, we should. That's why the Greens at both State and Council levies have called for a vacancy levy on undeveloped land left vacant where it'd otherwise be suitable for residential building purposes. We're also pushing for a far greater investment in public and community housing, and secured an additional $3 billion for that purpose from the Federal Government through negotiations on their HAFF Bill in 2023.
Brisbane City Council is already cutting the charges to incentivise more new housing - how would removing the cap make a difference?
At the moment, because Labor and the LNP have privatised housing supply, big developers control how fast new housing is built. We know developers are sitting on lots of vacant land and a backlog of approved projects, but it’s more profitable for them to drip-feed supply and keep prices high. Developers will just pocket the free money from the LNP, and it will drive up the amount they’re willing to pay for land, pushing prices up even further. Kow-towing to the development lobby has only made the housing crisis worse - we need more public housing, a ban on unlimited rent increases, and vacancy levies, not more developer handouts.