This week the Victorian state government issued an economic growth statement (Victoria: open for business) setting out a series of initiatives designed to:
- open doors
- cut red tape
- build new skills
- reach every community.
In this update, we will focus on the initiatives impacting development in Victoria.
Priority sectors
Five priority sectors have been selected as the focus of a new industry policy to drive innovation and conditions to benefit Victorian businesses. The new policy will be released in early 2025.
The priority sectors are:
- advanced manufacturing and defence
- health technologies and medical research
- the circular economy
- digital technologies
- agribusiness.
The focus will be on developing capability in these sectors, attracting global industry and investment, unlocking further development, accelerating advanced technologies, and innovation, and developing new and existing export markets.
Unlocking land
The Statement recognises that a key to attracting new investment is freeing up suitable land for development. Initiatives already underway to unlock land include:
- The Northern Freight Precinct (including 1400 ha for the new Beverage Intermodel Freight Terminal)
- 1000 ha of new land at Officer South
- Continuing to develop Arden and the Fisherman‘s Bend Innovation Precinct
- Unlocking land in greenfield locations at Avalon, Bendigo and 400 ha of government land in Ballarat.
New initiatives announced in the statement include:
- Bringing forward planning of the Merrifield North precinct to be complete by end 2028
- Reviewing the zoning of 3300 ha of land at Altona North and Hastings
- Creating a ‘Greenfield land concierge service’ to work with councils to unlock land identified that is currently underutilised.
Finally, the existing Development Facilitation Program will be expanded to rezone significant underutilized land holdings. It is proposed that this will involve the fast tracking of approvals for the redevelopment of land such as golf courses, racing tracks, institutional sites, and university land surplus to educational needs.
Regulatory reform
Excessive regulation is a disincentive to investment, adds unnecessary cost and delays project commencement and completion. The Statement proposes numerous reforms including:
- The unlocking of more Market Led Proposals with new alternative and flexible pathways. The new guidelines have already been released and introduce a new strategic development pathway for major housing and strategic developments.
- Speeding up Environmental Effect Statement processes by targeting assessment review of no longer than 18 months (more than half of all assessment succeeded this timeframe).
- Cutting the number of business regulators by half. Victoria currently has 37 regulators and these will be reduced to at least 18. The Government will start by focusing on regulators in construction and food industries. A roadmap to deliver this initiative will be published next year.
- The establishment from early 2025 of priority assessment teams within key regulators to provide dedicated support for high value, higher complexity projects to ‘chaperone’ applications – and applicants – through the assessment processes.
- Slashing the regulatory cost burden for businesses by $500 million by 2030.
Will it work?
The initiatives outlined in the Statement comprise both high-level and generic statements of intention with limited detail and long lead times and robust and much needed reform and streamlining.
It remains to be seen how quickly these initiatives will be able to be delivered.
Fewer regulators and a streamlining of processes to enable development will, of course, be welcomed by business, however for many businesses the issue does not lie in the number of regulators, rather in the resources available to those regulators and the consequential impact on efficiency.
For a project proponent, increased approvals coordination between agencies, and a shorter EES timeframe (supported by narrowing EES scoping requirements, more targeted EES inquiry hearings and alternative mechanisms for community input (e.g. online engagement tools)) certainly has the potential to accelerate project delivery, but any reform will need to also meet the challenges of stakeholder management and lengthy Technical Reference Group processes Where the EPBC Act is triggered for a project relating to impacts on matters of national environmental significance, the assessment requirements of the Commonwealth will also need to be considered.
Notably, there is only one very limited suggestion in the Statement about abolition or reduction of the taxes that have been recently introduced and which have created significant business uncertainty. The sole suggestion is that universities may be able to access an exemption from windfall gains tax. Otherwise, there is no mention of revisiting taxes impacting on property development and business confidence which have been introduced or re-set in the last two years, such as stamp duty and land tax, which both recently increased, windfall gains tax and VRLT.)
