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Affordable housing policy dumped

Sean Nicholls

May 20, 2011

THE Planning Minister, Brad Hazzard, has called an immediate halt to new development applications made under a controversial policy designed to boost affordable housing for low- and middle-income-earners, and announced amendments to the scheme while a new policy is developed.

The policy, introduced by the previous government, allowed medium-density developments to be built even if they did not comply with local planning laws as long as 20 per cent of the housing was set aside to be rented at below market rates for 10 years.

It was designed in part to help workers such as teachers, nurses and police who are being forced to live on Sydney's fringe because of rising rents in the inner suburbs.

Mr Hazzard, who in opposition promised to abolish the policy, said affordable housing was ''critical'' but the policy imposed inappropriate development on suburbs.

It provided ''an avenue for small-time developers to rip into local communities and change [their] entire face''.

Mr Hazzard said some small developers were rorting a loophole in the scheme by applying the 20 per cent figure to the number of apartments in a development, but then making those apartments far smaller than the rest to maximise their profits.

From today, no applications will be accepted under the old policy. Existing applications will be subject to a ''character test'' to ensure they are compatible with local development control plans.

The policy will be amended to specify that the 20 per cent rule applies to total floor space, rather than numbers of units.

In a major change, Housing NSW will now be required to comply with a local council's notification policies when lodging a development application for affordable housing.

Under the old system, the applications were exempt, prompting anger from residents who learned about developments only once construction began.

More rigorous rules will be applied to ensure housing is close to transport and services.

In urban areas it will have to be close to public transport routes operating seven days a week. They will need to be within 800 metres of a train station, within 400 metres of light rail or 400 metres from a bus stop. A test will be introduced in regional areas stipulating housing built under the policy must be within 400 metres of a local centre.

The amendments effectively remove the incentive for developers to include affordable housing in their projects. But the government says it will establish a new affordable housing taskforce to develop a replacement policy.

''For the agony the communities were suffering there was no evidence that people who seriously needed affordable housing were getting it,'' Mr Hazzard said. ''It just seemed to be a very good cash cow opportunity for some, generally small, developers.''

The Local Government Association president, Keith Rhoades, welcomed the announcement. ''It has been of concern to councils right across NSW because it was circumventing their local planning rules. We've all got to be supportive of affordable housing and we don't want ghettoes either. We want to make sure the housing mix is right.''