Planning, policy + property: Lessons we’ve learnt from Australia’s COVID-19 lockdown
OPINION:
If you are in property, the impacts have been felt along asset class lines with industrial performing reasonably, residential benefitting from subsidies and office feeling the beginning of a pinch. Retail and hospitality have been hard hit and will likely continue to feel the effects for quite a while. There are now also geographic chasms occurring with the Victorian economy going back into lockdown.
The economy has been propped up by government transfers not seen since World War 2 (in real terms). While transfers provide temporary relief and it can be argued just delay the inevitable pain, structural reforms to industries can make permanent changes to productivity and benefit the economy in getting out of the trap it is in.
REFORMS
On that note what we have just been through should be used as a learning experience and a catalyst for reform. The reforms will be far more important than cash handouts in the medium term. It needs to be said that in New South Wales the operational reforms that have been implemented by the Department of Planning Industry and Environment have been very successful. The fast track program has been implemented very well and seems to have provided the Department with a focus that they haven't had for decades. Jobs and investment have delivered a very effective means in helping risk averse organisations with an organising principle to help them better manage risk. While the fast track program appears no different from the gateway approvals process it has worked well in an operational sense and should become a permanent fixture of the Department’s toolkit.
Also changes foreshadowed by the Premier at a recent CEDA luncheon and then further explained by the Planning Minister offer further shards of hope. One of the changes mentioned was the right of appeal in the Land and Environment Court to decisions made by Planning Panels (and Councils) on planning proposals. While long overdue such a reform is critical in getting the industry back on its feet. Certain Councils really haven't been acting with the same amount of urgency as other levels of government during the past six months and seem to be struggling with the changes. This change may bring a shot of reality into the picture. It will be up to the NSW Parliament to make the call on this when they vote on the changes.
WORKING FROM HOME
During the past six months, working from home has become the standard feature of many people’s employment. It was ironic that I was sitting at home watching a presentation on line from the Greater Sydney Commission where they said that they were going to continue with the policy of sterilising employment land from any other uses. I almost fell off my chair. Here I am in employment at a residential premises on residentially zoned land (and I have been for six months). Surely, they have seen that Optus and many other corporates have said that working from home will be permanent. Major law firms are seeing 15% of their employees back in the office and it is unlikely they will be back to full use in a long time. If there ever was a case to jettison a last year’s policy fashion now is probably the time. Rather than rely on edicts from above, the local planners need to bring to bear some of the skills they learnt at University. There are strong cases for mixed development in some employment zones (not all but some) and sterilising land by decree will simply lead to an oversupply of employment land and/or a less efficient city as employment patterns change. Rather than sterilising the land a case should have to be made by local planners as to why the land should be employment only.
KEY LESSON
The lesson from lockdown is simple. Flexibility is the key in responding to events that could never have been expected. When you find something that works stick to it until it no longer works. No-one really knows how events are going to unfold and to respond appropriately will take a great deal of effort.
