Labor backbencher urges property developer licensing to go further

Property developer licensing laws in the ACT need to go further to ensure proper accountability, a government backbencher has said.

Labor committee chair Suzanne Orr said while the bill was an important step, it “should not be viewed as the last step”.

“Property developers have an important role in the delivery of our built environment and in turn a large level of social responsibility,” she said.

“With this responsibility should come accountability.”

The Legislative Assembly’s standing committee on planning has delivered a report into its inquiry into the territory’s proposed property developer licensing laws.

The laws were introduced to the Assembly by Sustainable Building and Construction Minister Rebecca Vassarotti, who is from the Greens.

Under the proposed laws, property developers would be required to hold a licence for the first time and will be required to pay up for repairs if there are issues with their buildings.

The scheme would also establish a public register of licensed developers, while also giving the government greater power to issue rectification orders and disqualify rule-breakers.

The planning committee made seven recommendations, including that a review of the legislation, set to take place in five years, should consider whether government agencies undertaking development be included.

The committee recommended the bill should pass following changes but Labor and Liberal members of the committee made further recommendations.

Labor backbencher Suzanne Orr. Picture by Sitthixay Ditthavong

Ms Orr said a future review of the bill should consider stronger regulation and compliance mechanisms, proposing an audit of past work of developers to ensure what was originally proposed was delivered and developers should receive financial penalties if this is not the case.

Ms Orr, who is the deputy chair of the Legislative Assembly’s planning committee, said it was common for developers to not deliver what they had promised.

“I have heard consistently that what is promised in a development proposal is often not delivered,” she said.

Ms Orr pointed to an example of developments proposing a commercial proponent and then later amending their proposal to remove commercial tenancies.

She also pointed to amending the number of bedrooms in apartments.

“Other examples include amending the number of one- or two- or three-bedroom apartments leading to an abundance of some and a scarcity of others,” Ms Orr said.

Liberal member of the committee Mark Parton said while the bill responded to a genuine problem experienced by many in the Canberra community, he was concerned the bill could result in reduced investment by property developers.

“Laws are drafted to have consequences and if I believed that these laws would do nothing other than to protect ACT residents from the pain of costly defects, then I’d be wholeheartedly support the bill in its current form,” he said.

“By far and away, the biggest unintended consequence of this bill is likely to be reduced investment by developers in Canberra and the complete failure of the government to achieve its housing targets.”

Mr Parton said he fell “just short of recommending that the bill not pass” but said recommendations from him and the committee needed to be given serious consideration.

“The recommendations made by the committee as a whole are given genuine consideration and acted upon by the government it would be extremely difficult for me to support it,” he said.

Canberra Liberals member Mark Parton. Picture by Gary Ramage

Planning committee chair Jo Clay, from the Greens, said the bill was significant as it sought to bring property developers into the chain of accountability for building defects in the ACT.

“The bill aims to improve accountability and transparency in the building and construction industry and ensure that developers will be competent and have the capacity to deliver quality buildings,” she said.

The ACT government first committed in 2019 to introduce a licensing scheme for property developers in the territory.

Shane Martin, the council’s ACT executive director, said the scheme would penalise the overwhelming majority of developers who did the right thing.

Mr Martin said the bill would penalise developers for things outside of their control.

“Creating personal liability for decisions outside of a developer’s direct control cannot make policy sense,” he said.

“This will just create a situation of delays, greater costs and less supply, further exacerbating our housing crisis.

“The report itself acknowledges this reality. All representatives of the committee, including the Minister, conceded that this Bill will raise housing prices and costs.

“A developer should only be responsible for things that they can directly control. The bill should include a comprehensive list of what is reasonably within a developer’s control and outline reasonable steps a developer can take.”