Melbourne 2030: From Vision to Reality 1. The Role of the Victorian Civil and Administrative Tribunal

Transcription

1 Melbourne 2030: From Vision to Reality 1 The Role of the Victorian Civil and Administrative Tribunal by Justice Stuart Morris President Victorian Civil and Administrative Tribunal The role of VCAT in determining Melbourne s growth and evolution is overrated. Decisions of VCAT are often hailed as profound, crucial or critical in the development of the Melbourne metropolis. In truth, the key decisions are usually made by others; and the key drivers of growth, and how growth manifests itself, are economic and social influences. In considering the role of VCAT in the implementation of Melbourne 2030, I perceive a conflict between ego and judgment. Naturally the head of any organisation seeks to promote its role in the community. But it is more important for judgment to win the day. And my judgment is that VCAT s role in relation to Melbourne 2030 is relatively modest. Let me explain. Like it or not, many of the forces which will shape the future of the Melbourne metropolis are beyond the effective reach of government. These forces might be environmental, social or economic. For example, the capacity of a city to grow will depend upon its ability to be serviced with water and to cope with its effluent. In the past the growth of some cities has been retarded by air pollution problems; and a modern day equivalent could well be traffic congestion. Social changes are also largely beyond the control of government, yet can be highly influential in influencing the way a city will grow. In the present context, two things stand out. There is a significant ageing of the community, which will be particularly evident for the over 80 age group. Indeed, this cohort will double in its number over the next twenty or so years. Naturally this will have a substantial impact upon the nature of housing which will be in demand. Perhaps a more important social change is the reducing size of households; which is a key reason why the total number of households that will be demanded over the next thirty years will substantially increase. Economic factors are also critical in the making of decisions about new development. Sometimes planners delude themselves, and in turn delude the community, by promoting planning outcomes that are completely at odds with the economic or social reality. Like it or not, the market will play a significant role in the type of development which will occur in Melbourne and where it is to be located. If purchasers want to live in town houses, town houses will be built. If they do not want to live in town houses, they will not be built. Economic factors are not only important on the demand side, but are also relevant on the supply side. To take an example, the cost of building a town house is about $1,500 per square metre; whereas the cost of erecting a multi-level apartment is in the order of $2,200 per square metre. Yet the price that purchasers are generally willing to pay, per square metre, for a town house exceeds that which they are willing to pay, per square metre, for an apartment. Thus any 1 A paper delivered to the Melbourne 2030 From Vision to Reality Conference held at the Melbourne Park Function Centre on 20 November 2003.

2 2 policy designed to encourage more apartments vis-a-vis town houses starts with an immediate economic handicap. It is true that that handicap may be overcome by additional yields on apartment sites or by superior locations. But high yields will not always be compatible with existing residential amenity; and superior locations are not universal. No plan is likely to work if it involves swimming directly against the economic tide. Then there are decisions by government which are not generally regarded as town planning decisions, yet may have profound implications. Take the policy of federal governments in relation to immigration, just as one example. Current policy results in the settlement of about 25,000 additional people in Victoria each year; most of whom settle in Melbourne. This represents 750,000 over 30 years. I am not putting forward an argument for or against immigration; but merely identifying the significance of this type of governmental decision on the future growth of a city such as Melbourne. The Commonwealth Government will also influence spatial behaviour within a city by its taxation policies, such as its policies in relation to negative gearing, and its macro-economic strategies. And let us not forget taxation policies that encourage the provision of the company car; maybe employers could be given a tax concession for providing employees with public transport tickets! The significance of the Commonwealth Government in the growth and morphology of our cities is a good reason why it must should renew its interests in urban development, somewhat in the Whitlam/Keating tradition. Then there are State government decisions which have major ramifications in relation to urban development and form. These are usually in relation to major infrastructure projects, such as railway lines or freeways. Obviously the Mitcham/Frankston freeway will have a significant bearing on accessibility to jobs, preferred transport routes and the like. So too may enhanced rail routes to the regional cities. Decisions about these matters will generally not be made by the Minister for Planning, but will be whole of government decisions. Decisions about the Casino Complex, the Grand Prix at Albert Park, the Docklands and Federation Square were all made by State Government, not just a planning department. This illustrates how important it is, for the implementation of Melbourne 2030, for a whole of government approach to be adopted. Turning to decisions made or initiated by the Minister for Planning, these will extend to matters such as the urban growth boundary, major rezoning proposals, such as the creation of new suburbs, and planning scheme amendments which give a green, or red, light to particular developments. Decisions about these major developments do not go through the same planning permit application procedure that is used for a villa unit development. Despite all that I have said it is true that there still remains a significant amount of development which is the subject of that standard application procedure. According to the recent discussion paper Better Decisions Faster 2 there are about 45,000 applications for planning permits in Victoria each year. Dr Michael Buxton and others 3 put the number of applications at 60, August Michael Buxton, Robin Goodman and Trevor Budge, A Failed Experiment: The Performance of the Victoria Planning Provisions and the New Format Planning Schemes, October 2003.

3 3 The number of permit applications which come before VCAT each year is about 2, So of all the planning applications received in Victoria in any year, councils make the final decision in 95% of them. VCAT s role is confined to only 5% of the planning applications. In the year 2002/2003 VCAT s Planning and Environment List dealt with 2,404 applications for review of decisions to grant a permit, decisions to refuse to grant a permit and failure to grant a permit. Just over 30% of these were appeals by objectors; with the balance being brought by permit applicants. Sometimes permit applicants are referred to as developers; but it is our experience that some of these are in fact home owners wishing to extend their home. Perhaps the most alarming change in the character of appeals being brought before the Planning and Environment List is the percentage of appeals against a failure of a council to decide a permit application. In 2002/03 there were 494 appeals of this type. This is far too many. It does not reflect well on the planning system; and it suggests that the resourcing of council planning departments has not been in line with the growth in the number of developments which require planning approval. Looked at as a percentage of all applications in the Planning and Environment List, failure appeals constituted 15 per cent. The comparable number in the year 2001/2002 was 12 per cent. In 1998 the comparable number was 5 per cent. And in 1993, admittedly in a recession year, only 3% of all applications were against a failure to decide. The councils which generate a substantial number of applications, of whatever type, are principally drawn from areas where development pressures are being experienced. I use the expression development pressures to mean circumstances where there are strong forces, economic and otherwise, for development, and also strong forces resisting development. In terms of number of appeals, the top ten municipalities were Yarra, Port Phillip, Stonnington, Boroondara, Bayside, Mornington Peninsula, Glen Eira, Moreland, Banyule and Monash. The 2002/2003 statistics also give some indication of the proportion of cases in which the applicant for review is fully or partly successful. These show success rates for objectors of 61%, permit applicants of 69% in appeals against refusal and success rate of 75% by applicants when the appeal is against a failure to decide. The nature of review before VCAT is known as review on the merits. This is distinguished from what is known as judicial review where the exercise is confined to examining the legal correctness of the decision. Not only does review on the merits enable the parties to contest the real issue in dispute, but also it tends to put technicalities in their rightful place in the back seat. Victoria s planning appeal system is a particularly fair system, having regard to the extensive third party rights which are available. These are far more extensive than in other States of Australia, a point that is sometimes overlooked by certain lobby groups. When VCAT overturns a decision of the Minister approving a major development, as has happened recently, some observers seek to take cheap shots at the Minister. These observers fail to appreciate that VCAT may have spent six weeks hearing submissions and evidence about the proposal, enabling it to form a considered view, whereas a busy minister would usually be confined to departmental advice. I believe that ministers for planning, who, over the years 4 This represents the sum of all applications for review in respect of decisions to grant, refusals and failure to grant a permit; but excludes reviews concerning conditions and secondary consents.

4 4 since the mid-1960s, have permitted review of decisions they make, on their merits, have displayed not only courage, but farsightedness in a true democratic tradition. It is important to understand that when a matter is determined by VCAT it will usually mean that the development proposal has been subject to more consideration, and more refinement, than was the case when the same proposal was considered at first instance. I understand the strong message which certain councils are trying to send developers: that the development proposal should be fully refined when it is put to the council for consideration at first instance. But it is also the case that further refinement will always be possible, indeed desirable; and decisions which are made at the review stage will always be advantaged by the provision of more detailed information. What does this all mean? I think it means that VCAT s influence in making decisions on planning applications is principally directed at fine tuning development proposals. Poor development proposals, which councils reject, will generally also be rejected by the tribunal. Sound planning proposals, which councils support, will also generally be supported by the tribunal. It tends to be the marginal decisions, particularly those made in the face of the recommendations of a council town planning officer, which tend to be overturned by the tribunal. Importantly, it is commonplace when this occurs that the approved development has been fine tuned, by alterations to the development form or by the imposition of more stringent conditions, so as to ameliorate the proposal. I have sought to explain why the planning outcomes that result from VCAT decisions are unlikely to be crucial to the implementation of Melbourne But there are two other aspects of VCAT s role which I believe are important. First, VCAT can play, along with the Minister, an important leadership role in the making of decisions about planning matters. What distinguishes VCAT (and, for that matter, the courts) from other decision makers is an obligation to give reasons for its decisions. Further, VCAT processes are completely open to scrutiny by the public. Hearings are conducted in public; decisions are publicly available. 5 If VCAT makes any error of law, an opportunity exists to have the decision overturned. These characteristics mean that the principles articulated by VCAT in the making of decisions can have wide ranging effects in the way the planning system operates. For example, in the last few months the tribunal has ruled that responsible authorities should disregard anonymous objections. 6 It has explained the way section 62(3) of the Planning and Environment Act, which deals with amendments to plans approved under a permit, operates. 7 It has ruled upon interests a person must have to be a valid objector. These types of decisions fill a void. They provide guidance to responsible authorities and the community in the practical application of planning laws. The other significant role which VCAT plays is in the efficient operation of the planning system. It is no secret that there has been a decline in the timeliness of planning decisions over the last few years. Certainly similar times have been experienced before: the late 1980s provide a good example. There are a number of reasons for the current decline: one of which is that there has been an increase, with the VPP planning provisions system, in the number of discretionary decisions. This has been also affected by the increasing desire of governments, All decisions in the Planning and Environment List are published on the website Cun Sheng Liu v Melbourne City Council [2003] VCAT 1521 (24 October 2003). Melbourne CC v Becton Ltd [2003] VCAT 1077 (4 September 2003).

5 5 especially councils, to control what occurs in their municipalities: heritage controls and vegetation controls are two examples. A further factor is the increasing desire of all stakeholders to subject development proposals to greater scrutiny. These days it is common for an application for a modest medium density development to be accompanied by a planning report, a traffic engineering report, an arborist report, a surveyor s drawing, a landscape architect s report and, sometimes, an acoustic consultant report. This is then magnified by the employment of a second arborist to check on the first arborist s work! The increase in the number of failure appeals is a manifestation of the increasing delays that have occurred at municipal level. VCAT s past performance has also been less than perfect. During the 2002/2003 year a typical waiting time between the lodgement of an appeal and the making of the VCAT decision was about six months. This time would have been 7-1/2 months if it had not been for the initiative of the Minister for Planning to provide additional funding of $500,000 to VCAT for each of the 2002/2003 and 2003/2004 financial years. In August this year I announced Operation Jaguar, a comprehensive plan to intensively manage VCAT s Planning and Environment List so as to promote more timely decisions. The plan involves the holding of a practice day each Friday to intensively manage the case load and for dealing with urgent matters. It also involves streamlining the procedures which are necessary before a planning appeal can be listed for hearing. Importantly the members of VCAT have embraced Operation Jaguar and we are already experiencing a substantial improvement in the timeliness of our decisions, particularly in relation to urgent matters. In the past some minor, but urgent, disputes could take six, or even eight, months to resolve. Recently I was able to resolve a dispute over alterations to a largely completed development, which was being affected by the withholding of a certificate of occupancy, only eight days after it was lodged at VCAT. Melbourne 2030 specifically articulates a policy direction: provide more resources to the Victorian Civil and Administrative Tribunal in order to: - increase the number of tribunals that can sit; - support VCAT in achieving its objective of increasing the proportion of cases that are heard by panels of two members rather than by a single member; and - assist VCAT to significantly reduce the time taken to deal with planning appeals. Operation Jaguar will make a substantial impact in implementing this initiative. Operation Jaguar is cost neutral and, to that extent, demonstrates how desirable it is to review all our systems in order to promote efficient and fair outcomes. But the goal of significantly reducing the time taken to deal with planning appeals is also dependent upon proper funding and, in particular, a continuation of existing funding sources. If these funding sources dry up, some of the gains of Operation Jaguar will be lost. I do not have a Project Panther in my back pocket.

6 6 I now turn to the way in which VCAT has approached Melbourne The principal decision which is relevant is that of Judge Higgins, Deputy President Horsfall, Senior Member Sharkey and Member Cimino in O Connell Street Developments Pty Ltd v Yarra City Council 8 which was handed down on 30 April The City of Yarra had been concerned by an earlier decision in Ashlyn Enterprises Pty Ltd v Yarra City Council 9 (referred to as the Cheesegrater case). The council argued that there was no legal requirement to have regard to Melbourne Hence a hearing was held to determine the legal status of the policy. Essentially the tribunal concluded that the metropolitan strategy (as opposed to the Implementation Plans) contained in Melbourne 2030 is a final strategy adopted by the Minister. The tribunal held that the plan was a strategic plan which has been adopted by a minister within the meaning of section 60(1)(b) of the Planning and Environment Act and, hence, was a relevant matter. Further the tribunal held that the policy was a strategic planning document that can be accorded weight for the following reasons: it was a strategic plan; it had been adopted after an extensive consultation process; and the Minister and the State Government were pursuing its implementation on a serious basis. The tribunal commented: Our view is that the tribunal s obligation in making planning decisions is to apply the current planning scheme and in doing so is obliged under section 60(1)(b)(2) and (3) to have regard to the metropolitan strategy. The Implementation Plans would not appear to be a matter for relevant consideration. The tribunal added: The primary obligation of a responsible authority and the tribunal when deciding on a permit application is to apply the existing law, being the appropriate legislation and the planning scheme currently in force, and whilst it is desirable that discretion be exercised in a way that does not compromise the metropolitan strategy, until it is incorporated in the planning scheme, it should not be the basis for the approval of a proposal that is inconsistent with or contrary to the controls or policies of the existing planning scheme. The tribunal concluded: No particular aspect of the strategy itself necessarily carries greater weight than another. When considering the strategy, the tribunal must have regard to each of the policies contained therein. In some situations there may be conflict or tension between the respective policies. In those circumstances it 8 9 [2003] VCAT 448. [2003] VCAT 87, 24 February 2003.

7 7 will require the tribunal to balance those conflicting interests. Each case will of course depend on its own facts. Although the policy loomed as a substantial consideration in some cases after its release, such as the Cheese Grater case, the more typical experience is that the policy has been considered, alongside existing policies, as supporting a particular approach. This reflects the fact that Melbourne 2030 contains many of the same themes as previous metropolitan policies. I now wish to make some general comments about Melbourne 2030 and how it might move from a vision to reality. Essentially Melbourne 2030 is an aspirational document. It establishes, and articulates, a vision for the Melbourne metropolis, providing a framework for all types of governmental decisions which have some spatial impact. The main thrust of the policy is to continue to protect the liveability of the established areas and to increasingly concentrate major new development in strategic development sites, such as in and around activity centres. It is important that governments publish aspirational documents which set out the outcomes which are sought to be achieved. This is so even if there is some degree of generality in describing the outcomes; and even if there is a tension between different goals so that, ultimately, some balancing process will be necessary. Without a light on the hill, decision makers will be directionless and many of the fine objectives that good planning can produce will be lost. It seems to me that the key elements of Melbourne 2030 can be summarised as follows: an urban growth boundary is to be established to set clear limits to the outward development of the metropolis; urban expansion is to be concentrated into a limited number of growth areas; the growth in housing needs, which cannot be accommodated in designated areas for urban expansion, will be encouraged within existing urban areas, and will be particularly concentrated in or near activity centres; public transport between activity centres and into urban expansion areas will be enhanced so as to reduce reliance upon motor vehicles. Clearly there are other important policies and policy directions which are relevant, such as those relating to environment protection, social justice, urban design and the decision making process. My selection of four key components should not be taken as overlooking these policies. The urban growth boundary will inevitably place more pressure on existing urban areas: the designated growth areas, such as Cranbourne and Werribee, have a finite capacity to absorb new households. The policy vision is that much of this additional pressure can be absorbed in or around activity centres, or on other strategic redevelopment sites, such that existing

8 8 residential areas within the metropolis will retain a high level of amenity. The policy thesis is that such an approach will not only be better at maintaining the heritage and social qualities of Melbourne s suburbs, but also will promote travel by walking, bicycle or on public transport. This outcome is not only hailed by reference to environmental and sustainability objectives, but is also said to minimise the impact of additional households on traffic congestion. In my opinion, this vision is not capable of being achieved unless there is active government involvement in consolidating land, in and around activity centres, so as to provide efficient, high yielding development opportunities. There is no need for new powers to be given to the Minister to implement such a policy. For example, section 172(2) of the Planning and Environment Act enables the Government to compulsorily acquire land if it is satisfied that it is desirable to enable the better use, development or planning of a particular area. Alternatively, such projects could be regarded as projects of State or regional significance, and thus attract Part 9A of the Act, which gives the Government broad sweeping powers. If such a course is followed, the law will protect those with interests in the land being acquired. The reforms to the Land Acquisition and Compensation Act made in the mid-80s, following my report into the subject in 1983, means that fair and adequate compensation will be available in these cases. The nature of the exercise makes it suited to a revolving fund. It is not necessary for governments to be involved in the construction or marketing of new dwellings. The critical role, which I believe only Government can effectively perform, is to consolidate land holdings to provide efficient sites for redevelopment. I have no doubt that the seed money for such a revolving fund will be substantial: one would expect at least $100 million to be necessary. However such an investment should not be perceived as some recurrent outlay, never to be seen again. Rather it should be compared with an infrastructure investment; albeit one which is likely to have a particularly high benefit to cost ratio. Another major initiative which could be contemplated relates to public transport. A boost in the availability, reliability and frequency of public transport services is clearly a key factor in the implementation of Melbourne Urban form can influence travel behaviour; but transport opportunities can have an even bigger impact on urban form. The goal of that is, 20% of motorised trips to be made by public transport by the year 2020 will not be achieved by exhortation. Cars are very convenient and much loved. Mere changes in the urban form are also unlikely to dramatically change travel patterns. There needs to be a substantial and noticeable change in the supply of public transport. Money will always be a problem. The public purse is tight, and the demands never-ending. But one radical answer might be a substantial reform of the land tax system to eliminate all exemptions including for the principal place of residence so as to provide universality and better reflect ability to pay. Such a reform could be accompanied by a public transport levy, payable as an additional land tax, with the funds tied to supporting public transport services. Such a land tax levy would reflect the fact that public transport benefits more than its users; it also is a service to property and does much to buttress land values. Such a vision

9 9 would involve a levy that would reflect not only land values, but also the extent to which particular properties were benefited by public transport services. The implementation of Melbourne 2030 will not be achieved just by relying upon promoting good urban design, exaltation or even by Operation Jaguar! What is required is long term commitment, preferably on a bipartisan basis, a whole of government approach, money and daring.