SUBJECT: DRAFT REGIONAL GROWTH PLAN FOR THE GREAT SOUTH COAST REGION

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1 5 July 2013 Aaron Garrett Senior Project Manager Department of Transport, Planning and Local Infrastructure Moorabool Street GEELONG Victoria SUBJECT: DRAFT REGIONAL GROWTH PLAN FOR THE GREAT SOUTH COAST REGION Cement Concrete & Aggregates Australia (CCAA) welcomes the opportunity to provide comments to the Department of Transport, Planning and Local Infrastructure on the draft Great South Coast Regional Growth Plan. Introduction CCAA is the peak industry body for the heavy construction materials industry in Australia including the cement, pre-mixed concrete and extractive industries. For your information, a list of CCAA Victoria s members is provided in Appendix 1. CCAA members account for approximately 90% of the $7.21 billion in revenues generated by these industries that, between them, employ 18,000 Australians directly and a further 80,000 indirectly. CCAA members operate rock quarries, sand and gravel extraction sites, cement production and distribution facilities and concrete batching plants throughout Australia. There are approximately 640 operating quarries across Victoria that produced some 52.2 million tonnes of stone, limestone, gypsum, sand and gravel in 2010/11 which was used to produce building and construction materials such as cement, bricks, concrete, tiles, pavers and road paving. The value of production from these quarries is estimated to be $760.2 million. The Victorian premixed concrete industry produced 6.2 million m 3 of premixed concrete in 2011/12 worth around $1.3 billion. This is enough to build around 100,000 new homes, 100 Eureka Towers or 44 Bolte Bridges. Further value is added through the manufacture of concrete products and delivering concrete services. CCAA s members service local, regional and national building, construction and infrastructure markets. The reliable and cost-effective supply to these markets is fundamental to sustainable growth and it is CCAA s aim to promote policies and planning frameworks that recognise the importance of these materials to Australia s sustainable future. CCAA welcomes efforts to conduct strategic land use planning that takes into account extractive industry values that provide increased certainty to proponents and the community and results in better outcomes for all stakeholders.

2 Importance of construction materials to the Great South Coast Region CCAA welcomes the draft Regional Growth Plan s recognition that access to local construction material resources is a fundamental issue for the industry and for Victoria and the Great South Coast Region s continued economic prosperity, as outlined in the CCAA submission on the Strategic Directions for the Great South Coast in December The economic benefits of locating heavy construction materials such as sand and stone close to market is recognised as a key future economic direction of the draft Plan on page 21. CCAA also supports identifying a key challenge for growth as sourcing local stone, including identification, protection and extraction approval, to support economic development and minimise heavy freight movement on page 16 of the draft Plan. CCAA also supports secure access to key construction material resources in the region, including onsite quarrying for wind farm proposals on page 24 of the draft Plan, assuming these on-site operations meet the same standards and permitting requirements as other commercial extractive industry operations. CCAA also supports the land use policies, strategies and actions on page 28 of the draft Plan that directs urban growth, commercial, industrial and rural residential development away from areas where it would limit the ability to utilize natural resources, including sand and stone, and to identify, manage and facilitate access to natural resources, including sand and stone. CCAA recommends that the term sand and stone be used instead of just stone in the Plan as heavy construction materials includes both sand and stone. Government policy The Government s recent response to the Parliamentary Economic Development and Infrastructure Committee s report on its Inquiry into Greenfields Mineral Exploration and Project Development in Victoria recognised that areas of construction material prospectivity be identified and be provided with appropriate planning protection, thereby guaranteeing a level of security around future developments. The Government committed to: Establishing a taskforce to identify current extractive industry resources and future needs, with the taskforce consisting of representatives from industry, the Department of State Development, Business and Innovation and the Department of Transport, Planning and Local Infrastructure. Identify and implement the most effective mechanism to ensure appropriate planning protection for extractive industry resources, taking into consideration known resources and future supply and demand issues. Incorporate Extractive Industry Interest Areas into Regional Growth Plans so that identified extractive resources are taken into account during any future planning scheme amendments in regional areas. Whilst no Extractive Industry Interest Areas have been identified to date in the Great South Coast Region, the concept of directing incompatible land uses away from key strategic sand and stone resources is an action that should be incorporated within the Plan Incorporating these Government commitments into the Great South Coast Regional Growth Plan will help to limit future land use conflicts and allow the identification of high quality sand and stone resources to be considered strategically. Continued population growth and construction of significant infrastructure projects will result in pressures to identify and protect quality sand and stone resources with good access to these markets. Page 2

3 Just as agricultural and environmental values are assessed during the strategic land use planning process, so should earth resource values. This is especially relevant for the large areas identified as high value terrestrial habitat in Figure 6 of the draft Regional Growth Plan. These environmental areas also need to acknowledge the regionally important sand and stone extraction areas that will need to be developed further in future years. Infrastructure CCAA welcomes the focus of the draft Regional Growth Plan on providing appropriate transport infrastructure for the region that will improve productivity and transport efficiency. As recognised, a sustainable extractive industry with quality material close to market contributes to affordable infrastructure, affordable housing and an attractive investment climate. Inappropriate strategic land use planning could result in higher operator costs be it via increased transport costs, expensive approvals processes or unwieldy fee structures. These costs are passed on to the consumer which in turn, results in rising costs of local infrastructure, including roads, schools and hospitals and decreased housing affordability. In fact, Macromonitors estimate 1 heavy construction material costs will be the most significant contributor to rising infrastructure construction costs across Victoria over the next decade. The most likely forecast for infrastructure construction costs predict an average total increase in costs of 3.6% per year for the next 10 years, with heavy construction materials contributing 37% of the total increase. Any policy which adversely affects materials transport costs or levels of investment in additional materials industry capacity would cause larger increases. Measures aimed at minimizing materials cost increases and ensuring adequate materials supply, as outlined in the draft Plan could provide a substantial benefit to Government and to private sector partners in infrastructure provision in Victoria. Planning protection CCAA welcomes the draft Regional Growth Plan supporting the protection of natural resources, including sand and stone, so they are available for future generations, including through appropriate planning controls. The Regional Growth Plan should include viable strategies and realistic actions that will realize the region s growth potential and support delivery of the overarching principles outlined in Section 15. Recommendations For the Great South Coast Regional Growth Plan to deliver on its principles of efficient and sustainable settlements, a mobile and connected region and a thriving and dynamic economy, CCAA recommends that: Industry and Government work together to identify current resources and future needs, refine and improve EIIAs, identifying key resource areas of quality construction material resource areas close to potential markets, as Government has committed to do as part of its May 2013 response to the EDIC Inquiry. Such a taskforce should be listed as an action in Section 15, Principle 1, Strengthen the regional economy. Appropriate planning protection is provided for key construction material resource areas in the region. 1 The impact of heavy construction materials prices on infrastructure costs in Victoria. June Macromonitor report for CCAA. Page 3

4 Streamlined planning approvals are provided to extractive industry developments in these resource areas. These recommendations should be incorporated into the Regional Growth Plan in the following areas: In Section 15, Future directions for regional growth: Principle 1, Strengthen the regional economy to include o Identify and protect regionally important sand and rock resources and better understand future demand for resources. Principle 9, Land and infrastructure needed to support growth is identified, to include: o Foster a sustainable and affordable supply chain, including heavy construction materials, to support the provision of cost effective infrastructure. The Victorian regulatory environment needs to be internationally competitive to continue to attract capital to ensure an ongoing, competitive, vibrant heavy construction materials industry, one that helps to maintain the Great South Coast Region and Victoria s productivity, housing affordability and lower infrastructure costs. Given the significant role played by heavy construction materials prices in infrastructure cost increases, measures aimed at minimizing material cost increases and ensuring adequate materials supply, as outlined previously, could provide a substantial benefit to Government and to private sector partners in infrastructure provision in Victoria. CCAA looks forward to working with Government to achieve these key aspects. Please do not hesitate to contact me to discuss any of these issues in more detail. Yours sincerely Brian Hauser State Director Vic/Tas Page 4

5 APPENDIX 1 CEMENT CONCRETE & AGGREGATES AUSTRALIA MEMBERSHIP FOUNDATION MEMBERS Boral Construction Materials Boral Cement Limited Cement Australia Pty Ltd Hanson Australia Pty Ltd Holcim (Australia) Pty Ltd VICTORIA ORDINARY MEMBERS Aidan J Graham Pty Ltd Alsafe Pre-Mix Concrete Pty Ltd Axedale Sands & Gravel Barossa Quarries Pty Ltd Barro Group Broadway & Frame Premix Concrete Pty Ltd Fulton Hogan Construction Pty Ltd Hillview Quarries Pty Ltd Hymix Australia Pty Ltd Independent Cement & Lime Pty Ltd Mentone Pre-Mix Premier Resources T/A Hy-Tec Industries Pty Ltd Rocla Pty Ltd ASSOCIATE MEMBERS Agi-Kleen Pty Ltd BASF Construction Chemicals Australia Pty Ltd Concrete Colour Systems Concrete Waterproofing Manufacturing Pty Ltd T/a Xypex Australia Grace Construction Products Sika Australia Pty Ltd WAM Australia Page 5