The Victorian Government has set up a dedicated taskforce to help keep the state’s building and development industry running through the coronavirus crisis.
Planning Minister Richard Wynne and Treasurer Tim Pallas will oversee the Building Victoria’s Recovery Taskforce, which will investigate planning and investment opportunities to boost Victoria’s building and development industry over the short, medium and long term.
The Taskforce will provide real-time advice to Government on issues impacting the industry, helping to remove barriers to building and development works, vital for supporting Victorian jobs, housing and infrastructure. It will also work with industry and unions to review existing major building and development projects, ensuring workers stay safe and healthy while infrastructure is delivered in Victoria.
The Taskforce will initially focus on overseeing the fast-tracking of planning approvals using Ministerial powers, where decisions have been delayed due to coronavirus related impacts on the Victorian Planning System.
The Government will also seek the Taskforce’s advice on a pipeline of building and development projects over the longer term, including initiatives that further expand social housing options.
The Taskforce will advise on financial incentives and current revenue measures – such as land tax, developer contributions, fees and rates – and make recommendations to help businesses survive and fast-track investment.
It will be co-chaired by Roger Teale, a former President of the Property Council (Vic) and Senior Executive at LendLease; Jude Munro AO, chair of the Victorian Planning Authority; and Stan Krpan, a Victorian Public Service CEO.
The Taskforce will receive advice from three Industry Working Groups and be guided by a Steering Committee, involving representatives from industry peak bodies and unions.
It will run for an initial period of three months, reporting back to government with recommendations.
Minister Wynne recently approved four new building projects located at 118 City Road, Southbank, 555 Collins St, 52-60 Collins St and 550 Epsom Road Flemington, worth more than $1.5 billion dollars.
He said the taskforce will help ensure the building and development industry is a driving force for Victoria’s economy through this pandemic and beyond.
“It will help deliver existing projects more efficiently and assist new projects to get off the ground faster.”
Michael Langhammer, Business Advisory Partner from Pitcher Partners Melbourne, said there is fear across the industry that as the pipeline of works is completed towards the end of the calendar year and into the first quarter of next year, that most of Government stimulus packages will have expired at a time when many in the property industry will be at their most vulnerable.
“We want to see the Taskforce explore opportunities to stimulate and fast track projects, including community projects (metropolitan and regional), infill medium density projects, and urban renewal, social, defence and affordable housing projects.”
The property industry is made up of many businesses turning over less than $50 million and as such the number of projects and building contracts required to keep these developers, builders and contractors employed is significant.
The latest industry statistics show that 1.2 million people are employed in the sector, across 400,000 building and construction businesses. 73% of these businesses have seen an average drop of 40% on their forward work.
Of the $423.7bn revenue earned by the sector, almost half (49%) is generated by the sub-categories of residential building construction, building completion services and installation trade services.
“The highly fragmented structure of the building and construction sector is evidenced by the number of small-size enterprises. A large share of these (58.9%) have no paid employees and comprise mainly sole proprietors and partners. Almost 60% generate less than $200,000 in annual revenue and very few employ more than 20 people, while about 6% of them generate annual revenue of more than $2 million,” said Mr Langhammer.