It's unsurprising that NSW is 2nd to Victoria: Chris Johnson

It's unsurprising that NSW is 2nd to Victoria: Chris Johnson
It's unsurprising that NSW is 2nd to Victoria: Chris Johnson


New research by the Grattan Institute and CommSec reveal NSW is slipping further and further behind Victoria in the key areas of economic growth, unemployment and construction work completed.

Disappointingly, for the second year in a row, NSW has failed to keep pace with Victoria, slipping further behind in relative economic growth according to the CommSec’s latest ‘State of the States’ report. This is very alarming and has significant negative consequences. Part of this decline is due to the state government’s complex planning system, which is hindering housing production and making homes even more unaffordable.

A report by the Grattan Institute notes that both NSW and Victorian state governments are facing significant population pressure. However in the lead up to the state election, the NSW government has adopted a populist ‘anti-growth’ rhetoric, suggesting migration intake should be halved, winding back critical planning reforms designed to increase housing supply and exempting key electorates, such as Ryde, from additional growth.

The NSW government lacks clear, strong leadership to effectively manage population growth and is constantly caving to every action group opposed to change. As a consequence housing supply has dropped off, especially in accessible areas close to transport and services, where housing is most suitable. Home ownership is declining, and more and more people are spending a large percentage of their income on housing costs.

The Grattan institute report suggests that the NSW government must go further to ensure enough housing is built, particularly in established suburbs. The NSW planning system is hugely complex and obtaining approval to build new homes is a risky and onerous process. There are huge delays in processing development applications and rezonings. This just adds to the cost of housing production and deters investment.

The Grattan report also suggests that all states should follow the lead of the ACT and replace ineffective stamp duties with broad-based property taxes.

The Urban Taskforce has always supported a broad-based property tax as a much fairer and equitable method of taxation, as opposed to inefficient stamp duties. We applaud the ACT government for introducing this approach.

Chris Johnson is the Urban Taskforce CEO

NSW Urban Taskforce

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