Significant challenges need to be overcome if Victoria is to meet its target of delivering 180,000 new homes in Melbourne’s outer suburbs over the next ten years, an industry briefing has heard.

During a briefing hosted in Melbourne last week by the Victorian division of the Urban Development Institute of Australia (UDIA), leaders from government and industry discussed actions which are needed to unlock new housing supply in Melbourne’s greenfield areas.

Panellists included Justin O’Meara, Head of Spatial Planning, Housing, Building and Land Delivery at the Department of Transport and Planning; Sommer Liston, Development Director at Stockland; Les Stokes, Director of Economy, Growth and Infrastructure at Mitchell Shire Council; and Kate Kinsella, Principal Urban Planning Development Liaison, Urban Planning and Development at Melbourne Water.

The discussion was moderated by Sean Pinan, Director of Catalyst Development Services and President at UDIA Victoria.

An ambitious housing delivery program

The session came as Victoria aims to deliver 180,0000 new homes in greenfield areas o1ver the ten years to 2034.

This is part of a broader target of delivering 800,000 new homes across the state during that period. This target was established in the Victorian Housing Statement that was released in 2023.

To support the target from a greenfield viewpoint, the Victorian Government last year published a 10-year plan for greenfield development.

Central to the plan is the development of 27 new Precinct Structure Plans (PSPs). These will be delivered in a staged manner across three separate ‘horizons’ between now and 2034.

A PSP is a long-term plan for urban development which describes how land within a given area is to be developed and how and where services and infrastructure are planned to support the development of new communities.

(In addition to the aforementioned documents, the greenfield housing strategy will be supported by two other documents.

Released last December, the Victorian Economic Growth Statement provides a strategic plan for economic development including a 10-year plan to unlock industrial land.

Meanwhile, the recently released Plan for Victoria, sets out a coordinated approach to deliver more affordable housing and choice, connected infrastructure, livable suburbs and towns and sustainable environments over the next 25 years.)

In a keynote presentation that was delivered as part of the briefing, O’Meara outlined some initiatives that are being implemented by the Department of Transport and Planning.

These fall under three ‘buckets’ involving the planning pipeline, unlocking zoned land and monitoring and reporting.

Initiatives include:

• Development of a ten-year sequenced program of work to balance the delivery of residential and employment areas as well as infrastructure delivery.
• A commitment to streamlining processes for preparation of PSPs and reducing the timeframe for PSP preparation from a current average of 3.5 years to 2.0 years.
• Publication of a guidance note to guide practitioners and stakeholders about how to prepare a staging plan and the infrastructure which needs to be implemented.
• Working with industry to better understand and address challenges which may impact new home delivery in designated areas.
• Development of guidance on how to meet government PSP guideline targets with respect to density and housing diversity.
• Testing new approaches to more readily understand Aboriginal cultural heritage values to support future process at the planning permit stage.
• A new Industrial Land Gateway Service (launched in June) to support proponents in requests to bring forward rezoning of industrial land.
• A concierge service for greenfield subdivision (launched in June) to assist developers and local councils to work with government and other stakeholders to address constraints which are preventing development from occurring in zoned land in areas where PSPs have been gazetted.

(Victoria’s 27 proposed new PSPs. Image: Victorian Government)

Challenges and strategies

Several themes stood out from the panel discussion.

(1) Collaboration is critical

According to Liston, the importance of collaboration and partnerships in PSP delivery should not be underestimated.

“That to me is the biggest area of opportunity,” Liston said.

“When you’ve got strong relationships, trusting relationships between authorities and those working on the projects, that’s where those projects are successful.

“On the flip side, if you can’t get a meeting with an authority, that’s where it struggles and breaks down.”

Stokes agrees.

From a local council viewpoint, he says a particularly important area of collaboration is working with industry to identify and address previously unanticipated constraints which may emerge during the delivery of PSPs early on and to coordinate infrastructure delivery.

He says Council needs to ‘have an open door’ to the industry and should provide connection through to service authorities and other agencies to ensure that all relevant stakeholders are operating in a coordinated manner.

(2) Vision needed to make generally in accordance provisions work

As PSPs undergo development, a challenge for councils and developers is to gain agreement on generally in accordance provisions.

Essentially speaking, these provisions aim to provide a faster and more streamlined approval development process by deeming applications to be ‘generally in accordance’ with the Precinct Structure Plant in cases where development applications align with the broad outline and intent of the plan but feature minor or inconsequential variations. Where this is the case, applications will be able to access a streamlined development approval process without third party notice requirements or appeal rights.

According to Stokes, it is important when dealing with this for developers and council to agree about the overall precinct vision. Once this is in place, the parties are more readily able to work together and use the provision to generate an agreed outcome.

(3) Accelerating PSP timeframes

Another challenge is the time involved in PSP preparation.

As things stand, PSPs take on average 3.5 years to deliver from project initiation to finalisation. This creates frustration for both developers and resource-stretched local government as the process becomes bogged down in lengthy panel procedures.

However, the Government aims for this to be reduced to two years.

O’Meara says that the Department is investigating several means by which PSP preparation can be accelerated.

These include:

• Implementing stronger mechanisms to obtain timely and authoritative inputs.
• Time bound limits on resolution.
• Containing the scope and content of PSPs to deliver plans which are simpler, more consistent and which enable the permit process to respond to detailed design and approval matters as part of future subdivision and development processes.
• Commencing a ‘progressive certainty’ approach for matters which are routinely determined at the permit phase.
• Piloting use of alternative planning tools so as to not always rely on PSPs.
• Conducting workshops with industry and other stakeholders to help to prepare plans as efficiently as possible.
• Delivering a more efficient process for standing advisory committees. These are independent bodies who are appointed by the Minister for Planning to advise on strategic matters relating to PSPs – especially when there are unresolved issues from public submissions on draft PSPs.

On the last point, O’Meara highlights approaches taken with regard to PSPs in Melton East and Devon Meadows and Casey Field South.

In relation to this, the Department along with Melbourne Water set aside several days to get relevant parties together prior to the commencement of panel proceedings.

This was done in an effort to address issues which had been raised during consultation ahead of the formal panel process.

He also suggests that learnings may be possible from other programs.

An example would be the state’s Activity Centre Program through which greater density will be delivered in and around activity zones.

Whilst set in a different context to PSPs, O’Meara says that this program has a highly streamlined operation and may offer learnings which could be applied to PSPs.

(4) Funding for community infrastructure

Another challenge is ensuring adequate funding for community infrastructure within PSPs.

On this score, Stokes speaks of two challenges.

First, funding has been difficult as many of the previous grant opportunities through programs such as the  Growing Suburbs Fund have dried up and are no longer available.

Second, there is a challenge to ensure that provision of community infrastructure remains adequate in cases where there are efforts to generate greater density within existing precinct structure plans compared with that which has been previously allowed for within the original plan.

Speaking particularly on the first matter, he says that councils will become increasingly reliant upon industry partnerships and a greater proportion of facilities being provided by proponents.

To enable this, processes for development contribution works in kind will need to become more flexible (traditionally, these have focused on local roads and parks).

(Panel session at UDIA briefing. From left Justin O’Meara, Les Stokes, Kate Kinsella, Sommer Liston, Sean Pinan. Image source: UDIA Vic)

(5) Avoiding infrastructure delays

Another concern is development being held up by delays in infrastructure delivery.

In the PSP of Devon Meadows and Officer South in Melbourne’s east, for example, there are concerns about the adequacy of drainage that will be in place to support new development.

O’Meara acknowledges that this is an ongoing difficulty. He says challenges range from industrial development being held up by utility services concerns to drainage schemes and cultural heritage matters needing to be worked through.

He says that the Department will work closely with other government authorities such as Melbourne Water to address this.

In the aforementioned case of the Devon Meadows and Officer South, it is intended that priority will be given in relation to Melbourne Water infrastructure in order to enable development to occur in an unconstrained manner.

(6) Making work in in kind arranagements work.

A further industry challenge is negotiating work-in-kind agreements between developers and the Minister for Planning.

Under these arrangements, developers who operate in growth areas agree to provide land and/or constructed state infrastructure directly rather than pay the Growth Area Infrastructure Contribution (GAIC).

An example of challenges in this area is the Gunns Gully Road Interchange – a new interchange which is proposed between the Hume Freeway and Gunns Gully Road in Melbourne’s outer north near Beveridge.

As part of its Cloverton project in the area, Stockland is negotiating to deliver the interchange under a work-in-kind arrangement.

However, negotiations have drawn out for more than a decade.

Asked about this, Liston says that she is not personally involved in that project from Stockland’s point of view and is not able to speak directly to that specific matter.

In light of timeframes which are needed to resolve these issues, however, she stresses the need for projects such as these to be put on the agenda early on.

This applies not only to large strategic matters but also approvals of a smaller nature.

In New South Wales, for example, a self-certification program which is available enables developers to have detailed design plans for roads and drainage approved within a week of the self-certification occurring.

In Victoria, by contrast, approvals of this nature can take more than six months. (A system of self-certification is currently being developed by Melbourne Water.)

(8) Melbourne Water lifts its game

One final point noted in the discussion has been an improvement in the operations of Melbourne Water – which is responsible for assessing flood risks and planning applications in both greenfield and established urban areas, including drainage schemes for new developments.

Previously, the organisation had accumulated a significant backlog in relation to the assessment of new development applications from a planning viewpoint.

However, Kinsella says that the organisation has worked hard work over the past twelve months to eliminate the backlog and review service levels.

As a result, the organisations is now resolving 98 percent of development applications within agreed service level timeframes.

Melbourne Water has also initiated a range of supporting initiatives.

These include:

• Provision of guides regarding minimum application requirements to enable industry to provide quality applications which can be quickly assessed.
• A new template for stormwater management strategies
• Establishment of the Urban Planning and Development Strategic Collaboration Group – an industry group which is facilitated by Melbourne Water and which aims to address key challenges and barriers which industry faces in terms of issues such as land use planning, technical matters, climate change and processing and timelines
• A development liaison team to facilitate early engagement.