The Fitzroy Residents Association (FRA) is one of the oldest resident associations in Victoria having commenced in 1970 with a mission of promoting a sustainable, liveable environment in our suburb. At the time of our establishment, under the leadership of people such as Brian Howe (later Deputy Prime Minister) and Barry Pullen (later Housing Minister), Fitzroy was undergoing major transformation. Government had decided Fitzroy was a slum and that it could do a better job by bulldozing large areas of homes and replacing them with modern government buildings. Residents resisted and the suburb went on to develop into one of the most liveable parts of Melbourne. This experience shows us that creating good places for people to live and thrive is best achieved through collaboration between communities and government.
In relation to the inquiry, I would make the following points:
- The Planning and Environment Act is intended to provide fair, orderly, economic and sustainable use of land and to do so in a way that; protects natural and constructed assets, secures pleasant, efficient, safe living and recreational environment, conserves areas of scientific, aesthetic, architectural and historic interest while providing and protecting public utilities.
- Government has traditionally managed the achievement of these goals through an orderly, long-term planning process that is built around consultation and provides transparency for a planning framework that can be understood by all relevant stakeholders.
- These provisions fail to appreciate both the goals of the Act and the processes expected of government. We have seen a government acting without due process or consultation and imposing outcomes from which there is no recourse to independent arbitration. In other words, they are imposing planning changes on the community in quick time; changes that cause great anxiety and will have significant impact on people’s lives.
- The proposed changes have major implications for what, in many cases, is the largest investment most Victorians will ever make – their homes. If the value of a property is the sum of the value of the land, buildings as well as the amenity and character of the area where it is located, these changes will arbitrarily take away part of the value of a person’s asset. This is contrary to long standing legal principles that date from the Magna Carta in 1215 and are still evident in the Land Acquisition and Compensation Act of 1986. It is the job of government to protect an individual’s property (“life, liberty, property”) not take it away.
- Government is entitled to capture value created through major investment in new infrastructure such as the suburban rail loop. The means to do that is through compulsory acquisition and fair compensation for existing landowners. It is an approach that has been used at different times in Victoria’s history. For example, this is how the State Rivers and Water Supply Commission captured value from its investment in irrigation infrastructure and created new irrigation communities in different parts of Victoria.
- The premise on which these changes are taking place is incorrect. Planning rules were not a bottleneck when home construction was at record levels prior to COVID. The change today is that the cost of inputs to home construction have risen faster than the ability of customers to pay. Taking value away from existing property owners and from public spaces and handing it to private developers won’t work while other costs remain so high. If it does stimulate cheap and poorly designed and constructed towers, these will leave a legacy of vertical slums in parts of Melbourne.
- There is significant scope for development within the existing planning rules. In our suburb of Fitzroy, we believe we can meet the government’s target of doubling our population be 2050 and maintain current design and development overlays for our activity precincts as well as our neighbourhood and heritage character. The problem is developers won’t invest. Look at the Fitzroy Gas Works site, nothing has happened since development was supposed to start in 2019 apart from a school and sports centre. Developers won’t put money into a project until they are guaranteed a profit. Even Homes Victoria walked away from the Gas Works site.
- There is an assumption in the current debate that people want to live in high-rise buildings. That is not borne out by evidence in our area. We are seeing a backlog of apartments waiting to be sold. Media reports have pointed to a pool of apartments that are unsold and holding back the ability of developers to achieve higher prices on new developments. Apartment prices for our area have flat lined over recent years. Houses with land on the other hand have shown much stronger demand and price growth.
- In the post-war housing boom, government led the way. Perhaps it wasn’t always good leadership, but they invested in producing homes economically. Prefabrication was a significant innovation (factory at Holmesglen) led by government. Our development industry has not been innovative. It just wants to keep doing the same thing. Developers sit on huge parcels of land in our area that have planning approvals but they either prefer to pursue office buildings or just keep litigating to exceed the planning requirements. These sites should be the focus of government attention. Not by forcing oversize or poorly designed buildings on the neighbourhood but by subsidising construction through tax exemption or stimulating more innovative construction methods.
- Government must be prepared to invest to bridge the current market failure in the housing sector. Instead, government simply seeks to ‘rob Peter to pay Paul’ through planning changes that take value from one part of the community in the hope that some of it might make it through to another part of the community. There is no evidence this is succeeding or will succeed in future.
Michael Spencer, Chair Fitzroy Residents Association
24 April 2025