Federal treasurer Wayne Swan

11 May 2011 – Budget 2011, Comment and responses: Yes there were modest amounts allocated to urban and regional development, education and hospitals and even some money to map sustainability goals, but hidden within those measures in the Federal Budget brought down last night was some alarming news for the environment.

First and most high profile of anti-environment measures was more slashing of renewable energy schemes, dressed up as something else. The Greens were blunt: it was a “coal budget” with $500 million in cuts to the renewable energy sector.

This comes as NSW prepares to slash its solar scheme but is a contrast to the Queensland Bligh Government, which this week decided to manage its blow out in solar schemes by capping the size of the solar installation instead of the tariffs, perhaps at least partly motivated by an impending state election.

Even worse were the implications for urban sprawl buried in some of the budget measures and unearthed by the ever-vigilant NSW Urban Task Force, the outfit battling hard to break down the gates of the citadel (in reverse) and allow its residential developer members access to the wide green spaces beyond the city limits.

Chief executive officer of the Task Force Aaron Gadiel said the $100 million support for jobs in suburban and regional locations implied support of housing on the urban fringe and paved the way for more of this.

The detail of where that job support will be is crucial: in regional centres it makes sense, in fringe suburban locations, it may prove to be the flowers decorating the Panzers, if the jobs fail to materialise.

Worse Gadiel believes a new era of rampant sprawl could be imminent when he reminded us that the Productivity Commission was serious when it said it would examine the issue of deregulating zoning to make it more “rational” and economically “efficient” (like a Saturday market perhaps?) and will bring down the results of its deliberations next week.

The Green Building Council of Australia found good news to celebrate, in particular the $29 million earmarked to support the development of sustainable plans in regional and high growth coastal areas and the $20 million for urban renewal projects.

It was also hopeful the $10 million earmarked for the development of a set of sustainability indicators would include a communities’ rating tool which is well under development by the GBCA. (The Urban Task Force called for this to be more reflective of middle Australia rather than “fringe” groups, without mention that it has been the course taken by “middle Australia” that will destroy the quality of life for future Australians.)

The Property Council of Australia’s chief executive officer Peter Verwer said the budget laid out a ” powerful development plan for regional Australia, along with a targeted increase to migration and labour skills programs that will boost Australia’s economic muscle.”

But it was just an entre to the main course of a soon to be released population strategy, Verwer said. However, the government needed to “join up” its urban programs to regional and population policies. For instance the budget failed to deliver outcomes on housing affordability, required by a larger and more skilled labour force, he said.

Following is more detail from the main interest groups and the federal government.

The Australian Greens

The Australian Greens read the budget as a focus on coal at the expense of renewable energy.

Funding for renewable energy has been cut by over $500 million over four years, re-badged once again and pushed back to as far as 2024 in a budget focused once again on coal,” Australian Greens Deputy Leader, Senator Christine Milne, said.

“The long-promised Renewable Energy Venture Capital Fund and the Emerging Renewables Program are both being funded almost entirely out of existing allocations to the Renewable Energy Future Fund and the Australian Centre for Renewable Energy.

“The Australian Greens said the Emerging Renewables Program, promoted as a $100 million program, will receive only $2 million of new funding over four years and the re-badged allocations to the Venture Capital Fund are stretched out over 14 years to 2023-24.

“This is a budget that shows a government completely uninterested in renewable energy,” Ms Milne said.

“On a day [Tuesday] when the Intergovernmental Panel on Climate Change has released a report showing renewables can power 80 per cent of the globe by 2050 with the right support, the Gillard government has shown that it still sees renewables as a cute niche industry, not a substitute for coal.

“Venture capital funding for renewables out past 2020 is an insult to all those brilliant Australian researchers and developers who are ready to commercialise their ideas now and see them powering our homes and businesses by the time the government is ready to offer help.

“The government has followed the long tradition of trumpeting new measures for renewables simply by taking existing funding and giving it a new name.

“The $506 million cuts include the already announced scrapping of Solar Schools and pushing funding of Solar Flagships and other programs out beyond the forward estimates.

“In addition, the scrapping of Green Start and other energy efficiency schemes has taken $134 million out of the climate budget.

“This reduced support for renewables is particularly odd given that the government has acknowledged that clean coal is a pipe-dream, cutting funding for Carbon Capture and Storage Flagships, the National Low Emissions Coal Initiative and the Global Carbon Capture and Storage Initiative.”

The Green Building Council of Australia

The Green Building Council of Australia said the $160 million in funding for projects that support sustainable urban development was welcome as the first step towards an integrated strategy for Australia’s cities and communities.

Chief executive of the GBCA Romilly Madew said: “We are particularly pleased to see the $29 million earmarked to support the development of sustainable plans for regional and coastal high growth areas, as well as the $20 million allocated to support urban renewal projects.”

The move appeared to support the call in March by the Australian Sustainable Built Environment Council for a federal minister and department for cities and urban development to ensure a streamlined, co-ordinated approach to urban management.

“This funding demonstrates the Australian Government is listening to industry’s concerns. It acknowledges that more must be done to address the current lack of policy co-ordination across all levels of government, which currently includes 45 federal programs and strategies, as well as inconsistently-managed programs across eight state and territories and more than 500 local governments,” Ms Madew says.

The budget announcement includes $10 million earmarked for the development of a set of sustainability indicators.

“We assume this program will be complementary with the Green Building Council of Australia’s Green Star – Communities project, which already has the support of all three levels of government, including every state land development organisation in Australia,” Ms Madew said.

The Green Star – Communities rating tool will include a set of best practice benchmarks to assess the environmental, economic and social sustainability of building projects at the community or precinct scale.

“The Green Star – Communities project will provide a simple set of guiding principles which will support Australia’s property and construction industry to deliver productive, affordable, livable and sustainable communities. But we need the Australian Government to support this with visionary leadership and linked-up policies,” Ms Madew said.

“The $100 million allocation to boost employment opportunities in suburban areas reflects one of the five principles underpinning the Green Star – Communities project. The need to create prosperous communities. Job opportunities will not only increase economic prosperity, but decrease greenhouse gas emissions and improve livability by reducing the need for people to commute long distances for work.

“While we are pleased with this funding, it is just the beginning. A consistent, long-term, co-ordinated approach is needed to meet the challenges of transitioning to a low-carbon economy while maintaining Australians’ high standards of living.

“The GBCA looks forward to working closely with the Australian Government on an integrated strategy for Australia’s sustainable buildings, neighbourhoods, precincts and communities,” Ms Madew concludes.

The Property Council of Australia

The Property Council of Australia welcomed initiatives in the 2011 Federal Budget to “join up” Australia’s population, regional and urban policy frameworks, along with increased infrastructure spending programs.

PCA chief executive officer Peter Verwer also welcomed the redesign of the proposed $1 billion green building retrofit allowance.

In addition, the Property Council welcomed the government’s acknowledgement that its environmental protection and biodiversity legislation requires a major and urgent overhaul. But it said even more welcome would be the sustainable population strategy.

PCA chief executive officer Peter Verwer said, “The Gillard Government’s first Budget lays out a powerful development plan for regional Australia, along with a targeted increase to migration and labour skills programs that will boost Australia’s economic muscle.”

“The main course of the 2011 Federal Budget is a $4.3 billion regional strategy that is underpinned by infrastructure and skills initiatives.

“Australians living in urban areas are eagerly awaiting the release of the National Urban Policy and Population Strategy, as these are vital for long-term economic growth planning.”

“Instead, the Government has released a tantalising tasting plate of its much-heralded urban and population policies for Australia.

“The budget’s sampler is a mere hint of the forthcoming population policy, with a $100 million employment precincts and business hubs program and a $10.1 million program to develop indicators of sustainable community progress.”

The Federal Budget provided a bigger role for Infrastructure Australia, which will develop a National Infrastructure Construction Schedule – a pipeline for nation-building projects with a delivery timetable, Mr Verwer said.

It also outlined a modest program for encouraging greater private sector investment in large-scale infrastructure.

“Infrastructure Australia has been given the resources and riding instructions to take a long-term approach to scheduling infrastructure

“In future, Infrastructure Australia will also release the rationale behind its recommendations, which will increase confidence in its deliberations.”

Mr Verwer said the government needed to “join up” its urban programs to regional and population policies and provide performance goals such as in the National Competition Policy, that were measurable and enforceable.

“The Urban Policy says states and territories should develop 20-year freight strategies, it should also insist on 20-year housing and land release programs.  The budget failed to deliver outcomes on housing affordability, required by a larger and more skilled labour force.”  he said, adding that he welcomed plans to modernise the design of Australia’s Managed Investment Trust regime.

The Urban Taskforce

The Urban Taskforce read the $100 million of support for jobs in suburban hubs as a green flag for expanding the urban boundaries for residential development, and welcomed by its members whose main focus is greenfield development.

Taskforce chief executive, Aaron Gadiel, said: “Instead of banning or stopping urban expansion, they are now talking about pro-actively supporting employment growth.

“This will help match jobs to the strong need for expanded residential areas at the edge of our cities. Ultimately this scheme will need a lot more money, but it is an excellent start.”

Mr Gadiel said the $36 million “top-down” strategic review of infrastructure by Infrastructure Australia would help sharpen the Federal Government’s accountability for its funding decisions.

“This move gives Infrastructure Australia the resources and mandate it needs to take the lead on indentifying projects for federal funding. It no longer needs to wait passively for state and local governments to serve it up project proposals. This will remove the Commonwealth’s ability to blame state governments for poor quality funding submissions.”

Mr Gadiel pointed to the $20 million two-year scheme to fund urban renewal projects as welcome, but said the funding allocation was modest and its focus on “demonstration projects” will limit its effectiveness. “This Commonwealth should be neck-deep in its support for urban renewal initiatives, but this program is really just a toe in the water,” he said.

“The $29.2 million four-year program to fund strategic assessments in seven high growth regional centres will help address the unnecessary red tape imposed by federal environmental laws. There’s far too much duplication between state and federal environmental laws. Many of the same species are protected at both a state and federal level, by different bureaucracies with different rules.

“These strategic assessments will provide an opportunity to consider the federal environment issues in a growth region holistically, and make a single up-front decision about how biodiversity issues are to managed. This will reduce the need for expensive federal environmental reviews to be carried out for each individual planning application.”

On the $10.1 million allocated for sustainability indicators he wanted to see the indicators reflect the “mainstream community”, and not “fringe groups”.

There was also a welcome for the decision to focus on “easing congestion” as relaxing the “highly restrictive land use laws” (zoning laws).

Mr Gadiel said the Productivity Commission was expected to publicly release its report to COAG on the reform of planning, zoning and development assessment laws next week.

The taskforce was disappointed that $150 million in funding for the F3 to Sydney Orbital project was dropped.

The Planning Institute of Australia

The Planning Institute of Australia said it welcomed the introduction of important new programs and initiatives in the Federal Budget 2011 targeted at building more productive, sustainable and livable cities and regions.

“The imminent release of the National Urban Policy and associated $181.4 million initial funding signals the start a new era for planning in Australia, acknowledging that far greater investment will be needed to create real improvements”, PIA national president Ms Dyan Currie said.

“PIA supports the Federal Government taking steps towards a more sustainable Australia, and with sustained commitment and continued investment, the focus on planning for productivity, sustainability and liveability will pay dividends into the future.”

“For too long disjointed approaches to planning for cities and regions across Australia have been hindering our future capacity to respond to emerging challenges.  The new approach is about establishing a long-term framework for making our cities work better.

“The Federal Budget is peppered with an assortment of initiatives that are aimed at improving cities and regions, addressing population growth and boosting employment.

“The Liveable Cities and Urban Renewal Program is an important new initiative, seeking innovative solutions to poor urban design, high levels of car dependency, traffic congestion, a lack of open space and rising carbon emissions.

“The establishment of a Liveable Cities and Urban Renewal Program is a great start, but is seriously underfunded, with just $20 million over four years to tackle critical issues in our urban centres.

“PIA understands that this is a start and will advocate that the Government increase funding over time, working collaboratively with state, territory and local governments to leverage the additional resources needed for the innovative solutions to improve our cities and regions.

“Through the Suburban Jobs initiative the Government has recognised the need to get more jobs into the suburbs and new employment precincts, with $100 million dedicated to help States and Territories think through and plan for expanded employment closer to where people live.

“This initiative is another great start, but there are very powerful forces pulling employment into the centre of our cities – metropolitan areas as a whole have to be restructured if we are to make progress.

“Other key announcements include increased funding for Infrastructure Australia, increasing by 40 per cent to nearly $36 million over four years, and a mandate that includes the recognition of infrastructure as a catalyst for more sustainable and productive patterns of urban development.

“Government infrastructure spending must align with the restructuring of our cities and regions to support sustainable population growth and employment.

“New rail, road and port spending must be clearly linked to productivity, sustainability and liveability outcomes, consistent with the National Urban Policy.

“Another key feature of the Federal Budget is the tax incentives to support greater private investment in infrastructure provision, attracting up to $25 billion of additional private investment nationally.

“The government’s proposal to clear away some of the tax disincentives to private sector investment in major infrastructure projects is very welcome.”

“Public Private Partnerships will need to play an important part if we are going to marshal the infrastructure resources required to reshape the cities.

“While we have been given an insight into the National Urban Policy as part of the Federal Budget 2011, the other vital pieces of the puzzle are the Sustainable Population Strategy and the Regional Policy agenda.”

Australian Local Government Association

The Australian Local Government Association welcomed the maintenance of the Financial Assistance Grants to local government across Australia and a commitment to review FAGs by 2012-13.

President of the ALGA Genia McCaffery said: “FAGs provide vital support that assist councils to provide local services and infrastructure which is needed by all communities. ALGA has strongly argued that the current level of funding is inadequate and that a review is required.”

Ms McCaffery also welcomed the Government’s decision to again bring forward the first quarterly payment of the 2011-12 Financial Assistance Grants, worth $536.6m, into 2010-11.

“Bringing the first quarterly grants payment forward from August to June will help to smooth out the cash flow, especially in rural and regional councils which rely heavily on the Financial Assistance Grants. The last thing small communities need as we emerge from the downturn is a reduction in the cash available because of a reduced cash flow for the council.

“Local government also welcomes the Government’s commitment of $4.3 billion to regional Australia and $180m to Urban Policy initiatives with a particular focus on jobs. ALGA’s 2010 State of the Regional Report highlighted the critical importance of jobs to support local communities and take pressure of housing markets.”

The Australian Conservation Foundation

The Australian Conservation Foundation chief executive officer Don Henry welcomed cuts to the Fringe Benefits Tax subsidy for company cars but said Australian taxpayers were still paying out $5 billion a year in fuel subsidies.

This included about $1.7 billion to mining companies such as BHP and Rio Tinto.

This translated to “every household in Australia contributing about $200 a year so companies like BHP Billiton and Rio Tinto don’t have to pay a single cent in tax for the diesel they use in their off-road mining operations.”

The budget was a missed opportunity to go further in environmental gains, Mr Henry said. He was disappointed that the tax breaks for green buildings had been deferred and that the National Solar Schools program had been cut by $156 million.

“The Budget is steady-as-she-goes on the environment, right at a time when we need to redouble our investment in protecting and restoring our precious natural environment.

“Major national environment programs, such as Caring for our Country, remain static at a time when a major injection of funding is needed to stem Australia’s environmental decline.  Continuing the Environmental Stewardship Program ($84 million) and the establishment of a National Wildlife Corridors Plan ($10 million) are steps in the right direction.

“The allocation of $300,000 in 2011-12 to support a resolution to the Tasmanian forest conflict is inadequate.  We urge the government to find the funds necessary to help close this historic deal and implement the principles being negotiated by environment groups, unions and the forestry industry.

“The additional $9.7 million to help continue delete the a network of regional marine planning program falls well short of the $350m needed to meet our international responsibilities to protect the oceans around our coastline.”

“The $10 million to develop Australia’s sustainability indicators and the $29 million over three years for strategic assessments in areas of high population growth are important previews to the coming sustainable population policy.

“The election commitment to establish an Emerging Renewables fund has been increased from $40 million to $100 million, however the Connecting Renewables program (of $1billion over 10 years) remains a pipe dream of the future with only $1.4 million over the forward estimates.”

The Minister for Climate Change and Energy Efficiency

The Minister for Climate Change and Energy Efficiency Greg Combet said details of some of the budget measures included:

•                Office of the Renewable Energy Regulator $53.2 million additional funding over four years to provide ORER with resources necessary to administer new statutory responsibilities resulting from the amendments to the Renewable Energy (Electricity) Act 2000 made in June 2010.

•                Solar Cities – $13.7 million in additional funding over two years to support seven Solar Cities – Adelaide, Alice Springs, Blacktown, Central Victoria, Moreland, Perth and Townsville to trial new sustainable models for electricity supply and use.

•                Greenhouse and Energy Reporting – $20.2 million in additional funding over four years to support delivery of the National Greenhouse and Energy Reporting Act 2007.

•                Energy Efficiency – $13.0 million additional funding over four years to support further energy efficiency initiatives, including initiatives identified under the National Strategy on Energy Efficiency.

•                National Solar Schools Program – The NSSP will close on 30 June 2013 with a saving of $156.4 million. Successful schools in the 2010-11 funding round will receive grant payments. There will be two further funding rounds for 2011-12 and 2012-13.