The injection of $300 million into state-owned development authority Landcom cements the fundamentally old-school notion of NSW as the nation’s population-driven growth centre with infrastructure to match.
At a time when labour costs are elevated and services strained, the government is starting to salt away provisions for what looks increasingly likely to be a longer-term buyback of services and utilities sold off because they had become a financial albatross under their own inertia and lack of innovation.
Apart from the major cash injection privatisations, one of the main reasons government assets are disposed of is to address imbalances of state monopolies and the frequent lack of innovation that goes with it.
Think telecommunications. Owned by the Post Office originally, separated off into a government-owned business, partially privatised, fully privatised, future fund established all topped with a re-entry into the wholesale market by another government-owned entity, the National Broadband Network.
When comes to the great cycle of managing state assets, Mookhey has sensed the time is right for the government to re-enter the market around housing and energy, the two biggest costs for people living in the state.
“We have to undo the damage privatisation did,” Mookhey said at the Budget press conference, lamenting the sale of the state power generators to private operators he now has to bribe to keep coal-fired power stations running to stop potential blackouts.
Labor’s right faction in NSW tried for years to flog electricity off to boost its coffers and give it more choices than the standard rat-on-a-wheel exercise of balancing the books, a fact diligently ignored by the current regime.
Instead, there’s a focus on rebuilding core public services: public hospitals, public schools, public transport, reducing road usage fees and biggest of all, public housing.
Here there’s a bit of a nuanced difference between state-owned housing, social housing, affordable housing and all the other property permutations.
What Mookhey seems to be advocating is a more coordinated, synergistic and planned system of government that works at a holistic level rather than in competition with itself, private interests and people’s aspirations.
Developers in NSW are somewhat of a law unto themselves and have previously corrupted policies in their own interest on both sides. That said, constrained housing supply in Sydney and regional areas creates distortions and locks essential workers out of the market when they are needed the most.
What wasn’t talked about in the budget was potentially linking cost-controlled housing with public sector employment as a way to attract people to work in roles that give public purpose but aren’t that well paid.
Would you be a nurse if you knew your rent was cheap and fixed for say five years or ten years? What about being a bus driver if you knew could buy an affordable house and pay it off?
Defence solves this problem by running its own land bank, the Defence Housing Authority, because troops are posted to areas with the condition they and their families are adequately housed.
If the government wants to keep public sector wages competitive and affordable, this kind of trade-off on housing could be one way forward, especially if public services urgently require many more quality staff to stay running.
As Patrick Troy, author of the public policy textbook Accommodating Australia often argued, functional infrastructure made for functional communities and government-built housing established many communities.
That’s not such a bad thing given the poor quality of many slapdash private builds recently, and one of the reasons the $24 million is being ploughed establishment of a NSW Building Commissioner with some teeth to weed out the shonks. Not a big coin, but not a bad idea.
“You repair your roof when the sun is shining,” Mookhey said.
“This government is doing its homework, not just handing over a free cheque… [We are] doing this for public good, not to hand a windfall to private [interests].”
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