How plans to build 3900 homes shrank to just 414 houses

The Minns government has been accused of “land banking” after it blamed market conditions, construction costs and infrastructure concerns for its decision to drastically scale back plans to redevelop an ageing public housing estate.

Meanwhile, the government is under pressure to make a large financial commitment to social housing in the June budget, and will use a meeting of the nation’s housing ministers today to demand a greater share of federal housing funds.

NSW Premier Chris Minns (left) and Prime Minister Anthony Albanese at the launch of the funding accelerator.Credit: Nick Moir

Ministers will discuss their bids, submitted last week, for the first $500 million tranche of the Housing Australia Future Fund.

In 2022, the state-owned Land and Housing Corporation announced plans to replace 1019 social housing dwellings at Riverwood, on the T3 line near Bankstown, with 3900 new homes, in a 30/70 public-private split.

Shortly before the election, those plans were iced by the then Coalition government following community concerns about infrastructure, including from Oatley Liberal MP Mark Coure.

Labor revived the plans this month, but only for a 1.6-hectare slice of the 30ha site. The revision showed 60 dwellings would be replaced by 414 new homes, of which 124 would be public, 83 affordable (discounted) and 207 private.

Accompanying documents said the decision to reduce the project’s scope dramatically from 3900 homes to 414 was because of “changes to market conditions, including increases in construction costs and uncertainty around infrastructure delivery”.

Urban Taskforce chief executive Tom Forrest, who represents big developers and is a former Labor chief-of-staff, said the government should play by the same rules as private operators.

“If a developer sat on a site and waited for the market or project feasibility to improve, we would be gratuitously accused of land banking,” he said, referring to the developer practice of staggering projects to maximise profits.

The government will continue to work on a master plan for the broader estate, but the indicative timeframe for this is now 2028 to 2043.

In Riverwood in October, Premier Chris Minns and Prime Minister Anthony Albanese launched the Social Housing Accelerator – a $2 billion Commonwealth fund, of which NSW gets $610 million. The leaders announced a project to convert three old homes into 11 new dwellings.

NSW Housing Minister Rose Jackson said she would make the case for more federal funding at a ministerial meeting on Monday.Credit: Dominic Lorrimer

NSW Housing Minister Rose Jackson said Riverwood was among many “half-baked redevelopment proposals” Labor inherited from the Coalition that were unfunded, stalled or cancelled.

She said the decision to scale it back was “not really about money, it’s about what we can actually get moving in the shortest possible time”. However, she said community concern about congested roads and transport had also played a role.

Jackson said she would use the ministerial meeting to advocate for more federal funding to help NSW meet its target of building 377,000 homes by 2029 under the national accord.

“We need the Commonwealth to come to the table,” she said, reiterating the NSW government’s calls for a “fairer” carve-up of billions in GST revenue.

Meanwhile, numerous stakeholders have told the state government it must commit substantial funds for public housing in the June budget.

Housing advocate Shelter NSW, council peak body Local Government NSW and the Community Housing Industry Association (CHIA) have called for about $2 billion each year for at least five years to build 5000 social housing dwellings annually.

“This investment will leverage federal government funding and community housing industry capability to deliver up to 25,000 homes for people whose needs will not be met on the open market,” the CHIA said in its pre-budget submission.

The United Workers Union, Rail, Tram & Bus Union and National Tertiary Education Union were among signatories to a letter to Minns this month – organised by the Sydney Alliance – calling on the government to finalise its election commitment that all housing built on public land should be at least 30 per cent social and affordable housing.

Churches, charities and social groups also signed the letter. “The alliance will actively oppose any moves to sell land for development without this commitment,” it warned.

The government – which today marks one year since its election – is yet to complete its promised audit of surplus public land suitable for housing redevelopment.

Jackson said delivering more homes was her government’s “core focus”, but it was essential community infrastructure matched that growth. “This approach is not just about building more homes, it’s creating the best places for right now and future generations,” she said.

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