Public funds not handouts for developers

MINE subsidence is a major constraint to Newcastle’s revitalisation, but the state government should not be undermining our public infrastructure fund by giving handouts to private developers, as they have recently announced.

We need a sustainable, equitable and long-term solution, which addresses the size of the problem and the cost to fill the ‘‘honeycomb’’ of mines under our city.

Grouting the mine workings is expensive and usually extends well beyond the footprint of individual sites, under public space and adjacent sites.

There is no grouting cost sharing mechanism that incentivises development in Newcastle.

The financial viability of commercial and residential redevelopments in the city is constrained by this market failure.

But the proposal by the Liberal government to take money from the infrastructure fund and give it to developers is depleting money that should be spent on much-needed public infrastructure like public schools and health facilities.

The Liberal government has missed the opportunity to provide a sustainable long-term solution for mine subsidence in Newcastle.
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They have missed the principle that public funds should only be used for public purposes and not channelled to a select few developers.

And they have missed the point by ignoring the inequity between adjacent landowners and the public space. In 2009, I pushed successfully for Newcastle Council to establish a Mine Subsidence Working Group, which would investigate, among other things, funding arrangements for a sustainable long-term solution.

During the 2011 election campaign, the then Labor government announced they would take over the working party under the Department of Premier and Cabinet, where it languished until the recent announcement during this election.

The only sustainable, equitable and long-term solution is to establish a Mine Subsidence Revolving Fund, so that the grouting of each city block can be done in one hit, with the state government recovering its investment equitably from the landowners.

The fund would be topped up by the private beneficiaries as developments are approved and Newcastle would not have to rely on half-baked promises, made during elections.

Real estate valuers will say that the Newcastle mine subsidence disincentive has already been factored into the price of the city’s development sites.

However, the Sydney-centric government needs to recognise that their failure to recoup money from the coal companies who caused the problem and their inaction over the years to develop a sustainable solution has compounded the problem. Newcastle needs a sustainable, equitable solution to the ‘‘honeycomb’’ of mines under our city, not half-baked promises made during elections.

Michael Osborne is a civil engineer, a Greens councillor on Newcastle City Council and a Greens candidate in the upcoming state election

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