Be that as it may , Wales’s increase in gross domestic household income in 2010 remains consistent with the research finding that Wales in 2010 was the poorest part of the UK with a Gross Value Added per head equivalent to only 74% of the UK average. This is a poor place – with the odd well-off town or enclave -whatever indices you use. Not so, say the Welsh Government.

Wales Online says this: ‘There has long been a debate as to which is the best measure of the wealth of Wales. The Welsh Government has previously said that it prefers GDHI because it is a better aggregate measure of living standards than GVA, which doesn’t include some components of income.’ No wonder then that the Welsh Government welcomed the latest GDHI figures.

As a spokesperson from the Welsh Government said:’Despite the challenging economic circumstances, and the real impacts felt by people and businesses across Wales, the regional GDHI figures released yesterday show that relative living standards in Wales have improved and signal that some of the longer-term challenges are also being addressed,”

“Since devolution, Wales has seen the third largest percentage increase in GDHI per head out of the UK countries and English regions. However much still needs to be done as there is room for considerable improvement and the Welsh Government will continue to use all the economic levers at its disposal to try to ensure these figures continue to improve’.

This is the stuff that makes me angry. It combines disingenuousness with complacency. It borders on lying and helps no-one in Wales apart from a few deluded people in Cardiff Bay.

There is a serious debate about how to measure wealth and it boils down to the relative importance of financial as contrasted with asset wealth. Economists disagree on the merits of the different approaches and even on the facts. For example, some economists think that asset wealth in housing has had only a small impact on personal consumption by house-holders. The majority think differently. I’m with the latter crowd.

What this means in terms of GDHI in Wales is actually that rising disposable income can be consistent with falling asset wealth. Indeed, Wales’s  GDHI is as it is probably because house prices and costs are so low in UK terms while a high proportion of public sector workers in Wales have salaries , linked to UK wide public sector pay levels, which are closer to the UK average. Having a higher disposable income might just mean that housing costs are lower in Wales. To put it in context for a UK or international reader, a nurse renting my father’s house in the lower part of the Valleys only 12 miles from Cardiff would be earning roughly the same as a nurse in any other part of the National Health Service but can occupy the three bed-roomed house for about 450 sterling a month. In the south-east of England they would pay three times this.

Moreover, the gap between Welsh housing costs and English costs widened in the decade in which Welsh HDHI rose by comparison with the UK average (2000 to 2010). They both rose but overall the gap widened while Wales got closer to UK average GDHI levels. There is a link.

Another part of the debate is whether rising house prices is really associated with a knock on wealth effect. The majority academic position is ‘yes’ with some estimating that house price inflation and the leverage associated with it raised income thus consumption amongst householders in the UK in the first decade of the century by around 5%. The wealth effect was more obvious amongst those with higher house-price values. Essentially this leverage added unofficial wealth to the formal GDHI figures. This means that the ‘wealth index’ preferred by the Welsh Government doesn’t count in the extra consumption available from leveraging housing wealth. That is to miss the big economic story of the 2000-2010 period and to favour an inadequate measure of the wealth (or lack of it )of the Welsh.

That measure also misses the point about primary Welsh incomes being so dependent on public sector ,thus UK level, salaries. These rose significantly higher than private incomes between 1997 and 2010 and obviously contributed to Welsh GDHI. These salaries held up well in the first stage of the recession but are now experiencing downward pressures and few believe we will see the public sector boom years return. At the same time house prices in Wales have not risen as much as UK prices have since 2008 and indeed they declined in 2011. Both these factors impact GDHI in contradictory ways though neither is good for the Welsh economy.

Conclusion? GDHI is not actually an accurate measure of household consumption let alone wealth. Its rising in Wales probably shows how low property values are and those values are a better measure of the nation’s wealth or poverty than GDHI. If they drop further,if public sector employment and wage levels were to hold up, Wales’s GDHI would rise while the nation actually got relatively poorer in reality. GDHI is a fig leaf to cover the Welsh Government’s embarrassment. Using it rather than GVA is an attempt to move the goal posts. It is a version of the old joke that the patient’s operation went perfectly well and they had the best of care by international standards. But they died. The Welsh Government needs to move away from self-serving flexibility around the facts to a real recognition of the poverty trap we are in – and of how much worse it is going to get unless we base our policies on reality not phoney indices.

It was for a think-tank called the McKell Foundation named after a well-respected and pragmatic Labor Leader in NSW who was premier during the war years. It’s a non-political report and has been commended on all sides of politics. It expresses views on planning I have outlined before in work I am doing for the Committee for Sydney where I am strategic advisor. We ended up doing about 20 media interviews on Homes for All. The full report is available here.

Two things seemed to catch the imagination. One was that current planning policy has almost made impossible one of the most affordable, sustainable, well designed and popular style of homes:the Sydney Terrace. We called for a reinvention of the terrace for the 21^st century.

The second thing which attracted attention was two stats. Currently 70% of 35 year olds and below in Sydney cannot access home-ownership.  At the same time, 22% of all Australians now own 55% of the nation’s  housing stock. This strange result has been caused by a combination of Nimbyism and over generous tax allowances to home-owners and the middle class which have fuelled home-price inflation and strangled supply. Essentially, renters are subsidising owners of 2,3,4 and 5 homes. This got a lot of attention.

Have a look at the introduction I wrote for the report below then have a look at the full report. British readers will have a sense of déjà vu and find that despite the differences of policy and scale Australia’s housing distortions are quite similar to the UK . And just like bad public policy caused supply and affordability problems in the UK as in Australia so too can good public policy sort the problem out.

Twenty years ago it took three times the median salary to buy a house in Sydney. Now it takes nine times, a higher ratio than London or New York at the peak of the market. It puts Sydney at the top of the wrong league table.

At the same time, home ownership is becoming something older people do. Housing stress, whether it’s the cost of a mortgage or rent, is now afflicting over half the population, with interest rates set to rise further. Many cannot get a home to buy or rent affordably or have to go to Sydney’s edges to do so. First time buyers now typically pay half of their income on mortgage costs.

But while two thirds of 35 year olds in Sydney cannot access home ownership a fifth of the population now owns half the homes – because the perverse demand incentives and shortage of supply are making multiple ownership available to the few, but sustainable home ownership is open to a declining proportion and increasingly at an older age.

The whole system is under acute stress

The knock on consequences affect the whole system. Rents in Sydney are rising four times faster than inflation. The squeezed middle which used to be able to afford to buy now has to rent, pushing lower income renters to find the fewer remaining

cheaper lettings – and again further out of Sydney to places with the fewest jobs. The pressure on public housing waiting lists grows unsustainably as there is not enough money to house those already in public housing let alone build enough new stock.

This is a housing system in acute stress. It is broken.

A comprehensive action plan to fix it is vital, Homes for All is it. The good news? Bad public policy caused these system failures. So, good public policy can fix them. But it needs to cover 6 areas at the same time:

1. the battle for more housing must be won – with politicians and the public;

2. new policies to increase supply constrained by anti-development planning rules and NIMBYism: we are at crisis levels in Sydney with less than half the supply needed;

3. new and better quality affordable housing supply is also vital but that requires new sources of private finance to be attracted to the sector – which can only come from a radical stock transfer policy, the growth of the community housing sector and a new regulatory framework;

4. new policies to reshape demand which has become distorted through incentives which give massive benefits to existing home owners, turned housing into a speculative investment and away from its prime role as shelter and actually increased home price inflation;

5. new housing and urban renewal agencies or special purpose delivery vehicles and a new active role for government: to work with the private sector to bring complex and large sites to market; and

6. strategic long term investment in the economic development and connectedness of Greater Western Sydney not just to take pressure off home prices near the CBD but also to enable the sustainable growth of what will be the biggest population centre in a Sydney of 7 million. We see this as requiring a special purpose delivery vehicle for Western Sydney. This would help plan and deliver town centres and large sites. It could also help promote the key game changing infrastructure investments that will open up denser, more and better housing capacity, and infrastructure such as a fast train to Parramatta from the CBD.

Politicians need to lift their game; so do we, the people

Our housing market is in crisis because successive governments, at every level, have choked off the supply of new homes while at the same time stimulating demand with the most generous of tax concessions, grants and exemptions. We pile burdens on developers and costs to first time buyers and wonder why Sydney’s population and economic growth has fallen behind other Australian cities which have pro-growth leadership.

The planning system in New South Wales, whose role it is to deliver new housing, has broken down. We are now building just over 43 new homes for every 10,000 people – and at around 15,000 homes a year we are building less than half what we need to catch up on earlier population growth projections which themselves were conservative.

A campaign for more and better homes

This has coincided with a growing NIMBYism which has exploited the lack of informed debate about the need for new housing – and leads to the position where people who own homes are effectively inhibiting the possibility of home ownership and shelter for others. We also need to rethink the type of housing we provide and revisit and reinvent some old models such as terraces and semidetached housing which served us so well in the past.

Inheritance is becoming the major way into home ownership in Sydney – which is neither right nor very Australian. We have to do better than this. Our recommendations start with us: we the people and our leaders need to understand our own dismal role in this crisis. We need a new civic dialogue on the needs and benefits of growth. A campaign for more and better homes. It starts here.’

Remember, Wales’s GDP faltered even when the UK economy was motoring in the early ‘noughties’. Wales is essentially going through something more than a cyclical downturn though the recession and Westminster policies curtailing the public sector are clearly exacerbating the problem. Its economy is in the toilet. And it’s impossible to see on current policies anything other than further decline.

To put it in a context which Australians (amongst whom I live) will understand but not believe, the GDP of West Wales and the Valleys (where I am from) is now less than any place in Greece, most of Slovakia and even Romania. A rather worrying head up own backside response from an unnamed Welsh Government source said: “Opposition parties are quoting statistics selectively and in a misleading way’. When in the UK I was a special advisor to the UK Labour government and an advisor on urban regeneration to a Welsh Government minister so I’m no member of Opposition Party. Such a response is complacent and deceitful and shameless. It gets worse. Listen to this. No ‘we’re on to this’ or ‘you just wait and see how much Wales gets its economic mojo back after  another 4 years of our government’. No the response is to dispute the meaning of the stats. So, the source – who sounds a bit like Wales’s chief government  economist actually, as I’ve heard him give this kind of speech – says: “Since 2001, GDP per head in West Wales and the Valleys has broadly kept pace with the UK as a whole”. However, GDP is particularly misleading as it does not take account of the large flows of commuters outside of the area – a point fully recognised by the report.

On the first point it just means that Wales has been getting poorer more or less in line with the decline of UK GDP since 2002. And most of the EU has been getting wealthier, hence the gap between UK and Welsh wealth has increased a little and between EU and Welsh wealth a lot. I’m not comforted by this game-playing. Wales is getting poorer. As to the latter point, which is really saying Gross Value Added (GVA) is a better measure of wealth for an area with lots of out-commuting for work than GDP, I say OK. But that doesn’t bring any good news for Wales either. GVA per head n Wales is now under 75% per cent of the UK average and has collapsed since 1995 when it stood at 84 per cent.

Then the unnamed Welsh source says: “In order to get a clear picture of economic performance, it is necessary to look at a wide range of indicators, including employment rates and measures of income – where West Wales and the Valleys has performed well.” This is where self delusion becomes bad for the Welsh nation because the reason why “measures of income” is preferred by our source is because he thinks that the fact that Welsh people have had a modestly rising disposable income whilst GDP and GVA went south is some kind of positive news . What it really means is this: that a Wales that is over dependent on public sector jobs and national wage rates – the one declining with the cuts, the other under Westminster government pressure seeking to introduce regional wage rates – and a Wales that saw house price growth much lower than the UK average so that the gap in average prices with England grew. That Wales also saw a relative rise in disposable income.

This unsustainable position just shows how poor Wales is as its low house prices show the lack of demand to live there – and indeed the population has stagnated since 1921. The lack of disposable income in the southeast is a sign of its prosperity and the high premium people will pay to experience its attractions. Wales’s higher disposable income is a sign of the opposite.

As to the opposition parties, the Liberals seem to have no idea what planet they are on let alone which country they are in. So their spoke-person’s response is: “We must have a strong, pro-active vision for the future of West Wales and the Valleys if those areas are to regain their place as the engine-room of the Welsh economy”.

They haven’t been the engine room of the Welsh economy since 1921 and will never be again. They have survived more or less on subsidy and welfare payments since then and the dynamic population which migrated there for what turned out to be no more than a 60 or 70 year boom, has emigrated from there over the last century leaving a workless rump in some Valley communities which is north of 40%. The unique circumstances which made these places vital and economically vibrant have gone away forever. Our problem is that neither our heads nor our policy have got round to embracing this fact. Inertia leads to denial and fighting over the meaning of statistics when it’s obvious that Wales continues its decline and the Valleys is just speeding faster down the pan.

Are there any signs of regeneration and renewal? Few and far between. Clearly cuts in public spending will drive up unemployment further. That will lead to long term worklessness. But even more importantly, Wales has seen what little infrastructure money it had to spend being cut in half. So it’s difficult to see where some structural changes to the Welsh economy are going to come from.

Of course we hear bleating from Welsh government sources that they don’t have the powers to do this, that or the other. Well, a) I don’t believe they are being innovative or original enough with the powers they have, b) they sold devolution on the basis of being the answer and now ,all the time, they seem to say it’s deficient and c) some politicians have introduced structural reform that will be a game changer for Wales, despite a budget under pressure.

Wales’s education system has been reformed and the change has the potential to raise at least one part of public sector activity in Wales to a global competitive standard. I will understandably be accused of bias because I used to work for the current education minister Leighton Andrews when he was in charge of regeneration policy. I also helped write the report which has led to the reforms I praise being introduced. I cannot help this. Some things are true even though I say they are. Leighton saw a complacent educational establishment in denial about an education they regarded as best in class but which turned out to be bottom of the class by international standards. A lack of teacher accountability for performance and to parents was at the heart of this failure so Leighton decided to make them accountable and to introduce testing, reduce the powers of the local education authorities and increase the responsibility and power of school governors. I believe the results of this reform will be seen in the next ten years and thereafter.

But I’m struggling to see any other example of deep structural reform. Or much sign of dynamism by the administration. Or much innovation from an opposition which can never really win anyway. There is some life and vigour in some local authorities like Cardiff, Monmouthsire, Newport and by some former colleagues in Caerffili but little in the rest of Wales.

The irony of Wales’s rugby team being world class again when the rest is going to Hell in a handcart is inescapable. I note that regional rugby in Wales is at death’s door however and income coming into the game is in severe decline, particularly from ordinary paying punters who are so much more important in a place without big private companies to provide sponsorship. So, crisis is facing the game outside the Millennium Stadium if not (God willing) in it. The one glimmer of hope is that the standards of professionalism and focus which we have seen from the Welsh management inspires the leadership of the Welsh Government to take the nation by the scruff of the neck and raise it up in just the same way the national team has been. But then the Welsh management is run by a Kiwi and our politics is not so lucky.

If this all sounds familiar to a British observer it’s because it’s a replay of UK economic history. The sectors involved are different – in the UK it was the high price of sterling which favoured financial services that  killed manufacturing – but the result is the same. You’d call that result a two or three speed economy if that didn’t give the misleading impression that the policy which led to a fast speed in some sectors is not connected to the slow speed in another. ‘Two speed economy’ actually means a zero sum game in which one sector booms at the expense of another.

The other similarity with UK experience is that there is a differential geography to the ‘two speeds’. Just as the manufacturing and export economy of Northern England, Western Scotland, the Midlands and South Wales were over time destroyed by economic policies – interest rates and exchange rates  – which benefited London’s Square Mile in the City and the ‘Home Counties’ dependent on it – so too is the high Aussie dollar damaging not just sectors but places.

The latest data shows that the hitherto manufacturing heartlands of Victoria and Western Sydney are being hit hard by the high dollar with little response form the federal government except to bash the banks and call for people to buy Australian. Again this is similar to  the UK response which ,whether or not the Labour party was in government, the slavish neo Liberal position was taken that governments shouldn’t interfere in the markets and if that mean the North of England or South Wales went to the wall, then too bad. There was nothing to be done except ship welfare payments to those collapsed regional economies from the booming sought-east. For more than a hundred years the interest and exchange rate policies which helped raise one part of the UK at the expense of most of the others, was maintained. Interestingly, the Cameron government has been relaxed about the decline of sterling because financial services can no longer drive the economy as before. Desperation in the UK has thus created a small opening for a shift back to making and exporting things – from the old manufacturing geography. Unfortunately, demand in the rest of the world collapsed at the same time so there are no buyers for Britain’s newly cheaper manufactured goods.

The delusion that governments should not intervene to assist their manufacturing expert sectors and indeed regions is one not ahred,of course,by the world’s most successful manufacturing economies. Germany deliberately supported the Euro as a way of strengthening its manufacturing sector threatened by re the previous high value of the Deutsche Mark. And as the Euro sank recently German exports soared (not least to the PIGS’ economies including poor old Greece whose manufacturing sector was wiped out by the price of the Euro and Germany dumping its goods in their market). China has deliberately kept its currency undervalued in order to sell into the world. The resulting imbalances may have screwed up the world economy but neither China nor Germany are worried too much as their national economies –and particularly manufacturing – bloom.

The Australian response to this has largely been benign neglect and non-intervention though the recent decision to maintain subsidies to the Aussie car industry may be a sign of a new approach. Neo liberal fetishists may complain and denounce these modest interventions as signs of socialism or perhaps more plausibly protectionism. In fact they are a very timid and belated response to the destruction of Aussie manufacturing and hardly amount to a considered new form of mercantilism. I wish it was because what China and Germany have done very successfully is essentially a form of mercantilism where the state supports key sectors.

In Australia, passivity over the price of the Aussie dollar will not just make the country even more of a quarry than it is at the moment. It will not only reduce the diversity of the economy. It will over time destroy the export thing-making economy in places like Western Sydney. This will make Sydney even more unbalanced and unsustainable as currently most housing development is targeted at Western Sydney where already 2 million people live but where only 500,000 jobs are currently located.

And by the way, a few decades of an over high currency value leads an area to need the attentions of those who read Regeneration and Renewal as short term boom leads to long term slump with the two speed economy over time creating a no speed economy in some regions. Regeneration activities only become necessary when bad macro-economic and fiscal policies have done their worst to formerly dynamic places  That was the UK experience. Why will the Australian end-game be any different?

We early on identified planning and governance as key challenges for Sydney. CFS’s important study , Global Sydney, published in 2010 ,benchmarked Sydney against other global cities and found that despite Sydney’s very strong performance in certain categories (liveability for example),it needed to transform its transport and governance infrastructure. A global city with 43 local councils and no metropolitan governance has challenges not faced by Singapore let alone London. By contrast Sydney has what CFS is calling a ‘decision-making deficit’.

Planning is clearly at the core of modern public governance. So to have problematical governance structures inevitably leads to problematical planning delivery. This is certainly the case in Sydney though the problems afflicting the planning system here are not just an expression of the problems of governance. Planning is in difficulty here partly because planners themselves have created a system which no longer delivers the quantity or quality of development the city needs. This is why the Committee for Sydney welcomed the Moore/Dyer review of the New South Wales planning system launched last year and why it decided to make a submission. Sydney needs a planning system fit for a global city. The review will be critical in achieving what Sydney needs.

Below is a copy of the executive summary of the CFS planning submission which I helped draft .The full version is available on the CFS website. Note that the CFS has now created a Planning Reform Taskforce to lead on CFS engagement with the planning review in 2012. It is chaired by the CFS deputy chair, the formidable Lucy Turnbull. If you have any views on this submission or the review, why not respond to this blog? And readers from the UK should note:you will find many of the problems are the same in your cities as in Sydney – and that may something interesting about the shared difficulties many democracies are experiencing in persuading local electorates to support development and growth. However, Melbourne ,Perth and Brisbane have been growing twice as fast as Sydney over the last decade or so and have permitted many more homes in relation to demand. Sydney needs to learn from those cities and others – and fast.
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The CFS planning submission

An effective and equitable planning system is vital for a strong Sydney economy, for maintaining an attractive and sustainable environment, and for promoting a vibrant and inclusive democracy. The current planning system in New South Wales cannot achieve these aims.

The consensus view is that the system is broken. It cannot achieve its fundamental purpose: to reconcile, in the fairest and most efficient manner possible, competing economic, social and environmental priorities, at the national, city and local level.

There is clear evidence that Sydney is failing to plan properly for growth and to meet its full potential. In 2010/11 only some 16,000 homes will be delivered in Sydney compared with demand for between 25,000 and 50,000.The review of the planning system is vital. We need a planning system which enables strategic decision-making to support Sydney’s competitiveness

In the view of the Committee for Sydney a new Planning Act is needed to:-
• improve the civic discourse around land-use planning,
• restore community trust and faith in the development process,
• reduce unnecessary uncertainty, delays, regulatory costs and risks,
• better align tiers of government in the planning process
• ensure strategic decision-making in the economic interests of Sydney
• secure the development needed in this most important of Australian cities.

Governance and planning: further reform

Much of the problem is the decision-making deficit around development promoted by the multiplicity of smaller councils in metropolitan Sydney. There is a failure to take decisions which, however beneficial to the wider community and the interests of Sydney have adverse impacts for existing homeowners. Examples range from the location of ports, roads, airports, railway lines and waste disposal sites to major residential developments – all essential projects for a growing city. The planning system routinely fails to enable strategic decisions for Sydney to be taken.

By contrast Vancouver and Auckland have transformed their governance structures to streamline planning and decision-making. The WA government has also initiated a radical review of governance in Perth. Tasmania is undertaking a similar review for Hobart and Southern Tasmania. Brisbane’s capacity for integrated planning and cross government and agency collaboration is enhanced by the large scale of city and local government in South Eastern Queensland. Victoria is enjoying the fruit of the consolidation of local government which was undertaken in the 1990s. In a globalised economy investors view good governance and effective decision-making on planning as essential investment criteria. Competing cities get this. Sydney must not get left behind.

The current planning system pleases no-one

Currently, the planning system pleases no-one. Private developers find the approvals process subjective and fraught with uncertainty, delays and risk. As for the public, the planning system has become an un-transparent process for delivering unwelcome development in the eyes of some and not enough development in the eyes of others.

Conflicts over land–use have been heightened when they could have been resolved earlier in the development process. The key is how we involve the public in plan-making and the subsequent all too adversarial development application process. Both need fundamental reform.

Q1. What should be the underpinning objectives and philosophy of a new legislative structure?

Community involvement

We need to enhance the role of communities in shaping the values and strategic objectives in the local plan at the earliest opportunity – something made easier by new social media – while reducing the area of discretion and subjectivity at the later DA approval process.
Productivity growth

The new planning system must place greater emphasis on delivering economic objectives and on the State or City-significant infrastructure and development projects which underpin productivity. Planners need clearer guidance on the importance of economic considerations alongside social and environmental ones.

Integrated land-use and infrastructure planning

The interlocking nature of the challenges facing Sydney calls for a more integrated approach to infrastructure and land-use planning. The emerging Transport Masterplan for New South Wales is an early opportunity to promote the better integration of land use and transport planning.

Better public sector coordination

The current Act requires a costly and unworkable process of consultation with, and approval from, too many concurrent authorities. Queensland’s Coordinator General/whole of government approach to key development applications should be explored.

Better linkages between State and local plans

Effective planning regimes provide better linkages between a State Government’s strategic plans and local plans. The current s.79C is a key part of the problem for Sydney as is the lack of statutory weight for metropolitan and regional plans. Currently, s.79C, which provides the heads of consideration for planners and consent authorities, constricts consideration to local environmental, economic and social issues. In reality priority is given to local environmental issues only. A ‘new s.79C’ must include as specific heads of consideration issues of regional or metropolitan significance such as population growth, demographic change,housing supply productivity and access to transport.There is now a big gap between such strategic planning issues and the local issues which are taken into account at the level of statutory planning. This is a major defect in the system and leads to inertia in Sydney.

This situation is made worse by the fact that Sydney’s Metropolitan Plan does not have any statutory weight compared to often outdated LEPs and sits alongside many other plans relied on in the development application process. There is no clear hierarchy of plans for a consent authority to grasp onto when making decisions of metropolitan or regional significance. That hierarchy must be clarified in the new Planning Act. Regional and metropolitan plans must be statutory. A new Act should however also require that any new metropolitan or Regional Plan be based on robust research, analysis and the kind of deeper community and stakeholder engagement we advocate in this submission.

Development levies

The current approach to levies and developer contributions actively deters development in Sydney and adds excessive costs to those buying new homes whilst not delivering the infrastructure needed. A more transparent and proportionate approach is required.

Transport oriented development

Sydney has a network of 300 rail stations, many with under-developed ‘footprints’ around them. It is sensible for much new higher density housing and economic development in Sydney to be focused at transport nodes.

Q2. How should plan making be undertaken?

By engaging the community – at an earlier stage
Plan-making at city and local level is an opportunity for far deeper community engagement and civic discourse than has been the case. By ensuring participation and community endorsement of key objectives and principles at the early stage, we can create a far better platform for a more consensual, objective and successful development application process at the later stage.

On the basis of greater public involvement and confidence we can then reduce the scope of local discretion over development applications when they conform to the strategy, planning controls and building codes.

Q3. How should applications for proposals for development be assessed and determined?

Code Assessable Development

Such a transparent ‘code-based’ assessment system, and a presumption that conforming development will be approved, engenders certainty for developers, raises community trust and makes the Development Application process less adversarial.

Code assessable development is the basis of the effective Queensland planning system. Under the Sustainable Planning Act 2009, codes which express the development standards which apply to land must be adopted. Development Applications are assessed for compliance against such codes. If the development complies the local government must approve the application. Such code assessable development does not require public notification. New South Wales should follow suit. Certification of development and complying development should be based on objective criteria and subjective discretion reduced. It is the balancing provision to enhanced community involvement in the plan-making stage.

Procedures for development of City/State/Regional/National significance or priority

Every effective planning system needs to have a means of processing major projects which cannot be adequately dealt with at the local government level. The challenge is to identify appropriate thresholds which trigger a different planning approach and appropriate mechanisms.

A replacement device for 3A for development of ‘more than local significance’ needs to form part of the new planning approach. An effective planning regime needs to enable development of demonstrable wider community benefit beyond what may be acceptable to a vocal minority. See also our comments above relating to deficiencies of statutory framework as provided in s.79C.

Q4. What should be the availability of conciliation, mediation, neutral evaluation, review or appeal?

The elements of reform we suggest around community involvement in plan-making, transparency of process, the more objective code-assessable approach, accepted procedures around 3A style development of significance and standardised levies, will go a long way to reduce the possibility of conflicts around determination. Too often the development assessment process has become the stage for policy making and the appeal body, such as the Land and Environment Court, is called upon to make decisions that should have been determined locally. Excessive time and costs are spent in achieving a less than optimum outcome. Much of this will be avoided in a planning system with the improvements we have identified.

A brief conclusion: planning reform and governance

The Review is a critical opportunity to turn a new page on planning for this city. It must be grasped. Re-organizing city governance remains the next key task. We note that the strap-line for the radical review of local government in Perth is: ’Towards More Effective Metropolitan Governance’. In our analysis the full transformation of planning delivery in Sydney will come from a similar review here.

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The full submission can be read on the Committee for Sydney website at htp://sydney.org.au

The story of South Wales since the collapse in the 20s has been that population went down overall in the 30s and 40s – and in some places dropped like a stone – then recovered slowly but in many places has not reached the levels seen in 1921. Indeed, the Rhondda has lost more than 40% of its population at the economic peak and many former mining towns continue to lose population. New South Wales’s population has more than trebled in the same period. This is despite the fact that for more than 20 years now other Australian States have seen even faster growth with Sydney in the last decade for example ‘only’ growing at 1.2% per annum whilst Melbourne has seen 2% growth each year.

Some national figures for Welsh and Australian population growth since 1901 show what a terrible ‘long century’ it has been for Wales since 1901. In that year Wales’s population was about 60% of Australia’s. Today it’s about 13%.

Yes, New South Wales has got failed places where population went away when the economy did. But even places well away from the fast developing coast where most Australians seem to want to live, have seen and will see some population growth in the next few decades. So Dubbo or Tamworth will still grow 1% a year or more though nothing like the growth we shall see in Sydney or coastal towns like Port Macquarie, destined to grow by 30% in the next dozen years or so. The Valleys of South Wales will be very lucky to maintain their current depleted populations though continued decline is predicted. And why not? There is after all precious little to keep people in some South Wales places except free social housing and welfare benefits.

Many New South Walians don’t actually get how well off they are by such comparisons. Whilst there are patches of concentrated deprivation here and in remoter places there are what Tony Abbott has called ‘welfare villages’ largely inhabited by indigenous populations trapped far from either employment or anything that would look like a traditional lifestyle, New South Wales has no equivalent of Merthyr, Blaenau Gwent, the Heads of the Valleys are any South Wales social housing estate you can name where multi-generational worklessness is normal. Some NSW coastal towns have higher economic inactivity than is good for them but this is mostly a sign of relative affluence as they attract early retirees. Despite the anxieties ,New South Wales is still on the rise .Old South Wales remains in serious trouble and things worsen as , public spending begins to fall, the euro zone implodes and GFC 2 picks up pace.

There are some echoes between the NSW and OSW (Old South Wales) experiences, largely to do with managing and leveraging mining royalties. For various reasons, as much to do with non local ownership patterns in Welsh mining, whatever money was made when King Coal ruled the world from South Wales, was in the first period of small scale mines, re invested locally. As the scale of pits and capital required grew, royalties and mining incomes tended to be exported to London and thence internationally. Globalisation is not that new, after all. This mean that the coal boom brought very little local capital formation of any scale in South Wales and hence wasn’t recycled in local businesses or infrastructure. As Australia is investing $25bn a year less in infrastructure than it was in the 1970s, despite the mining boom of the last few decades, there must be a worry that some of the Welsh history is being replicated in Australia .

Of course NSW has never had the type of mining based economy OSW had and Queensland or Western Australia have today. The numbers are worth comparing. South Wales had a coal-mining workforce in 1921 of 150,000 in a population of 2.5 million whereas Australia’s resources sector only employs 170,000 in a population of 23 million. Indeed, there is now increasing worry that without a big mining sector NSW will in some senses get left behind by the other resource giants. Hence the references here to Australia having a two or three speed economy, with NSW not being in top gear.

It’s more complex than that because Sydney remains Australia’s only global city and has seen its financial services sector more or less sail through GFC1. It’s also the case that Sydney is well placed to capitalise on the continuing with the only economy which seems matter in the early to mid 21st century: China.

What is suffering in NSW and indeed Australia , is the non mining manufacturing economy whose exports are being killed by the high price of the dollar – which itself has risen high partly on the back of the mining boom. And herein lies a real danger and a real echo of the South Wales experience.

It’s sometimes forgotten outside the UK or just not known that the collapse of manufacturing in the west of the UK (Wales), the midlands, the north and Scotland , didn’t just affect a sector. It affected a geography. Whereas that geography had been the wealthy and ebullient part of the UK in the 19th century, in the 20th century it was the south-east which prevailed, largely on the back of financial and business services. There was a link between the collapse of one and the rise of the other and of the differential and opposite fates of the periphery versus the centre. Its name was sterling and principally the high exchange rate thereof.

Essentially, as UK economic policy began to favour the growth of financial services over anything else, the default position became to protect the value of sterling and the high interest rates which kept it there. Interest rates became set less by what the economy outside London needed and more by what the Masters of the Universe in the City of London, Wall Street and the Gnomes of Zurich wanted. As with the Aussie dollar today, high comparative interest rates were attractive to currency dealers and bankers whose money the City was delighted to save, manage and invest. Thus started a process which left manufacturing struggling with both high interest rates and a price for sterling which left them incapable of selling their goods. The century long decline of manufacturing Britain and the many communities in it has seen populations dwindle, multi-generational worklessness entrenched, and the balance of economic and political power in the country swing decisively south-east. Now out of the 11 regions or devolved countries in Great Britain, only two make a net contribution to the UK Treasury: London and the Southeast. In 1850, the opposite would have been the case, with London and the south-east piggy-backing industrial Britain.

Although many think this shift and decline were natural or automatic they have more to do with public policy than acts of God. Germany has retained its industrial base – even though its cost base increased – because its public and economic policy supported it and because its financial services were less important in the first place. Interestingly, as Germany in the last decade or so let its financial services off the leash so too has the ‘real German economy’ been adversely affected by the kind of stupid and greedy behaviour we saw in the City.

The UK suffered from having an economic policy which supported one sector at the expense of another. It also favoured one or two regions over the majority. Part of this is indeed the difficulty of having a single interest rate or currency for very different 2-3 speed economies – and the current euro zone crisis is as much about this inflexibility of policy as anything – but it is also about governments making choices. In the UK the choice was made to back the City at the expense of the UK’s manufacturing capacity and heartlands, with the latter being ‘compensated’ by increased welfare transfers, public spending and ‘regeneration’ investment. Not enough effort was put into developing new sectors and the infrastructure needed to re-launch their economies. Then we demonised them for being ‘dependent’ when the engine of their growth and jobs for those who now receive welfare benefits, had been blown up by their own governments.

I add: this is not a left-right battle. I worked for Labour governments that had little commitment to re-tooling the industrial economy outside London or little economic idea in their heads except de-regulating the City to make it safe for Lehman Brothers.

So South Wales lies more or less broken by the end of the industrial economy, with public spending now faltering as a way of filling the employment gap and parsimonious but still demoralising welfare benefits trapping people in failed places and catastrophic lifestyles.

Whatever the immediate prospects for the NSW economy, it can and will avoid the fate of Old South Wales being more diverse and less dependent on a single source of e employment anyway. Having said that, it will suffer from a one size fits all economic and fiscal approach which favours the nation-wide mining industry. Interest rates are being set by Chinese demand for resources rather than to reflect the needs of other Australian sectors or regions outside the mining boom. The logic of that is that to stay competitive in such sectors –rather than give up the ghost as the UK so disastrously did – NSW needs to disproportionately and proactively invest in infrastructure , soft(education) and hard(connectivity stuff), that supports productivity and competitiveness . Yes that’s harder to do without the mining royalties in the first place but there are other ways to skin the cat, including sweating existing assets more efficiently and borrowing-to-invest-and pay book through growth(structured finance approaches). My worry is that Treasury orthodoxy will prevent the NSW risking its AAA status in the bond markets precisely at a time when no-one should be listening to S+P or anyone of the ratings agencies who brought us GFC 1 – and precisely at a time when NSW needs to be improving its infrastructure both to maintain competitiveness and ensure the sustainable growth of Sydney. I am sure sense and ambition will prevail.

And Old South Wales? Deep in the mire of structural and policy driven poverty it also has a bureaucracy which is trapped in Treasury orthodoxy and frankly not up to the challenge of defending it against the coming storm let alone turning the economy around. Returning to my 1901 comparisons I believe that the Old South Walians and the New South Welshmen of that era would both have looked pretty equally confidently at the prospects of the coming century. It says everything about South Wales’s strength then and feebleness now that no-one would have found the comparisons between glowing futures of the two places far-fetched then. To make them today is a study in stark contrasts.

I am now leading the Arup team working on Moreland Council’s digital strategy. That’s in Melbourne and is a first wave test site for the roll out of the National Broadband Network. A really interesting place where more than 50% of the population were born outside Australia.

I’d be interested in your views on the strategy work I’ve been doing. I think the NBN can have substantial impacts, not least on the design and delivery of public services, if the public sector can get its act together. I see a big need role for local government to take a leadership role in developing strategies and taking action to ensure that local communities can exploit the opportunities. Local government can also lead the way by digitising its own services, by involving citizens in online conversations and relationships and by ensuring that there is a significant local effort around digital inclusion. A commitment to open data and open government is a must in this process.

I’m a rubbish consultant by the way, because I give away all my best ideas free here…

The problem is partly governance. There are just too many councils in Sydney at 43. There is no equivalent of the single metropolitan tier we have in London. So, on a routine basis, strategically important development applications which should be approved and which will be of benefit to the community and the city are rejected in the interests of a vocal minority of current house-owners. Nimbyism is promoted by this small scale of council.

But the planning system is broken anyway notwithstanding the governance crisis in Sydney. As someone I consulted told me ‘Planning in Sydney? It’s buggered mate’. There is an arcane reason and an obvious one. The former has to do with s79C of the 1979 EP+A (aka the planning act). The latter has to do with the breakdown in public trust towards the planning system.

Section 79C is the core of the planning system and is the bit on which planner’s base evaluation of development applications. It boils down to a template which highlights the local environmental impact of development over any other consideration. Despite the fact that ‘economic impact’ is a consideration in reality little attention is paid to it. More importantly, because the city’s metropolitan plan is not statutory its strategic concerns –on population growth, an ageing population, productivity, a presumption in favour of transport oriented development ,climate change and infrastructure of more than local significance – get ignored in favour of local plans with statutory backing. So the Committee for Sydney backs a reform of s79C so that it includes wider strategic considerations and greater statutory weight being given to city and regional plans and the establishment of a proper hierarchy between plans.

Although the submission doesn’t support part 3A as it is – this became notorious and contentious as a device for ministers to in effect force through development against the wishes of local councils – the CfS does see the need for a replacement device which enables development of more than local significance to be approved, in the wider interests of the city. Every effective planning system has such a device and boy does Sydney need one.

The final reform CfS proposes to development applications procedures is that we think the highly politicised, subjective and ad hoc approach to development applications taken by many local councils needs to be replaced with a more technical and objective appraisal which essentially ensures that the application is in compliance with the plan and the building code. DA approval is presumed for compliant development. Such a ‘code–assessable development’ process applies in Queensland and the result is clarity and lower transaction costs for developers while ensuring community buy-in. Brisbane twice as fast as Sydney in the last decade and having an effective planning system was partly behind this.

So far, so good. But what I think adds distinction to the CfS submission is the emphasis and value given to engaging the community deeply and early in the plan-making process. This is the quid pro quo for a more ‘code-assessable’ system. We need a new civic discourse on the values and objectives of the planning system and local and city-wide plans. We should use modern social media to ensure that people in their hundreds of thousands get involved in plan-making in this city. And the planning review is a real opportunity to kick-start that enriched community involvement in planning we so obviously need. Call me an optimist, but I believe that we can get more planning applications and more development through even in the middle class inner suburbs if we engage with people more on why, for example, density is a good thing, or why we should do flatted development around transport nodes or how their children will never get affordable homes without this kind of approach.

I see no alternative anyway to such a civic discourse and I for one am willing to accept the results. I think modernist planners and supporters of density have been too indifferent to the need for dialogue with – listening to – people who don’t share their views. The broken planning system in NSW is partly about an attempt by people who thought they knew more to force change on citizens who just weren’t with the programme. There needs to be a first principles discussion between the framers of plans and planning systems and mere people. And when we do that we can make more progress on delivering for Sydney than by just ignoring people and attempting to good to them instead of with them.

I was moved to write this piece by an experience this week of speaking at a slightly weird event in Chippendale on the border between South Sydney and the inner west. There were 5 architects and me. All the previous speakers (all intelligent and decent men, which we all were) more or less moaned about the lack of political will to deliver denser development .Though I agreed with the objective I had a strong sense of being in the presence of a latter day Sydney version of the Culture Wars so much a feature of public life in a divided Australia in the previous decades. The disappointment in and contempt for people who still hanker after the ¼ acre block and suburbia was palpable despite the fact that many of the speakers lived in such places.

I rebelled and said that we in the density camp had never respected people enough to have a proper conversation with them about why we needed this kind of development in Sydney. I pointed out that Australian cities are different to European or Latin American ones – Sao Paulo for example has a population of 18m on the same geographical foot print as Sydney with its over 4m. Maybe density is the answer, and I’m sure that greater density as a principle is correct if we want to build stronger communities less reliant on carbon and long road commuter journeys but we need to be clearer as to what our overall aim is. Are we building Sao Paulo or something else? I’m not clear and I’m sort of an expert. How can mere people know what we mean?

The South Australian Integrated Design Commission is the other great initiative worth a serious look. Run by the excellent Tim Horton ,whose glass is never just half full but positively brimming over – optimism is a vital force in urban regeneration in my experience – the IDC has just come to the end of a series of meetings and workshops aimed not just at identifying the best design solutions for the future of Adelaide but how you deliver them. Experienced and long suffering readers of this blog will know that I have a short fuse on the subject of ‘design-led urban regeneration’ if that means ignoring economic realities and how ‘visions’ can be mad real, as is so often the case. I remember the overkill of fact-free masterplanning and reality-lite design guides which flowed from the Urban Task force in the UK. To be fair, the Task Force did have other recommendations other than ‘good design’ but that one thing got focussed on and a lot of paper subsequently flowed. The result? Some better designed buildings and places in towns that still didn’t have any economic rationale and remained dysfunctional. I exaggerate for effect.

The IDC notion of design – to its great credit- embraces an understanding of the economic imperative and driver of change – and the need for delivery tools and vehicles to implement the vision or the design approach – whilst retaining all the planning,design and architecural excellence you’d expect in an organisation so named. Find out about them.

Why the title? Oh, Mr Horton forgot to tell me that the genuinely great – though not always right or applicable in all circumstances- Nordic planning guru Jan Gehl was in the audience when I spoke at an IDC event today. When asked about Comrade Gehl I said ‘I think Jan Gehl is great but in thiscontext I think he’s a miniaturist when what we need is the big picture’. I meant that urban regeneration requires an answer to the question ‘what is the place for and on what economically will it live?’ and that the Gehl approach does not answer that question. It addresses itself to a level of detail below that big picture. But I probably came across as sneering at genius. And then the chair says:’and Jan Gehl, would you like to respond?’! I burbled my appreciation of his ability and then sulked for half an hour….

I still think I’m right of course but civility is always a virtue.It was kind of funny – and at my expense of course , which I’m sure regular readers and indeed friends will appreciate. I’ll get my coat….

To be fair, though we always try and nurture the really talented and committed , we sometimes award prizes for kids who show a positive attitude towards music rather than talent – a display of sentimentality my competitive and musically rigorous –nay unforgiving – dad would have been contemptuous towards. But then,if he were alive we wouldn’t have the awards so the question of his views doesn’t arise. That settles that. Sorry dad.

My father died in 2006 aged 82. He came to the mining village of Beddau when he was about ten ,his father having been driven out of Cardiff by a resentful constabulary frustrated at their inability to nab Dan the Band (as he was known locally) for the illegal gambling he definitely got up to in Cardiff ‘s infamous Tiger Bay. Having failed to get him before the courts they tended to beat him up at any opportunity and sensing this only led one way,my criminal grand-dad settled for life in the far less glamorous but comparatively safer mining village where my Dad was brought up.That’s where I grew up too.

There being no justice or God, my grandfather’s penchant for violence was matched by an extraordinary capacity to play the trombone ,which he did like an angel, which he wasn’t. He raised his 4 sons as brass band musicians . All played well. My father became the best cornet player in Wales in his teens . He was so good that at 13 the major brass band instrument maker of the day in the UK used him in its advertising.

He played for the best band in Wales at the time as solo cornet player, the Park and Dare band. He was also sold into slavery at 14 by his father to be solo cornet play for a while with the famous Brighouse and Rastrick band. He entered 64 instrumental contests as a soloist and won 64 first prizes. I have a letter from Clara Novello Thomas , a well known concert singer of the 30s and 30s saying that my dad at 14 was the best brass player she had ever heard , when he had supported her on a tour.

In the War he was part of an entertainment group that had Spike Milligan and Tommy Cooper in it. He was friends with Milligan who was once interviewed by the Musician’s Union house journal , and as a trumpet player himself he said my father (who he knew as Danny, his first name) was the best trumpet player he had ever heard. At my father’s funeral we had a brass band play part of an unfinished symphony he started writing when he was 16 and finished in time for Camborne Band to play at 81. He conducted it at their invitation , spontaneously, before an audience of 400. He may have been what Gramsci called an organic intellectual – a status he definitely would have sneered at and which he had attained through a talent which the state had done nothing to nurture as he left school at 15 with no qualifications. I never saw him read a book. He just wrote music on backs of envelopes.

After the War which he never gloried in, taking Milligan’s view, that a lot of strangers whom he had never met were inexplicably trying to kill him, he went back to the factory he had worked in before. He rose through the ranks to become a stork keeper and transport manager before leading a strike and then resigning. He was blacklisted for some years before his brother got him a job working for the National Coal Board as a filing clerk.

On his retirement he became for 15 years an energetic and much loved Labour councillor who was indefatigable in defence of the interests of his constituents . He died un-defeated in an area where Labour doesn’t always win. I can tell you that his dying words according to the nurse who attended were:’when’s he going?’ Puzzled, she asked me to interpret. Easy I said. He hated Tony Blair who kept on saying he would retire in his third term. My dad wanted him to honour that promise sooner rather than later. On the day he died I texted my then boss the Cabinet Minister David Miliband to the effect that ‘my dad gave up the struggle at 4am . His flag stayed red to the end. His last words were ,’when’s he going’ and he was talking about your mate’.
To his credit he responded warmly .

This is the man myself , and his first and beloved Council of Llantrisant , honour with the awards. The area has retained a passion for music and some remnant of its musical tradition. The kids who we support are fantastic. Not at all what you might expect if you weren’t Welsh and thought such things were for middle class kids. Sadly, that may be the case in much of the UK. We seem to be holding on to some social capital in my area ,though it’s a constant battle. Some of the schools help significantly by promoting and teaching music quite effectively, though not all.

The next Awards are in late October. To their great credit the Llantrisant Council co-fund this event with my family. They loved him too. I think they also knew that the area had nurtured this talent decades ago and wanted to use his example as an inspiration to other kids who might have few material comforts at home but who can through music raise themselves to another level. I have to say that if my dad can be an inspiration to them – when he grew up in abject poverty but was as rich as Croesus in terms of his personal culture – then that’s wonderful. But these kids continue to be an inspiration to me and those who hear them, too. There’s a few kids over the years who win this Award on go on to the Welsh College of Music or just carry on playing to ever higher standards. Some give up but retain a love of music. All are lifted through their involvement with music, that great secular mystery.

There’s one ten year old playing for us this year who won a prize two years ago. He played the organ never ever having had any tuition and with no musical background at home. His parents were both mystified and delighted he was so musical and had got support from the Ifor Williams Music Awards. I just feel immensely proud and thrilled that music can still transform the lives of kids who yet live in challenging circumstances. This was an almost entirely working class community when I grew up in it and remains decidedly not the Vale of Glamorgan or a leafy borough of any kind.

I am reminded that Venezuela has taken an advanced position in the debate on cultural wealth combating material poverty with its extraordinary ‘La Sistema’ approach which has brought serious ,classical, musical skills to hundreds of thousands of slum dwellers. And transformed their lives. The Williams Awards do not amount to La Sistema! But they are underpinned by the same values. And they could be emulated and scaled up , if others want to help out.

When I see the Welsh government today struggling to make an impact on the nose-diving Welsh economy, now the poorest in the UK or raise the skills levels of kids at the bottom of the pile, I do wonder if there are lessons to be learned from our own little Big Society social enterprise we’ve got going. With a bit more support – from schools for example who seem to be ever more philistine or worried that such music is ‘western’ or ‘middle class’ and thus not suitable for working class pupils today (which is middle class rubbish of course) – we could have quite a big impact. But there’s a deeper thing missing. I don’t think the issue of cultural as well as material poverty is taken seriously nor indeed the idea that building up ‘cultural capital ‘ can help defeat or at least transcend the latter. I know it can. I’ve seen it in my own family and my community. And it doesn’t cost much. What do we want? La Sistema .When do we want it? Yesterday but tomorrow will do. PS :My dad made money from music too:so will some of the kids who win the Wards in his name. What’s not to like?