The state’s developer lobby is seeking an urgent meeting with the State Government about infrastructure charges on residential developments, which it says will drive up house prices in South Australia.

Urban Development Institute of Australia (SA) president Stuart Moseley said yesterday that developers were very concerned about the Government’s uncertain approach to coordinating, funding and delivering infrastructure to support urban growth.

He told a UDIA lunch, attended by Planning Minister John Rau and his Opposition counterpart Vickie Chapman, that the current “messy” approach to  infrastructure charges would make homes even more unaffordable.

Two years after Rau stood in the same forum and told the UDIA that he would never rezone land to residential without infrastructure being sorted out first, Moseley accused the Government of having a “policy vacuum” in this area, with the goal posts and the “whole playing field” constantly shifting.

“The area continues to be shrouded in uncertainty,” Moseley said. “It is slowing the land supply pipeline and costing the sector time and money at a time when we can least afford it.”

He said the UDIA had presented the Government with a proposal for addressing its concerns in September last year, and a clear position was now needed.

“In the absence of a clear position, the policy vacuum is being filled in all sots of ways, not all of which are going to be positive for this industry.”

Several councils, for example, had announced separate rates to pay for infrastructure on new allotments and SA Water had proposed a State-wide infrastructure charge on all new lots.

Moseley said these practices raised the prospect of “intergenerational inequity”, where the first owners of new blocks would pay the brunt of infrastructure costs, while subsequent owners wouldn’t.

“We think the lack of certainty in this space is a significant threat to housing affordability. Infrastructure already accounts for $70,000 or more on the cost of a greenfield block and the more pressure that is placed on that from upfront, lump sum charges, the more risk there is that housing will be pushed beyond the reach of even more South Australians.

“So we are calling for leadership and direction to resolve what we would say is a very messy situation and we are urgently seeking to meet with minister (Tom) Koutsantonis whose portfolio responsibility it is.”

A spokesman for Koutsantonis, whose portfolios include housing, urban development, transport and infrastructure, said a meeting had been scheduled with the UDIA to discuss its concerns.

He said Koutsantonis was unaware that the UDIA was unhappy with the agreed time “as they had not expressed that opinion”.

“But he is more than happy to have an earlier meeting, if the association feels it is necessary,” he said.

“This Government takes seriously the provision of appropriate supporting infrastructure as part of urban development projects and that commitment was recently demonstrated by the release of the Playford Growth Area Structure Plan that includes provisions to ensure land will only be re-zoned when infrastructure agreements can be reached with landowners, the council and state infrastructure providers.”

Rau told the lunch yesterday that the cost of infrastructure was “one of the most significant points for us to nut out”.

“I’m very clear in my own mind about what we don’t want to do,” Rau said. “We don’t want to follow New South Wales’ very unhappy experience where levies became crushing and burdensome …

“The real question is this: we have to ascertain what proportion of infrastructure is going to be paid by the taxpayer … and what proportion of the infrastructure will be funded out of the development.”

He said the intergenerational inequities also had to be considered, particularly whether it was reasonable for the first purchaser of a property to “pay the whole lot”.

Rau also pushed the capacity of his urban renewal precinct legislation to address infrastructure concerns.

The legislation, now before parliament, aims to give new statutory powers to the Urban Renewal Authority (URA) and create a new process for planning and developing declared urban precincts. The legislation will create an alternative planning process for urban renewal areas, within which the Government can vary state taxes, rates and charges to encourage development.

The legislation says that a draft precinct plan must be prepared which sets out policies and principles behind the declaration, a masterplan, design principles and an implementation framework, including infrastructure details.

Chapman said the Opposition supported parts of the Bill, but would not support the URA being a developer as well as regulator within these precincts.

She said the development role was best left to the private sector.

Disclosure: David Washington was media adviser to John Rau from January 2011 to July 2012.