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In Sydney pollies must go west to win the rest

Frank Zumbo

by Frank Zumbo

11 Apr 05:35am

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Filed under: Australia, Cost Of Living, Politicians, Sydney, Western Sydney

33 comments

There’s no doubt that tackling the escalating cost of living is central to keeping the all-important voters of Western Sydney happy. Sydney is one of the greatest cities in the world and that privilege shouldn’t come with an expensive price tag, especially for Western Sydney.


We need to make Sydney a place that’s once again affordable for all Sydneysiders. That’s the challenge for both the State and Federal Government. Any failure in this regard may spell disaster at election time for the Government of the day.

After years of neglect and poor planning decisions it’s clear that Sydney has lost some of its gloss and Sydney voters don’t like that. Sydney has become just too expensive for all those struggling Aussie families out there in voterland.

While the city has sprawled out towards the Blue Mountains services have failed to keep pace and the price of land has spiralled out of control.

Not surprisingly, Western Sydney has become the new political battleground. Both major parties try daily to outdo each on how much love they can give it. For all those on the ground in Western Sydney they know all too well the daily battles they face getting to work on congested roads or trying to access scarce government services or public transport.

As both the politicians and football codes try to make inroads into Western Sydney there’s no doubt that it is the place to watch. It’s the new frontier in battle for the hearts and minds and as the Federal election inevitably draws closer more and more attention will be devoted to its swinging voters.

So what can be done for those all-important voters?

First, we need to tackle the rising price of land and housing in the greater Sydney area. The price of land has skyrocketed over the years and that’s a direct result of land releases not keeping pace with the growth of Sydney. We urgently need to fasttrack the release of land for residential development.

The release of land needs to be accompanied by the timely provision of services, especially public transport. It’s not good enough that Sydney’s infrastructure is in a state of decay. A world class city needs world class infrastructure. Housing developments must be strongly supported by new hospitals, schools, roads and public transport links.

Tackling the availability of suitable land for housing developments needs to be complemented by the availability of affordable finance. The sad reality is that any efforts by the State Government to make more land available could be so easily frustrated or undermined by the big banks not playing their part in providing affordable finance to Sydneysiders.

The big banks need to act as good corporate citizens and repay all the support that taxpayers, including those in Sydney, gave them during the global financial crisis. Yes, we want the banks to be profitable, but we don’t want them to keep inflating interest rates and fees as that stifles housing development in Western Sydney and around Australia.

Inflated interest rates and fees add to the cost of housing developments and that’s why the Federal Government needs to play its part by ensuring we have world’s best competition and consumer laws. Australia’s current weak competition and consumer laws have meant that the big banks have been allowed to dominate the housing and business loans market. And that’s bad news for all those struggling families and small businesses in Western Sydney.

The inflated interest rates for businesses, especially small business, mean that the big banks can put a brake on economic development in Western Sydney and across the nation. Less affordable finance from the big banks means less economic development to provide jobs and keep down the cost of goods or services.

We need real and effective competition in the Australian banking sector for the simple reason that real and effective competition puts downward pressure on interest rates and fees.

Real and effective competition is obviously critical to keeping down the cost of living across Sydney and the nation. Whether it be groceries or petrol, it’s essential that we have strong and diverse competitors keeping prices down across Sydney. Currently, we have just two major supermarket chains that dominate the grocery sector and the same two are also increasing their dominance in petrol and liquor.

Having just two players in a local area leads to higher prices for goods or services in that area as the two players keep retail prices inflated. While occasionally the two players will engage in pricing gimmicks to give the impression of some competition, the harsh reality is that we need strong price competitive independents in the local market to keep prices down.

That means we need more competitive diversity across Sydney. Governments at all levels must work towards inviting strong independents back into suburbs across Sydney and especially in new developments. The two major supermarket chains can be part of new developments but only alongside new grocery, petrol and liquor independents.

Improving affordability is not just about putting downward pressure on the price of goods or services, it’s also about helping Sydneysiders, especially those in Western Sydney, find the cheapest grocery and petrol prices everyday. At the moment consumers are largely in the dark about where to find the cheapest prices. That means that they may be paying more than they should.

The Federal Government must work towards ensuring that all major supermarkets and petrol stations publish online and in near real time all supermarket shelf prices as well as the price of petrol, diesel and LPG sold at all service stations.

If the Federal Government cannot get agreement on a voluntary industry code of conduct where all relevant prices are published online and in near real time, then it should put in place a mandatory industry code of conduct that requires industry participants to do so. Such a mandatory code must be backed by financial penalties and be actively enforced to ensure full compliance.

Clearly, there are lots of simple and practical steps that can be taken by the Federal and State Government to deliver a better result for the voters of Western Sydney. The exciting thing is that those same steps could be used to deliver the same benefits to consumers across the country.

In that regard Western Sydney is another microcosm of the real Australia and a failure of a major political party in Western Sydney inevitably means that party’s failure across the country.

No wonder Western Sydney is seeing more and more visits from politicians.

Let’s hope that the politicians bring real offerings and not just the same hot air that Western Sydneysiders may get on those scorching summer days.

Most commented

33 comments

Show oldest | newest first

    • SteveKAG says:

      07:09am | 11/04/12

      “Any failure in this regard may spell disaster at election time for the Government of the day.”

      What bubble are you living in, this government will not retain power simply because the bogans of western sydney get some cash…..........

      I can’t stand stories like this shit that are written in such a way that the rest of us that don’t live in Sydney should actually give a crap, that your problems with western Sydney are somehow greater than issues with any western suburbs in any other capital city. Sort out your own western suburbs, Fix your own god damn airport…....we that live in the rest of Australia don’t give a shit sunshine.

      The language you use in your story is also so demeaning to those living in working class suburbs “Sydney has become just too expensive for all those struggling Aussie families out there in voterland”. Sounds like academic bubble clap trap to me.

      Reply

    • hello kitty says:

      08:58am | 11/04/12

      I agree
      O’Barrel is gone at the next election.

    • JT says:

      09:48am | 11/04/12

      You do understand NSW is critical to any Federal election right? We decide who wins.

    • Bill says:

      10:33am | 11/04/12

      JT - NSW doesn’t decide who wins federal elections.

      Two-thirds of the population live outside NSW. I think their votes more than account for those from NSW. And Steve is right. Did it ever occur to the people of Sydney that no one knows or cares what happens in its suburbs? Where’s the article highlighting the problems being faced by Adelaide’s southern/eastern/northern/western suburbs? Or Brisbane’s, etc, etc?

    • JT says:

      11:03am | 11/04/12

      It pretty much does Bill. I quote expert Antony Green:

      ‘‘With just under a third of the seats in the House of Representatives, New South Wales is critical to the outcome of any Federal election. The last time a government was elected without also winning a majority of the seats New South Wales was 1961 when the Menzies government scraped back into office with a 2-seat majority. It is nearly impossible for either side of politics to win if they do badly in New South Wales, while a good result in New South Wales can cancel out poor results in other states.’‘

      NSW is the most important state in a Federal election, you may not like it but that doesn’t change the facts.

    • Big Jay says:

      11:25am | 11/04/12

      @Bill and SteveKAG…I understand why people take offence about undue attention to Sydney’s western suburbs. However, there is a real (and understandable) reason for this. It’s just matter of parliamentary seats (or population). There are somewhere between 11-14 seats in “Western Sydney” which is close to that of the entire South Australia or Western Australia, and many of them are the most marginal anywhere in the country. Remember the govt is in power by ONE seat, losing a handful of these changes everything.

    • Bill says:

      11:56am | 11/04/12

      Big Jay - every federal seat has (approximately) the same number of voters and every federal seat has the same representaion in the Parliament (i.e. one person). A western suburbs Sydney seat is no more important than a northern suburbs Hobart seat.

      There are also a dozen or so seats in south-eastern Melbourne, most of which too are marginal. So don’t think that there is something special about seats in Sydney. I can guarantee you that the rest of the nation never gives them a second thought.

    • The Prof says:

      02:20pm | 12/04/12

      Bill of course no one Western Sydney seat is more important than a seat elsewhere.  What he is saying though is there are a bunch of them in the same boat that will play an important part in the next election.  Therefore it is an important issue.

      If you think there are a bunch of seats in Melbourne in the same boat then fine highlight that but everytime there is an article mentioning Sydney or NSW you have a massive whinge.  You come across like a tool.

      And no I am not from western sydney.  Never think about the place myself but don’t get offended when articles are written about it.  Same as when articles are written about Adelaide, where some of the journos seem to be based, I don’t throw my toys out of the pram and whinge that nobody cares about Adelaide

    • Tubesteak says:

      07:11am | 11/04/12

      The western suburbs voters would feel less pressure if they learned to live within their means. Spending a lot of money on a McMansion and 3 new cars isn’t the smartest idea

      It used to be that one car and a 3 bedroom house was enough for the average family. Now it isn’t

      Not much point blaming the government because you can’t afford a champagne lifestyle on a beer budget

      The only thing you can really blame on the government is poor infrastructure. That doesn’t really add to the cost of living. 

      Maybe give up a lot of middle class welfare so the Feds can give the money to the states to fund this stuff. But voters would whine about that, too

      Reply

    • Tubesteak says:

      08:50am | 11/04/12

      Also, it’s not so much a land release issue but a land use one. Stop trying to build quarter acre blocks and build more high-density high-rises in places that people actually want to live. That is far more efficient and useful.

      Banks shouldn’t just lend to anyone. That was part of the problem that caused the GFC in the US. Banks were lending to people who couldn’t afford the repayments after the honeymoon period because banks were forced to do this by government legislation (CRA) and market conditions (Glass Steagall, Freddie Mac, Fannie Mae). Banks should lend to people they feel can afford it. Not just any schmuck that turns up and sticks their hand out.

      The big banks only dominate the housing loan market because most people are too stupid to do their research to find the hundreds of other lenders out there with more competitive rates. I did and got a much better loan than any banks is offering. It’s a building society. Moreover, people are expecting 95-110% LVRs and have never proven a capacity to save or repay. No FI should lend to that.

      There is now no such thing as just “two competitors”. You can find deals online or go further afield to do your shopping. Not difficult.

    • JT says:

      09:53am | 11/04/12

      ‘‘poor infrastructure. That doesn’t really add to the cost of living.’‘

      Of course it does, having to travel further than any other person in any other city in Australia just to get to the CBD adds to the cost of living.

      ‘‘Maybe give up a lot of middle class welfare’‘

      It is not really welfare when you pay for the majority of it in your taxes, lower our taxes and I’m sure people would give up the rebates they get in return.

      ‘‘Stop trying to build quarter acre blocks’‘

      No such thing as a quarter acre block release in metro Sydney. Blocks in Sydney are almost always 450-550 sqm and 50-60kms from the city.

    • Rocksteady says:

      09:57am | 11/04/12

      But the banks have got themselves into a huge mess, they need to keep lending, especially in housing downturns, if they tighten lending restrictions enough there’ll be no buyers for the huge amount of property around the country that they basically own.

    • PW says:

      10:13am | 11/04/12

      Most people when buying a home buy the most expensive they believe they can afford. So if the price of petrol, electricity, food, etc were to fall, people would have a greater income to direct to housing. Unfortunately, if these costs rise, as is more likely, after such a decision has been made, you get stress.

      You somehow artificially attempt to make housing more affordable, as in first home owner grants, people will just pay more and/or prices will rise accordingly. You attempt to force housing prices down, for example by removing negative gearing, you just create a rental shortage and every home owner in the country has to take a haircut. Not likely to go down well.

      Basically, free markets will always find equilibrium. The answer is that when buying a home, people must think ahead, the trouble is that not all do. It is not the job of Governments to tell people how much they should spend on housing.

    • SimonFromLakemba says:

      10:27am | 11/04/12

      Sh*t I agree with JT. Time to take a nap!

      @PW

      That’s true. If the bank says you can afford $500k people will go and spend $500K, they get greedy.

      I was watching a good doco the other night on Bankwest and how after Comm Bank bought them out they started cutting peoples loans, was fairly interesting.

    • Big Jay says:

      11:49am | 11/04/12

      @SimonFromLakemba - I saw the same doco. Please note that was COMMERCIAL loans, no bank would dare pull those stunts with retail/mortgage customers.

      On topic, the comments above are mostly fair in that many people make it hard for themselves (borrow too much, waste money on rubbish) and then whinge to the govt (and anyone else) however, poor infrastructure does add pressure to the cost of living. Eg. We’re paying more for power to maintain/upgrade electricity infrastructure because the State govt took money out of the sector (through public sector company dividends) to waste on whatever else. Roads that used to be free (built buy govt) are now private toll roads. It does add up.

      Yes, I live in Sydney. No, not in the Western Suburbs.

    • Tubesteak says:

      12:39pm | 11/04/12

      JT
      Long distance train tickets are now comparatively less. You don’t need to live on a block of land in Blacktown when an apartment in Alexandria/Neutral Bay etc costs about the same and can house the same number of people.
      “Your taxes” is somewhat of a misnomer. The bulk of taxation (about 50%) is paid for by the top 10% of earners which is all companies/super funds
      You don’t need any sort of block. Urban sprawl is what is killing this city. Build up, not out.

      Rocksteady
      It’s not necessarily turnover that maintains prices. If only some can afford then they will pay what sellers are willing to sell at. Sellers aren’t going to make a loss unless they really have to.

      PW
      That’s the problem: mortgaging yourself to the limit. People shouldn’t do this. Inflation is a fact of life so prices will always rise. Housing prices will not fall if you remove negative gearing. I’ll just charge more in rent to cover the difference and I won’t sell at a loss

      SimonfromLakemba
      I’ll go looking for that doco on youtube. Could be interesting.

    • PW says:

      02:32pm | 11/04/12

      “Housing prices will not fall if you remove negative gearing.”

      It’s very difficult to predict what would happen with any certainty, and it depends greatly on how it were introduced, but it is highly likely that well entrenched property investors will be able to work around it, whereas there will quickly be an absence of newcomers, who will be able to get better deals elsewhere. The entrenched investors will wait for the price drop and then pounce, as will owner-occupiers, at which time equilibrium will be restored.  I’d be very surprised if some overall softening of the market didn’t occur.

    • PW says:

      03:49pm | 11/04/12

      “The western suburbs voters would feel less pressure if they learned to live within their means. Spending a lot of money on a McMansion and 3 new cars isn’t the smartest idea”

      Next door to me is a very modest 3 BR fibro Housing Commission house circa mid-‘60s, and they’ve got 6 cars. Mum, Dad, 2 sons and their girlfriends. They fill up the driveway, front yard (which is just dirt, no grass can survive), the street in front of their place and in front of my place too. Every one of them drives to work each day.

      I’m sure this family must have their picture hanging up on the wall at the local RTA.

    • SimonFromLakemba says:

      04:03pm | 11/04/12

      @Tubesteak

      http://www.abc.net.au/4corners/

      As big jay says, it was commercial loans. But still fairly relevant.

      @PW

      Tubesteak is right, being in the industry the only thing that will change is that the rental market will get so tight it will screw everything up. Some towns have a vacancy rate of under 1% and that’s with negative gearing.

      I think the market is fine as it is at the moment.

    • gobsmack says:

      07:50am | 11/04/12

      In Melbourne, certain large property investors are holding on to huge swathes of land suitable for residential development.
      If they released it all, the price of land would tumble, so they only release it in dribs and drabs.
      The suburban area is also dotted with countless undeveloped plots that have been left vacant for years while the land value gradually increases.
      If governments, State and federal, ALP and Liberal, were serious about making land (and therefore housing) more affordable they could legislate to force landholders to develop or lose the land.
      However, a drop in housing would mean current owners would lose some of their paper wealth and no political party would risk that.  It would also mean more unsecured debt for the banks.  So it’s not going to happen.

      Reply

    • Rocksteady says:

      07:52am | 11/04/12

      I find it dubious when Supermarkets say they can’t publish their prices online. People don’t need some flashy website, an excel spreadsheet would do fine. 
      It’s hard to believe Coles and Woolies don’t have a current price list of all their products in digital form.
      Really all they have to do is make the data available to app developers and you’ll see 15 comparision apps available within a month.

      Reply

    • Inky says:

      08:58am | 11/04/12

      Don’t publish their prices online? I shop for groceries using Woolworths homeshop. Coles has a similar service. Amazingly, I see the prices of what I’m buying before they arrive at my door, I even pay for them prior to then.

      Are the homeshop prices the same as the instore ones? Seems to be. Are the specials the same? Don’t know. It’s too difficult for me to get there in person to check.

    • Bill says:

      08:41am | 11/04/12

      The ‘all-important voters of western Sydney’? What makes these people any more important than the voters of northern Brisbane, or southern Adelaide, or eastern Melbourne, or inner-city Perth?  The problems they face are exactly the same problems people face in other cities. We all have issues with congested roads, inadequate public transport, duopolies, rising interest rates. These problems aren’t confined to one section of one particular city.

      Reply

    • Kate says:

      12:26pm | 11/04/12

      There are more of them. Sydney is 4.5 million people. That’s 3 times the population of South Australia. Or ALL of Queensland.

      There are (conservatively) about 14 Federal seats up for grabs in Western Sydney. There are 11 in South Australia and 15 in Western Australia.
      Think about that. A play for this small group of suburbs, is greater than an entire state in strategic terms. They’re also swing seats. It’s all a numbers game, and none of these cities (hmm maybe Melbourne) have the weight to deserve column inches.

    • Bill says:

      12:55pm | 11/04/12

      Kate - Melbourne has a population of 4.2 million and has approximately the same number of federal seats as Sydney. In fact, there will be more people living in Melbourne (and therefore more seats) than Sydney in the next 20-30 years, so your argument that the western suburbs of Sydney has some special status is specious at best.

      The fact remains that no Sydney seat is more important than any seat in any other state or territory. The two major parties fight just as hard to win a seat in Perth as they do in Sydney.

    • Inky says:

      08:59am | 11/04/12

      I see that once again, some threat facing a part of Sydney is a “national issue”.

      Reply

    • Bill says:

      09:25am | 11/04/12

      The self-obsessed sydneysiders always think that the rest of the country is constantly focussed on events happening in nsw. I personally don’t care about what’s happening in my community and my city - all I want to know is what’s affecting the people in some area of the country I’ve never been to and know nothing about…

    • Inky says:

      11:05am | 11/04/12

      The sad part is some of the things he mentions in the article to address the problem are the sorts of things that would fix similar problems in other areas and change things on a national scale.

      Unfortunately, this is all wrapped up in hubris. If this article was written after taking a step backwards, it would have reached a much wider audience.

    • Kate says:

      12:35pm | 11/04/12

      “The sad part is some of the things he mentions in the article to address the problem are the sorts of things that would fix similar problems in other areas and change things on a national scale.”
      Then, what’s your issue?
      As stated above, these seats are the ones that MATTER come a federal election. That’s why they get attention. But you’re right, things that help them, will likely help others too.
      If online pricing comes in, and it’s because of an attempt to ‘buy’ these voters, do you think that only supermarkets in Western Sydney will be publishing their prices?
      If lending laws are relaxed, so you think you’ll need to have a 2*** postcode to apply?
      If the NSW state government switches the tax structure to stop landbanking, and it works, do you think other states won’t follow suit? Rats, somebody else had that idea first. Can’t do it now…
      It doesn’t matter WHY something gets attention. It matters that it DOES.
      Ride the coattails….

    • Inky says:

      01:07pm | 11/04/12

      “Then, what’s your issue?”

      Well congrats, you caught me, I read the article and admitted that some of the things there actually might help an area outside of the one focused in the article.

      But look around, how many more are just throwing it all into the bin as being more Sydney-centric rubbish? Believe it or not, there’s a whole country out here, and many of the people living outside of the chosen land couldn’t give a stuff what goes on there. And so, we ignore.

      And so, we ignore.

      If there’d been less Sydney-centric hubris, this would likely have reached a wider audience and the chances of something being done about it would also increase.

      Like I said, it’s a pity that this message is being clouded by Sydney-centric hubris. It’s doubly a pity that you can’t seem to see this.

    • Bill says:

      02:00pm | 11/04/12

      Kate, you’re wrong. Seats in Sydney aren’t the only ones ‘that matter’. Every seat in every state and territory matter just as much. Why don’t you understand this?

    • badwolf says:

      12:25pm | 11/04/12

      As a non-bogan living in western sydney i have to ask is there any way to keep these pollie bastards away from us?

      Reply

    • Tbird says:

      01:08pm | 11/04/12

      Is there a world outside Sydney….? All important? Stuff the rest of the country….
      Same issues for everyone everywhere.
      Biased story Mr Zumbo.

      Reply
 
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