BILLS DIGEST NO. 39, 2014–15              22 October 2014

Albury-Wodonga Development Corporation (Abolition) Bill 2014

Tarek Dale
Economics Section

Date introduced: 1 October 2014

House:  House of Representatives

Portfolio: Finance

Commencement:  Parts 1 and 2 of Schedule 1 dealing with the abolition of the Albury-Wodonga Development Corporation, commence on Proclamation; or, if no such date is fixed, six months from Royal Assent or 1 July 2015, which ever date falls later. Part 3 containing transitional provisions commences the day after Royal Assent.

Links: The links to the Bill, its Explanatory Memorandum and second reading speech can be found on the Bill’s home page, or through the Australian Parliament website.

When Bills have been passed and have received Royal Assent, they become Acts, which can be found at the ComLaw website.

Purpose of the Bill

The Bill abolishes the Albury-Wodonga Development Corporation (‘the Corporation’), and transfers any remaining functions to the Department of Finance.

Structure of the Bill

The Bill contains three parts:

•       Part 1 repeals the Albury-Wodonga Development Corporation Act 1973 (Cth) (the AWDC Act)

•       Part 2 makes a number of consequential amendments to a number of Commonwealth Acts and

•       Part 3 includes transitional provisions relating to the transfer of assets and liabilities between the Albury-Wodonga Development Corporation and the Department of Finance.

Background

The Corporation has an extensive history, with its origin in a regional development project under the Whitlam Government. The Appendix to this Bills Digest gives a brief summary, drawing on more extensive publications. Since 2008, the Corporation has ceased any development activities— its sole activity has been selling its holdings of developed lots and undeveloped land.

The National Commission of Audit recommended in its report that the Corporation be wound up, with residual landholdings transferred to the Department of Finance.[1] That recommendation was included as a measure in the 2014–15 Budget.[2]

Committee consideration

Senate Standing Committee for the Scrutiny of Bills

The Senate Standing Committee for the Scrutiny of Bills has not yet reported on the Bill.

Policy position of non-government parties/independents

The Bill has not yet been debated in the House of Representatives. At the time of writing no public comments have been made by members of the opposition or cross-bench in relation to the Bill.

Financial implications

The Bill is not expected to have a financial impact. The Explanatory Memorandum states that while the change will ‘achieve efficiencies’, ‘the financial impact on both the Commonwealth and the community is low’.[3]

Statement of Compatibility with Human Rights

The Statement of Compatibility with Human Rights can be found at page two of the Explanatory Memorandum to the Bill. As required under Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the Bill’s compatibility with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of that Act. The Government considers that the Bill is compatible.

The Parliamentary Joint Committee on Human Rights has not yet reported on the Bill.

Key provisions

Schedule 1, Part 1 of the Bill repeals the AWDC Act, and Part 2 makes a number of consequential amendments to other Commonwealth acts to reflect the repeal of the AWDC Act.

The Corporation’s land bank

As part of the wind-up of the Corporation, its assets will be transferred to the Department of Finance. This includes its land holdings, and remaining developed lots. Over a number of years the Corporation has successfully sold a significant portion of its holdings:

•       in 1996 the land bank’s holdings were approximately 15,500 hectares[4]

•       in 2005 they were 6,387 and

•       at 30 June 2014 there were 1,086 hectares remaining.[5]

As at 30 June 2013, the Corporation also had some remaining developed lots, including residential properties (53 owned outright, and 29 through a joint venture), and a number of industrial lots (three owned outright, and 42 through joint ventures).[6]

Transitional provisions

Part 3 of Schedule 1 contains a number of transitional provisions required in closing the Corporation, transferring assets and liabilities to the Commonwealth, and dealing with a number of other logistical issues.

Item 8 defines key terms used in Part 3.

Item 9 transfers assets, and item 10 transfers liabilities, from the Corporation to the Commonwealth at the time of commencement (that is on Proclamation).

Item 11 provides a mechanism for transferring vested land interests to the Commonwealth, and item 12 provides a similar mechanism for transferring other vested interests to the Commonwealth.

Item 13 specifies that after commencement, anything done by the AWDC or in relation to it, is treated as being done by the Commonwealth.

Item 14 substitutes the Commonwealth as party to any proceedings which were pending prior to commencement.

Item 15 transfers the AWDC’s records to the Department after commencement.

Item 16 specifies that if any investigations or complaints in relation to the Corporation are underway, prior to commencement, then after commencement they will continue in relation to the Department.

Item 17 specifies that instruments in force before commencement that refer to the AWDC are taken to refer to the Commonwealth (with some exceptions).

Item 18 clarifies that AWDC board members, the chief executive officer, AWDC staff and consultants are not transferred to the Commonwealth.

Item 19 specifies that the Secretary of the Department will prepare a final annual report for the final reporting period of the AWDC’s activities.

Item 20 specifies that for the purpose of ‘winding-up of the joint Commonwealth/state scheme’, the Commonwealth may dispose of vested assets, and do all things necessary in connection with this.

Item 21 exempts the transfers under Part 3 from any stamp duty or other taxes.

Item 22 specifies that certificates issued under Part 3 (for example, under items 11-12) are taken to be genuine unless the contrary is established.

Item 23 enables the Minister to delegate his/her powers under Part 3 to the Secretary or a Special Executive Service employee of the Department.

Item 24 stipulates that where the operation of the Schedule would result in the acquisition of property on other than ‘just terms’ (within the meaning of paragraph 51(xxxi) of the Constitution), then the Commonwealth is liable to pay ‘a reasonable amount of compensation’, with the relevant person able to institute proceedings in the Federal Court where there is not agreement on the amount of compensation.

Item 25 enables the Minister to make transitional rules by legislative instrument.

Appendix: Background information

In early 1973, former Prime Minister Gough Whitlam and the New South Wales and Victorian premiers agreed to ‘develop a growth complex at Albury–Wodonga, on the border between New South Wales and Victoria’.[7] The three governments established ‘a development corporation to acquire land and create an economically sustainable city within an attractive urban environment.’[8]

The role of the Albury-Wodonga Development Corporation (‘the Corporation’) has changed over time. As initially conceived, it was to include ‘city planning and construction, establishment of areas for business and trading, settlement of immigrants and managing Commonwealth accommodation and services’.[9]

Following a review in 1989–1990, the Corporation transferred planning powers back to local councils in February 1992, after which its role became ‘essentially one of property management’.[10] In 1995, a decision was made to wind-up the Corporation entirely, with its assets to be disposed of in ‘an orderly manner’.[11]

The Albury-Wodonga Development Amendment Act 2000 amended the Albury-Wodonga Development Act 1973, to simplify the Corporation, in preparation for its abolition.[12] This was part of a broader process under which the Victorian and New South Wales state parliaments also repealed their corresponding legislation, reflecting the transition of the Corporation to a purely property management organisation.[13]

In 2005 the Commonwealth Government announced that the Albury-Wodonga Development Corporation would ‘exit its land development activities by July 2007, and sell its remaining property assets over an approximate ten year period’.[14] Final development activities were completed in the 2007–08 financial year; since that period, activities have focused on disposing of existing developed lots and land holdings.[15]

In February 2013, the end date for the Albury-Wodonga Development Corporation’s sale activities was extended to 2021, in order to ‘avoid the risk of a fire sale and ensure the Corporation’s remaining land disposal program does not destabilise the local property market’.[16]

Members, Senators and Parliamentary staff can obtain further information from the Parliamentary Library on (02) 6277 2500.

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[1].              National Commission of Audit, ‘Principal bodies’, Report: phase one, February 2014, accessed 7 October 2014. The phase one report was completed in February 2014, and released on 1 May 2014; M Cormann (Minister for Finance), Release of the National Commission of Audit report, media release, 1 May 2014, accessed 7 October 2014.

[2].              Australian Government, Budget measures: budget paper no. 2: 2014–15, p. 71, accessed 8 October 2014.

[3].              Explanatory Memorandum, Albury-Wodonga Development Corporation (Abolition) Bill 2014, p. 1, accessed 8 October 2014.

[4].              B Pennay, Making a city in the country: The Albury–Wodonga National Growth Centre Project 1973–2003, University of New South Wales Press, Sydney, 2005, p. 313.

[5].              Albury-Wodonga Development Corporation, ‘About the Corporation’, Albury-Wodonga Corporation website, accessed 8 October 2014.

[6].              P Veneris (Chief Executive Officer), ‘Performance and Trends’, Albury-Wodonga Development Corporation: annual report 2012–13, Albury-Wodonga Development Corporation, p. 4, accessed 8 October 2014.

[7].              B Pennay, Making a city in the country: The Albury–Wodonga National Growth Centre Project 1973–2003, op. cit., p. ix.

[8].              Ibid.

[9].              Senate Rural and Regional Affairs and Transport Legislation Committee, The Albury-Wodonga Development Amendment Bill 1999, The Senate, Canberra, April 2000, p. 2, accessed 8 October 2014.

[10].              Ibid., pp. 2–3.

[11].              Ibid., p. 3.

[12].              Ibid., p. 2.

[13].              Ibid., pp. 1–2.

[14].              M Cormann (Minister for Finance), Statement of Expectation: Albury-Wodonga Corporation, September 2014, accessed 8 October 2014.

[15].              P Veneris (Chief Executive Officer), ‘Performance and trends’, Albury-Wodonga Development Corporation: annual report 2012–13, op. cit., p. 4, accessed 22 October 2014; W Hanrahan (Chairperson), ‘The year in review’, Albury-Wodonga Development Corporation: annual report 2007–08, Albury-Wodonga Development Corporation, p. 3, accessed 8 October 2014.

[16].              W Hanrahan (Chairperson), ‘The year in review’, Albury-Wodonga Development Corporation: annual report 2012–13, Albury-Wodonga Development Corporation, p. 3, accessed 8 October 2014.