Thursday, September 8, 2016

Millers Point: A Play in Five Acts

[With apologies to Henrik Ibsen]

[Taken from the transcript of the hearings on Budget Estimates 2016-17 on 29 August to 1 September 2016 of the Legislative Council General Purpose Standing Committees Nos 1, 2 and 5. The names of the players are shown.]

Act 1 – Family and Community Service
[Available on-line here.]

The Hon. PAUL GREEN: Can you update the Committee with regard to the current public housing situation at Millers Point and how the Government has responded to the needs of those vulnerable housing tenants, ensuring they are adequately housed and not displaced from ageing in place?
Mr BRAD HAZZARD: It is a challenge. It is a difficult issue. The Government took a view which was that those particular properties were worth so much—as you are aware, when I became Minister I had a chat to the Premier and others about this issue. Initially the view was that each one of those properties could sell for between $1.5 million or $2 million, and possibly $5 million or $6 million.
The $2 million sale of one very old property—usually more than 100 years old, with challenging maintenance issues, and often with an elderly individual living in it—could lead to the rehousing of six families or individuals from the waiting list of 60,000. As much as that was a difficult decision for the Government, the fact was that the sale could raise half a billion dollars and build about 1,500 new homes. That was the policy decision that was taken to try to address the very long public housing waiting list. The last figures I saw showed that the list had gone up by another 2,000 or 3,000. Even though we are building new homes at a rate that has not been seen for years, it is still very challenging. I do not know whether you have seen the really good Auditor-General's report from three or four years ago. I was fascinated to read it because he talked about the fact that the former Government had been forced—as governments sometimes are—to make the decision to reduce the amount of public housing because it had to pay maintenance on the properties. In a sense, it was eating public housing.
We have reversed that. We have created a lot more. I am intent on building a lot more public housing. As recently as last week a Labor Minister from one of the other States came to see what we were doing and to consider how it could work for them. It is difficult. Having said that, I also recognise that there are some folks who have a community of interest. Some people really want to stay in Millers Point. As a result, I approached the Government and the Cabinet and it was agreed that we would put aside 28 units for accommodation. They have all been modernised. They are only small but they are fantastic. Sadly, not all those properties have been taken up. At the moment only about 12 of them have been taken up.
I have asked the department to be as flexible as possible. For example, there are a couple of brothers who are used to living together. In those 28 units there is one three-bedroom, a couple of two-bedrooms and the rest are one-bedroom. That is the evolving accommodation demographic: Most people are living by themselves.It does not mean that they necessarily want just one bedroom for accommodation, unfortunately, but that is what the Auditor-General said that we should be doing. In the case of the two brothers, I asked the department to knock a hole in the wall. That required council approval. The department got council approval and put the two brothers together. We are trying to be flexible.
The Committee would also know that Minister Speakman also recently made a decision about the Sirius building. There are about seven tenants still in there. We are looking to rehouse them. I have been out personally to look at some of the properties. Almost everybody who is being rehoused has been offered really good property in Glebe, Marrickville and Leichhardt—inner-city areas. There are a few people who are saying that they will not move. A few of the younger ones are running a campaign saying that they will not move. I am saying, "I am sorry; you have to move." For those people who have complex needs, there are another 16 units of accommodation available in Millers Point.
The Hon. PAUL GREEN: Do you know the condition of sale of the Sirius building? Why could affordable and public housing not be included in that?
Mr BRAD HAZZARD: There has been no decision taken on that yet. There are two arguments. On the one hand, you could say that on all government-held land there should be some affordable and social housing. Sometimes that happens. On the other hand, by saying that that has to happen to the Sirius building you could substantially reduce the price. You could get a much higher price and build a lot more social and affordable housing somewhere not too far away. I think the answer is that one should probably go with the latter. It is difficult.
The Hon. PAUL GREEN: Providing accommodation on site ties in with the principle of ageing in place. That is pretty important for those people.
Mr BRAD HAZZARD: I understand that. Keep in mind that some people in the Sirius building have been there for only two or three years but are saying they want to stay there.
The Hon. PAUL GREEN: I am talking about the one who has been there for 50 years.
Mr BRAD HAZZARD: There are others for whom I feel the greatest sympathy, but the reality is that I also feel sympathy for the other 60,000 individuals and families on the waiting list.
The Hon. PAUL GREEN: I appreciate that. In 2015-16 what has been the total sale of public housing? What amount is being used to reinvest in developing new social housing?
Mr BRAD HAZZARD: Every cent that comes out of the social housing in Millers Point goes straight into — [end]

Act 2 - Ageing, Disability Services and Multiculturalism
[Available on-line here. ]

The Hon. PAUL GREEN: ... Minister, you would agree that it is important for people to be able to live in and have quality of life in their local communities.
The Hon. JOHN AJAKA: Yes.
The Hon. PAUL GREEN: Can you enlighten us how your department is helping those people around Miller's Point who have been displaced from their housing, given the fact that their communities, their friends and their doctors are local?
The Hon. JOHN AJAKA: I think there are three aspects to that. The first aspect, of course, is that this is a matter for Minister Hazzard, for Family and Community Services. I understand that he was here yesterday morning. It is a matter for his agency to take the lead in relation to that. The reply to the second part of your question is that many seniors and older people are sitting on the waiting list and they are desperate for social housing. The third aspect is that when the sale of a Miller's Point property is able to be utilised to purchase three or four other properties it is appropriate that action is taken from a whole-of-government perspective. That is the action that is being taken. I am well aware, and I know Minister Hazzard is able to answer these questions, that appropriate action — all action — is being taken to assist those seniors currently residing in Miller's Point to transition into another home.
The Hon. PAUL GREEN: Thank you for that. I realise it is another portfolio, but that is not the question that I asked. Are you concerned, as the Minister for Ageing, about the approach to remove people who are ageing in place from their homes? Are you concerned that it will set a dangerous precedent—moving elderly seniors or vulnerable people from their homes, given that their real estate may be attractive to the Government, but that it is not in the interests of those people?
The Hon. Dr PETER PHELPS: It is not their place, it is the Government's place — it is government housing.
The Hon. JOHN AJAKA: I am satisfied that all action is being taken by Minister Hazzard and by the secretary, who is sitting on my left, that appropriate assistance and care have been given to assist those seniors to locate, in many cases to a brand new home in a location that they choose. It was important for me as Minister to be made aware that those actions were being taken sensitively and appropriately to ensure that these residents are relocated. I also indicate that I have met with a number of residents who have located to these new homes — and I have visited these new homes—and they thanked the Government for what has occurred. At the same time, many residents who have been sitting on the waiting list for years—
The Hon. PAUL GREEN: I was not talking about those residents; I was talking about the principle of ageing in place.
The Hon. JOHN AJAKA: I am talking about Miller's Point residents who have moved and who have said to me that they love their new home. You have to weigh up the fact that everybody benefits from the sale of one property to purchase four other properties. As long as you take the appropriate action in being sensitive and providing all the assistance — and that is what is occurring — to answer your question I am satisfied.

Act 3 - Finance Services & Property
[Available on-line here. Rev Fred Nile is Chair]

The CHAIR: As you know there has been a large sale of public housing properties in the Millers Point and The Rocks region. Do you have an estimate of what you anticipate the income will be from that sale?
Mr DOMINIC PERROTTET: The Millers Point sale?
The CHAIR: And The Rocks. Approximately?
Mr DOMINIC PERROTTET: I will get the figure.
The CHAIR: What income have you received and what income do you anticipate?
Mr DOMINIC PERROTTET: In relation to Millers Point property sales, sales are expected to return hundreds of millions of dollars which will be directed back into the social housing system.
The CHAIR: What is the exact figure?
Mr DOMINIC PERROTTET: That will help more than 60,000 applicants. As at 13 July 2016, 94 properties have been sold with gross sales proceeds totalling $263.4 million. The CHAIR: That is Millers Point?
Mr DOMINIC PERROTTET: That is Millers Point.
Mr NEWMAN: In Millers Point there are 293 individual properties to be sold. We do not forecast sales from those properties until such time as they are sold because it depends upon market conditions at the time of sale.
The CHAIR: You can make a rough estimate?
Mr NEWMAN: We have not done that. We do not provide that information.
Mr DAVID SHOEBRIDGE: You do not provide an estimate or you do not have the information?
Mr NEWMAN: We have not undertaken a forecast for the asset sales for the 293 individual properties.
Mr DAVID SHOEBRIDGE: It is a dartboard process?
Mr NEWMAN: We do not forecast asset sales because market conditions change from time to time. We have seen strong markets over the last two years, particularly in the Millers Point sales.
The CHAIR: More than you expected?
Mr NEWMAN: Yes. We would have underestimated if we had tried to forecast sales, so we do not undertake detailed forecasting and provide that. The CHAIR: It has been suggested to me that the table sale of public housing properties in Millers Point and The Rocks will raise in excess of $880 million, including the figure you have quoted.
Mr DOMINIC PERROTTET: What is important is that there are 94 that have been sold and that has generated $263.4 million. There are, going forward, a further 293 properties to be sold in addition to the 94 that have been achieved so far. It is not for us to make a determination as to what that would be. As you can see, 94 properties netted $263.4 million. The properties are different and there are 293 further properties to be sold and we are working through that process. The CHAIR: The income is far in excess of what you originally anticipated. It has been very successful, in other words.
Mr DOMINIC PERROTTET: I would say it has been a successful process to date. I do not want to make any commitments in relation to the amount to be obtained from the process. There are 60,000 vulnerable people on a waiting list for social housing. Through this process we will provide further homes to those who need it. For example, if we look at the recent decision not to list the Sirius building, a great decision from the Minister for Heritage, we will now be able to provide 300 extra families with access to social housing.
The CHAIR: That is the point I am seeking to make: How much of that money will go into public housing and how much into general revenue?
Mr DOMINIC PERROTTET: Two things in relation to that, first, the Government has made a commitment that for any sales in relation to Millers Point the funds will be directed back to social housing. There will be no funds going to consolidated revenue, the funds go directly to social housing. Second, as with other areas of government, if an agency sells an asset those funds go back into the capital expenditure for that agency going forward. We want to incentivise good financial management within agencies to ensure the increase in capital expenditure over the years is supported through them looking at better ways to manage their asset portfolios. We put those measures in place to ensure that they do just that. Millers Point is a fine example of that process having a strong effect to help the vulnerable people in the State. The CHAIR: You mentioned the Sirius building. What are the plans for that building?
Mr DOMINIC PERROTTET: The heritage Minister made a decision to not list the Sirius building on the heritage register. That was a decision he made.
Mr DAVID SHOEBRIDGE: Despite advice.
Mr DOMINIC PERROTTET: We are the Government, we make decisions.
The CHAIR: What is the next step?
Mr NEWMAN: Chair, the next step in the process is for us to undertake a sale strategy for that asset. That is what we are working on now. That sales strategy will include determining what is the right method to take the asset to market and what action we should take to put that asset in the right condition for sale. That may include undertaking a detailed review of items such as the title, building condition, the current planning consents on current planning approvals for the asset and other normal due diligence you would undertake on an asset prior to sale.
The CHAIR: Does that include demolition of the building and selling empty land for redevelopment?
Mr NEWMAN: No, there has been no decision on demolition of the building. That is part of the development of the strategy, whether or not you sell the building as it is. The Government has not made any decision on the structure itself at this stage.
Mr DOMINIC PERROTTET: Some of us have personal opinions on the quality of the architecture.
The CHAIR: I know there is a big debate on it. Some people wish to retain it.
Mr DAVID SHOEBRIDGE: Including the Heritage Council.
The CHAIR: I have visited the Sirius building and spoken to elderly female residents who are still living there. I hope you do not demolish it too quickly, because there are people living in it at the moment.
Mr DOMINIC PERROTTET: The Minister for Family and Community services is dealing sensitively with that process.
The CHAIR: I know it is the responsibility of another Minister, but the challenge is to make sure that those people are relocated to reasonable accommodation in the future.
Mr DOMINIC PERROTTET: I accept that these are difficult decisions and there are sensitive elements to them. I believe that the Government is taking the right approach. We are doing this in a way that ensures we balance the care and needs of those who are vulnerable who currently live in those buildings—and who, in many circumstances, have been doing so for some time—with the need of other vulnerable families to access social housing.

Act 4 – Premier [Available on-line here.  Again, Rev Fred Nile is Chair.]

The CHAIR: I have been involved in helping residents in The Rocks and Millers Point especially the very aged residents, particularly females, in the Sirius building. I know you have had great success with selling public housing properties in Millers Point and The Rocks. Figures given to me show that if everything is sold it could raise in excess of $880 million, which is far more than your original estimate of $380 million. Forty tenants still remain in Millers Point who have not received an offer of alternative public housing that meets their needs. The majority of them are frail aged residents who have probably lived in the community all their lives. Does the Government have a proposal to reconsider its approach to the remaining residents to let them remain in public housing in Millers Point or The Rocks?
Mr MIKE BAIRD: The advice I have is that the expectation is $500 million as opposed to the $800 million estimate that you have quoted. That will provide 1,500 new homes, so more than three to one in terms of the number of additional dwellings provided, which is the rationale. To date about 100 properties have been sold and about $260 odd million raised, which has gone towards 650 new homes. But we also understand the circumstances of some of those tenants, the frail and the elderly. The Minister has taken a personal interest to ensure that we listen and respond to those circumstances. We have ensured that a number of dwellings will remain and provide an opportunity for them rather than ask them to move out. The Minister understands those concerns and is directly providing support for those tenants.
The CHAIR: Is there a possibility of retaining the Sirius building?
Mr MIKE BAIRD: The Minister has made a decision in relation to its heritage status. Again, we will do everything in relation to public housing to ensure that the tenants are looked after as part of that process.

Act 5 – The Environment, Heritage  [Unfortunately both Labor and the Greens did not weigh in on the day. Available on-line here. Representatives of both parties were silent on the Sirius building but have included some related questions in the Supplementaries that are to be answered before the end of September. On the same day Myra was speaking out. Check 'The story of my life' here. Keep up the fight, Myra!]

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