The numerous problems that need to be addressed
Part 2 of a 3 part series

In this three-part series, I’ve been looking at how governments and unions dip their hands into the pockets of business owners and help themselves to any profits by way of taxes, high labour costs and other forms of revenue. Here, there’s more to it, and I’ll be taking a look at governments in general and their ridiculous costs for everything when it comes to building a development.

The topic of government charges was discussed briefly when I talked about the different taxes that state and federal governments lay on us, and also through their pseudo-government departments, which are disguised as little quangos or whatever they are.

The fact of the matter is that if you’re in property, and let’s face it, most businesses need to operate out of a property somewhere, then the government will charge you a tax on the value of the property. It’s called land tax. Brilliant idea, isn’t it?

You would think so, but I’ll tell you why it isn’t.

Hurting the business owners with more tax
The price of land tax gets passed on to the business owner who’s operating out of that business, and he just ends up passing it on to his customer (product price hikes). But, if you’re in a business that’s a price taker and not a price maker, then your only option is to reduce your costs. But how? Well, you can’t go to the government and say, ‘You need to reduce my land tax because I’m going to go broke if I keep paying this,’ because the government is going to respond with, ‘We don’t care’. The only thing you can do then is either reduce the size of your workforce, or scale your business down to make it smaller, or else close the doors and sack everybody. Simple as that.

Nobody’s going to run a business and pay everybody else more than they get paid themselves. They’re going to give up on that idea, because quite frankly, what’s the point? If you’re not making more money than everybody else, why be in business? Why carry all the risk?

Business owners are thinking about these sorts of issues 24-hours a day, seven days a week, wondering how they’re going to pay one bill, how they’re going to improve, how will they reduce customer complaints, how will they improve productivity, sales, marketing and revenue. These thoughts go on long after the card’s been punched, mind you.

Want to develop? Fat chance
On to governments and their interferences with property development. With all these different levels of government, each one has development timeframes. So, you want to develop? You need to fill out an application form, but that takes time, and bear in mind you’ve still got holding costs on the property. Once your application goes through, you’ve then got to develop it further, and then pay more money to one department, then another and another. Before you know it, you’ve got all these charges that get banged onto the application.

I’ll give you a case in point. I knew a fellow who was trying to put a development together in a Perth suburb south of the Swan River. He spent half a million dollars of cold, hard cash on reports, expert opinions, designs and more reports. It took him three years before he finally gave up – it was too hard.

He just dropped half a million dollars and three years of his life. Totally insane.

I’ve been dealing with government on a particular project since June, 2011 and yet here we are in 2017 and we still haven’t gotten it resolved. I can’t believe it myself, because from the start it will employ people, develop amazing things, and create jobs for youth. The project has benefits for charitable works, and yet I’ve been working on it now for six years. That to me is criminal. There are so many layers of government, so much regulation, so much red tape, because you have to studies done, reports done, another study done, and then another report done. By the time you get all of it done, you’ve just wasted 12 months of your life, and then you get to the end of it all and the government turns around and says, ‘Well, we need another report.’

I have another case in point. I had one case with Belmont Council in Western Australia. The council asked me for an Independent Traffic Management Report, so I got one done – it cost me money (lots of it) and I presented it to them. At the meeting the planning person (let’s not go into what I think of this individual) said, ‘We don’t believe it.’ I replied, ‘Well, if you don’t believe it that’s not my problem. You asked for an independent report, there it is.’ The rest of the conversation went a bit like this:

‘Yeah, but we don’t believe it, so you have to do it again.’
‘No, I don’t. If you want to, you do it again. I’ve done it. If you don’t believe it, you get your own report done.’
‘No, no, no, you have to do it and you’re going to pay for it.’
‘No, I’m not.’

Consequently, that development has been stopped. I got my deposit back and the property is still sitting there empty, so there’s another business that’s not going anywhere and that, again, is simply criminal.

It’s of my opinion that local governments are the worst. They really have no clue and all they’re about is seeing what we, the people, can do to frustrate the system even more.

Another development issue of mine I’d like to bring up – a bus stop needs to be moved. It’s taken four, maybe five months to get to a stage where it can actually be moved. Imagine the time we’ve wasted, and the money we’ve wasted, backwards and forwards over a jolly bus stop.

This is the same country where the prime minister of the country has gotten up and said, ‘The housing crisis we have in Australia is due to a supply issue, we don’t have enough supply.’ No wonder there’s not enough supply, because we deal with fools at local government level who think that moving a bus stop will be detrimental to their lives. Therefore, no one can develop the land, because if you can’t move the bus stop, you can’t develop the land. And if you can’t develop the land, there’s a whole heap of houses that don’t get built.

How clever is that?! This is what we put up with every day, and the people in their ivory towers that live in Point Piper and Toorak and all the leafy suburbs where there are plenty of money, they don’t have to deal with this nonsense because they’ve got somebody in their office who deals with it, so they don’t even have to touch it.

Then, when you try and talk to a government minister, they don’t even bother to get back to you. You send them an email, you want to talk to them about a project and explain that it will employ people and be beneficial for a wide variety of people and organisations. But they don’t even bother to get back to you.

If you start dealing with this stuff on a daily basis, you’ll slowly go stir crazy because it really is insane, and you just keep going around and around in a circle. How can property developments be so difficult, when there is clear indication of employment and profit for large groups of people and organisations? It just doesn’t make any sense.