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Business
Margaret Paul

Hundreds of millions of dollars in funding for growth areas not allocated, despite huge demand

Congested roads at peak hour. Overflowing car parks at train stations. Portable classrooms on school ovals.

The evidence of population growth putting pressure on services on Melbourne's sprawling outer fringe is everywhere you look.

But the ABC can reveal a fund set up to help pay for those services contains more than $368 million in unallocated funding, and none was promised in the most recent state budget.

The state Growth Areas Infrastructure Contribution (GAIC) Fund was established in 2010 as a way for landowners in new housing areas to contribute to services like new train stations, bus lines, buying land for schools and community centres.

It applies to new housing in Wyndham and Melton in the outer west, Hume, Whittlesea and Mitchell to the city's north, and Casey and Cardinia in the outer south-east.

Landowners, including developers, pay about $110,000 per hectare of land to the fund, which is administered by the minister for planning and the treasurer.

As of May 2022, more than $600 million in funding has been committed to more than 100 eligible projects in newly developed areas.

But experts say the fund is not being spent quickly enough in areas of enormous demand, leading to a huge backlog of infrastructure spending, and electoral unrest.

Residents say suburbs are desperate for infrastructure

Syeda Zahra moved to a new housing estate at Mt Atkinson, between Melton and Werribee in the outer west, earlier this year.

The teacher aide is learning to drive, and there is no local bus service, so if she can't get a lift to Rockbank train station to get to work, she gets a $24 uber.

"That's $45 a day I waste on Ubers," she said.

Ms Zahra has been campaigning for a bus service out the front of the local community centre.

She has bought a deep freezer so she can prepare meals and avoid heading to the nearest shops – a 15 minute drive across the Western Freeway in Caroline Springs.

"These are basic needs," she said.

"A grocery shop, a pharmacy, a bus service."

The GAIC has contributed almost $40 million to bus routes around Wyndham, but locals say despite improvements, most people rely on their cars.

Aaron An lives in Williams Landing, home to 9,448 people in the 2021 census.

The growing suburb has no school, so Mr An's 10-year-old daughter was zoned to a primary school in Laverton, on the other side of the RAAF air base. He said for many local families the school drop-off involves busy roads, including crossing the Princes Freeway.

"Williams Landing is a very nice suburb with a young and vibrant community," he said.

"Sadly, I know some young families had moved to other places just because of the school issue."

Mr An, who is a former Wyndham City councillor, chose to send his daughter to a private school instead.

He said private schools are so popular that local families are putting their babies on the waiting list at birth.

"Imagine if Williams Landing had a local school, we could potentially reduce hundreds of cars in the surrounding roads during peak hours," he said.

The GAIC fund has helped pay for new education facilities across Wyndham, including $875,000 each for kindergartens in Wyndham Vale and Tarneit, and $2.2 million for a primary school in Tarneit.

Underspending in Melbourne's west and north

In Melbourne's outer south-east, much of the money raised locally has been committed — $243 million for projects in Casey and $8.43 million in Cardinia.

But in the west and north, where population growth has been among the fastest in the country, the fund is under-committed.

In Wyndham, 58 per cent of the $247.11 million collected is unallocated, and in neighbouring Melton, 54 per cent of the $276.15 million raised is unallocated.

Overall, $368.93 million is uncommitted, and none was promised in the state's 2022-23 budget.

It's a fact that has not gone unnoticed in areas starved of infrastructure.

Melton Mayor Goran Kesic said despite funding being collected from the area for over 12 years, the community had continued to miss out on their "fair share" of investment.

"Money that is collected in the City of Melton should be spent in the City of Melton – in a timely and strategic way that doesn’t leave communities behind," Mr Kesic said.

"Given $150 million of growth area infrastructure contribution funds collected within the City of Melton are still unallocated, government should be transparent about where it is planned to be spent."

The government denied it was not using the contributed funds appropriately.

"Every dollar of the contribution is spent on providing infrastructure for growing communities – such as schools and ambulance facilities," a government spokesperson said.

On Thursday, Premier Daniel Andrews noted planning processes for major projects took time.

"I wouldn't want anyone to think we're not spending that money and going well and truly beyond — hospitals, schools, road, rail, kinders," he said.

The opposition's treasury spokesman, David Davis, said the lack of spending is short-changing communities.

"Andrews and his Labor government have scooped in massive taxes from growth areas but been hopelessly slow to spend them for the purposes for which they were intended and desperately needed," he said.

"Andrews has starved fast growing areas of the facilities and support they deserve, and have paid for in development taxes."

Experts call for services earlier

RMIT's Centre for Urban Research Professor Jago Dodson said this was concerning because services are not in place when people move in.

"What that means is residents are moving in on day one, and needing to get to work or get around the neighbourhood or get to the city, and so they use their cars," he said.

"And then that behaviour becomes entrenched and so even when, eventually, belatedly a bus service is provided, people have got so used to driving their cars to access everything that the bus service doesn't get the uptake you would hope from it."

Census data shows the average number of cars registered to each household in Wyndham is 1.9, which is slightly higher than the state average of 1.8 – a common trait among outer suburban areas.

Professor Dodson urged the government to spend the money earlier.

"This is the challenge: to provide the facilities when demand is low but we know it's going to grow, and be prepared to accept it won't be economic in a strict user-demands sense for a number of years," he said.

"But there are incalculable benefits that come from that early adoption by the people who are using the service that over the long term have great pay-off."

He said the area around the Tarneit train station is a good example, where the car park is full by about 7am, and the government has recently installed 500 extra spaces.

Infrastructure a 'crucial issue' for outer suburban voters

Redbridge director Kosmos Samaras, a former Labor party assistant state secretary, said a lack of infrastructure is "the number one issue" that comes up in outer suburban focus groups.

"It actually intersects with their perception that historically they're being neglected because they're in safe seats," he said.

He said the feeling of a lack of services may cost Labor votes at this month's state election, particularly in the outer west.

But he said that is not translating into support for the Coalition.

"Yes, they are agitated towards the government or the Labor party in general, but they do not trust the Liberal party at all," he said.

A 2020 Auditor General report on developer contributions recommended investigating reforms to the GAIC program, including improving project selection ad seeking greater council input. 

The report found there are "design weaknesses that impact on their ability to provide required infrastructure to growing communities".

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