Chief Minister Andrew Barr has argued there is no incentive for the ACT government to hold onto land, hitting back against claims that the government is restricting the release of land to maximise its profits.
Mr Barr, who is also the Treasurer, faced the Legislative Assembly's standing committee on public accounts on Monday morning to answer questions about the government's mid-year budget review.
Opposition housing spokesman Mark Parton questioned the Chief Minister about a comment in the statement of risks in the mid-year review, which was the supply and demand of land and what effect this had on government revenue.
"If the demand for land is higher than supply, then there may be upward pressure on prices which would see an increase to government revenues, in the absence of a supply response," the statement of risks said.
"On the other hand, lower than expected demand and/or sale prices would reduce revenue for the government."
Mr Parton highlighted the first part of this statement and said the government had failed year-after-year to meet its land release targets. He argued the government had created a situation where demand for land was higher than supply.
"By your own admission this does put upward pressure on prices resulting in an increase in government revenue," he said.
"I'm just wondering how you could explain how this does not give the appearance that the government is deliberately creating a situation where demand for land is higher than supply, therefore raising more revenue at the expense of Canberrans wanting to buy a single residential blocks of land."
But Mr Barr rejected this, saying the government was able to get more revenue from releasing land and there was no incentive to not releasing land.
"The more land the government sells, the more revenue the government will receive so if the argument is there is an incentive in the system to sell less land there isn't, there's an incentive to sell more," he said.
Recent releases of land for single residential blocks owned by the ACT government have attracted overwhelming demand. Last year, 7400 buyers registered for 51 blocks of land in Macnamara, a new suburb in the Ginninderry development.
In an earlier release for Macnamara there were 8700 buyers registered for 71 blocks.
Mr Barr said supply chain challenges and works associated with creating new suburbs were delaying the release of land.
"There is no incentive to hold back land, there are definitely supply side challenges in the release of land [for example] environmental impact assessments, all of the work associated with servicing a new estate [and] all of the below the ground work that is necessary in order to be able to release a block of land," he said.
The Chief Minister also faced questioning from assistant shadow treasurer Peter Cain about the territory's debt, which is forecast to grow to more than $9.6 billion over the next four years.
Mr Barr said it was not an immediate priority for the government to reduce debt, saying it was increasing to fund infrastructure. Mr Cain questioned whether this meant if debt was related to infrastructure spend, to which the Chief Minister said it was.
"If the government were not to borrow it would be akin to this generation having to effectively pay in advance for the infrastructure enjoyed by subsequent generations," Mr Barr said.
Mr Barr also likened the territory's debt to somebody receiving a mortgage.
"It would be like suggesting that no one could ever have a mortgage to buy a home. That you couldn't invest in the asset until you save up all the cash to pay for it outright," he said.
Mr Cain disagreed with Mr Barr's assessment.
"[That's] a very inaccurate comparison. Everyone pays off their mortgage, that's the goal. The goal is to pay off your mortgage," he said
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