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Deconstructing Adelaide's construction lobby

By Malcolm King - posted Friday, 12 December 2014


One of the most persistent myths in South Australia is the facile old economy belief that Adelaide needs more buildings. It needs another office block in the CBD like a chocolate teapot needs hot water.

South Australia's economy is in dire structural trouble. We have a serious brain drain and shrinking private investment, flat real wages and retail spending, low investment in hard capital and a high attrition of executive public sector and NGO staff. Unemployment and under employment is trending up, kindling a catastrophe in the northern suburbs.

Over the last few years I have publicly criticized the no-growth 'nay-sayers' in South Australia but now it's time to examine the other side - the rent seekers and 'yea-sayers' behind SA's property and construction industry.

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Rent-seeking is the act by lobbyists to gain and redistribute government monies to their clients without creating new wealth.This includes the SA Property Council, the HIA and the REISA – to name just a few – who consistently harangue one of the worst state governments in recent memory, to release more land for development.

A key element of the property development propaganda campaign includes the standard fear tactic, ie, if the state doesn't keep driving urban sprawl and building new glass towers in the CBD, then we can kiss SA's economy goodbye. This 'all or nothing' thinking is childish. What the state really needs is jobs and they won't be in the construction industry. Their use of dodgy, self-generated and self-serving surveys is laughable.

The other dubious tactic is one they stole from former Premier John Bannon. If you're against 'building stuff', you're anti-development, a traitor, a heretic. That's got a touch of 'Mississippi Burning' about it. You ain't from around here, are you boy?

The SA Property Council recently appointed former Liberal Party spin-doctor Daniel Gannon as its new executive director. He escaped the career wilderness of being the Opposition leader's media adviser. One of his predecessors, Nathan Paine, a mover and shaker in property lobby circles, began his career with former SA Planning Minister Paul Holloway.

Paine recently established a new advisory business, Property & Consulting Australia, with Matt Clemow, a former chief of staff to ex-Infrastructure Minister Pat Conlon. They represent a group called State Forward Consortium, which has no public record of its membership nor its aims.

Paine and Clemow also work together at MacroPlan Dimasi, a property/project management business.Clemow is also the General Manager of the Committee for Adelaide, tasked with trying to regenerate the local economy. The Committee's blog has been dead for six months.

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The SA construction industry is propped up by a range of state and Federal Government funded projects. These include(d) the South Road Upgrade program, the government-underwritten New Royal Adelaide Hospital, the $200 million South Australian Health and Medical Research Institute (SAHMRI) and the $1 billion Tonsley Park redevelopment.

While the property industry pays more than $1 billion in state taxes, this is simply returning monies to the public purse. If you think this is capitalism in action, you're wrong. This is trade protectionism. What will happen to the local workforce? It will go to where the work is. If there's a major contract, the work must be tendered nationally. As a lobby group, its core function should be working overtime to ensure private investment in the state – something SA desperately needs.

Adelaide's preoccupation with CBD development stems from failing to ask the most basic question – do we need it? The city is chock full of empty office space (12.4 per cent vacant in August 2014. Now 13.8 per cent and rising). Some parts of the city look like the Ebola virus has hit.

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About the Author

Malcolm King works in generational workforce change. He was an associate director at DEEWR Labour Market Strategy in Canberra and the senior communications strategist at Carnegie Mellon University. He also runs a professional writing business called Republic.

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