NSW would defer local infrastructure contributions, unlock A$900m

The release says the aim is to reduce upfront costs by allowing developers to pay later in the construction process.

The release also says the government plans to streamline and rework the rules on how councils levy local infrastructure contributions and then spend the money. It does not set out what the revised framework would contain.

The numbers

The release says the government aims to unlock more than A$900 million in infrastructure contributions already collected by councils. As an immediate first step, it says the planning minister would issue directions allowing councils to spend more than A$900 million held under repealed contribution plans.

It also states that councils hold a collective balance of more than A$4.6 billion in infrastructure contributions. The release does not say how that balance is split between councils or how much of it is committed to works.

For context on approvals, the release says a development application can take up to 130 days to prepare and assess and cost A$30,000. It also says nearly 50,000 homes were completed in New South Wales in 2025-26, up 16 per cent on the prior year, while the national figure rose by 2.8 per cent, and that housing commencements rose by more than 10 per cent.

What’s next

The release gives no start date for the deferral, and it does not say what legislation, regulation or instrument would carry the change.

For councils, the release says the government would consider a potential extension of financing facilities where needed for councils affected by the timing change. It also says that where councils hold contributions for an unreasonable period, the state would step in and use those funds to directly deliver infrastructure. The release does not define an unreasonable period.

The same release lists other planning measures. These include simplifying approvals so fewer projects need a full development application, covering minor renovations, internal fit-outs and signage, by expanding exempt and complying development pathways. It also lists clear document requirements and page limits for applications that are still needed, standardised conditions that councils can place on approvals, and consolidated compliance and reporting information for common business types.

Earlier this week we reported on a Land and Environment Court appeal over 69 units at Hornsby, another New South Wales planning outcome that bears on how projects reach approval.