A new report by the state's peak business organisation, the Chamber of Commerce and Industry of Western Australia, predicts the cost of building a new home in Perth could rise by $10,000 unless action is taken to secure future supplies of basic raw materials close to Perth.
The availability of basic raw materials such as clay, sand, hard rock and limestone for building and construction is fundamental to economic development and the provision of affordable housing in Western Australia.
CCI's Basic Raw Materials Strategy 1996 - 2008 downloads
CCI's Basic Raw Materials Strategy 1996 - 2008 serves as a blueprint for the development of the state's extractive industries for the next 30 years. It is estimated that approximately 19 million tonnes of sand, rock, limestone and clay are extracted from within a 100 kilometres of Perth, with the industry generating turnover annually valued at more than $864 million.
For years, Western Australians have enjoyed an abundant supply of basic building materials, allowing a large proportion of Perth residents access to a high standard of housing at a modest price. However, dwindling supplies and a failure by state and local governments to identify and safeguard future sources is threatening the industry's ability to meet future demand.
The report found the availability of basic building supplies in and around Perth is under threat with supplies of sand, limestone, and plastic clays at critically low levels.
Competing land interests and the urbanisation of Perth's outer-lying suburbs threatens the industry's ability to contain costs. Areas that were once predominantly used for the extraction of basic raw materials are now burgeoning residential developments or have been set aside as conservation areas.
As a result, producers are under political and community pressure to source basic building materials from further afield, which will adversely impact on their cost. On this basis, CCI estimates the cost of building a new house will increase by $10,000 if materials have to be transported an additional 50 kilometres. It would add $200 million a year across the whole Perth housing market.
The Basic Raw Materials Strategy makes a number of recommendations aimed at striking a harmonious balance between the extraction of basic raw materials and other competing land interests. These include -
- Modifying state planning policies to recognise the importance of the extractive industries.
- Allowing the State Government to control land use planning decisions affecting basic raw material resources.
- The creation of a specific agency with the authority to determine the access and extraction of basic raw materials within a strategic framework.
- The development of a state-wide basic raw materials strategic plan to ensure there is a sustainable supply of quality and competitively priced raw materials for the next 50 years, half of which would be sourced within 50 kilometres of its catchment.
- Develop planning policies that provide certainty to both the public and industry.
Demand for basic raw materials in Perth and the outer metropolitan region has increased almost 40 per cent since 1995 as a result of the city's rapidly expanding population and a trend to build larger homes.
The importance of securing future sources of basic building materials such as limestone and rock has never been greater, with the report predicting that by 2036 demand for these products will be more than double the expected reserves.
Statement by CCI Director Industry Policy, Trevor Lovelle