Political alliance revives market project

Lord Mayor Robert Doyle’s ambition to redevelop the Queen Victoria Market (QVM) appears to be well and truly back on track after a shoulder-to-shoulder vote of confidence from Premier Daniel Andrews on July 11.

“We have the same shared vision, the same goals,” Mr Andrews said.

The Lord Mayor, Premier and Planning Minister Richard Wynne outlined some relevant decisions around planning amendment C245, which had been sitting on Mr Wynne’s desk for almost a year.

Although the full detail of the amendment is yet to emerge, the government will gazette a maximum building height limit of 125m on the Munro site, which is 25 metres higher than the discretionary limit recommended by an independent planning panel.

When the council bought the site for $76 million in 2014, the discretionary height limit was just 20 metres.

But, despite the extra 105 metres, the council is facing losses in the tens of millions of dollars over its Munro investment – losses it is not including in its market redevelopment costing estimates.

Mr Andrews’ endorsement of the project is a blow to the opponents of the redevelopment, who had pinned their hopes on Mr Wynne’s reticence to support the council.

It now appears that Mr Wynne (who refuses to speak with CBD News) has been sidelined from the decision process, which may explain his ignorance over the current QVM detail.  Mr Wynne incorrectly told the July 11 press conference: “My understanding is that, in the recent iteration of this is that there will not be a requirement for any of the sheds necessarily to be moved.”

Cr Doyle’s majority on council and the high-level ALP connections of his planning chair Nicholas Reece is manifesting in a presidential style of lord mayoralty.  Given the Premier’s support for QVM, it is probably no coincidence that Cr Doyle was the previous week attempting to hose down his fellow councillors’ criticism of the West Gate Tunnel proposal (see our story on page 7).

The renewed momentum for renewal comes despite a number of recent political setbacks for the QVM project.

The first was the resignation of QVM chief executive Malcolm McCullough on July 3 after little more than a year in the job.

The second was the release of the long-awaited, but underwhelming, future market retail plan.

Rather than present a document which might excite a market trader about future profitability, the 42-page documents adds very little to what is already known.  Incredibly for a retail plan, dollars are mentioned just once in 42 pages.

The council’s QVM business case is also deficient.

The Lord Mayor makes much of the independence of SGS Economics and Planning (SGS), which authored the Queen Victoria Market Precinct Renewal Program Business Case.

At the July 11 event, Cr Doyle said: “The business plan says that if you do nothing or take a minimalist approach, it (the market) will go under.  It’s not sensationalist in its language but its conclusions are quite chilling.”

“That’s why we went out and got the most rigourous, independent analysis that we could get.  It’s not an internal one.  We didn’t know what was going to come back.  It’s come back and it makes for some very compelling reading.”

However, the consultants were working with the council’s own construction costings.  There was no scrutiny of the council’s $308.77 million construction cost estimate.  There was no scrutiny of the $60 million the council plans to gain from future land sales (bringing the cost estimate back in line with the Lord Mayor’s oft-quoted $250 million net cost).

Given that the council in 2014 expected to make similar profits from its Munro site purchase but is, instead, looking at net losses of potentially $150 million, one might have expected some public disclosure around these numbers.

And is it right for the council to isolate its Munro losses from the cost of redevelopment?  It would be more honest for the council to admit it is looking at costings closer to $400 million than $250 million.

What then, would this do for SGS’s finding that the project will return a ratio of 5.5 for each dollar spent?

Without public oversight of the inputs, the business case has no legitimacy.

The council says it checked its construction costs with quantity surveyors Donald Cant Watts Corke.  But we have no evidence of this.

The council also says that Price Waterhouse Coopers (PWC) has “independently assessed” the business case.  But it refuses to reveal what PWC was specifically asked to look at, or what disclaimers the accountants might have included in their “endorsement”.

The Queen Victoria Market renewal is a terrific project for Melbourne.  And the council should be congratulated for taking it on.

But the City of Melbourne seems incapable of running an open, honest and transparent process.

Community meeting

Opponents of the council’s renewal plans are hosting a community meeting at the Drill Hall, 26 Therry St, at 7pm on Monday, August 14.  The group promises to reveal its architecturally prepared alterative plan for the market.

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