Urban Taskforce chief executive Tom Forrest said the planning department’s consultation process had highlighted serious issues with the measure. Forrest argued the proposed rules would fail to entice developers to buy into the proposed system.

“Industry is becoming increasingly concerned that the planning bureaucrats have whittled the government’s policy down to effectively make it impractical and unfeasible,” he told theHerald.

“I think it’s inevitable that the whole thing will be revisited. It’s better for the government to come back to the table sooner rather than later to get the political credit for increasing housing supply.”

The government’s reforms were undermined by three key issues,Forrest said.

First,the floor-space ratio and height bonuses attached to developments would not supersede existing council development controls – a departure from what was originally proposed by Labor when the policy was announced in June.

Second,even if developers did not use the entirety of the 30 per cent bonus,there was no flexibility on the 15 per cent affordable housing requirement.

Finally,the affordable housing requirements were in addition to any existing targets set by council,meaning some buildings could need up to 25 per cent affordable housing.

In response to questions from theHerald,Scully said the ongoing consultation with industry was “always envisaged” and the policy was based on “substantive feedback ... informed by their modelling”.

“Happily,we’ve seen tremendous support from the industry when it was released,and community housing providers are looking to get engaged to supply more affordable housing and housing generally,” he said.

Property Council of Australia NSW executive director Katie Stevenson said the organisation was “productively engaged with government” in an effort to overcome challenges such as resolving conflicts with local council rules.

“We are having productive conversations with government to refine the implementation of its important but complex policy to ensure it realises its commendable ambitions,” she said.

Urban Development Institute of Australia NSW chief executive Steve Mann said the 30 per cent height and floor space bonuses needed to be fully realised for developers to privately fund affordable rental housing,calling for the government to consider an alternate model.

“The recently announced affordable housing bonus is a step in the right direction,however industry is concerned that the Department of Planning is drafting a policy which will fail to deliver its stated intent,” he said.

Any change to the reforms would be the second time the government has retreated on housing policy,after Better Regulation and Fair Trading Minister Anoulack Chanthivongshelved efforts to outlaw secret rent bidding following criticism by tenants’ advocates and homelessness groups.

Minns’ appeal to the influential mayors had mixed success.

After meeting Minns last Thursday,Carbone said the two leaders could not agree,accusing the premier of “dumping” Sydney’s population in the western suburbs and seeking to redistribute taxation to pay for amenities for residents “east of Parramatta”.

“It’s one rule for the west and another for the east,” he said.“He is burdening and taxing the working people west of Parramatta,to pay for infrastructure for those that live in the east.”

While open to increased housing targets,Mannoun said any additions required improved social and transport infrastructure to handle the influx of people.

“I told him I was open to what he was saying,in terms of density. Liverpool can be the solution to Sydney’s housing problems. We can take extra growth,but we need the support in terms of amenity,” he said.

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