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Office of the Chief Information Officer - Victorian Government Agency Case Studies: Land Exchange (LX)

Department of Sustainability and Environment

The property market is one of the critical industries in creating wealth and growth in the State of Victoria. It is estimated that the market operates on an average annual turnover of $44 billion dollars. However the information system that is currently in place for land transactions is still relatively primitive.

The current delivery of land related information and transactions is predominantly paper-based. The services are often operated and maintained by two or more agencies at different levels of government.

In order to address this, Land Exchange (LX) will establish an online environment where people can exchange land-related information and conduct transactions via the Internet. Core LX functionality will comprise:

• Electronic Conveyancing Project (EC)
  • Electronic settlement, lodgement and registration of interests so that people can transfer ownership in land via the Internet (excludes the conveyancing process that occurs prior to settlement).
• Streamlined Planning via Electronic Applications and Referrals Project (SPEAR)
  • Electronic registration of planning applications so that subdivision and consolidation planning applications can be lodged, referred, tracked and paid for online.
• Crown Land Status Online Project (CLSO)
  • Online access system that allows for the identification of Crown land and the determination of its status.

The role of LX will be to deliver core government land-related information and transactions via the web. Key LX investment outcomes are expected to include:

• faster, easier and accurate transactions in freehold and Crown land
• online access to land related information and transactions across the state
• increased efficiencies and savings for industry and government
• increased process transparency for parties
• reduced risk for the government through the migration from paper to electronic records.

The potential for commercial operation of the LX infrastructure is currently being tested so that the scope for additional revenue to government can be examined. The LX project will be the first ICT initiative of its kind for Australia . It will establish Australia’s most innovative land transaction system and provide the opportunity for the infrastructure to be leveraged in other Australian jurisdictions.

Considerable cost and time delays

Currently, land-related transactions are primarily paper based and require a high level of inputs from government and industry in order to be conducted. Such inefficiencies impose considerable cost and time delays to the government, industry and the community. Industry alone is estimated to absorb additional costs of around $200 million per annum that relate to such inefficiencies. Research performed by independent consultants indicated that much of the cost could be reduced if online access was made available to an integrated land-related information and transactions system.

In addition to efficiency and cost issues identified, there are also challenges to the government in maintaining Crown land records that cover approximately one third of the State. The deteriorating condition of the paper records present risks relating to the long-term maintenance of Crown Estate data. The difficulties in maintaining the condition of the records also means the updating and information sharing of these paper records is problematic.

Faster and easier access

The objectives of the proposed investment must address existing inefficiencies in land information and transaction provision that impose considerable cost and time delays. The primary goal is to provide all Victorians with faster and easier access to accurate land-related information and transactions. In summary, the LX project will address the service delivery needs by:

• creating an efficient and timely system for transferring ownership in land
• streamlining the application and referral process for development
• providing easily accessible and authoritative Crown land status information
• replacing the deteriorating paper Crown land records
• improving connectivity between core datasets
• removing the cost and access differences for rural and regional users.

The EC and SPEAR applications will be integrated into the business processes of the relevant government agencies that are associated with land related services.

The nature of the technical solution can be summarised as:

• object oriented, component based system
• service oriented architecture
• custom development leveraging re-usable components
• strong emphasis on reuse at different levels
• based on the J2EE platform
• uses industry accepted open source products
• high levels of interoperability through use of standards
• uses WebSphere Studio as fully as possible
• uses Java as the development language
• use of well known design patterns
• development based on user requirements.

Major challenges:

Stakeholders and expectations

In order to develop business requirements that are user focused, it was fundamental for the LX project team to engage various stakeholders to ensure the development of business requirements and functional specifications that met users’ needs. Each stakeholder has their own requirements and expectations of LX, it therefore became an integral part of the LX program to manage these expectations.

Governance structure

In order to ensure that key stakeholders contributed to project oversight, it was necessary to establish a comprehensive program governance framework. The framework is based on PRINCE2 project management methodology and has a number of different groups whose terms of reference have been clearly defined.

The management of the governance structure has presented a challenge in terms of meeting the ongoing reporting requirements and ensuring that it remains ‘fit for purpose’ as the program has evolved.

Legislation

The LX system requires a legislative framework to ensure that electronic transactions can occur. The development of the Transfer of Land (Electronic Transactions) Bill has necessitated the resolution of numerous complex issues and required extensive stakeholder consultation.

Expected investment returns

Service Enhancement

• Transparency - Introduction of transparency among the parties to the transaction eg., monitoring of progress
• Responsiveness - Reduction in Land Registry processing timeframes and inputs, thus improved response time
• Quality - Improved data quality via better validation and certification of data
• Convenience - EC - Elimination of need to arrange or physically attend property settlements and removal of bank cheques. SPEAR - data only needs to be entered once, reduced communications with other parties, automatic notification if application is incomplete
• Equity - Removal of cost and access differences for rural and regional users

Financial

• Reduced cost for users / applicants - EC savings for vendor and purchaser reps. is estimated at around $70 per transaction:
  • Potential statutory fee reduction for EC end users (vendors and purchasers)
  • Potential professional fee reduction for vendors and purchasers via industry efficiencies and competitive pressures (EC).
  • SPEAR savings currently being estimated.
• Reduced cost for industries - $33 million per annum saving for industry using EC is estimated by 2010 based on reaching 66 percent of transactions in scope. SPEAR savings currently being estimated.
• Provide Govt revenue - Potential for revenue stream generated from licensing agreements to be used to fund LX operation

Economic Development

• Increased ability to attract new business and investment - Reduced time frames and holding costs relating to infrastructure and property development

System Improvement

• Remove duplication - Reduction in data duplication and maintenance
• Improved functionality - Elimination of paper documents which are often lost or incorrectly completed

Organisation Improvement

• Cross agency processes - Reform of State Revenue Office duty collection process
• Risk minimisation - Prevention of permanent information loss of State's Crown land holding due to rapid paper deterioration

Human resource development

• Improved technology skills - The LX project is an ICT initiative that is first of its kind in Australia
• Greater collaboration across departments - The LX requires collaboration between the Department of Sustainability and Environment, Department of Treasury & Finance (SRO) and a large number of local government authorities
• Commitment to Govt strategy - LX supports the government's commitment in 'Growing Victoria together' in the area of
  • Promote growth in information and communications
  • Improve the business environment through competitive business cost
  • Increase Victoria 's productivity and competitiveness.

Land Exchange Contact Details:

Fiona Delahunt
Land Exchange Program Manager
Department of Sustainability and Environment
Email: fiona.delahunt@dse.vic.gov.au

A copy of the Land Exchange case study is also available for printing pdf format. (This document requires the use of Adobe Acrobat Reader.) (218kb)

Last updated: 23 July 2010

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