A detailed analysis: The New South Wales Planning System Green Paper

In this Legal Update, we provide more detail on the four areas of key reform outlined in the New South Wales Planning System Green Paper. Building on the overview of the Green Paper provided in our earlier Legal Update, this update explores the way in which the government seeks to bring about fundamental reform to the planning system and its culture, and also considers the extent to which the Green Paper embraces the detailed recommendations made by the Independent Review.

In June 2011, the NSW Government established the NSW Planning System Review, an Independent Panel chaired by the Honourable Tim Moore and the Honourable Ron Dyer. The Independent Panel’s terms of reference included recommending a statutory framework and necessary implementation measures for a new planning system for New South Wales. With this goal in mind, The Way Ahead for Planning in NSW – Recommendations of the NSW Planning System Review (Review Report) contains matters of specific detail necessary for the preparation of legislation to replace the Environmental Planning and Assessment 1979 (EP&A Act).

In contrast, the Green Paper contains matters of broad policy and is intended to be followed by a White Paper and Exposure Bill which will contain matters of operational detail. It is unclear as to whether matters which have been raised in the Review Report, but not addressed in the Green Paper have been dismissed by the Government, or will be addressed in the White Paper and Exposure Bill. 

As outlined in our earlier Legal Update, the Green Paper identifies four fundamental areas for reform which we now consider in more detail.

The Green Paper places public participation at the forefront of the new planning system and provides for a “public participation charter”.  It is not clear what legal rights are to be afforded to members of the public under the new scheme or what possible remedies, if any, may be available in the event that due public participation is not provided.

The Review Report, while not addressing public participation as a forefront topic, provides recommendations and opportunities for public participation throughout the paper. These recommendations contain details as to how public participation will be provided for in legislation. For example, the Review Report proposes a new neighbourhood right of appeal in the event that a development is approved which does not comply with a development standard where the affected neighbour can demonstrate direct adverse effect as a result of the non-compliance. This right of appeal is proposed in order to balance the removal of non land use table development prohibitions, but has not been expressly picked up in the Green Paper recommendations.

Planning at the State level

The Green Paper proposes a clearer and more succinct hierarchy of strategic plans, with State and Regional level documents (NSW Planning Policies and Regional Growth Plans) containing matters of broad policy. It is proposed that these documents will not have legal weight themselves and will not be statutory instruments. They will be implemented though the lower order strategic plans (such as Subregional Delivery Plans and Local Land Use Plans).

The existing State level planning documents (State Environmental Planning Policies) are proposed to be removed entirely from the planning system. While this may remove the possibility of conflicts between overlapping instruments, it may inhibit the ability of the State to quickly implement matters of State planning policy. Further detail is yet to be provided as to how this will be managed. For example; when a new NSW Planning Policy is introduced, will each of the lower order strategic plans be required to be updated or will those lower order policies be interpreted with reference to the NSW Planning Policy?

Another issue which may arise from the proposed lack of legal weight for NSW Planning Policies is the location of controls presently contained in the facilitative State environmental planning policies, such as the State Environmental Planning Policy (Infrastructure) 2007 and State Environmental Planning Policy (Exempt and Complying Development Codes). The Review Report recommended that these types of controls could be located in a schedule to the Local Land Use Plan, which would provide the State with the ability to control matters of State planning policy whilst locating all controls in one instrument. However this recommendation is not adopted in the Green Paper and there is no clarity about how SEPP controls would be preserved in the new scheme.

Subregional Delivery Plans and Local Land Use Plans

The Green Paper is somewhat unclear about the nature of development controls to be included in Subregional Delivery Plans and the nature of controls to be located in the Local Land Use Plans. This is particularly pertinent in the event that Subregional Delivery Plans are not proposed for every part of the State.

The NSW Government has clearly identified that the Standard Instrument Local Environmental Plan program will continue and that the Standard Instrument Local Environmental Plans will become Local Land Use Plans. This indicates that the Local Land Use Plans will contain similar controls to those presently contained in Local Environmental Plans. However, Local Land Use Plans are also proposed to contain the types of development controls which are presently contained in Development Control Plans.

Subregional Delivery Plans and Local Land Use Plans will also contain three new zones, which we have assumed are in addition to the zones presently contained in the Standard Instrument Local Environmental Plans, as follows:

• An Enterprise Zone aimed to boost employment generation by providing a high degree of flexibility in planning controls and relief from taxes and levies.
• A Future Urban Release Area Zone to identify areas proposed for future growth of residential development.
• A Suburban Character Zone which will explicitly exclude development that adversely impacts on the character of an area.

The Green Paper proposes a number of significant departures from the current approvals system, which include recommending the removal of elected councillors from the decision-making process at a local level. In their place, the Green Paper recommends the appointment of an independent expert panel or of council staff acting under delegation, as the appropriate decision-makers.

Depoliticised decision making

The Green Paper proposes to “strengthen” the decision-making of Joint Regional Planning Panels (JRPPs) and the Planning Assessment Commission (PAC). Interestingly, the Green Paper recommends changes to the way in which both of these entities make decisions. In the case of JRPPs, the Green Paper recommends a much earlier involvement in the decision-making process, with the result that JRPPs would be involved in pre-lodgment meetings with proponents and would be able to engage in regular briefings. The Green Paper goes so far as to suggest that JRPPs may have their own dedicated staff. These recommendations appear to be responsive to concerns widely expressed during the consultation process that JRPPs are presently too remote from proponents during the development assessment process.

Similarly, presumably in response to submissions, the Green Paper recommends that the PAC play what appears to be a more limited role, namely to evaluate the evidence-based merit assessment by the Department, particularly submissions and a proponent’s response to them, rather than re-assessing a proposal itself.

Code assessable development

The Green Paper advocates the expansion of “code assessable” development, although there are a number of unresolved questions as to how this will be implemented.

The Green Paper proposes that fully complying development cannot be refused, and will be approved within 10 days. It is not clear whether the 10 day timeframe will be a guideline or benchmark, or a period with statutory force.

The Green Paper states that code assessable development will be development which meets applicable standards in a subregional plan or a concept development, which raises again the question as to the way in which complying development controls will be established. The Green Paper contemplates that in some cases the Subregional Delivery Plan will not contain all of the necessary standards and requirements, and that in those cases it will be the consent authority (council or JRPP) which conducts a combined code assessment and merit assessment for a proposal against strategic objectives in the plan.

This is an obvious area where further detail is critical in order for proponents to gauge the extent to which the reforms discussed in the Green Paper will, in practice, lead to a greater availability of code assessable development.

State significant development

The Green Paper proposes a suite of reforms to streamline the assessment of state-significant development. One novel reform proposed in this regard is that the consultants who prepare environmental impact statements for state-significant development should be chosen from an accredited panel, and required to meet certain standards regarding the impartiality and quality of their work. Further, the Government is reportedly considering options to codify or streamline the EIS requirements when appropriate. This change represents a significant departure from the present position that proponents are able to select their own consultants, and appears to have its genesis in the questions for discussion identified by the Independent Panel in December 2011.

A further reform which no doubt will be welcome in the area of State significant development is the introduction of a case management approach to deliver better integration between proponents, councils and other agencies, and to enable speedy resolution of inconsistent agency requirements.

Expanding appeals and reviews

The Green Paper proposes the expansion of the existing review mechanisms under section 82A and section 96AB of the EP&A Act. These reviews are proposed to be undertaken by an expert who was not involved in making the original decision. For example, if the development was determined by Council staff, the review must be undertaken by a more senior staff member. The Green Paper also specifies that where the original decision is made by the JRPP or PAC no review mechanism will be available.

More generally, the Green Paper proposes that existing rights of appeal under the EP&A Act would be maintained. Presumably this means that present avenues of access to the Land and Environment Court will not be changed, although this will need to be carefully reviewed when the draft legislation is released.

A key element of the new planning system outlined in the Green Paper is the integration of the provision of infrastructure and strategic planning. It is further envisaged that this infrastructure project delivery would be delivered through the private sector.

The Green Paper recommends that ‘planning agreements need to be phased out or significantly modified and simplified’. It proposes that planning agreements in the new planning system will be based on performance outcomes which would optimise private sector innovation by relying more heavily on developer in-kind contributions and there would be defined time frames for negotiation of the agreements.

The Green Paper proposes three new types of contribution levies:

1. Local infrastructure contributions which are identified in Council’s local infrastructure plan. The contributions will be constrained to provision of funding for councils for local roads, drainage works and community facilities. 
2. Regional Open Space Levy which will be collected for regional open space, regional drainage works and biodiversity off-sets. Acquisitions under this levy could be undertaken by State Government or Councils.  
3. Regional Infrastructure Contributions, which will be identified in Growth Infrastructure Plans, will provide funding for the upgrading of roads, the provision of heath and education facility and land for emergency service facilities.

The Green Paper further proposes that the payment of levies will occur as “as late as practically achievable in the development process” in order to limit any unnecessary costs on the development industry. This recommendation addresses the significant concern of the development industry about the payment of levies early in the development process and which requires a high level of up-front capital.

Significantly, the Green Paper proposes to establish a mechanism to ensure that contributions which are collected are actually spent on infrastructure planning and delivery. Specifically, the Green Paper proposes that:

• Development contributions collected in a catchment will be spent on infrastructure within that catchment – ensuring that the ‘beneficiary pays’ principle is maintained
• Development contribution revenue will be directed, or hypothecated, towards infrastructure provision, rather than getting lost in consolidated revenue
• A clear reporting process through the Budget will show the value of development contributions collected, and how they have been allocated to infrastructure planning and delivery.

The Green Paper proposes a new stream of development called “public priority infrastructure”. These are development proposals which, if identified in strategic plans, could not be refused by a consent authority. The environmental assessment and determination process for these developments will focus on the conditions to be placed on the development rather than whether the developments will proceed. The Review Report proposed that these assessments would be undertaken by the Planning Commission and that these types of development would be limited to large scale developments such as the North West Rail Link. 

The Green Paper does not contain any information about the saving and transitional provisions proposed to be included for the transition to the new planning system. Given the extent of the reforms which are proposed, and the length of time which will likely be required to finalise the drafting of new legislation and then develop the necessary plans in the hierarchy described above, it is clear that significant effort will need to be put into the drafting of savings and transitional provisions to provide clarity for projects and planning proposals which are underway or shortly to commence.

Submissions can be made on the Green Paper until 14 September 2012. Please contact us if you would like assistance in preparing a submission.