Evolution, not revolution: reforms proposed for the NSW planning system

16 Jan 2017

Proposed changes to the planning system will impact developments in NSW. Anyone with a current or future development project or modification should consider seeking advice on the potential implications for their development and whether or not to lodge a public submission before 10 March 2017.

On 9 January 2017, the NSW Government announced broad changes to the Environmental Planning and Assessment Act 1979 (NSW) (Planning Act).  The Minister for Planning, Rob Stokes, outlined that the planning reforms seek to improve housing supply, target delays in processing development applications and provide consistent assessment pathways for major projects.

The extent of reform under the Environmental Planning and Assessment Amendment Bill 2017 (NSW) is not as comprehensive as the NSW Government's previous proposal, the now lapsed Planning Bill 2013 (NSW). However, the wide-ranging changes proposed for the Planning Act will impact on development applications and modifications in NSW.

Community participation and consultation

  • Community participation plans: local councils, relevant NSW Government agencies and the Secretary of the Department of Environment and Planning will have to prepare a community participation plan that reflects the community participation principles to be set out in the Planning Act (unless this can be met through the community engagement strategy it has prepared under the Local Government Act 1993 (NSW)).
  • Early consultation: provisions of the Planning Act will be refined to clarify that regulations may be made to encourage or require certain activities to be performed before lodgement of a development or modification application.  Providing incentives for early consultation will be explored by the Department.  State significant development (SSD) proponents will have to demonstrate community consultation prior to lodgement as part of an environmental impact statement.

Local planning

  • Local strategic planning: to fill the gap in the strategic planning hierarchy, local councils will be required to development local strategic planning statements that provide strategic context and reasoning for local planning controls and take a 20 year horizon consistent with regional and district plans.  These statements are intended to inform rezoning decisions and guide development.
  • Independent Hearing and Assessment Panels (IHAPs): provisions in the Planning Act for IHAPs will be updated and bring existing and future IHAPs created by local councils under one framework.  The Minister for Planning will be given the power to direct a local council to appoint a IHAP where it is reasonable to improve the quality and timing of decisions or manage conflicts of interest or corruption.
  • Local environmental plan (LEP) reviews: local councils will be required to review LEPs every five years for consistency with strategic plans, State environmental planning policies, local demographics and other matters.
  • Development control plans (DCPs) consistency: currently there are over 400 DCPs across NSW which vary significantly in structure and content.  DCPs will now be required to follow a standard format that will be developed in consultation with local councils and model DCP provisions will be developed for use on an optional basis.
  • Voluntary planning agreements (VPAs): the Bill will refine and strengthen the Minister for Planning's power to make a direction in respect of the methodology to be used in a VPA.  Further improvements to the policy framework for VPAs are currently on public exhibition until 27 January 2017, including a draft ministerial direction, revised practice note and planning circular. 

Development assessment

  • Termination of transitional Part 3A arrangements: to prevent the ongoing use of section 75W to modify former Part 3A projects, all existing approvals under Part 3A or the transitional provisions will be moved to the SSD or State significant infrastructure (SSI) pathways (except for development that is completed or under construction).  Modifications under the former Part 3A modification provisions will only be allowed for up to two months following passage of the Bill.  After this time, modification applications will be assessed against the development as at the time it became SSD or SSI.  The section 96 modification power is narrower and requires development to be "substantially the same" as the development originally approved.  The ongoing effect of approval Part 3A concept plans will be preserved.
  • Independent Planning Commission (IPC):  the Planning Assessment Commission will be renamed the IPC.  The IPC will solely be a determining authority and will no longer provide an  advice or a review function in development proposals.  The Department has indicated that this will potentially reduce the State significant determination timeframe by 70 to 160 days.  The current and proposed determination process is shown in the figure below and the changes will require public hearings to be held over two stages.  The first hearing will be held at the end of the public exhibition period and the second hearing will be held once the Department's draft assessment has been prepared.

     Independent Planning Commission

    Source: Department of Planning and Environment, Summary of Proposals, January 2017. 

  • Deterring unauthorised works: planning authorities, including the court, will be prevented from approving modification applications for works that have already been completed (other than in limited circumstances, e.g. minor error, misdescription or miscalculation).  This means that enforcement action (eg. a demolition order), or a requirement to obtain a new building certificate, may be imposed in respect of any unauthorised works. 
  • Statement of reasons: decision-makers will need to give a statement of reasons for any decision that is proportionate to the scale and impact of the decision.  The statement will highlight specific considerations of particular importance to the decision and must be considered by consent authorities when considering any future modification applications.
  • Complying development:  the Department has identified anomalies between the complying development and development application pathways.  Examples of such differences include that a certifier cannot issue a complying development certificate if the development is on an unregistered lot and a special infrastructure contribution cannot be levied for complying development.  The Bill seeks to rectify such differences between the two pathways. 
  • Step-in power: Secretary of the Department will be provided with the discretionary power to give advice, concurrence or general terms of approval on behalf of another agency in certain circumstances.
  • Transferrable conditions: sometimes conditions are duplicated across more than one approval creating parallel regimes that regulate the same impacts (e.g. mining and energy projects currently have multiple agencies regulating their dust, noise, blasting, biodiversity, and other impacts).  To address this, transferrable conditions of consent may cease to have effect when they are adequately addressed in conditions subsequently imposed under other regulatory authorisations (eg. environmental protection licences or mining lease).  Responsibility for enforcing these conditions will then lie with the NSW Government agency regulating the licence, lease or other approval rather than the original consent authority.
  • Consistency with development approvals: following recent case law, the changes will establish a clear requirement for construction certificates to be consistent with development consents and permit the Court to invalidate a construction certificate due to inconsistency.
  • Concurrence for Part 5 projects: the current requirement for environmental planning instruments to require concurrence or notification of public authorities will be extended to Part 5 projects within future infrastructure corridors to avoid inappropriate development in such areas.
  • New design object: the objects of the Planning Act will be updated to include "promote good design in the build environment" to allow for the consideration and balancing of design against other objects of the Planning Act.
  • Enforceable undertakings: to improve compliance outcomes where fines or prosecutions may be ineffective, the Department and local councils will be provided with the power to enter into enforceable undertakings with holders of a development consent.  This will require holders to remedy any harm that has occurred and improve activities to avoid further non-compliance.

Next steps

The public consultation period for the Bill closes on 10 March 2017.  Anyone with a current or future development project or modification should consider whether to seek advice on the potential impacts of the proposed reforms and whether or not to lodge a submission. 

Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.