Radical reshape of NSW planning laws

The NSW Government has introduced into Parliament a Bill which proposes the most radical changes to NSW planning laws in the last decade.

The changes proposed in the Environmental Planning and Assessment Amendment (Planning System Reforms) Bill 2025 go well beyond promoting the key objective of accelerating housing delivery. They will affect the assessment and approval pathways for most development in NSW, by refocusing planning decisions on key issues, expanding accessibility to pathways, streamlining assessment and decision-making, and simplifying development delivery.

The Bill would amend the Environmental Planning and Assessment Act 1979 (Planning Act) to make changes which affect all scales of development, by the public and private sectors, though most changes are focused on smaller scale projects. The introduction of the Bill coincides with the establishment of the Investment Delivery Authority – an initiative intended to promote investment in large scale projects in NSW.

There's a lot of detail in the proposed changes, and some of it is reserved for regulations which are yet to be drafted. In this article, we have highlighted the key changes.

NSW Government's key objectives with the Bill's reforms

New authorities to make development decision-making more efficient

Development Co-ordination Authority

The Bill creates the Development Co-ordination Authority (DCA), which is effectively the Planning Secretary supported by a specialist team in the Department of Planning, Housing and Industry (DPHI). The DCA's primary role is to replace other State government agencies in:

• making decisions under the integrated development process on whether approval under several other environmental laws (eg. EPA licensing, roads, bush fire risk, water approvals) should be given for a development proposal submitted to a council and, if so, on what terms (known as General Terms of Approval); and

• making decisions about concurrence, and responding to consultation requests, where these are required under planning instruments such as State environmental planning policies (SEPPs) and local environmental plans (LEPs).

This means that a council needs to liaise with the DCA, and not with several other agencies, in seeking decisions or feedback on a development application (DA) under other environmental laws as part of the DA process.

According to the Planning Minster, the DCA will co-ordinate in-house the relevant technical expertise to deal with the requirement of other, issue-specific environmental laws by “offering a single, cohesive State response” to DAs. This should accelerate decision-making on DAs significantly, if DPHI is able to deliver decisions more quickly than the State agencies it's replacing.

Housing Delivery Authority

The Bill also establishes the Housing Delivery Authority (HDA), which has been operating since December 2024 under Ministerial order. The HDA's primary role so far has been to recommend large residential projects for State significant development (SSD) status to the Planning Minister, and it has recommended more than 215 projects so far.

Investment Delivery Authority

Separately from the Bill, the NSW Government has established the Investment Delivery Authority (IDA) as a panel comprising the heads of several key government agency to provide advisory and inter-agency support for major private sector investment projects.

Expressions of Interest for IDA support have now opened, focusing on advanced technology and energy (including data centres), renewable energy and energy security projects, as well as hotel developments critical to visitor economy growth.

The IDA's main functions will be:

• to advise major projects on how best to navigate the planning system;

• to "co-ordinate necessary infrastructure" for eligible projects (eg. water, electricity); and

• to provide a "centralised service" to fast-track planning assessments and related approvals – it is not clear what this will involve, but it will be less structured than the DCA's role.

While the IDA should provide valuable assistance for key productivity-generating projects, the eligibility criteria for projects to obtain IDA assistance are very high - an estimated development cost of $200m for hotels and $1bn for other projects.

Regional panels to be phased out

The Bill also proposes phasing out regional planning panels and the "regional development" planning pathway, and redirecting decision-making for projects previously considered by those panels mainly to local panels. More local panels will be established and they will be given a bigger workload as decision-making bodies.

New "targeted assessment" pathway

The Bill proposes a new planning pathway, known as "targeted assessment". Targeted assessment needs development consent, but the environmental assessment will not consider environmental impacts, site suitability and the public interest (section 4.15(1)(b), (c) and (e)), both at the DA stage and for any consent modifications.

The Government has suggested that SEPPs would be amended to specify criteria which must be met for a proposal to be targeted assessment development. These criteria are likely to include prior strategic assessment, probably across several potential developments, so that the "targeted assessment" is intended to promote precinct-wide planning, "front load" key assessment issues and avoid duplication at the DA stage.

The Government has also suggested that SEPPs may be amended to limit or remove the need for public exhibition of a targeted assessment DA in some situations.

It has indicated that the targeted assessment pathway could reduce assessment time frames for eligible projects by up to 50%.

More focused and proportionate environmental assessments

Changes to assessment requirements

Responding to concerns from proponents that environmental assessments divert too much time and resources to insignificant matters, the Bill proposes three radical changes:

• the requirement to assess all likely environmental impacts of a DA will be reduced to "significant" likely impacts (section 4.15(1)(b));

• the regulations may specify factors which are or are not relevant for a DA assessment in relation to environmental impacts, site suitability and the public interest, providing specific direction on where assessments should focus (section 4.15(1)(b), (c) and (e)); and

• the requirement in Part 5 of the Planning Act for determining authorities to assess all environmental impacts of an activity which is permissible without development consent (including many public infrastructure developments) "to the fullest extent possible" will be reduced to an obligation to consider environmental impacts "in a manner that is proportionate to the nature and risk of the activity" (section 5.5).

While the more focused obligation for DAs should remove the need for unnecessary assessment, we expect it will lead to debates in relation to many DAs about what is significant and what is not. A similar outcome for determining authority assessments under Part 5 is less likely, because the assessment scheme in Part 5 is designed so that public authorities often carry out the assessments for their own projects.

More accessible complying development

The Bill also proposes a mechanism for proponents to obtain variations of some development standards for complying development (eg. setbacks, minimum lot size), so that they are not directed into the development consent pathway because they do not meet all of the strict standards which apply to complying development types. The variation would be authorised in a certificate issued by the relevant local council or another prescribed person.

This should make complying development much more accessible.

Consent conditions to be standardised and proponents to be consulted

The Bill would:

• allow SEPPs to specify standard development consent conditions (in addition to the regulations which already can do so), including "model conditions" and criteria for councils to prepare their own conditions; and

• require consent authorities on a DA to give a DA proponent at least 7 days to review and comment on draft consent conditions.

A development consent condition has no effect to the extent that it is inconsistent with a standard or model condition.

These changes should make conditions more practicable and speed up post-assessment DA processes. However, they could also cause difficulties where consent authorities impose conditions of their own on topics which model conditions already cover.

Simplified pathways for development consent modifications

Under the changes proposed in the Bill:

• applications to modify development consents which involve no environmental impact will not need public exhibition, in the same way as modifications to correct minor errors, misdescriptions or miscalculations current don’t need it;

• these categories of modification application cannot be refused (and must be approved as soon as practicable) if not determined within 14 days of lodgment; and

• for other modification applications, the requirement for a consent authority to consult with the relevant concurrence authority about modifying a condition imposed in connection with a concurrence will be removed.

Clearer, more directed Planning Act objects

The Bill would reframe the objects of the Planning Act to reflect modern planning considerations informed by current social, environmental and policy priorities.

Additional targeted objectives are proposed to promote the delivery of housing, resilience of developments to climate change and natural disasters, and a proportionate and risk-based approach to environmental planning and assessment.

This change is important because it will guide the way in which the Planning Act is interpreted, including in assisting to resolve some of the potential for debate on some of the more significant contentious changes we have described above.