Should creating environmental planning instruments be subject to greater Parliamentary oversight?

Last week, the Regulation Committee of the NSW Legislative Council announced it was conducting an inquiry into whether State Environmental Planning Policies, or SEPPs, should be made disallowable by the Legislative Council.

In a media release supporting the announcement, the Committee Chair, the Hon Mick Veitch MLC, commented that the inquiry would provide an opportunity to shine a light on the “scrutiny gap” arising from the exclusion of SEPPs as legislative instruments from disallowance, or the power of veto, by the House. The inquiry will also examine whether the NSW Government Guide to Better Regulation is being adhered to in the making of SEPPs.

The inquiry follows the introduction to Parliament late last year of the Environmental Planning and Assessment Amendment (Review of Land Decisions) Bill 2020 (Land Decisions Bill). The Hon Mark Banasiak MP introduced the Land Decisions Bill as a private members bill on 20 October 2020 before debate was adjourned on the bill on 11 November 2020. In his second reading speech, Mr Banasiak told Parliament that he was introducing the Land Decisions Bill in response to what he termed recent impingements on private property rights without parliamentary scrutiny, and by a mere “wave of the environment Minister’s pen”, including the controversial Koala Habitat Protection SEPP which commenced on 17 March 2021.

If passed, the Land Decisions Bill would introduce three significant changes to the NSW planning framework:

1. It would allow a single House of Parliament to disallow environmental planning instruments (EPIs) made under Part 3 of the Environmental Planning and Assessment Act 1979 (EP&A Act), which include both SEPPs and Local Environmental Plans, or LEPs. At present, the Governor is empowered to make SEPPs on the Minister’s recommendation with respect to any matter of State, regional or district environmental planning significance. Either the Minister or local councils are empowered to make LEPs for the purpose of local environmental planning. The power to make EPIs is subject to certain community consultation and exhibition requirements, but ultimately resides in the Executive.  Under the proposed reforms, notice would be required to be provided to Parliament prior to the making of an EPI, and either House of Parliament would be permitted to pass a resolution disallowing an EPI in whole or in part. Resolutions of disallowance could only be passed within 15 sitting days of the House after notice is provided, with the consequence that existing EPIs could not be disallowed. The disallowance power would be absolute and result in repeal of the EPI. Once disallowed, a period of 4 months would need to pass prior to any attempt to pass an EPI that is substantially the same as that previously disallowed.
2. The Land Decisions Bill would create a new pathway for the mediation of certain disputes arising under the EP&A Act. Under the current proposal, an applicant dissatisfied with any determination by a consent authority under Part 4 of the EP&A Act in relation to a development application or modification application, or an application for a complying development certificate, could request the consent authority to refer the dispute for mediation. Within 14 days of receiving any such request, the consent authority would be obliged to refer the dispute to a mediator. The mediation pathway within a new Division 8.2A of the EP&A Act would be available to applicants in addition to any rights of review presently contained in Division 8.2. Except for certain disputes relating to changes in land use zones or development standards, the costs of mediation would be shared in equal parts by the parties.
3. The Land Decisions Bill would expand the administrative review jurisdiction of the Civil and Administrative Tribunal to include decisions by persons and bodies “relating to the use or value of private land”. Under the proposal, an owner of private land could commence review proceedings in the Tribunal in respect of disputes to which the new Division 8.2A of the EP&A Act applies, but only once mediation has first been attempted and does not result in resolution of the dispute. An applicant’s right of appeal to the NSW Land and Environment Court (LEC) under Divisions 8.3 to 8.6 would remain unaffected.

The above proposals in their current form raise at least the following issues:

1. Any extension of the disallowance power to EPIs could generate great uncertainty in the planning process for proponents of development, especially since it constitutes an absolute power of veto;
2. The proposed mediation pathway is uncertain in a number of respects as it does not prescribe any date by which mediation must take place, nor any process by which a mediator is selected;
3. The status of any agreement coming out of a mediation is unclear, given the Land Decisions Bill contains no clear power for a consent authority to change its Part 4 decision following mediation;
4. It is unclear whether applicants and consent authorities could have their legal representatives present at mediation and how this would affect the proposal that each party be generally responsible for its costs;
5. As observed by the Legislative Review Committee, there is no discretion on the part of the consent authority to determine whether a dispute is appropriate for referral to mediation. The proposal could therefore produce additional costs and resourcing issues for those authorities;
6. The proposed expansion to the jurisdiction of the Civil and Administrative Tribunal would effectively create a parallel system of merits review (alongside the jurisdiction of the LEC), which is at odds with the role of the LEC as a specialist Court. It would also result in duplicative processes; and
7. Decisions “relating to the use or value of private land” would include all decisions not only of councils, but of the Minister, the Independent Planning Commission and the NSW Valuer-General.

It is likely further debate on the Land Decisions Bill will await the outcome of the Regulation Committee’s Inquiry into the disallowance of SEPPs and related matters. The closing date for public submissions to the Committee is 19 May 2021 and the Committee is due to report to Parliament by the first sitting day in August 2021.