Environmental Planning and Assessment (Planning System Reforms) Bill 2025

Mr PAUL SCULLY ( Wollongong—Minister for Planning and Public Spaces) (14:30:20): I move:

That this bill be now read a second time.

I am pleased to introduce the Environmental Planning and Assessment Amendment (Planning System Reforms) Bill 2025. This bill represents significant reform to the Environmental Planning and Assessment Act 1979 [EP&A Act], but it is also a continuation of ongoing reforms made by the Minns Government. Our reforms have been guided by the following principles: We need more homes and jobs, we need well-located homes around transport infrastructure, we need more social and affordable housing, we need to make sure these new homes are well designed and well built, and we need to approve them and build them as quickly as possible. We need to reform the confused planning system.

Over the past two years we have been implementing bold reforms to the New South Wales planning system. So far these have included the Transport Oriented Development Program, rezoning land around 37 train stations from the Hunter to the Illawarra, and seven transport oriented development accelerated precincts to deliver tens of thousands of more homes over the coming years. We have also provided incentives for affordable housing. We released the pattern book to help deliver homes faster by providing anyone who uses the endorsed pattern book designs with a 10-day approval pathway. We introduced the Housing Delivery Authority [HDA] to help accelerate the assessment of new homes and we introduced the Low and Mid-Rise Housing Policy, allowing dual occupancies, terraces, townhouses and semi‑detached dwellings in almost all local government areas in the State—which was previously not allowed.

The reform changed planning controls within 800 metres, or a 10-minute walk, around 171 town centres and stations, restoring permissibility and addressing the missing middle. We led the nation by introducing the highest energy efficiency standards in the country for new homes, saving homeowners over the long term on energy bills. We have undertaken an audit of New South Wales government land to free up surplus land for housing. We have made the biggest investment in social housing in New South Wales history to fund around 8,400 new social homes. We are introducing a Pre-sale Finance Guarantee that commits to purchasing up to 50 per cent of dwellings in eligible off-the-plan residential projects to help developers secure financing and accelerate the construction of new homes.

We have introduced the most comprehensive set of rental reforms in more than a decade. We released the Industrial Lands Action Plan, which sets out a new approach to plan, secure and manage the supply of industrial lands to deliver new jobs, drive investment and support the building of more homes. We look to the future by taking the lead on the adoption of artificial intelligence in planning assessments for major projects to free up time and resources for our planners. These initiatives are underway and are increasing the housing supply New South Wales needs. New South Wales has made commitments under the National Housing Accord, which is an agreement between all three levels of government, including local councils. But it is sometimes forgotten that the National Housing Accord is an agreement that includes institutional investors and the residential development, building and construction sector. In other words, we are all in this together, and together we must deliver New South Wales' share of the National Housing Accord target.

The Minns Labor Government inherited a housing challenge over a decade in the making. For years not enough homes have been built and this is causing young people in particular to move to other parts of the country. Sydney is the 859th least dense city in the world and second most expensive and has less housing diversity than 100 years ago. Our planning reforms are based on enduring Labor values: providing access to the basics, like a roof over your head; creating stronger communities, jobs and productivity for people to prosper; and handing a higher standard of living to future generations. But they are also based on feedback and the experience of those trying to build homes. With this bill, the Government presents the Parliament with a choice. Members can either ignore the many sources of advice, including the Productivity Commissioner's warning that Sydney will become a "city without grandchildren", or we can act to reverse the trend by making significant reforms to increase housing supply in the years ahead.

Members can either bring communities together in support of more housing and a better planning system to enable it, or they can support self-interest and leave future generations locked out of housing and locked out of New South Wales. Members can either provide opportunities for health workers, teachers, police, firefighters, cleaners and hospitality workers to live closer to their jobs, or they can confine them to hours of travel and time away from their family and community activities every single day. These are the stark choices we now face together. But we also face another choice—keep a convoluted planning system that has lost its sense of proportion or introduce overdue reforms. Some 90 per cent of the development in New South Wales has a value of less than $1 million—a value that is much less than the median price of a home in New South Wales. Over the years, the number of conditions on a consent have more than doubled, delaying the commencement of construction.

The planning system spends a disproportionate amount of time and resources assessing low-risk proposals and debating relatively minor issues that are often immaterial to the outcome. We are sweating the small stuff. We need a system that rebalances the effort and prioritises outcomes over process. The bill builds on planning reforms passed earlier this year, which had the support of the Opposition and other members in both Houses. It goes further with amendments designed to modernise the New South Wales planning system. The Government has engaged in discussions and negotiations with the Leader of the Opposition, the Leader of The Nationals and the shadow Minister for Planning and Public Spaces in the other place. These were constructive discussions, and I thank those members for that. I hope this approach will result in bipartisan support for the bill. It also forms part of the Government's response to the Legislative Council's inquiry into the planning system and the impacts of climate change on the environment and communities, led by Ms Sue Higginson.

The EP&A Act was given royal assent nearly 50 years ago. Since that time, it has been amended multiple times by successive governments and several times by this one. This has created an Act that has become complex and unwieldy. The combined effect over many years has produced an Act and a system that obsesses over relatively minor matters of detail and delays decisions about whether a proposal as a whole has merit. In short, the bill is about re-establishing a planning system that will assess land use to produce outcomes, not give priority to process—a modern system to deliver faster and fairer results. I now outline the details of the proposed amendments to the Act and explain why they are essential. The bill modernises the objects of the Act to reflect contemporary planning priorities. The new objects focus on promoting land use that supports housing supply, climate resilience, economic productivity, the environment, heritage and conservation, and good design and construction.

For the first time, a new object will be written into the Act that supports the need to respond to climate change, promoting resilience to natural disasters through adaptation, mitigation, preparedness and prevention. Significantly, we will introduce a new object to embed proportionality and a risk-based approach to planning and assessment in the Act. These changes are intended to better align the legislative framework with the current social, environmental and policy priorities—objectives that will remain with us well into the future. Accordingly, the changes to the objects point to and provide support for our biggest priorities in land use planning decision‑making across government, industries and local communities. As the House will know, the Housing Delivery Authority opened in 2025 to create a new optional State-led pathway for major residential projects—projects that can deliver the scale and speed of housing we need across New South Wales.

The HDA was introduced in recognition that the State needed to play a role in assessing larger, more complex housing proposals, and it is already proving its worth. To date, I have declared 240 proposals as State significant development under this new pathway. If approved, those projects have the potential to deliver more than 86,700 homes. That level of interest reflects both the urgency of the housing challenge and the confidence that industry has in the HDA's role. This bill will embed the HDA into the Act, making it a permanent but still optional feature of the New South Wales planning system, to give confidence to proponents of large projects that these projects will be assessed within a State significant pathway, offering clear time frames and greater certainty. The bill also includes a series of administrative amendments to support the HDA's ongoing operation.

I now turn to amendments regarding the expansion of the complying development pathway. Complying development is intended to deliver faster housing. Approvals can take as little as 20 days, compared to the many months, sometimes longer, for a full development application. A complying development certificate also gives approval for construction. It cuts red tape and frees up planning resources. Currently too many low-risk, good- quality developments are stuck in a revolving door of unnecessarily complex processes. This bill proposes a reform to expand the complying development pathway. This is about restoring balance and getting necessary, low-impact developments like houses assessed and built faster.

Complying development in New South Wales has produced restrictions, not enablement. Planning codes are too rigid and, in some cases, just ludicrous. For example, something as small as a 20-millimetre noncompliance with a front setback standard can send a straightforward application into a full development assessment process. On average, this adds more than 60 days onto the process. Not only does this create delays and expense, but it also overwhelms councils with paperwork and requires a disproportionate level of scrutiny. It has become an all- or-nothing system—either complying or complex and nothing in between. This bill will change that.

The bill proposes to expand complying development to allow for minor variations to standards, like setbacks from the lot boundary, minimum landscaping requirements or site requirements like the width of a lot, without requiring a full development application. Councils would retain oversight, but minor variations with minimal impact could be approved without subjecting the project to months of needlessly intricate process. And, if the council does not make a decision on the variation within 10 days, or 20 days if the council is also assessing the complying development certificate, the variation will be deemed to be approved, and the development can proceed in the complying development pathway. That means more certainty, faster outcomes, less risk of delay and a greater focus on what really matters—the project as a whole.

The bill will also streamline the process for modifying a complying development certificate, cutting out unnecessary procedural steps that add cost and complexity. These changes will say yes to homes, not no based on some minor change. The changes let councils and independent local panels apply scrutiny to the complex applications rather than straightforward applications like dual occupancies, granny flats or small infill projects that we all know we need. This reform has the potential to deliver up to 5,000 homes per year through the complying development pathway and brings flexibility without compromising on good planning outcomes. This is a practical, targeted reform to help home owners build a place to call home more quickly.

The bill also tackles a problem we have heard a lot about: minor modifications to existing development applications. At the moment, some changes are stuck in a grey area. They are too minor to need a full assessment but are more than just administrative. For example, changing the order of project stages or removing a condition that no longer makes sense. Minor changes that have no environmental impact but can hold up the commencement of construction by months. The bill proposes expanding the scope for minor modifications and setting a 14-day time frame for a decision. If the modification application is not decided within 14 days, it cannot be refused. This will cut down delays, save applicants money and speed up construction. These are commonsense reforms that are decades overdue.

There is currently a gap between the faster complying development pathway and a full development application assessment process. There is often a duplication of assessment, public exhibition and/or concurrence requirements, once, when consultation and consideration of important impacts have occurred up-front, and again, when those upfront assessments are again put on exhibition. Targeted assessment will provide a fast-tracked process, bridging the gap between complying development and a full development assessment. It will streamline the process by turning off unnecessary steps if the issues have already been addressed through up-front strategic planning or have been addressed through development controls or codes. For example, the low- and mid-rise pattern book has been through a detailed design process so that impacts are addressed through compliance with the patterns.

This new pathway will allow reduced or no public exhibition, depending on how much strategic work has already been done. It could be used for both small- and large-scale proposals, as long as key planning issues have been resolved up-front or are adequately addressed in the planning controls. If they have done the right thing and done the work up-front, eligible projects could cut assessment times by up to 50 per cent—down to under 50 days. This will accelerate low-risk development, reduce duplication in assessment and free up councils' resources. In a similar way to complying development, controls and codes will be created to allow targeted assessment to operate efficiently and responsibly. Before development can be eligible for a targeted assessment pathway, an explanation of what is proposed must be publicly exhibited. The community will be informed up-front about development that is proposed to for targeted assessment and encouraged to engage early in the strategic process.

I now refer to the amendment to establish the Development Coordination Authority [DCA]. The 2021 NSW Productivity Commission white paper and the 2024 NSW Productivity and Equality Commission housing review recommended better interagency coordination. This new authority will centralise decision-making and advice currently referred to multiple State agencies. The authority will bring together experts from across government agencies to coordinate conditions on development applications. Today a development could be referred to up to 22 different State agencies. If a development application needs to be referred to an agency, it takes about 50 days longer to get a decision. Every additional referral beyond the first, adds 100 more days to the clock.

While parts of the Government have made concerted efforts to streamline their input into development proposals, there are more improvements to be made without compromising environmental outcomes. We have seen the benefits of interagency coordination interstate. Queensland's State Assessment and Referral Agency actively manages cases and coordinates advice from State agencies. Our proposed development coordination authority will go further, with more involvement in housing approvals and bringing technical experts together under one roof. This will allow a centralised decision on concurrences, referrals and integrated development, offering a single, cohesive State response instead of multiple separate ones. This builds on the coordination and monitoring functions that the NSW Housing Taskforce has been providing for the past year.

For State significant projects and rezonings, technical advice will be integrated directly into assessments, allowing real-time conflict resolution and faster decisions between agencies. Applicants, councils and State agencies will have a single point of contact when dealing with the State, enhancing customer service, saving time and providing more clarity and consistency. There will be no weakening of environmental protections or standards. DCA's experts will continue to apply the same legislation, policies and standards set by agencies. Proposed section 4.47A states:

The Development Coordination Authority must, in determining the general terms of an approval or whether or not an approval body will grant an approval, exercise the function as if it were the approval body acting in accordance with the Act under which the approval is granted.

Agencies will continue to be responsible for issuing other approvals and enforcing compliance under their own Acts. As part of the changes, DCA will take responsibility for issuing concurrences and advice on bushfire hazards.

The Government is using this opportunity of planning reform to harmonise and streamline how the planning system deals with natural hazards. The bill will place consultation and mapping requirements for bushfire-prone land from the planning Act in planning instruments so that they can be updated more readily, as needed to keep pace, as scientific understanding and best practice evolve in the same way that similar provisions are done. Crucially, bushfire risk will continue to be subject to rigorous assessment by experts, in line with the requirements of the NSW Rural Fire Service. Overall, centralising and coordinating State Government interactions will make the planning system more nimble and more certain. It will lead to more consistent and robust management of risks, all without changing the way proposals are assessed, unless that change is driven by the relevant experts in agencies. The bill makes provision to formally establish the DCA, as well as assigning it key functions, delegations and enabling powers in the Act.

I now turn to the amendments regarding the roles and functions of consent authorities. This bill will simplify the approval layers for development applications and focus accountability for making the final decision. Right now, who determines an application—local councils, local planning panels or regional planning panels—is not clear to applicants or communities. There is also very little difference between development that is considered by a local versus a regional planning panel, creating duplication of function with a cost and administrative impost. This bill will remove the regionally significant development pathway and give effect to a staged removal of Sydney district and regional planning panels because, on average, applications take 100 days longer via Sydney district and regional planning panels than local planning panels. So, instead, this bill proposes that regional planning panel functions will be handed back to councils and local planning panels. This change alone is expected to return around 350 development applications a year to local determination. That means less confusion, red tape and administration, and greater clarity on responsibilities.

In regional areas with small volumes of applications, we will utilise joint local planning panels with local representation from each council area. This approach will make sure there is continued local representation in development decisions, aligning with the ministerial statement of expectations on development application approvals. The Department of Planning, Housing and Infrastructure will carry out secretariat functions on behalf of certain regional councils to minimise any financial impact on those that are not adequately resourced for this change. The referral criteria for local planning panels will be updated to make sure they are focused on genuinely significant matters. This is about restoring confidence in the system by making it clearer through providing locally focused independent decision-making. Recommendations from Operation Dasha and direct engagement on the proposed reforms with the ICAC have informed the proposed panel changes, and the intended implementation approach will reduce the risk of corruption within the New South Wales planning system.

I now outline the amendments relating to public exhibition and community participation in the planning process. The New South Wales planning system must always be transparent. It must be accountable, and it must give the community a voice in planning decisions. However, community participation is inconsistent across New South Wales. In some cases it is duplicative, and in many cases it is unequal. At the moment, every local planning authority is required to prepare its own community participation plan, or CPP, as it is known. That has resulted in more than 100 different plans across the State, each with its own approach, its own timelines and its own thresholds for community engagement. Consultation periods can vary from one week to four weeks. In some cases, members of the public are being asked to comment on matters so minor they barely register as development at all, such as decks, earthworks and retaining walls. This is not sound planning, and it is often used to prevent and preclude rather than create and construct.

The bill proposes to create a single, best practice standard approach for all planning authorities and functions in New South Wales. This reform is about consistency. It is about clarity. The new statewide community participation plan will be prepared by the planning secretary. This will allow the planning secretary to provide appropriate exhibition time frames for different planning matters, based on their impacts. Councils will no longer maintain their own community participation plans but may adopt their own engagement strategies or policies, provided these are consistent with the requirements of the statewide plan. This is a commonsense reform that brings consistency, improves efficiency, protects and promotes community participation for the issues that matter most, so that it is valued and valuable, not criticised for using small matters to hold up proposals that have substantive benefit.

Right now, some conditions make projects harder to deliver—or even unfeasible—because of the burden they place, even though the consent is granted. The proposed bill will allow the imposition of standard and model conditions of consent, and this will be prioritised for housing projects. These changes will bring greater certainty and set sensible limits on the types of conditions that can be imposed. At the moment, conditions are often issued without warning and can be difficult to implement or even contradictory. The Government also proposes introducing a requirement for consent authorities to consult with applicants before finalising conditions of consent. Requiring consultation on the conditions will avoid surprises, reduce unnecessary or conflicting conditions and limit the need for later modifications driven by back-and-forth discussions. It will also allow applicants the opportunity to review and comment on conditions before they are finalised. The accompanying regulations will clarify when this consultation is required—for example, based on the type or scale of development.

Changes will also be made to improve internal review processes, including extending time frames for reviews and pausing the appeal clock while a review is underway. The changes will give applicants the ability to seek a review from local planning panels should they want a second opinion on the decision outside of the officers of the council. The proposed bill will also extend the eligibility for deemed refusals appeals and allow applicants to lodge an appeal up until the development application is determined. These measures are designed to reduce litigation in the NSW Land and Environment Court, which will reduce the costs on applicants and councils and encourage a mediation-first approach to dispute resolution.

Changes will be made to broaden the powers of the New South Wales Government to intervene in so‑called "zombie" consents, which are historic consents that legally commenced decades ago. These consents have caused much local community concern across New South Wales. New powers will provide two resolution options. In the case where development is inconsistent with environmental planning instruments or outcomes, it will be possible to revoke a development consent and pay compensation to the landowner. In other cases, orders can be issued to direct that works be completed in a specified time.

I now outline some other important changes the Government proposes making to how all remaining development applications are assessed in New South Wales. The bill updates section 4.15 of the Act, which sets out what consent authorities must consider when assessing a development application [DA]. Firstly, the Government proposes making changes so that assessment focuses on the significant impacts of a development, so that minor impacts are not given disproportionate attention. Currently, too much time and effort are spent on minor or irrelevant matters that have little impact on the final decision. For bigger projects like State significant development, the changes will help narrow down the issues of contention early and up-front so we do not spend time or resources on things that do not matter.

The Government proposes introducing a power for the regulations to clarify the matters that must be evaluated under section 4.15 of the Act. It will provide the government of the day with flexibility to address interpretation issues with this part of the Act. This will enable the planning system to be more responsive and to address issues without delay. As planning challenges continue to evolve, whether due to environmental concerns, climate risks or best practice, the regulations can be updated to clarify the evaluation criteria easily. This will improve clarity, transparency and accountability of DA decisions and reduce the likelihood of legal challenge.

The bill includes a regulation made under this new power. It addresses previous court judgements such as Hoxton Park ResidentsAction Group Inc v Liverpool City Council [2011] NSWCA 349. In that case, the NSW Court of Appeal found that the likely impacts of a development may include those that flow from an activity not included in the development application. In the case of Hoxton Park, this was offsite road works. This means that a consent authority is often required to assess matters that the proponent has excluded from the application and proposes to be assessed under an alternative planning pathway. The new regulation clarifies that a consent authority is only required to assess the environmental impacts of the development that are proposed under a development application, not those impacts of a development that are proposed to be dealt with under an alternative planning pathway. These reforms are about making the system more practical, more efficient and more focused on outcomes, not just the processing of applications. They are designed to support good development, reduce delays and give everyone involved more certainty.

I also highlight an important change to part 5 of the Act, which deals with environmental impact assessment for activities carried out by public authorities. Currently, those authorities must consider environmental impacts "to the fullest extent possible". Whilst this sounds like a requirement for thoroughness, in practice it has led to disproportionate assessment, especially for low-risk activities like the installation of temporary signage, drilling boreholes for geotechnical investigations or the widening of an existing intersection. The bill replaces wording in the Act so that public authorities can examine environmental impacts appropriately, proportionate to the nature and risk of the activity. Where there is a risk of significant harm, the assessment will be rigorous. But for low‑impact activities, the focus will be on what is truly relevant. Members should note that this change maintains strong environmental safeguards while making the assessment practical and focused. Together these changes will allow public authorities to get on with important work for the benefit of the State.

Another focus of the bill is improving the delivery of housing by reducing uncertainty and delays, especially after development consent has been granted. We know that greater certainty at both the assessment and post-consent stages can make a real difference. It helps reduce the back-and-forth information requests, gives more consistent outcomes and supports faster project commencement. Several legislative changes are proposed to support this. Firstly, the bill allows for a new regulation that enables the planning secretary to set clear information requirements for DAs. This means that consent authorities, including councils, will be required to request consistent and wholly relevant information. It will be clear from the outset what information applicants need to submit, reducing delays and confusion and making sure applications are high quality and assessment ready.

The bill also introduces a range of sensible housekeeping and consequential amendments to help clear up well-known issues and improve how the Act is interpreted and applied in practice. The bill addresses an issue that has frustrated applicants, councils and courts for years: the ongoing legal uncertainty around what constitutes a development standard. This is not just a technical issue; it has very practical consequences. As a result of the term "development standard" not being clearly defined, we have seen a steady stream of appeals to the Land and Environment Court about whether a planning control is or is not a development standard and whether it can be varied or whether it is effectively a prohibition. This legal grey area has delayed decisions, driven up costs, and created widespread frustration and confusion for all involved. In fact, the courts have been sounding the alarm on this for some time.

In 2010 the New South Wales Court of Appeal described the confusion around development standards as "a blight upon our planning system". Another judge described it as a "logical quagmire" and said that the waste of public and private money arguing over these issues should be resolved, preferably by legislation. The bill will do that. It provides a clear, updated definition of "development standards", removing the ambiguity once and for all. This will reduce unnecessary legal disputes and speed up decisions. The bill also brings much-needed clarity to the way non-discretionary development standards are applied. Non-discretionary development standards are important tools in the planning system that limit the ability of a consent authority to consider certain impacts of development if the development standard is met. They prevent consent authorities from refusing or conditioning aspects of development that relate to those standards.

At the moment, when a development application does not meet one of the standards, it is often unclear what level of discretion consent authorities have. Uncertainty about assessing development against the standards has led to inconsistent decisions, adding complexity and avoidable delays. The reforms in the bill set out a clearer framework for how to assess applications, including when and how alternative standards, such as those in an environmental planning instrument, can be considered. In practice, that means that there can be exceedances of non-discretionary standards and, in those cases, they should be assessed on merit. This change is about reintroducing common sense and more predictable outcomes for all parties involved.

Almost 46 years ago the Minister for Planning and the Environment, Paul Landa, said in the second reading debate on the then Environmental Assessment Bill and related bills that one of the objectives of the bill was to "provide positive guidelines for the development process, to speed up decision-making, to foster investment and facilitate economic growth". This bill focuses us on those simple but critical aspirations. It is no simple technical update to the Environmental Planning and Assessment Act. It is a necessary reset of the way the planning system and its pathways work in New South Wales. It tackles the practical delays that are holding up the delivery of homes and job-creating projects and driving up costs. It removes unnecessary red tape that has grown over decades, which may have had a purpose at a given point in time, but which has not stood the test of time. It simplifies decision-making and makes sure that good development—development that has overall benefit—does not get stuck in the system but is still assessed properly.

The reforms are practical, focused, balanced and overdue. They reflect what industry, councils, planners and communities have been telling all governments for years: The planning system is too slow, too complex and far too uncertain. The bill creates a planning system that is faster, fairer, modern and more capable of delivering the homes, jobs, productivity, investment and infrastructure that New South Wales needs, without overturning the fundamentals. It supports the Government's broader housing agenda. It supports the Government's broader job creation agenda. It supports the Government's broader environmental agenda. It also supports the agenda of everyone that needs a home, a job, a good environment and higher living standards. It encourages proponents, big and small, to create homes or modify existing homes to better suit their phase of life. As the Premier said in his McKell Institute post-budget address on 16 July this year, "… the Government's aim is that all parties and independent members across the Parliament join us in a bipartisan effort to modernise this nearly half‑century‑old Environmental Planning and Assessment Act".

Together we can show the people of New South Wales that we are united in providing increasing housing choices for young people, families and local key workers so that they can all have a place to call home—and, most importantly, within the communities they choose. The bill is about change, because times and attitudes have changed. Process does not equal progress. We need outcomes. The reforms mean that our land use will be assessed so that we progress outcomes that include well-designed homes that are not only are close to transport but also great places to live and relax, that generate employment, and which protect and improve our environment. I commend the bill to the House.

Debate adjourned.