The NSW Productivity Commission has called for major changes to the NSW planning system based on a report by Sydney planning consultants Mecone that was unearthed through freedom of information legislation.
The results of the detailed study comparing planning in Western Australia, Queensland, Victoria and New South Wales put NSW last of the four in terms of time taken for determinations and the impact on productivity.
Essentially NSW planning determinations take twice as long as the other three states and this has a big impact on the holding costs of land and the ability of developers to respond to the market. Some in the community may think the longer it takes the better for a developer to build new homes but the end result is to increase the cost of the homes.
Here are a few of the statements from the Mecone Report:
“Based off Department of Planning, Industry and Environment published data, demonstrates that many LGAs have clearly been unable to meet demand for the past 7 years.” The figure presented shows that of 33 councils 23 have not met demand over the last 7 years.
“These figures demonstrate that actual completions of dwellings in Sydney has historically lagged well below the level required to achieve State demand projections.”
“Comparatively, Melbourne and Brisbane dwelling approval rates are consistently above the actual dwelling approval rates needed.”
The Mecone Report then looked at whether DA times were improving in recent years. Their analysis showed that between 2015-16 and 2017-18 the mean gross days for a DA determination increased by 44% in the Sydney Metropolitan area and in NSW. So DA times are getting longer.
For Medium Density Housing the report states:
“NSW has a significantly longer estimated actual development timeframe, at 200 business days compared to between around 70 to 105 business days for other states. This actual timeframe is almost double the next slowest state (QLD’s Impact Assessable pathway) and more than triple the assumed legislated timeframe of 60 days.”
In a final chapter titled “Overarching Observations” the Mecone Report makes some negative statements about NSW.
“NSW has very rigid requirements for the development of LEPs – providing the least flexibility.”
“QLDs ‘Code Assessable’ and ‘Impact Assessible’ pathways significantly simplify the development pathway for proponents.”
The report identifies significant additional requirements within the NSW system that are not evident elsewhere. This includes extra competitions and design review processes as indicated below.
“The need to go through concept and detailed processes, as well as design competitions and SEPP 65 design review panels.”
“Concept DAs and Design Competitions …significantly extends the DA process timeframe (essentially doubling it).”
“NSW typically would require the largest number of reports, plans and forms for any DA.”
The Mecone Report that underpinned the NSW Productivity Commission’s review of the state’s planning system couldn’t be clearer. NSW has a slow and complex planning system and major reform is needed.
The NSW Government has said it will improve the planning system but it seems there is an underlying political problem as most Sydney siders don’t want growth and change.
The Federal Productivity Commission undertook a survey in 2011 of attitudes about growth and change in Australian cities. Melbourne and Brisbane recorded that half the population would not like increased population but in Sydney two thirds did not want population growth. It is this attitude against increased population that has filtered into planning departments at state and local level that has made many planners negative about growth.
The Mecone Report listed ‘culture’ as a problem area in the NSW planning system but no real recommendations followed to address this. If the culture of planners does not change then NSW and Sydney will continue to go backwards.
I guess we need to wait and see just how strong the NSW Government will be to reform its planning system from being the worst performing in Australia. Unless real change is undertaken NSW and Sydney will slip behind other states and territories. The Mecone Report should be the catalyst for real reform so that the state’s productivity in planning is significantly improved.