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New directions for resource management in New Zealand. Report of the Resource Management Review Panel [2020] NZAHGovRp 1 (30 June 2020)

Last Updated: 29 July 2020

Published by the
Resource Management Review Panel

ISBN: 978-1-98-857998-6 (online)
ISBN: 978-1-98-857999-3 (print)

© Crown copyright New Zealand 2020

This document is available on the Ministry for the Environment website: www.mfe.govt.nz.

Contents

Introduction

When the Resource Management Review Panel began its task last year no one anticipated the COVID-19 pandemic which has dominated our lives in recent months. Our response as a nation has taught us at least two important lessons. First, when faced with a crisis such as this we must set clear goals and priorities to deal with it. And second, we can achieve our goals through the carefully coordinated efforts of us all.
There is a proper case for short-term measures to expedite normal resource management processes in order to stimulate economic growth and employment. But it is more important than ever to set clear strategies for the long-term management of the system and establish processes necessary to implement the strategies agreed. In this report we recommend substantial changes to the present system with the aim of establishing more enduring solutions beyond the present crisis and bringing to an end the series of ad hoc interventions that have been an undesirable feature of legislative change.
We recommend two major new pieces of interrelated legislation:

• the repeal of the Resource Management Act 1991 (RMA) and its replacement with new legislation we have suggested be named the Natural and Built Environments Act (NBEA). This would have a substantially different approach but would incorporate some of the key principles of the RMA that remain appropriate
• new legislation which we have called a Strategic Planning Act.

The focus of the Natural and Built Environments Act would be on enhancing the quality of the environment and on achieving positive outcomes to support the wellbeing of present and future generations. This would include recognition of the concept of Te Mana o te Taiao which refers to the importance of maintaining the health of our natural resources, such as air, water and soil, and their capacity to sustain life. This new focus would be achieved through a system designed to deliver specified outcomes, targets and limits for both the natural and built environments. Significant changes to processes are recommended including stronger national direction and the introduction of combined plans for each region. We expect these changes to result in clearer direction, reduced complexity and opportunity for enhanced environmental quality.
The proposed Strategic Planning Act would set long-term strategic goals and facilitate the integration of legislative functions across the resource management system. These would include functions exercised under the new Natural and Built Environments Act, the Local Government Act, the Land Transport Management Act and the Climate Change Response Act. This legislation is also designed to integrate land use planning with the provision of infrastructure and associated funding and investment. Regional spatial planning will play a critical part in delivering the intended outcomes for the resource management system. The new legislation would include strategic planning for urban growth and responding to change, measures to respond to the effects of climate change, and the identification of areas unsuitable for development due to their natural values or importance to Māori.
Managing the effects of climate change has been a significant focus of our work. We have concluded that the complexities of the process of managed retreat (for example in coastal areas) require new discrete legislation we suggest be called the Managed Retreat and Climate Change Adaptation Act.
Our report identifies the importance of providing for a much more effective role for Māori throughout the resource management system and we make a number of recommendations about how this can be achieved. Given the unique relationship between the Crown and Māori under Te Tiriti o Waitangi, the Panel’s firm view is that a future resource management system should provide a direct role for Māori in decision-making and in the design of measures and processes to give effect to the principles of Te Tiriti. We also recommend the creation of a National Māori Advisory Board with a range of functions including providing advice to government and oversight of the resource management system from the perspective of mana whenua.
While the legislative changes we propose are vital, we emphasise that the success of the new resource management system will depend critically on the capacity and capability of all those involved in it. It is essential that substantially increased funding and resources be provided by both central and local government if the objectives of the new system are to be realised. The failure to provide sufficient resources and build capability has been one of the more important reasons for the failure of the RMA to deliver the results intended.
There are two matters outside our terms of reference that we wish to briefly comment upon. The first relates to the reform of local government. It has become clear to us that the resource management system would be much more effective if local government were to be reformed. The existence of 78 local authorities in a nation of just five million people is difficult to justify. Much could be achieved by rationalisation along regional lines, particularly in improving efficiencies, pooling resources, and promoting the coordination of activities and processes. Reform of local government is an issue warranting early attention.
The second issue outside our terms of reference relates to the rights and interests of Māori in our freshwater resources. Our report makes a number of recommendations about the allocation and use of freshwater. We appreciate this is a difficult issue and we understand the Crown intends to take steps to resolve it by other processes subsequent to our review. During the course of our review, we have attended a number of hui throughout the country and gained an appreciation of the real level of concern in the Māori community on this and other topics. The Panel’s view is that it would be desirable for the Crown and Māori to address and resolve this issue sooner rather than later. Without such a solution, we believe the allocation and use of water rights will continue to pose significant difficulties for all those involved in the system.
We expect our recommendations to result in better quality outcomes for both the natural and built environments and a more responsive system to meet the challenges we face as a nation. These include the need to respond to urban development pressures in our towns and cities, to reverse the deterioration of water quality in our streams and rivers, to address diminishing biodiversity and to deal effectively with the looming threat posed by climate change. Following the individual chapters of the report we have provided a summary of the principal reasons which led to the review and the main recommendations in our report, but note the report itself should be read for a full understanding.
Our report is a first step in a reform process and will be followed by widespread consultation to develop government policy and the form of future legislation.
We conclude by recording our thanks for the outstanding support we have received from the Ministry for the Environment and from all those who have taken the time to engage in the process of consultation and submissions which has accompanied the review. On a personal note, I also express my gratitude for the way in which panel members have given their time and valuable support throughout the review.

Hon Tony Randerson QC
Chair, Resource Management Review Panel
30 June 2020

Resource Management Review Panel members
Rachel Brooking
Dean Kimpton
Amelia Linzey
Raewyn Peart MNZM
Kevin Prime ONZM

About the review

Context

1. On 1 July 2019, Cabinet agreed to undertake a comprehensive review of the resource management system and the resource management review was launched by Hon David Parker, Minister for the Environment, on 24 July 2019. Minister Parker appointed Hon Tony Randerson QC as chair of the Resource Management Review Panel. Rachel Brooking, Dean Kimpton, Amelia Linzey, Raewyn Peart and Kevin Prime were appointed as members.
2. The Panel was tasked with the initial phase of the review and to work with officials to produce a report containing proposals to reform the RMA by the end of May 2020.

Aims of the review

3. The aim of the review, as set out in our terms of reference, is to improve environmental outcomes and better enable urban and other development within environmental limits. The review must design a system for land use regulation and environmental protection that is fit to address current and future challenges and should support the development of a system that delivers cultural and environmental outcomes for all New Zealanders, including Māori, and improves their wellbeing.

Principles to guide decision-making, objectives and outcomes

4. The Panel adopted principles to guide its decision-making, including fundamental assumptions underpinning how the system is designed as well as practical criteria. These are outlined in table 1.

Table 1: Principles to guide decision-making

5. The aim of the review is to improve outcomes across both the natural and built environments and address the underlying problems across the system that need to be resolved: legislation, institutions and implementation. The Panel identified objectives and outcomes it wanted to achieve, and the proposals for reform were developed to align with these. Table 2 outlines these objectives and outcomes.

Table 2: Objectives and outcomes of the review

Scope of the review

6. The review scope includes the RMA, the Local Government Act 2002 (LGA), the Land Transport Management Act 2003 (LTMA) and the Climate Change Response Act 2002 (CCRA) where the RMA intersects with these other Acts.
7. The review was asked to set the high-level framework for an improved resource management system and to consider a new role for spatial planning. A goal of the review was to improve planning responses to the pressures of urban growth, and better manage environmental effects.
8. The review was also invited to consider where relevant the potential impact of and alignment with other legislation (including the Building Act 2004 and Fisheries Act 1996), government programmes and regulatory reviews currently underway within the resource management system. In addition, the Panel has had to consider urgent legislation proposed to respond to COVID-19.
9. The Ministry for the Environment was tasked with providing secretariat functions to facilitate connections between the Panel and related policies and programmes. This included the use of the interagency working group made up of officials from a range of government agencies with functions or responsibilities across the RMA, LGA and LTMA.
10. Institutional reform was not a driver of the review, and it is expected that both regional councils and territorial authorities will endure. However, the Panel did actively consider which entities are best placed to perform resource management functions and how the relationship between the roles of these organisations has increased complexity.
11. Te Tiriti o Waitangi (Te Tiriti) settlement agreements will be carried over into any new resource management system and anything agreed to by the Crown through a settlement cannot be lost or changed as part of the review. The Panel’s recommendations need to be consistent with the principles of Te Tiriti.
12. A number of matters were out of scope for the review such as the marine environment beyond the 12 nautical mile territorial sea outer limit; existing Tiriti settlements; issues with other Acts; and issues relating to Māori rights and interests in freshwater allocation.
13. A full copy of the Panel’s terms of reference is attached as appendix 6.

Panel process and engagement

14. From 20 September 2019 the Panel met weekly until the delivery of its final report to the Minister for the Environment in June 2020. The Panel was supported by a secretariat and policy advice from the Ministry for the Environment.

Issues and options paper

15. The Panel released Transforming the resource management system: opportunities for change
    – Issues and options paper for feedback in early November 2019. The paper asked a series of questions about the existing resource management system and how issues with it could be addressed in a new system. Feedback on the issues and options paper closed in February 2020. In total, 187 submissions were received.

Engagement approach

16. The Panel had a significant engagement programme and met with stakeholders from industry, local government, the primary production sector, environmental non-government organisations and Māori organisations. Comments received informed both the development of the issues and options paper and the Panel’s final report. These comments provided valuable insights into how different sectors view and interact with the resource management system.
17. A list of all groups the Panel met with is provided in appendix 8.

Reference groups and working groups

18. Three reference groups were established by the Minister for the Environment to assist the Panel: Te ao Māori, Natural and Rural Environments, and Built and Urban Environments. Members provided a range of personal and professional experience across all aspects of the resource management system. Each reference group met with the Panel to workshop and test ideas. Membership of the reference groups is provided in appendix 9.
19. The Panel also established a number of working groups coordinated by Ministry for the Environment officials. These working groups were asked to address specific topic and policy areas. They drew on the experience of other agencies, reference group members and other experts. Working groups were established for climate change, spatial planning, environmental outcomes and limits, te ao Māori and economic instruments. Each group worked collaboratively to produce a paper for the Panel’s consideration.

Regional hui

20. During February, the Panel travelled around the country attending regional hui and engaging with iwi and hapū. Hui ranged in size from five to 50 attendees with the highlight being the attendance of school children in Gisborne who were keen to engage in better understanding the resource management system. Whether hui were large or small, the level of engagement was high and provided insights into key issues facing Māori in the resource management system. The feedback (both written and verbal) was valuable in informing the Panel’s final recommendations.
21. The Panel also met with a number of iwi with unique Tiriti settlement arrangements that intersect with the RMA. Many settlements have provided a greater role for iwi and hapū in decision-making and can offer insights into new and unique working relationships. The Panel was mindful that proposals for reform should complement and enhance these unique relationships.
22. Throughout our report ‘Māori’ is used as a broad term that encompasses all of the indigenous people of Aotearoa including both mana whenua and mātāwaka. ‘Mana whenua’ is used when referring to whānau, hapū and iwi who have customary authority over an area, and ‘mātāwaka’ is used when referring to whānau, hapū and iwi Māori living in an area where they are not mana whenua. Other terms are only used when the context demands it, such as, in quotations or when referring to specific sections of the RMA. For example, the term ‘tangata whenua’ is used in the RMA in several places.

Issues and options feedback received

23. Overall, submissions were comprehensive in providing useful information and ideas.
24. Overwhelmingly submitters agreed the resource management system required change. Key themes were the desire to see a move away from an effects-based system, the need to maintain an integrated RMA, support for spatial planning and greater recognition of Te Tiriti and a move towards true partnership.
25. The Panel appreciated the time and effort of all those with whom it met as well as those who made submissions or participated in the reference and working groups. The feedback has all been considered and was a valuable part of the Panel’s process.
26. A record of all submitters is provided in appendix 7.

What happens next?

27. This report represents the culmination of the Panel’s process and is the result of nine months of intensive work. We appreciate and thank all those who have contributed their time, energy and expertise.
28. The Panel concludes its work with the delivery of this report to the Minister for the Environment. The Ministry for the Environment will then provide advice to the Minister on the recommendations in the report. Cabinet is responsible for making all decisions about how to progress the Panel’s findings.
29. Cabinet has indicated a broad, open process of public consultation will follow its consideration of the Panel’s proposals. In addition, Cabinet has directed officials to look for opportunities to collaboratively refine and co-design policy options with Māori during the next phase of the review, in line with Cabinet’s agreed Guidelines for Engaging with Māori. The Panel has made recommendations to this effect.
30. Wide engagement with New Zealanders and stakeholders is anticipated before the introduction of any new legislation.

Overview of the proposed system

The opportunity for reform of the resource management system

1. The resource management system makes a significant contribution to the wellbeing of New Zealanders. It is at the heart of debate about crucial issues relating to the protection of the natural environment, such as freshwater quality and climate change. It is also fundamental to issues relating to built environments, including urban development, housing affordability and regional economic development.
2. The Government gave us the task of undertaking a comprehensive review of the resource management system. This was an opportunity to design a system that delivers better outcomes for the environment, people and the economy. In carrying out this review, we have completed a thorough analysis of issues with the RMA and its interaction with legislation across the resource management system. We have also looked to leading examples internationally.
3. Our proposals for reform are intended to provide a clearer and more positive focus for New Zealand’s resource management system. This will be achieved by reorienting the system to focus on delivery of specified outcomes, targets and limits in the natural and built environments.
4. Our view is that the RMA should be repealed and replaced with new legislation. A Natural and Built Environments Act would focus on enhancing the quality of both environments to support the wellbeing of present and future generations. New and separate legislation should also be established to promote the strategic integration of functions across the resource management system through development of regional spatial strategies.
5. Important aspects of our proposals include:
   • a new focus on enhancing the quality of the natural and built environments to support the wellbeing of present and future generations
   • improved direction for central and local government decision-makers through the use of specified outcomes, targets and limits
   • greater use of mandatory national direction
   • improved recognition of Te Tiriti o Waitangi and te ao Māori
   • establishment of long-term strategic and integrated planning for resource management and infrastructure
   • a stronger focus on decision-making about resource use, development and protection in plans rather than consents
   • simplified and integrated regulatory plans, which are clearer and more directive, and ensuring they respond to changes in economic, social, cultural and environmental conditions through improved planning processes
   • an improved consenting system that better differentiates between activities with significant and minor effects
   • a wider range of approaches to resource allocation than just the ‘first-in, first-served’ approach, guided by principles of sustainability, equity and efficiency
   • wider use of economic instruments such as permit trading and environmental taxes to complement regulation
   • establishment of a nationally coordinated environmental monitoring system
   • an emphasis on partnership in decision-making across central and local government and mana whenua
   • ensuring the system as a whole is efficient and proportionate.
6. This overview contains:
   • a summary of challenges facing the resource management system
   • a summary of reasons why the system has not responded effectively to date
   • a summary of our proposals for reform and how they aim to improve outcomes for the natural and built environments
   • a summary of specific measures to address the review priorities
   • a note about the relevance of our findings to the Government’s response to the impact of the COVID-19 pandemic on the New Zealand economy.

Significant challenges across the system

New Zealand’s natural environment is under significant pressure

7. New Zealand’s natural environment is unique and special. Not only does it provide us with a place to live, learn, work and socialise, it is part of our identity.
8. Our natural environment is under significant pressure.^[1]
   • Climate change: climate change is occurring at an unprecedented rate. In New Zealand the impacts of climate change (increasing sea levels, droughts, floods and fires) are already affecting where people live and how we use our environment.
   • Biodiversity: our native plants, animals and ecosystems are under threat. Almost 4000 of our native species are threatened with or at risk of extinction. In our marine environment, 90 per cent of seabirds, 80 per cent of shorebirds and 26 per cent of indigenous marine mammals are classified as threatened with or at risk of extinction.

Degradation of our natural environment is reducing ecosystem resilience to system shocks that can radically alter the flow of ecosystem services, affecting associated livelihoods and the wellbeing of communities.

Wider environmental decline: vegetation changes are degrading soil and water. We are continuing to see significant loss of native vegetation and wetlands and the reduction of benefits they provide (for example, flood and erosion control, water quality, carbon storage). Our heavy reliance on surface water and groundwater for drinking, domestic, industrial and irrigation uses is threatening the habitat of our freshwater species, increasing the concentration of pollutants and ultimately affecting our ability to use this resource. The way we use the land and sea is also putting pressure on our coastal marine area with harvesting, sediment, nutrients and plastics impacting marine habitats and species.

9. Degradation of our natural environment is reducing ecosystem resilience to system shocks that can radically alter the flow of ecosystem services, affecting associated livelihoods and the wellbeing of communities.

Urban areas are struggling to keep pace with population growth

10. New Zealand is becoming increasingly urbanised. Between 2008 and 2018 our population increased by 14.7 per cent. Ninety-nine per cent of population growth occurs in urban areas. Growth is expected to continue, with the highest rates in Tauranga, Auckland and Hamilton.^[2]
11. People are drawn to cities because they offer the benefits of more job choices, social and cultural interaction, and higher-quality, more diverse amenities and services. However, our cities are under pressure with rising urban land prices and some of the highest housing costs relative to income in the developed world. Poorly managed urban growth has also led to increasing homelessness, worsening traffic congestion, increased environmental pollution, lack of transport choice and flattening productivity growth.
12. The social impact of ever-increasing housing costs has been significant, in particular for the most vulnerable New Zealanders. For example, work by the Ministry of Social Development shows that housing costs for low-income New Zealanders have doubled as a proportion of their income since the 1980s, leading to increased income inequality.^[3] There have also been falling rates of homeownership and increased household debt.^[4] According to the Reserve Bank, New Zealand’s level of household debt is one of the most significant risks to our financial stability.^[5]
13. Many drivers have contributed to these pressures. However some councils, particularly in high-growth areas, are struggling to provide sufficient development capacity for housing in regulatory plans and supply enough infrastructure to support urban growth.

Rapid changes in rural land use have increased pressure on ecosystems

Some councils, particularly in high-growth areas, are struggling to provide sufficient development capacity for housing in regulatory plans and supply enough infrastructure to support urban growth.

In addition to the pressure in urban areas, rapid changes in rural land use have increased stresses on ecosystems. Between 2002 and 2016 there was a 42 per cent increase in the proportion of farmland used for dairy, and a decrease in the area used for sheep and beef. There was also continued intensification of land use and a shift to higher stocking rates.^[6]

In farming areas, water pollution affects almost all rivers and many aquifers – which in turn affects the mauri of the water, human health and our ability to swim and enjoy our water for recreation. Land-based industries are critical to New Zealand’s current and future prosperity, and to addressing global challenges like food supply, biodiversity loss and climate change. A transition is needed to achieve sustainable land use and ensure cumulative environmental effects are sustainable across generations.

Reasons why the system has not responded effectively

Lack of clear environmental protections

16. While a major improvement on the previous system, the RMA has not sufficiently protected the natural environment. The RMA had the ambitious purpose of sustainable management of natural and physical resources. However, the Act suffered from a lack of clarity about how it should be applied – taking over two decades for the courts to settle this through the Environmental Defence Society Incorporated v The New Zealand King Salmon Company Limited case.^[7] As a consequence of this lack of clarity, as well as insufficient provision of national direction and implementation challenges in local government, clear environmental limits were not set in plans. Lack of clear environmental protections has made management of cumulative environmental effects particularly challenging.

Lack of recognition of the benefits of urban development

The RMA’s focus on environmental effects can also mean the positive benefits of development and a long-term perspective are underemphasised.

It is well established that the RMA has not achieved good outcomes for our urban areas. A shortage of housing in New Zealand, and the perception that RMA processes are overly cumbersome and provide insufficient certainty for major infrastructure, have seen a long series of official inquiries which identified shortcomings in the performance of the RMA.^[8]

Some argue that because the purpose and principles of the RMA do not sufficiently recognise the positive benefits of housing, infrastructure and other development, the Act has hampered planning for development. The lack of content about these issues left decision-makers with little guidance on how to plan for development in urban and other areas. Infrastructure funding constraints have encouraged rationing of available land for development in an effort to manage infrastructure cost burdens.

A focus on managing the effects of resource use rather than on planning to achieve outcomes

19. The RMA has been criticised for having too narrow a focus on managing the negative effects of resource use, rather than providing direction on desired environmental and development outcomes or goals.^[9] The RMA is a framework law that enables rather than directs. It does not explicitly set out outcomes to be achieved, other than the high-level goal of sustainable management. Some argue this has made forward planning difficult. The RMA’s focus on environmental effects can also mean the positive benefits of development and a long‑term perspective are underemphasised, despite these being core aspects of ‘sustainable management’.

A bias towards the status quo

20. The RMA has favoured existing uses and consents, protecting established activities from changes to plan rules and standards designed to promote better environmental outcomes. The range of protections of this kind in the system is extensive, which seriously impairs the ability to respond to the environmental challenges New Zealand is facing. The RMA is largely silent on allocation. As resource scarcity has increased, the ‘first-in, first-served’ approach to resource allocation interpreted through case law has become unsustainable, inefficient and inequitable.
21. Furthermore, until recently there has been insufficient recognition of the importance of proactive and strategic planning in the system. Over the last decade, some councils have developed strategic plans and joint spatial plans for their regions, districts and communities to help fill this gap.^[10] Central government has encouraged this form of planning by requiring Auckland to prepare a spatial plan, future development strategies through the National Policy Statement on Urban Development Capacity, and spatial planning partnerships under the Urban Growth Agenda. However, the lack of legal weight and disconnection with RMA plans mean that the full benefits of strategic planning are not being realised throughout the system.

Lack of effective integration across the resource management system

22. The RMA set out to achieve integrated management of natural and physical resources. It drew together statutory decision-making frameworks for management of land, freshwater, soil, air, noise and the coastal marine area, among other things. Despite this, some argue that New Zealand’s resource management system remains insufficiently integrated.^[11]

Plans and decision-making under the RMA, LGA and LTMA all affect one another, but there is poor alignment between land use and infrastructure plans and funding.

Plans and decision-making under the RMA, LGA and LTMA all affect one another, but there is poor alignment between land use and infrastructure plans, processes (including public participation) and funding. This results in inefficiencies, delays and additional costs. Furthermore, multiple plans and processes can make it difficult for the public and Māori to participate in the resource management system effectively. In addition, the system has been weak at managing effects across domains, such as the land and the sea, and cumulative environmental effects.

Excessive complexity, uncertainty and cost across the resource management system

24. Overall, the resource management system is unnecessarily complex. This complexity is a product both of the RMA itself and of its interface with requirements across the LGA, LTMA, Building Act 2004 and wider legislation.
25. Considerable variation across the country creates uncertainty for resource users. Processes are complex, litigious and costly, and frequently disproportionate to the decision being sought or the risk or impact of the proposal. Matters that should be addressed in plans are left to the resource consenting process to resolve, generating needless uncertainty. There have been successive legislative amendments targeting aspects of the RMA, and a proliferation of new arrangements to work around it, such as the proposed Kāinga Ora Homes and Communities planning powers, and special housing areas. While the amendments sought to address deficiencies in the system, these workarounds have resulted in further misalignment between different pieces of legislation.

Lack of adequate national direction

Many commentators argue the main problem with the RMA
has simply been a lack of
national direction.

Many commentators argue the main problem with the RMA has simply been a lack of national direction.^[12] Under the RMA it was envisaged that central government would set national environmental bottom lines and policies through national policy statements and national environmental standards. However, for many years these powers were not exercised. Caroline Miller has described this as a failure of the government to participate in the co-operative mandate that the RMA created.^[13] It has been argued that the absence of national guidelines and policies has left local authorities^[14] and the Environment Court “to take bite-sized pieces rather than adopt a high level vision”.^[15]

While national direction was slow to be developed for many years, since 2013 the number of national direction instruments has increased considerably. National planning standards were also gazetted in April 2019 and set a common structure for plans, and some content, including definitions.

Notwithstanding this increase in national instruments, taken as a whole the suite of national direction is not yet cohesive. A lack of strategic direction across the national direction programme has flow-on effects for council implementation and the management of interactions between instruments. This in turn compromises the ability of individual instruments to have their intended impact.

Insufficient recognition of Te Tiriti and lack of support for Māori participation

29. Te Tiriti is an important part of New Zealand’s unique constitutional arrangements. Better recognising Te Tiriti in resource management decision-making was a driver behind the introduction of the RMA. The Minister for the Environment at the time of the resource management policy development process, Sir Geoffrey Palmer, noted:

the new law will be both practical and just. The principles of the Treaty form an important component for the decisions made in this review. The new Resource Management Planning Act will provide for more involvement of iwi authorities in resource management, and for the protection of Māori cultural and spiritual values associated with the environment.^[16]

30. The RMA contains several provisions that are specific to Māori, including in its principles and consultation requirements. At the time of the passing of the RMA, many Māori were optimistic they would have a larger and more meaningful role in resource management issues.

Since 1991 no RMA functions have been transferred to iwi authorities under section 33
of the RMA.

In some areas, Māori participation in the resource management system has improved over the past two decades. The number of councils engaged with Māori, such as through formal consultation, relationship agreements and iwi management plans, has increased. However, since 1991 no RMA functions have been transferred to iwi authorities under section 33 of the RMA. Nor have any iwi authorities been approved as a heritage protection authority under section 188. Both capability and capacity issues within councils and iwi authorities, and legislative barriers, have limited use of provisions for joint management arrangements under section 36B.^[17]

32. The Honourable Justice Joe Williams has argued that outside the Treaty settlement process, the RMA is the most sophisticated attempt in New Zealand law to bring together both Western and Māori concepts in the way envisaged by the Treaty. However, he also points out that the RMA is ‘not pulling its weight’. Treaty settlements have been more successful in providing for Māori to become partners in decision-making about resources. According to Justice Williams, this is “a significant admission of failure in the RMA itself, since the mechanisms to achieve similar outcomes have existed in that Act for more than 20 years without being deployed”.^[18]

Weak and slow policy and planning

33. Plans are regulatory instruments and should be clearly and unambiguously expressed. Some plans have been poorly drafted and many have not effectively managed cumulative environmental effects. There are also poorly designed and unnecessarily complex rules that have caused problems in urban areas. The proliferation of planning documents under the RMA has added complexity and cost, as both applicants and administrators must trawl through a multitude of policies to discern relevant direction. RMA policies and plans also lack integration and alignment.^[19]
34. Plan-making under the RMA has been too slow, partly due to the multiple avenues to relitigate decisions. This means the planning system has struggled to respond to challenges as they have arrived – in particular the housing crisis, intensification of rural land use and climate change. In practice, a council will have difficulty changing a plan within its three‑year electoral term.

Weak compliance, monitoring and enforcement

35. Weak compliance, monitoring and enforcement (CME) across the resource management system has undermined rules in plans that protect the environment. Problems with CME are rooted in both statutory provisions and institutional arrangements.

Weak compliance, monitoring and enforcement across the resource management system has undermined rules in plans that protect the environment.

Penalties for non-compliance are weak in comparison with those of other Commonwealth nations. The cost-recovery mechanisms of the RMA are poor, especially in relation to permitted activity monitoring and the investigation of unauthorised activities. Many offences have significant elements of commercial gain, but recovery mechanisms, such as civil forfeiture orders, are rarely used in RMA offending. Penalties imposed by the courts at sentencing are sometimes dwarfed by the commercial gain to the offender.

The devolution of CME functions to a large number of small local government agencies has also created a fragmented system. Many councils lack the economy of scale to properly resource CME and there is evidence from time to time of bias and conflicts of interest in implementation. Exacerbating this fragmentation is a long history of weak oversight and guidance from central government.

The fragmented system and limited economies of scale in our councils have held agencies back from investing in new technologies and tools. Information management across the sector is highly variable, and regulators have poor mechanisms for sharing data and intelligence about offences and offenders. Few councils have invested in new technologies such as remote sensing, latent devices, and drones for inspections or automated reporting systems.

Capability and capacity challenges in central and local government

39. While the legislation has some clear problems, a significant contributor to the difficulties with the RMA has been insufficient capacity and capability in central and local government to fulfil the roles expected of them.^[20]
40. Insufficient resourcing is considered one of the reasons for central government’s failure to implement national direction. Capacity and capability limitations within local authorities are frequently cited as a root cause of delay, uncertainty and cost. Under-resourcing has particularly affected the ability of councils to undertake necessary research and monitoring.

Weak accountability for outcomes and lack of effective monitoring and oversight

41. Some argue that weak accountability arrangements and conflicts of interest have also contributed to the failure to properly implement the RMA. For example, the Environmental Defence Society (EDS) notes, “agency capture of (particularly local) government by vested interests has reduced the power of the RMA to appropriately manage effects on the environment”.^[21] Others argue locally elected decision-makers have insufficient control and oversight of resource management functions.
42. It is widely agreed there is insufficient monitoring and collection of data and information on the state of the environment, on environmental pressures at the local and national levels, and on the performance of the resource management system itself.^[22]
43. Given both central government and local government have struggled to deliver a well-functioning system over many years, some argue that oversight of the system has been insufficient to hold both levels of government to account for delivering good environmental and urban outcomes.

Proposals for reform

Legislative architecture and objectives

The RMA should be repealed and replaced with new legislation we suggest be named the Natural and Built Environments Act.

Our view is the RMA should be repealed and replaced with new legislation we suggest be named the Natural and Built Environments Act. While the RMA’s approach to integrated management and many of its principles should be retained and built on, much of the rest of the legislation requires significant revision. We also consider new and separate legislation is required to provide for integration across the wider resource management system, including infrastructure planning and funding under the LGA and LTMA, and climate change mitigation and adaptation under the Climate Change Response Act 2002 (CCRA).

The purpose of the Natural and Built Environments Act would be to enhance the quality of the environment to support the wellbeing of current and future generations and to recognise the concept of Te Mana o te Taiao. It would have a positive focus on achieving high-quality outcomes. These outcomes would be specified in relation to the quality of the natural and built environments, rural areas, tikanga Māori, historic heritage, natural hazards and climate change.

Mandatory national direction would be required to guide how these matters must be reflected in plans, including through the use of targets. To provide greater clarity about biophysical environmental limits, the new legislation would also include a requirement to establish environmental limits or minimum environmental standards for certain resources (air, water, soil, biodiversity). Subject to compliance with environmental limits and binding targets, conflicts between outcomes would be reconciled through national direction and regional plans.

The reference to Te Mana o te Taiao in the purpose of the Natural and Built Environments Act is intended to ensure Māori views about the environment are reflected at the heart of a future system and align with the overall purpose of the Act. Te Mana o te Taiao refers to the fundamental importance of natural resources such as air, water and soil in sustaining all life.

A second piece of legislation, we have named the Strategic Planning Act, would be established to promote the strategic integration of legislative functions across the resource management system.

The Natural and Built Environments Act would also require decision-makers to give effect to the principles of Te Tiriti o Waitangi, and mandatory national direction would specify how to do this.

49. A second piece of legislation, we have named the Strategic Planning Act, would be established to promote the strategic integration of legislative functions across the resource management system, including those exercised under the RMA, LGA, LTMA and CCRA, and wider infrastructure provision by central government. This legislation would require the development of long-term regional spatial strategies. These would be jointly developed and agreed by central government, councils and mana whenua (with a Ministerial decision-making power to resolve disputes). They would set high-level patterns of development and contain objectives and policies consistent with the purposes of the Natural and Built Environments Act, LGA and LTMA, national direction, the national adaptation plan under the CCRA and relevant government policy statements. Regulatory plans would be required to be consistent with regional spatial strategies.

Combined plans

Over 100 RMA policy statements and plans would be consolidated into 14 combined plans.

Under the Natural and Built Environments Act, regional councils and territorial authorities would be required to work together to produce one combined regulatory plan for each region. As a result, over 100 RMA policy statements and plans would be consolidated into 14 combined plans, simplifying and improving integration across the system. Higher-level content for these plans would already be determined through national direction and regional spatial strategies, and the structure and format prescribed through national planning standards.

51. The process for creating these plans would involve an independent hearing panel (IHP) to improve the efficiency of plan-making while ensuring high-quality planning documents. The process would involve a joint committee of delegates from all local authorities in the region, a representative from the Department of Conservation and representatives from mana whenua. The joint committee would have the authority to determine the form of the combined plan for notification and to decide whether to accept the IHP’s recommendations. An independent audit of the proposed plan would be undertaken prior to notification to ensure quality and adherence to the requirements of the act and national direction. Local authorities, mana whenua and the public would have the right to make a submission on the combined plan, to be heard by the IHP and to appeal to the Environment Court along the lines of the model adopted for the Auckland Unitary Plan.
52. The consenting system would also better differentiate between more significant activities that require a robust environmental impact assessment and those with only localised effects that could be determined by a simpler alternative dispute resolution process. The direct referral and proposals of national significance tracks for more complex proposals would be retained but with some modifications. Councils would also have stronger direction on how they should specify activity classes and notification requirements would be reformed by a combination of new statutory presumptions and plan provisions for certain activities. The present focus of notification decisions on minor effects would be removed. Information requirements would be made proportionate to the nature and complexity of the activity.

A nationally coordinated environmental monitoring system would be developed to ensure systematic, coordinated and consistent monitoring across the country.

The allocation of certain public resources would be guided by principles that emphasise considerations of sustainability, equity and efficiency. These principles would be developed on a resource-specific basis through national direction and regional plans. Improved allocation of resources would also be achieved through wider use of economic instruments.

CME functions would be made more independent and better resourced in a future system. These functions would be consolidated into regional hubs with national oversight. Additional tools would be made available for low‑medium risk enforcement action. Penalties would also be increased to deter high-risk behaviour. The provisions relating to commercial gain would be extended to deter businesses from undertaking environmentally harmful activities.

A nationally coordinated environmental monitoring system would be developed to ensure systematic, coordinated and consistent monitoring across the country in line with the recent recommendations of the Parliamentary Commissioner for the Environment (PCE). Stronger links would be made between the Environmental Reporting Act 2015 (ERA) and monitoring functions under the Natural and Built Environments Act, to ensure a policy response to the outcomes of state of the environment monitoring. The system would also emphasise monitoring both central and local government performance in regard to their Te Tiriti o Waitangi commitments. The PCE would provide an independent audit of the functioning of the resource management system.

Institutional changes

56. Councils would remain the main decision-makers in the future resource management framework. However there would be greater requirements for partnerships between central and local government and mana whenua in delivery of planning functions. These partnerships are intended to improve capability and capacity in the system, and to ensure decision-makers have incentives to achieve good environmental outcomes.

The PCE would have an increased role in the new system including greater auditing oversight of systems for monitoring and state of the environment reporting.

Central government would have a more active role in the system through provision of mandatory national direction and a direct role in development of regional spatial strategies. Mana whenua would also have an expanded role in decision-making processes for regional spatial strategies and plans. An integrated partnership process for mana whenua and local authorities would rationalise the RMA tools relating to Māori interests into one process, including Mana Whakahono ā Rohe, section 33 transfers and section 36B joint management agreements. This process would also include discussion of how information from iwi management plans would be incorporated into other plans.

The PCE would have an increased role in the new system including greater auditing oversight of systems for monitoring and state of the environment reporting.

Table 1 summarises the changes we anticipate will result should our recommendations be taken forward.

Table 1: The opportunity for reform

Addressing review priorities

60. Specific measures to address review priorities are set out below.

Protecting and enhancing the natural environment

61. The following proposals are intended to deliver a system that better protects and enhances the natural environment:
    • specify outcomes for the natural environment including maintenance, protection, enhancement and/or restoration

Increase mandatory national direction to establish environmental limits, guide the management of the most significant risks to the natural environment and provide direction to meet targets for improvement.

establish a stronger system of environmental limits that incorporates a safety buffer to manage risks and uncertainty

codify the precautionary principle, favouring protection where there is uncertainty about information but significant risk of irreversible harm

include a strategic focus on achieving positive environmental outcomes, supported by a system of targets which help focus effort on achieving the outcomes

increase mandatory national direction to establish environmental limits, guide the management of the most significant risks to the natural environment and provide direction to meet targets for improvement

introduce a new spatial planning approach to provide opportunities for better-integrated management of environmental issues, and for cumulative effects to be addressed, including through programmes and projects managed under other legislation

improve the quality of plans and their responsiveness to emerging environmental issues

use regional combined plans to better integrate local government planning

make consenting arrangements more flexible to enable review and readjustment if environmental conditions change

establish a nationally coordinated environmental monitoring system

• strengthen the PCE’s audit function.

Better enabling urban and other development within environmental limits

62. The following proposals are intended to deliver a system that better enables urban and other development within environmental limits:
    • specify outcomes for the built environment including enhancing the quality of urban areas, ensuring sustainable use and development of urban land and recognising the benefits of high-quality urban development
    • establish regional spatial strategies to provide for better-integrated management of land supply and the infrastructure and services to support growth

Specify outcomes for the built environment including enhancing the quality of urban areas, ensuring sustainable use and development of urban land and recognising the benefits of high-quality urban development.

supply development capacity and simplify rules in existing urban areas to make it easier to undertake urban development and lower its cost, in particular the cost of new housing

make plan-making more efficient and responsive to change, so that it better accommodates the dynamic nature of urban areas

achieve better allocation of urban development capacity through regional spatial strategies and the use of economic instruments

• create an alternative, more streamlined pathway to resolve localised disputes over consents.

Addressing climate change

63. The following proposals are intended to deliver a system that better addresses climate change:
    • specify both mitigation of emissions and adaptation to climate change as outcomes to be pursued under the Natural and Built Environments Act, and require national direction for both
    • introduce regional spatial strategies that address both mitigation and adaptation

Introduce new legislation to deal specifically with the complexities of managed retreat and climate change adaptation.

improve the alignment between the Natural and Built Environments Act and the CCRA, including through consideration of national adaptation plans in regional spatial strategies and regional combined plans

enable existing use protections to be modified or extinguished in specified circumstances relating to climate change adaptation

make plan-making more efficient and responsive to change, so that it better accommodates the uncertainty associated with climate change adaptation

• introduce new legislation to deal specifically with the complexities of managed retreat and climate change adaptation which cannot be effectively addressed through the Natural and Built Environments Act.

Better aligning the system with te ao Māori

64. The following proposals are intended to deliver a system that better recognises Te Tiriti and te ao Māori:

Introduce a requirement to give effect to Te Tiriti o Waitangi, supported by mandatory national direction and the monitoring of performance.

refer to Te Mana o te Taiao in the purpose statement of the Natural and Built Environments Act to recognise a bicultural New Zealand and acknowledge Māori world views

introduce a requirement to give effect to Te Tiriti o Waitangi, supported by mandatory national direction and the monitoring of performance

specify outcomes for Māori interests and values

• develop better and more consistent partnerships between mana whenua and local authorities, including a greater role for Māori in planning, and appropriate funding and support.

Facilitating the economic recovery in response to the COVID-19 pandemic

65. The world’s attention is now focused on the COVID-19 pandemic and the resulting economic fallout. To facilitate the rapid large-scale development of infrastructure, housing and other projects needed to boost economic activity in the short-term, the Government intends to legislate for new fast-track resource consent processes under the RMA. We have a number of points to make in this regard.
66. First, as the Government has acknowledged, these are extraordinary times. New processes, including reduced opportunities for public input, are warranted in the short term, but our proposals are intended to provide an enduring solution for the longer term beyond the current crisis.
67. Second, it is important to ensure that short-term measures to address the current crisis meet environmental standards and do not compromise the ability to achieve our longer-term goals of enhancing the quality of the natural and built environments or the ability to meet agreed targets to address climate change.

Figure 1: Proposed future environmental management system

Chapter 1 Integrating land use planning and environmental protection

1. This review is expected to resolve debate on key resource management issues, including possibly separating statutory provision for land use planning from environmental protection of air, water, soil and biodiversity. Our proposals relating to the overall structure of a future resource management system are addressed in the first four chapters of this report.
2. This chapter discusses the legislative architecture of the RMA and the integration of statutory provision for land use planning and environmental protection. Chapters 2, 3 and 4 discuss our proposals for refocusing the purpose and principles of the RMA, recognising Te Tiriti o Waitangi and achieving strategic integration across the resource management system. Taken as a whole, our recommendations address the main issues and will substantially reshape both the RMA and the wider resource management system.

Background and current provisions

3. The RMA is a broad framework for the management of natural and physical resources encompassing air, land, freshwater and marine areas out to the 12-mile limit of New Zealand’s territorial sea. The goal of ‘integrated management’ of resources was central to the development of the RMA. Among the significant concerns the Act was designed to rectify were:
   • lack of a consistent set of resource management objectives
   • arbitrary differences in management of land, air and water
   • too many agencies involved in resource management with overlapping responsibilities and insufficient accountability
   • consent procedures that were unnecessarily complicated, costly and regularly delayed
   • pollution laws that were ad hoc and did not recognise the physical connections between land, air and water
   • insufficient flexibility and too much prescription with a focus on activities rather than end results
   • Māori interests recognised in Te Tiriti that were frequently overlooked
   • monitoring of the law that was uneven
   • enforcement that was difficult.^[23]
4. In seeking to achieve integrated management, the RMA replaced 78 statutes and regulations, among them the Town and Country Planning Act 1977, Water and Soil Conservation Act 1967, Clean Air Act 1972 and Noise Control Act 1982.
5. Integrated management is provided for under the RMA through a hierarchy of policies and plans prepared at the national, regional and district levels. Policies and plans within this hierarchy are aligned by a common purpose to promote the sustainable management of natural and physical resources. Integration between decision-makers is facilitated through the requirement for joint hearings, in most cases, where an activity requires resource consents from more than one agency. Joint policies and plans may also be prepared by two or more councils.
6. Despite a strong emphasis on integrated management, the RMA’s provisions continue to distinguish between the management of land and other natural resources in certain important areas. For example, while there is a presumption in favour of the development and use of land, the reverse applies to use of other natural resources and to discharges to the environment.^[24] The functions of territorial authorities and regional councils are also largely split between land use planning and management of natural resources.^[25] The approach taken to the recognition of existing uses and the duration of resource consents also differs between land and other natural resources.^[26]

Issues identified

7. The RMA has been the subject of considerable scrutiny and debate over the last 30 years. While most of this debate has focused on implementation issues, some recent criticism has centred on its fundamental design, including its approach to integrated management. Here we summarise the main arguments for and against reverting to separate systems for land use planning and environmental protection. We also consider the related idea of separate planning frameworks for the built and natural environments.

The case for separate legislative frameworks for land use and environmental protection

8. Some argue the integration of statutory frameworks for land use planning and environmental protection under the RMA has led to poor outcomes both for development and for protection of the natural environment. Perhaps the most forceful advocate of this view is Infrastructure New Zealand which has developed a proposal to merge the RMA, Local Government Act 2002 (LGA) and Land Transport Management Act 2003 (LTMA) into two new Acts: an Environment Act and a Development Act.^[27]
9. Infrastructure New Zealand’s main criticism of land use planning as practised under the RMA is that it lacks focus on strategic outcomes and is instead oriented towards minimising the impacts of physical development on other residents, activities and the environment. While this management of ‘effects’ is important, it is considered insufficient to deliver a coordinated approach to development. Infrastructure New Zealand also argues that land use planning under the RMA lacks integration with development planning, and in particular infrastructure provision under the LGA and LTMA. These shortcomings are thought to lead to a range of significant problems, including a lack of alignment between land use regulation and infrastructure provision, and processes that are unnecessarily complex and costly. This in turn is seen to contribute to constraints on regional development, including housing supply and affordability.
10. In its recent first principles review of New Zealand’s urban planning system, the Productivity Commission put forward a different argument for reconsideration of integrated management under the RMA. The Commission found that the built and natural environments have different characteristics and each requires a distinct management approach. According to the Commission, “the natural environment needs a clear focus on setting standards that must be met, while the built environment requires assessments that recognise the benefits of development and allow change”.^[28] This finding mirrored previous work by the Minister for the Environment’s Urban Technical Advisory Group (UTAG) in 2010. UTAG identified a potential advantage of developing separate legislation for urban planning, which would be to recognise “urban areas are generally heavily modified and dynamic environments, and therefore justify a more ‘anthropocentric’ set of assessments, processes and mechanisms for decision-making”.^[29] In the context of urban development, application of the RMA’s current purpose and principles is seen to prioritise protecting the status quo, leading to constraints on housing supply and affordability.
11. In recent extensive work on the future of New Zealand’s resource management system, the Environmental Defence Society (EDS) also reconsidered the RMA’s approach to integrated management, this time including a focus on what is needed to improve protection of the natural environment. EDS argued that the ‘broad overall judgement’ interpretation of ‘sustainable management’ under the RMA contributed to a failure to set sufficiently protective environmental controls over the last 30 years. In response, EDS questioned whether greater clarity could be achieved for the role of environmental protection in the resource management system by developing separate legislation. This would leave ‘planning’ decisions to be made within the ‘environmental limits’ established under a separate environmental protection statute.^[30]
12. Our own work over the course of this review has also identified other potential reasons why separate legislative frameworks for land use planning and environmental protection could be contemplated. These relate to transparency of processes and accountabilities in public administration. While in principle integration ought to be a good thing, challenges to this are conceivable. For example, processes and accountabilities in public administration may become blurred if failings in one part of the system are attributed to another part. We are also aware that many frustrations with the RMA relate to its role in urban planning and housing matters. It would be unfortunate if frustrations about these aspects of planning under the RMA led to less public acceptance of its necessary role in setting protections for the biophysical environment.
13. The main arguments for separating statutory provision for land use planning and environmental protection can be grouped as follows:
    • greater strategic focus and coordination of decision-making on land use and infrastructure is needed
    • a distinct purpose and tailored principles are required to guide decision-making about land use planning (or built environment matters) and environmental protection
    • greater clarity, transparency and accountability in public administration can be achieved through separate systems and processes.

The case against separate legislative frameworks for land use and environmental protection

14. On the other hand, others argue that integrated management under the RMA has not been the cause of poor outcomes for either the built or the natural environment. Rather, they point to a failure to implement the Act as intended. For example, Sir Geoffrey Palmer and Dr Roger Blakeley argue “one of the main reasons why the Resource Management Act has not worked as well as it should have, has been the failure of successive governments to use the tools that have been available since the Act’s inception, to provide national policy statements and national environmental standards”.^[31] In their view, deficiencies identified in urban planning could be easily addressed through national direction under the RMA’s broad umbrella of ‘sustainable management’.
15. Others identify practical problems with a move away from integrated management. As land use and environmental protection issues are intertwined, a move away from integration would suffer from the difficulty of distinguishing between what should be dealt with in a land use planning framework and an environmental management framework respectively. For example, the Resource Management Law Association (RMLA) argues “any proposal to fundamentally split the planning regime based upon built and natural environments risks arbitrary distinction of those two environments and resultant planning which does not holistically provide for integrated and efficient management of all resources”.^[32] If separate frameworks were to be developed, care would need to be taken to avoid duplication and ensure interfaces are appropriately managed.
16. Māori groups argue that separate decision-making frameworks for land use and environmental protection would be inconsistent with a te ao Māori understanding of issues and approach to decision-making.^[33] In te ao Māori, the environment is not seen as a collection of resources to exploit for human benefit, nor as a separate entity to protect; rather, people and the environment are thought of as an integrated part of a cosmological system based on kinship, respect and reciprocity. The environment is family. Māori emphasise the need for holistic decision-making processes to reflect this world view.
17. Finally, others point out the potential for separate legislation for land use and environmental protection to exacerbate problems with the complexity and cost of the current system. For example, Local Government New Zealand (LGNZ) argues that “given the disintegration that has been identified between the RMA, LGA and LTMA, it is difficult to see how a new, separate statute splitting off the management of natural resources from the urban environment could help this mix”.^[34]
18. Despite its conclusion that the approach taken to the built and natural environments under the RMA had been unclear, the Productivity Commission recommended maintaining an integrated statute, albeit with the addition of separate principles to guide planning in the built environment. This was informed by legal advice from Dr Kenneth Palmer, who argued that while there had been lack of clarity in the approaches taken to regulation of the built and natural environments, “it is difficult to see any compelling or justifiable case for turning the clock back pre the RMA and reverting to the former separate regulatory statutes”.^[35]
19. Likewise, having considered separate legislation for setting biophysical ‘environmental limits’, EDS recommended maintaining an integrated approach to land use planning and environmental protection under the RMA. This was based on the simple observation that “how we use land has significant implications for the wider environment”. EDS also points out that cross-cutting concepts like “landscape, ecosystem-based management, and catchment scale management” are as much land use as environmental protection issues.^[36] Duplication and complexity would result if separate frameworks were developed.
20. The main arguments against separating statutory provision for land use planning and environmental protection can be grouped as follows:
    • integration of frameworks for land use and environmental protection is not the cause of poor outcomes
    • land use and environmental protection, and the built and natural environments, are inherently interconnected and should be approached through integrated decision‑making
    • separate frameworks would be inconsistent with te ao Māori
    • developing separate legislative frameworks is likely to result in further complexity and cost.

Options considered

21. Our issues and options paper put forward the following options:
    • retain the RMA as an integrated statute with enhanced principles for land use and environmental management
    • split the RMA into a land use planning statute and an environmental management statute.
22. As noted above, given the focus of debate on urban issues, we have also considered whether to develop separate legislation for the built or urban environment.

Discussion

While serious concerns have been raised with the approach taken under the RMA, our clear view is these concerns can and should be addressed while maintaining an integrated approach to land use planning and environmental protection.

While serious concerns have been raised with the approach taken under the RMA, our clear view is these concerns can and should be addressed while maintaining an integrated approach to land use planning and environmental protection.

An overwhelming majority of submitters opposed separate legislation for land use planning or for the built environment. All Māori submitters were also opposed. The concerns raised echoed much of the previous debate on this issue, including:

• the integrated approach taken under the RMA has not been the cause of poor outcomes for our urban areas or the natural environment. Rather, this can be attributed to other problems, including implementation
• the built environment is part of the natural environment and it would be impractical to develop separate planning or permitting approaches for land use and environmental protection
• managing land use separately from environmental protection risks worsening environmental deterioration
• in general, achieving greater integration of statutes and processes, rather than less, is desirable
• separate legislation risks creating further complexity, including the need to reconcile how the new legislation would interact with a separate system more clearly focused on environmental protection

An overwhelming majority of submitters opposed separate legislation for land use planning or for the built environment.

a holistic approach to planning and decision-making is more aligned with Māori world views

a change of this scale risks significant disruption and cost

identified deficiencies can be addressed while maintaining an integrated statute.

25. That said, a small minority of submitters considered separate frameworks for land use planning and environmental protection to be warranted as a possible solution to systemic failure. The main points made were:
    • many years of an integrated approach have not delivered desired outcomes
    • management of public resources and ‘effects’ on private property have become confused under the RMA and there is a need for greater clarity about the establishment of biophysical environmental limits, as distinct from other ‘planning’ matters
    • current RMA processes are too complex, expensive and litigious, and could be simplified through a more clearly differentiated approach.
26. Before addressing the arguments, it is worth revisiting why integrated management was thought useful in the first place. Sir Geoffrey Palmer articulated the original policy argument for the notion of integrated management under the RMA as follows: “In the past the rights of people to use water, air, the land or minerals have been dealt with by a myriad of laws. Not only do all the things these laws govern relate to each other but all have an impact on the wider environment. We have to look at all the issues in an integrated way.”^[37] In other words, decisions which impact on one another should be considered together to ensure they do not work at cross-purposes. Integration of decision-making was also thought needed to avoid “unnecessary delay and duplication”.^[38]
27. Both these factors remain as relevant today as they were 30 years ago with regard to the connections between land use and environmental issues. For example, recent state of the environment reporting identifies changes in land use as the primary driver of declining freshwater and marine environmental outcomes.^[39] Likewise, process complexity and delays across the resource management system remain concerns for many developers.^[40] This suggests both the continued relevance of the original policy argument for integrated management, and also that the RMA did not completely resolve the identified problems.

Internationally, integration of decision-making frameworks for economic development and environmental issues is seen as essential to advancing sustainable development, in particular in the context of the structural economic changes necessary to address climate change.

Internationally, integration of decision-making frameworks for economic development and environmental issues is seen as essential to advancing sustainable development, in particular in the context of the structural economic changes necessary to address climate change.^[41] Land use planning and environmental protection are thought to be important types of decisions to consider together.^[42] While fully integrated legislative frameworks for environmental protection and land use planning systems are uncommon, the likely reason for this is that other jurisdictions have not been able to achieve policy reform of this scale.^[43] We are unaware of any country that has moved to make its land use and environmental protection decision-making frameworks less integrated. In fact, incorporating strategic environmental assessments and environmental impact assessments as part of land use planning is now considered essential in systems overseas.^[44] International best practice suggests we should be cautious about discarding an integrated approach before being certain it is at fault.

29. We certainly agree with Infrastructure New Zealand that land use planning under the RMA has had insufficient focus on strategic ‘outcomes’ and has been poorly coordinated with infrastructure planning under the LGA and LTMA. We discuss measures to address these concerns in more detail in chapter 2 and chapter 4. Here we note that, by itself, this is not an argument that an integrated approach is no longer appropriate. A strategic outcomes focus is needed as much for our system of environmental protection as it is for our system of development planning. It is also possible to maintain an integrated approach to land use planning and environmental protection, while improving integration of land use and infrastructure provision. In fact, we consider this to be essential.
30. We agree to a certain extent with the Productivity Commission’s conclusion that the built environment requires management principles that are distinct from those of the natural environment. This is discussed in more detail in chapter 2. Once again, however, this does not necessarily imply that integration of legislative frameworks for land use planning and environmental protection is no longer appropriate. It is possible to provide greater recognition of the particular characteristics of planning in the urban and other built environments within an integrated framework.
31. As noted above, many submitters on this review reinforced the conclusions of the Productivity Commission and EDS that an integrated approach should be retained. Submitters pointed out that an integrated approach taken under the RMA had not been the cause of poor outcomes for our urban areas or the natural environment. Rather, this can be attributed to other problems with the design of the RMA, and its implementation. A common refrain was that land use and environmental management are inextricably linked, and the built environment is part of the natural environment. Good decision-making therefore requires full and balanced consideration of impacts across these domains, and this is most easily provided for within an integrated statute. We agree.
32. We also heard a strong preference from Māori groups for an integrated approach to decision-making. We consider this an important point, as a significant aspect of our review is to ensure our approach to resource management better reflects te ao Māori.
33. Moreover, our view is that the nature of current and future resource management challenges which have been the focus of this review, in particular urban development, freshwater quality and climate change, suggests decision-making will require more rather than less integration in the future. Solutions to these challenges are complex and require identification of synergies or interdependencies between environmental protection and development outcomes. To take one example, an adequate response to climate change will require ensuring the trajectory of land use change in urban and rural areas delivers patterns of development consistent with national goals for climate change mitigation and adaptation. These synergies are more readily identified and acted on when making decisions under an integrated statute.
34. While there is something to be said for arguments made by some submitters that improvements in the transparency of processes and public accountability for environmental outcomes might result from separate land use planning and environmental protection frameworks, our view is that these possible benefits are outweighed by those of integrated decision-making. Separate statutes would inevitably create complex interface issues between purposes, processes, roles and responsibilities within the system. New principles would likely be needed to manage these interface issues. In practice, the possible benefits of improved transparency and accountability may prove illusory. We also consider that greater clarity of institutional responsibilities can be achieved in other ways, as discussed in chapter 14.

Expected outcomes

Although the RMA has not delivered the desired outcomes, our view is that its integrated approach is not at fault, and the case for integration remains strong.

Our proposal that an integrated statute for land use and environmental protection should be retained addresses a key issue raised in our terms of reference and aligns with the objectives and principles adopted for our review. Although the RMA has not delivered the desired outcomes, our view is that its integrated approach is not at fault, and the case for integration remains strong. While important concerns have been raised with the fundamental design of the RMA, our view is these can be addressed while maintaining an integrated approach. We turn to these issues in the next chapters.

Key recommendation

Chapter 2 Purpose and principles

We propose new legislation to be named the Natural and Built Environments Act to replace the RMA.

We propose new legislation to be named the Natural and Built Environments Act to replace the RMA. In this chapter we discuss our proposals for the purpose and principles of the new legislation. The purpose of legislation defines its policy objective and shapes the design and interpretation of its underlying detailed provisions. Decisions and regulations made under primary legislation have to be consistent with its purpose. The purpose and principles in Part 2 of the RMA establish and define an overall objective of ‘sustainable management’ and provide a framework for decision-making under the Act. They are the most general articulation of this objective, which is then refined in more specific form in the hierarchy of policy and regulatory instruments and processes enabled under the Act.

There was vigorous debate over many years about the meaning of sustainable management under the RMA and how it should be applied. Another longstanding concern has been that Part 2 of the RMA provided insufficient protection for the natural environment, and insufficient recognition and strategic focus for urban planning and development. Some argue this has resulted in a lack of stringency in how the natural environment is regulated as well as poor-quality regulation in urban and other areas.

We propose to refocus our system of resource management on enhancing the quality of the environment through pursuit of a defined set of ‘outcomes’ and ‘targets’ within specified ‘environmental limits’.

A generation has now passed since the RMA was developed and new environmental challenges have emerged, in particular for freshwater, urban development and climate change. In responding to these challenges, our proposals to develop a new purpose and principles section for the Natural and Built Environments Act build on the latest thinking internationally. We propose to refocus our system of resource management on enhancing the quality of the environment through pursuit of a defined set of ‘outcomes’ and ‘targets’ within specified ‘environmental limits’. This is intended to recognise what New Zealanders collectively value about our environment, including concepts from te ao Māori. Our proposals also respond to the complexity of natural and urban systems, and the need for a clear, rigorous and responsive management approach that recognises and provides for change.

Background and current provisions

Development of the purpose of the RMA

4. The background to the development of the purpose and principles of the RMA is relatively well documented.^[45] The RMA was the culmination of the Resource Management Law Reform Project (RMLR). The first phase of the RMLR process ended in December 1988, when the then Minister for the Environment, Geoffrey Palmer, released People, Environment and Decision Making: The Government’s Proposal for Resource Management Law Reform.^[46] This proposed a single integrated resource management statute that would replace procedures existing in a number of separate statutes.
5. The report proposed that a new act would have a general purpose as well as principles covering a range of matters and values, such as balancing individual rights and public welfare, and eliminating or minimising conflicts between resource uses, environmental quality, ecosystem values, the needs of future generations, and economic and social factors. Significantly, the report proposed that no one value would be overriding.^[47]
6. The report also spelled out what it saw as the main aim of the reform process:

This law reform is dealing with resource management laws whose primary function is to limit the adverse spillover effects of people’s activities and to allocate Crown resources. In doing both these things, in a way that promotes good environmental management, the laws can enable and encourage a positive approach which focuses on identifying and achieving desired outcomes rather than simply listing bad things.^[48]

7. An extensive public consultation and bill drafting process then took place. The public consultation process revealed strong support for establishing priority among the principles and “a preference for sustainable development to be the basic principle for the law”.^[49]
8. Ultimately the Labour Government’s Resource Management Bill, introduced into Parliament in December 1989, adopted sustainable management as its purpose. Sustainable management was defined in clause 4 of the Bill to mean “managing the use, development and protection of natural and physical resources in a way, or at a rate, which enables people to meet their needs now without compromising the ability of future generations to meet their own needs”. Clause 5 covered the principles to have regard to in order to achieve the purpose of the Act. These included the broad range of factors encompassed by the ‘good environmental management’ approach.^[50]
9. The Bill was not enacted before the October 1990 general election. During the election campaign the National Party indicated it was concerned about aspects of the Bill. Once elected, the new National Government appointed a review group to consider it. This group of five experts, appointed by the Minister for the Environment, invited and received submissions before producing a 200-page report recommending changes to tighten up aspects of the Bill, particularly its purpose and principles.^[51] Regarding ‘sustainable management’, the review group acknowledged the concept in the Bill was narrower than the Brundtland Report’s formula of ‘sustainable development’. It noted the latter concept “embraced a very wide scope of matters including social inequities and global redistribution of wealth” and the Bill addressed only a part of these matters.^[52]
10. The review group concluded the existing purpose and principles clauses (clauses 4 and 5 respectively) had an unclear relationship and would be difficult to apply, failed to recognise the built environment and failed to indicate priorities among matters to be taken into account.^[53] Accordingly, clause 4 was redrafted to provide “a simple purpose of promoting the sustainable management of natural and physical resources”. Provision was made for current generations to manage the use, development and protection of natural and physical resources to provide for their social, economic and cultural wellbeing subject to the need to:
    • safeguard the ability of future generations to meet their needs in relation to natural and physical resources
    • avoid, remedy or mitigate any adverse effects of activities on the environment.^[54]
11. The review group’s redrafted clause 5 spelt out the various dimensions of sustainable management. The principles were to “emphasise and explain the concept of sustainability and its biophysical dimensions”.^[55] In explaining its changes the review group considered that clause 4 contained “an unweighted balancing of socio-economic and biophysical aspects”. Its recommended drafting rejected the balancing approach and “conceive[d] of the biophysical characteristics of resources as a constraint on resource use”.^[56]
12. Following the review group’s report Environment Minister Simon Upton made two further amendments to clause 4: first softening the responsibility of the current generation to future generations in respect of resources; and second moving the reference to “safeguarding the life-supporting capacity of air, water, soil, and ecosystems” up to clause 5. According to Minister Upton, a “reference to the biophysical limits of natural and physical resources was necessary if some reasonable basis for taking account of the needs of future generations was to be established”.^[57]
13. The changes recommended by the review group and Minister Upton were introduced into the House by way of a Supplementary Order Paper. A further 500 submissions were then considered by a second select committee, before the Bill was enacted in July 1991 and came into force on 1 October 1991.

The policy intent of sustainable management in the RMA

14. In summary, the original policy intent of the RMA underlying its sustainable management purpose, as set out in Part 2 of the Act, was as follows.
    • It departed from the Town and Country Planning Act approach that, according to Minister Upton, “encouraged almost limitless intervention for a host of environmental and socio-economic reasons”.^[58]
    • The Act moved to an approach based on the management of environmental effects or ‘externalities’. It was “not designed or intended to be a comprehensive social planning statute”.^[59] The focus on outcomes to be actively sought was therefore “significantly narrower than the general welfare ambition of the old Town & Country Planning Act”.^[60]
    • The outcomes embodied in section 5(2)(a) to (c) were intended to provide “a framework to establish objectives by a biophysical bottom line that must not be compromised”.^[61]
    • They were to be treated as “high level constraints” that had to be met while enabling people and communities to promote their own welfare.^[62] They could not be traded off in order to enable the community to pursue its wellbeing.^[63]
    • They would be “progressively given specific content as rules or standards are promulgated under the Act” and it would be these, rather than the general guidance under section 5, that would be the yardstick against which particular case-specific matters would be measured.^[64]
    • Sections 6 and 7 provided guidance on what the bottom lines comprised of and so had a biophysical focus.

Development of the Treaty clause in the RMA

15. The RMA was developed during a time when the Government sought to give greater recognition to the Treaty. One of the Crown’s objectives for the RMLR was to ensure that ‘practical effect’ would be given to Treaty principles.^[65]
16. There was significant debate about the wording of the Treaty clause as the draft legislation was developed and then progressed through Parliament.^[66] Among the ideas put forward were creating a duty to balance kawanatanga and tino rangatiratanga as referred to in the Treaty and following the approach taken in the Conservation Act 1987 that required decision-makers to ‘give effect to’ the Treaty of Waitangi.
17. The final clause required decision-makers to ‘take into account’ the principles of the Treaty of Waitangi. The weaker approach reflected nervousness about the impact of a Treaty section in general resource management legislation following the Lands case where the Court of Appeal had enforced the Treaty clause in the State-Owned Enterprises Act 1986.

The current purpose and principles of the RMA

18. The current purpose and principles of the RMA are stated here for ease of reference. The purpose of the RMA is in section 5 as follows.

19. The RMA also identifies matters that are of special significance for resource management, as set out in sections 6, 7 and 8. These principles give ‘further elaboration’ to the section 5 purpose of sustainable management by stating particular obligations for those administering the RMA.^[67] The three sets of principles are:
    • matters of national importance – which decision-makers must ‘recognise and provide for’
    • other matters – which decision-makers must ‘have particular regard to’
    • the principles of the Treaty of Waitangi – which decision-makers are required to ‘take into account’.
20. The statutory hierarchy means that a ‘stronger direction’ is given in relation to matters of national importance in section 6 than for the other matters in section 7. The requirement to ‘recognise and provide for’ means the decision-maker must make actual provision for the listed matters. In contrast, the obligation to ‘have particular regard to’ requires the decision-maker to give those matters genuine consideration after which they may be rejected.
21. To meet the requirement to ‘take into account’ the principles of Te Tiriti, the decision-maker must consider the relevant Tiriti principles, weigh those up along with other relevant factors and give them the weight appropriate in the circumstances. Tiriti settlement legislation also prescribes matters for decision-makers to consider in the resource management system.
22. The RMA contains procedural principles which are set out in section 18A. Decision-makers are required to ‘take all practicable steps’ to:
    • use timely, efficient, consistent and cost-effective processes that are proportionate to the functions or powers being performed or exercised
    • ensure that policy statements and plans include only those matters relevant to the purpose of the Act and are worded in a way that is clear and concise
    • promote collaboration between local authorities on their common resource management issues.
23. The matters of national importance specified in section 6 are set out below. There is no hierarchy between these principles. Therefore, where there is a conflict between matters of national importance, the decision-maker must weigh the significance of the competing interests in the circumstances of the particular case.

24. The ‘other matters’ that persons exercising functions and powers under the Act must ‘have particular regard to’ under section 7 are set out below. They tend to be more abstract than the matters set out in section 6 possibly because the direction to consider them is not as strong. Nevertheless, relevant matters in section 7 must be considered and carefully weighed when reaching a decision.

25. Finally, the section 8 requirement that all persons exercising functions and powers under the RMA take into account the principles of the Treaty of Waitangi is set out below. When enacted, the RMA was a step forward for recognition of the Crown’s responsibilities under Te Tiriti. Since the RMA was enacted much has happened in the relationship between the Crown and Māori, in particular through the process of Tiriti settlements. Māori have also repeatedly criticised RMA provisions and their implementation.

Interpretation of the RMA’s sustainable management purpose since 1991

26. It has been well documented that, despite the intent of the legislation, since the mid-1990s and until recently the courts adopted the ‘overall broad judgement’ approach to interpreting the sustainable management purpose of the RMA. This approach, according to Judge Sheppard, “allow[ed] the comparison of conflicting considerations and the scale or degree of them, and their relative significance or proportion in the final outcome”.^[68]
27. Following the courts’ approach, some observers argued that the purpose of the Act was intended to be wider than ‘effects management’ and that it gave no primacy to biophysical bottom lines.^[69] Furthermore they contended:

the definition of sustainable management encapsulates the fundamental underpinnings of the concept of sustainable development in the sense that it requires decision-makers to adopt an integrated perspective for managing natural and physical resources. Sustainable development has been defined, based on the Brundtland report, as a decision-making process that should take account of ecological, economic and social and cultural values. The attraction of sustainability defined in this way is that rather than elevating biophysical objectives above everything, it ensures the proper consideration of development in its environmental context.^[70]

28. The courts’ interpretation attracted criticism, including from the Act’s authors, as undermining the original purpose of the RMA. They argued that the weighing of economic, cultural and social considerations alongside environmental ones has resulted in the inappropriate trading off of environmental bottom lines against actual or perceived economic or social benefits.^[71]
29. Most recently the Supreme Court has provided greater clarity over the meaning of Part 2 of the RMA with the Environmental Defence Society Inc v New Zealand King Salmon Co Ltd [2014] decision. This “provided a significant qualification on the general application of the ‘overall broad judgement’ approach”.^[72] In particular, where a higher-level policy document (in the King Salmon case the New Zealand Coastal Policy Statement) makes directive policies such as creating an effective ‘bottom line’, and decision-makers are giving effect to that policy, there is usually no need to refer back to Part 2 of the RMA because these policies give substance to Part 2.
30. The judgment also stressed that sections 6 and 7 are an elaboration of the purpose contained in section 5; that the matters in section 6 contained stronger direction to decision-makers than those in section 7; and that while section 6 requires decision-makers to take steps to implement the protective element of sustainable management, the section itself does not give primacy to preservation or protection within the concept of sustainable management.^[73]
31. Subsequent case law in R J Davidson Family Trust v Marlborough District Council [2018] has discussed the implications of the King Salmon decision for the role of Part 2 in consideration of applications for resource consents. The Court of Appeal found that King Salmon does not prevent recourse to Part 2 in the case of applications for resource consent where “planning documents may not furnish a clear answer as to whether consent should be granted or declined”.^[74] Therefore, whether or not Part 2 is relevant should be determined on a case-by-case basis.

If a plan that (sic) has been competently prepared under the Act it may be that in many cases the consent authority will feel assured in taking the view that there is no need to refer to part 2 because doing so would not add anything to the evaluative exercise. Absent such assurance, or if in doubt, it will be appropriate and necessary to do so.^[75]

The implications of King Salmon in this context are that genuine consideration and application of relevant plan provisions may leave little room for Part 2 to influence the outcome.

Issues identified

32. Issues identified with the purpose and principles of the RMA fall into five broad categories:
    • insufficient protection for the natural environment
    • lack of recognition and strategic focus for development
    • insufficient recognition of Te Tiriti and te ao Māori
    • insufficient focus on outcomes
    • lack of clarity in intent and implementation.

Criticism of Part 2 of the RMA has included concerns that it neither sufficiently prioritises protection for the environment nor promotion of development.

While these issues have made implementation of the RMA more challenging, planning and resource management practice has made progress nonetheless. Criticism of Part 2 of the RMA has included concerns that it neither sufficiently prioritises protection for the environment nor promotion of development. This is no accident given the RMA’s role in defining and reconciling these objectives.

Insufficient protection for the natural environment

34. The outcomes achieved for the natural environment from the resource management system have been mixed. Some outcomes (for example, air quality) have improved but freshwater, climate change, biodiversity and marine outcomes have been poor. The most significant trends in the state of the New Zealand environment are set out in the reports Environment Aotearoa 2019 and Our Marine Environment 2019.^[76]
    • Freshwater: waterways in farming areas are polluted by excess nutrients, pathogens and sediment. This threatens our freshwater ecosystems and cultural values, and may make our water unsafe for drinking and recreation. Using freshwater for hydroelectric generation, irrigation, domestic consumption and other purposes changes the water flows in rivers and aquifers. This further affects freshwater ecosystems and the ways we relate to and use our waterways.
    • Climate: our per-person rate of greenhouse gas emissions is one of the highest for an industrialised country. Most of our emissions in 2016 came from livestock and road transport. Changes to our climate are already being felt in our land, freshwater and marine environments. We can expect further wide-ranging consequences for our culture, economy, infrastructure, coasts and native species.
    • Biodiversity: our unique native biodiversity is under significant pressure from introduced species, pollution, habitat loss, harvesting of wild species, and other factors. Almost 4000 of our native species are currently threatened with extinction.
    • Marine: high volumes of land-sourced sediment are impacting coastal areas, many biogenic habitats are decreasing in extent, plastics are now found throughout our marine area and harvesting marine species is having long-term and wide-ranging effects on species and habitats. Because we do not know the cumulative effects of fishing on the marine environment, it is unclear if the current levels of fishing are sustainable or where tipping points are.
    • Land: the activities of logging native forests, draining wetlands and clearing land have reduced the range of benefits provided by native vegetation, accelerated our naturally high rates of soil loss and affected our waterways.
    • Urban: growth of urban centres has led to land fragmentation and threatens the limited supply of versatile soils near Auckland and other regional centres. Some of our cities and towns have polluted air, land and water as a result of home heating, vehicle use, industrial activities, and disposal of solid waste, wastewater and stormwater. Pollution affects ecosystems, human health and enjoyment of nature. Limited knowledge of the full range of pollutants, their extent and cumulative effects, makes it challenging to fully understand the impacts of urban pollution.
35. Management of some of these trends is outside the scope of the RMA. For other trends, the RMA is only one of many influences. Nonetheless, many would agree with the Environmental Defence Society (EDS) that “the environmental outcomes of the RMA have not met expectations” and that “it has largely failed to achieve the goal of sustainable management to date”.^[77]
36. One reason for this underperformance is that implementation of sustainable management proved difficult in practice. Implementation failures were largely the product of institutional issues rather than Part 2 itself. Resource management plans failed to set sufficiently strong environmental limits. This was partly because central government did not issue national direction for many years. Further, both central and local government lacked resources to adequately implement the RMA, including to undertake the necessary scientific work to monitor progress and inform regulation.

The ‘overall broad judgement’ approach applied for most of the RMA’s life weakened environmental limits.

That said, the ‘overall broad judgement’ approach applied for most of the RMA’s life weakened environmental limits.^[78] Applying this approach in consenting decisions allowed environmental limits in plans to be set aside on the basis of advancing social, economic and cultural wellbeing. The failure of the RMA to deal well with cumulative environmental effects is therefore partly rooted in the misinterpretation of its purpose statement.

While the effectiveness of plans in setting environmental limits has been strengthened following King Salmon, EDS argues that the phrases ‘recognise and provide for’ and ‘have particular regard to’ in sections 6 and 7 leave considerable scope for interpretation and application of environmental protection. Moreover, we continue to lack national policy on most of the issues covered in sections 6 and 7. At the regional level, regional plans are not mandatory and rules are not required, let alone prohibited activity rules. According to EDS, “our laws may need to be more active and directive in terms of when, by whom, and under what normative umbrella we impose bottom lines”.^[79]

The former Parliamentary Commissioner for the Environment, Jan Wright, has pointed out a further problem with the RMA in that it does not encourage prioritisation based on scientific analysis of environmental trends. Given our effects on the environment are infinite in scope, and that we have limited resources available for environmental management, we need a logical process for determining where to focus efforts. She proposed the following questions as selection criteria:

• is the problem cumulative? Do successive impacts keep stacking up or is there some natural mechanism that tends to restore the system?
• is the problem reversible? This is closely related to the ‘cumulative’ question, but allows for the possibility of human restoration of the system through technology and management practices
• is the size of the problem significant? Is it widespread and pervasive, or is it confined?
• is the size of the problem accelerating? Does it need to be dealt with urgently?
• is the problem approaching some kind of physical limit? Is there a tipping point – a level of the problem that tips the system into another state?^[80]

The RMA’s purpose does not address enhancing, restoring or regenerating the environment.

The current poor state of some aspects of the environment has led to observations that sustainable management is an insufficiently ambitious objective.^[81] The RMA’s purpose does not address enhancing, restoring or regenerating the environment. Resources must be ‘sustained’, life-supporting capacity ‘safeguarded’ and adverse effects ‘avoided, remedied and mitigated’. However some natural and physical resources are already over-allocated and their life-supporting capacity diminished. While the Act does allow authorities to pursue policies to restore the environment, it is fair to state as the Environment Court has done, that “the primary emphasis of the RMA is on consent-holders avoiding or mitigating the effects ... caused by them” [emphasis added].^[82]

Lack of recognition and strategic focus for development

The RMA purpose and principles provide insufficient recognition of, and strategic focus for, necessary housing, infrastructure and other development.

A second criticism of the RMA purpose and principles is they provide insufficient recognition of, and strategic focus for, necessary housing, infrastructure and other development. A growing shortage of housing in New Zealand, and the perception that RMA processes are overly cumbersome and provide insufficient certainty for major infrastructure, has seen a long series of official inquiries into the performance of the RMA. The initial focus of these inquiries was on ‘streamlining’ regulatory systems, but more recent reviews have sought to connect processes across the RMA, LGA and LTMA.

• In 2008 the House Prices Unit was set up in the Department of the Prime Minister and Cabinet to investigate what it would take to slow house price inflation and lessen the volatility of New Zealand’s house price cycles. It concluded that a focus on streamlining regulatory systems, especially under the RMA and building consents processes, might help.
• In 2008 the Sustainable Urban Development Unit was set up in the Department of Internal Affairs. It argued for streamlined RMA processes to better enable sustainable urban development, including the use of urban development authorities.
• In 2009 the Royal Commission on Auckland Governance addressed ownership, governance, funding and institutional arrangements for local government regulatory functions, public infrastructure, services and facilities in Auckland. The Government subsequently progressed reform of local government structures, provided for spatial planning in Auckland and set up a special process to develop the Auckland Unitary Plan under the RMA.
• In 2010 the Minister for the Environment’s Urban Technical Advisory Group developed proposals for urban planning reform, including spatial planning to integrate and align the RMA with the LGA and LTMA. After this review, the Minister for the Environment’s Building Competitive Cities report proposed reform of the urban and infrastructure planning system. This included recognising development objectives in the RMA, providing national direction on urban development, and utilising spatial planning and streamlined regulatory processes.
• In 2012 the Productivity Commission’s Housing Affordability inquiry argued that: there should be an immediate release of land for residential development; councils should ensure their planning policies, such as height controls, boundary setbacks and minimum lot sizes, are not frustrating more efficient land use; councils should review regulatory processes with the aim of speeding up, simplifying and reducing the cost of consent processes; and central government should review planning-related legislation to reduce the cost, complexity and uncertainty associated with the interaction of the LGA, RMA and LTMA.
• In 2012 the Productivity Commission’s Better Local Regulation report identified ways of improving how local regulation should be designed, implemented, evaluated and governed. It proposed a ‘partners in regulation’ protocol between central and local government.
• In 2012 the Minister for the Environment’s Resource Management Act 1991 Principles Technical Advisory Group (Principles TAG) recommended reform of sections 6 and 7 of the RMA to include development objectives.
• In 2013 the Local Government Infrastructure Efficiency Expert Advisory Group recommended an increased focus on regional spatial planning for infrastructure.
• In 2015 the Productivity Commission’s Using Land for Housing report argued for greater involvement of central government in local planning processes, in particular for infrastructure. It also proposed the use of spatial planning; more responsive rezoning including use of land price ‘triggers’ for plan changes; and stronger checks on regulatory quality.
• In 2017 the Productivity Commission’s Better Urban Planning report proposed developing separate objectives and principles for urban planning and environmental management within an integrated statute.

42. While these reviews have generated an ongoing process of RMA and wider urban planning reform, Part 2 has remained largely unchanged.^[83] The Principles TAG was appointed in 2012 to review Part 2 of the RMA. Importantly, this group was appointed prior to the King Salmon decision. The group noted that:

if the Government were desirous of upholding the environmental bottom line approach formerly thought to be the correct interpretation of the Act then significant amendment should be made to the Act, because that is clearly not the law as established by judicial interpretation.^[84]

43. From this starting point, the Principles TAG recommended reform of sections 6 and 7 to address what was then a mismatch between the ‘overall broad judgement’ approach adopted by the courts, the matters of national importance in section 6 and the hierarchy of matters provided for in sections 6 and 7. In particular, it argued sections 6 and 7 focused almost exclusively on the environmental factors that should be taken into account in decision-making, rather than acknowledging the full range of environmental, social, economic, cultural, and health and safety considerations raised in the Act’s purpose statement.
44. This advice led to an attempt to include “the effective functioning of the built environment including the availability of land for urban expansion, use and development” and “the efficient provision of infrastructure” in sections 6 and 7 in 2013. However, this reform was perceived by the environmental sector to change the balance of priorities in Part 2 of the RMA, and there was not enough political support to enact it.

Urban development is a dynamic process and urban areas need to evolve.

The lack of content on urban issues in Part 2 has not hindered the development of national direction or regional and district plan content on urban planning. However, the lack of such principles has left decision-makers with little guidance on how to create this plan content, for example how to balance the need for affordable housing with the desire to maintain urban environmental quality. The situation is further confused by consideration of urban environmental effects, such as loss of sunlight or traffic congestion, through a decision-making framework designed to consider effects on the natural environment. Perhaps most significantly, this has prioritised protecting the status quo, rather than recognising that urban development is a dynamic process and urban areas need to evolve.

Insufficient recognition of Te Tiriti o Waitangi and te ao Māori

While the RMA was designed to provide better recognition and protection of Māori interests in resource management, some consider it has not fulfilled this promise.

Part 2 of the RMA contains several provisions that are specific to Māori and Te Tiriti. Section 6(e) requires decision-makers to recognise and provide for “the relationship of Māori and their culture and traditions within their ancestral lands, water, sites, wāhi tapu, and other taonga”. Section 7(a) requires decision-makers to have particular regard to kaitiakitanga. Section 8 requires decision-makers to take into account the principles of the Treaty of Waitangi. Other parts of the RMA provide for transfer of functions and joint management arrangements, iwi management plans, Mana Whakahono ā Rohe agreements and consultation with Māori, among other things.

While the RMA was designed to provide better recognition and protection of Māori interests in resource management, some consider it has not fulfilled this promise. The Waitangi Tribunal notes, “it is disappointing that the RMA has almost completely failed to deliver partnership outcomes in the ordinary course of business when the mechanisms to do so have long existed”.^[85] The Tribunal also argues that Māori interests tend to be “balanced out” in the hierarchy of matters that decision-makers must consider in the RMA, and that lack of resourcing for Māori participation in processes has limited use of available tools.^[86]

48. These issues are as much about processes available under the RMA as they are about the purpose and principles. All the provisions in the RMA relating to Māori are addressed more comprehensively in chapter 3.

Insufficient focus on outcomes

49. The issues identified with the performance of the RMA in relation to both the natural and physical environments partly results from its focus on managing the negative effects of resource use, rather than on providing direction on desired environmental and development outcomes or goals.^[87]
50. As discussed, the RMA was intended to narrow the focus of ‘planning’ to regulation of environmental effects and facilitate a shift in planning practice in New Zealand away from the more ‘dirigiste’ system in place under the Town and Country Planning Act 1977.^[88] Minister Upton put it as follows in his third reading speech on the Resource Management Bill: “Unlike the current law, the Bill is not designed or intended to be a comprehensive social-planning statute ... for the most part, decision makers operating under the Bill's provisions will be controlling adverse effects”.^[89]

Thirty years on it is clear the ‘effects-based’ approach was not implemented as intended in relation to both maintaining environmental standards and providing an enabling approach for development in urban areas.

The RMA was intended to be broadly enabling of development, subject to environmental performance standards. Economic benefits were expected to flow from having “fewer but more targeted interventions”, while better environmental quality could be achieved with “fewer restrictions on the use and development of resources, but higher standards in relation to their use”.^[90]

Thirty years on it is clear the ‘effects-based’ approach was not implemented as intended in relation to both maintaining environmental standards and providing an enabling approach for development in urban areas. In particular, the continued use of detailed land use regulation suggests traditional town planning approaches continued in spite of the RMA, albeit without a useful guiding framework as to desired outcomes for urban development.^[91]

It has also become apparent that greater emphasis on ‘planning’ itself is needed within our framework for land use regulation and environmental protection. This is evident in the challenges of implementing an ‘effects-based’ approach in the context of both environmental protection and development.

• Environmental protection. Perhaps the most significant challenge for environmental management under the RMA has been controlling cumulative environmental effects – the result of activities that individually have a minor impact on the environment but collectively result in significant impacts over time and space. The RMA’s focus on ‘effects’ has led to a system oriented around assessment of individual resource consent applications, at the expense of managing cumulative effects in plans and taking a wider view of the changes required to achieve sustainable management. As the Parliamentary Commissioner for the Environment noted as early as 1998:

the approach to promoting sustainable management being developed in New Zealand is reactive, based mostly on the management of environmental effects rather than on setting environmental performance targets and articulating visions to improve the nature and efficiency of resource use in line with sustainable development”.^[92]

The primary antidote to the ‘death by a thousand cuts’ that results from cumulative environmental effects, is to consider these strategically through planning processes and set firm controls that shape development in line with desired end goals. This requires a focus on the positive outcomes the system seeks to achieve in managing the natural environment, be it improved freshwater quality, enhancement and restoration of ecosystems or other goals.

• Development. The RMA’s ‘effects-based’ approach has also been criticised for an insufficient focus on the positive outcomes that can be derived from planning for resource use and development. While the Act does require the management of resources to enable “people and communities to provide for their social, economic, and cultural wellbeing and for their health and safety”, the principles in sections 6 and 7 are largely focused on aspects of the environment in need of protection. There has been much discussion in recent times of the need for the system to set more specific goals for urban and infrastructure development to guide and encourage change. Primary sector industries like farming, forestry and mining also argue that the benefits of resource use and development are not given sufficient weight under Part 2 of the RMA.

Lack of clarity in intent and implementation

54. As discussed, it took over two decades for the courts to settle how and when to apply the RMA’s purpose. This length of time is indicative of the lack of clarity that has permeated New Zealand resource management practice.

It took over two decades for the courts to settle how and when to apply the RMA’s purpose.

In its recent first-principles inquiry into urban planning in New Zealand, the Productivity Commission notes that “ambiguous language and broad language ... led to regulatory overreach in urban areas, and a lack of stringency in how the natural environment is regulated”.^[93] In other words, a lack of clarity in the objectives of the RMA led to a poor management approach to both urban planning and environmental management.

EDS makes a similar but distinct argument regarding lack of clarity in Part 2 of the RMA. It suggests the RMA conflates two different environmental management functions: setting environmental limits; and making trade-offs across multiple objectives above those limits. As noted, these separate functions were reflected in the debate in the courts about the purpose of sustainable management. EDS argues the system should more clearly differentiate between the core things that should be protected with environmental limits, for instance freshwater quality, and those things that we may be willing to ‘trade off’, such as urban amenity.^[94] This is a similar argument to that of the Productivity Commission, but avoids drawing a distinction between the domains of the ‘built’ and ‘natural’ environments.

While sections 6 and 7 of the RMA do provide for a hierarchy of matters to be considered in plans, how to interpret this hierarchy has also been a source of confusion. The Principles TAG argued that neither the current selection of matters specified, nor their allocation between sections 6 and 7, is based on a clear rationale. It identified lack of clarity as an issue in the following aspects of Part 2 of the RMA:^[95]

• difficulty interpreting Part 2 as a whole, including its role in facilitating the overall broad judgement approach required under section 5 (of course, this is unsurprising, given sections 6 and 7 were drafted on the basis of the biophysical bottom line approach)
• difficulty interpreting each subsection and some key words within them, with many words and phrases lacking clear definitions
• the complexity added by the large number of section 6 and 7 matters for decision-makers to consider, and lack of clarity in the approach to be taken to weighing matters within or between sections. According to the Principles TAG, this has been compounded by the increasingly “ad hoc nature of the list”, as changes have been made over the years for particular purposes, but there had been no holistic review since the RMA was enacted.

58. Many commentators have pointed out that ambiguity in the meaning of sustainable management, including of the type identified by the Productivity Commission, EDS and the Principles TAG, might easily have been addressed by central government through earlier development of national policy, guidance or methodologies for decision-makers on how to decide what to assess under sections 6 and 7.^[96] A large body of national direction currently under development aims to address this gap. However, this begs the question as to why the legislation itself did not set clearer objectives and a clearer hierarchy of considerations, or require national policy on important resource management challenges, as is the case with the New Zealand Coastal Policy Statement.
59. This lack of clarity on the concept of sustainable management has led to the following impacts on the system.
    • Development of a more uncertain, litigious, and costly system over the last 30 years than might otherwise have been the case.^[97] The Supreme Court’s King Salmon decision has now increased certainty by reducing the opportunity to contest the meaning of resource management plans on the basis of the broad test in Part 2. However, the corollary of this change is it reduces a ‘check’ provided by the courts on resource management decision-making by local government. The impacts of the King Salmon decision are still working their way through the system.^[98]
    • Increased discretion for local decision-makers and the courts. The Supreme Court pointed out in its King Salmon judgment that it is unlikely Parliament intended national policy to be simply a list of matters subject to an ‘overall broad judgment’, given the rigorous process required to create national policy statements.^[99] In some cases, this discretion has enabled local government and the courts to interpret sustainable management in a way that avoids addressing difficult resource management challenges. Former Ministry for the Environment Deputy Secretary Lindsey Gow commented in 2014 that in some cases “devolution has resulted in local interests having an unacceptable dominance, leading to poor decisions; in other cases political differences and inertia have led to insufficient change.”^[100]
    • Poor monitoring by central government of progress towards sustainable management. The Productivity Commission points out that central government’s ability to monitor the performance of the planning system depends on the specificity of the objectives set.^[101] Without clear objectives, it has been difficult for central government to hold local decision-makers to account for delivering sustainable management, despite significant oversight powers provided in the RMA. The Supreme Court makes a similar point in its argument for a more rigorous interpretation of the Act.^[102]
60. In conclusion, while codifying the concept of ‘sustainability’ in law was undoubtedly a significant step forward for environmental management in New Zealand, lack of clarity about what this has meant in practice has hampered delivery of sustainable outcomes. Some of the problems outlined above may have been reduced with better implementation of national direction to set environmental standards, greater use of principles explaining how social, economic, and cultural wellbeing might be balanced with environmental protection, and the application of sustainable management to urban issues.

Options considered

61. The options put forward in our issues and options paper were:
    • retain or change the sustainable management purpose under section 5(1)
    • retain or change the definition under section 5(2), for example by adding a positive obligation to maintain and enhance the environment
    • reframe sections 5, 6, 7 to more clearly provide for outcomes-based planning
    • strengthen sections 5, 6 and 7 to more explicitly require environmental limits and/or targets to be set
    • recognise the need to ensure there is sufficient development capacity to meet existing and future demands including for affordable housing
    • recognise other urban planning objectives
    • develop a separate statement of principles for the built environment
    • recognise Te Mana o te Wai, or its underlying principles in Part 2
    • require national direction on identified topics or methodologies
    • provide for new concepts to address climate change
    • strengthen the reference to Te Tiriti in section 8.
62. We received a broad range of suggestions for reform from stakeholders. Overall, the options considered can usefully be grouped as follows:
    • reconsidering sustainable management and the ‘effects-based’ approach
    • addressing concerns with management of the natural environment (climate change matters are discussed in chapter 6)
    • addressing concerns with management of urban and other development
    • recognising Te Tiriti and te ao Māori (discussed further in chapter 3).
63. We discuss each of these in turn below.

Comments received

64. Submitters put forward many suggestions for how Part 2 of the RMA should be amended. These largely echoed the public debate about the purpose of the RMA that has continued since its enactment. There was no clear agreement amongst submitters but some significant themes emerged.
    • Most submitters agreed the RMA’s purpose of ‘sustainable management’ had not delivered intended outcomes and therefore warranted review.
    • Some submitters supported retaining the current section 5. Reasons given were the importance of existing jurisprudence, and support for the overall balance between environmental protection and development outcomes.
    • Other submitters argued the current definition of sustainable management unfairly elevated environmental protection over development issues.

Most submitters agreed the RMA should be reoriented to focus on positive ‘outcomes’ in addition to managing adverse ‘effects’.

Most submitters thought section 5 could be improved to address its effectiveness in achieving environmental protection, and to provide greater clarity on how to balance environmental and development outcomes.

Most submitters agreed the RMA should be reoriented to focus on positive ‘outcomes’ in addition to managing adverse ‘effects’. Reasons given included both the need to address cumulative environmental effects and better recognise the positive impacts of urban and other development on wellbeing.

Some submitters supported a new focus in Part 2 of the RMA on ‘enhancing’ the environment, including all Māori submitters.

Māori groups argued greater weight should be given to Te Tiriti.

Some submitters supported retaining a distinction and hierarchy between sections 6 and 7, others supported a combined list. There was also some support for a separate list of principles relating to the built environment (in both urban and rural areas).

• There was support for the existing matters specified in section 6. There were also requests to add a new reference to, or to place greater emphasis on, freshwater (Te Mana o te Wai), minerals, urban development, housing and infrastructure, climate change, heritage and property rights.

Discussion

Reconsidering ‘sustainable management’ and the ‘effects‑based’ approach

65. Many serious criticisms have been made of the RMA’s purpose and principles. That said, it is also apparent in state of the environment reporting and the wider public debate about environmental issues that much of the content underpinning Part 2 of the RMA is as relevant today as it was in 1991. In particular, the idea of ‘sustainability’ itself has only increased in prominence over the last 30 years as pressure on biophysical environmental limits has become more intense. We draw two broad conclusions from these observations that have guided our approach to reconsidering Part 2:
    • significant clarification of the policy objectives of the RMA and how they are to be achieved is required if we are to improve outcomes, both for the natural and built environments.
    • proposals for reform should build on, rather than discard, widely accepted principles.
66. Perhaps the most fundamental change contemplated in the options identified above is reorienting the system towards a positive focus on achieving ‘outcomes’ in addition to managing ‘effects’. As the New Zealand Law Society notes in its submission to us, there are significant interdependencies in the design of the resource management system. Substantial modification of section 5 would be required to focus measures under the RMA on achieving specified ‘outcomes’. This would in turn require changes in how sections 6 and 7 are framed. A new focus on ‘outcomes’ would have broad impact across management of both the natural and the built environment.
67. The RMA’s ‘effects-based’ approach was the subject of much comment in submissions. While some submitters discussed the value of a properly implemented and informed ‘effects‑based’ approach, most supported the addition of a complementary focus on ‘outcomes’. For example, from a development perspective Infrastructure New Zealand argues “the permissive, effects-based orientation of the current system heavily devolves resource management decisions down to affected parties and away from strategic public outcomes.” In its view, the effects-based regime should be replaced with a system that “balances “top-down” public outcomes needs against “bottom-up” desires to exercise property rights and promote local aspirations.” Fonterra and Federated Farmers made similar arguments that while an ‘effects-based’ approach remains relevant as a way of linking resource use with environmental outcomes, there is also a role for an outcome-based and more directive approach for priority resource management issues. In their view, this should be implemented through strategic spatial planning alongside an effects-based approach that provides flexibility in land use decision-making. From an environmental perspective, Forest & Bird points out that a focus on ‘outcomes’ in addition to effects could provide greater certainty about environmental limits and a necessary focus on restoration of the natural environment. We agree.

Our view is that a new focus on ‘outcomes’ should be incorporated within the purpose and principles of the Natural and Built Environments Act.

In light of the issues identified and the comments received, our view is that a new focus on ‘outcomes’ should be incorporated within the purpose and principles of the Natural and Built Environments Act. We note that the ‘effects-based’ approach under the RMA has not been implemented as intended. In practice, this has meant ‘planning’ has proceeded without a suitable guiding framework. In our view, this has been a significant underlying causal factor in the wide range of implementation challenges experienced under the RMA for the management of both the natural and built environments. As the New Zealand Planning Institute said in its submission on our issues and options paper, “an aspirational and forward-looking planning approach is needed to complement effects-based planning.” This would provide greater clarity about what the system seeks to achieve in management of both the built and natural environments. In a complex system that involves multiple layers of decision-making, clarity of objectives is required to ensure results are delivered.^[103]

While the concept of sustainability should remain embedded within our environmental management system, our view is that implementing a new focus on outcomes requires the current definition of ‘sustainable management’ in section 5 of the RMA to be replaced with a more specific and positive purpose statement in the Natural and Built Environments Act. To support this the principles, as currently set out in sections 6 and 7 of the RMA, should be expressed as ‘outcomes’ the system is intended to deliver both in relation to the natural and built environments. The outcomes established in a new purpose and principles section of the Natural and Built Environments Act would inform the development of the full range of instruments used under the new legislation, including national direction (see chapter 7), regulatory planning (see chapter 8) and the use of economic instruments (see chapter 11).

Our proposals for reorienting the purpose and principles of the Natural and Built Environments Act to focus on outcomes are discussed in the recommendations at the end of this chapter.

Addressing concerns with management of the natural environment

The deterioration of certain environmental outcomes suggests a new focus on restoration or regeneration of the environment is now needed to deliver the quality of the environment expected by New Zealanders.

Much of the debate about the development and interpretation of section 5 of the RMA focused on whether it established a biophysical environmental limit, and how this applied in practice. While Simon Upton stated his intention regarding Part 2 of the RMA was that “only sustainable outcomes were to be acceptable” and “whatever trade-offs in the circumstances of the case, a highest level trade‑off in favour of sustainability had already been made in legislation in advance”; interpretation and implementation of the RMA did not bear this out.^[104]

The decline of environmental outcomes experienced over the last thirty years suggests a continued need for emphasis on environmental limits. However, as the Supreme Court has pointed out, Part 2 of the RMA is not a “primary operative decision-making provision.”^[105] Rather, section 5 simply provides a ‘guiding principle’ to be applied by those performing functions under the RMA. And, while the operation of section 5 has been clarified following the King Salmon decision, the process of developing detailed environmental controls at the national, regional or local levels continues to afford broad discretion to central and local government. An important question for our review has been how to ensure our system of setting protections for the natural environment is sufficiently active and directive.

73. The deterioration of certain environmental outcomes also suggests a new focus on restoration or regeneration of the environment is now needed to deliver the quality of the environment expected by New Zealanders. The definition of sustainable management in section 5 of the RMA is a product of its time, and a new goal is now required to reflect New Zealanders’ aspirations for a high standard of environmental quality. This is already evident in the ambition of the government’s freshwater reform work programme, which aims to both stop further degradation and loss and reverse past damage.^[106]
74. Finally, as the risks of climate change and environmental deterioration have become more immediate, the concept of ‘resilience’ has gained prominence in environmental management. Resilience is the capacity of a ‘social-ecological’ system to absorb a spectrum of shocks and stressors, and to sustain and develop its fundamental function, structure and identity through either recovery or reorganisation in a new context. Fragile environmental systems can be pushed over a threshold into a new degraded state from which recovery is slow or impossible. These system changes radically alter the flow of ecosystem services and associated livelihoods. The striking examples of collapse of fisheries – such as the North Atlantic cod fishery in the early 1990s which for the preceding 500 years had largely shaped the lives and communities of Canada's eastern coast − illustrates the potential for rapid and permanent regime change. New Zealand must avoid these types of tipping points if we are to maintain our livelihoods.
75. The concept of resilience can be seen as a component of sustainability that emphasises the need to plan for unexpected events and rapid changes in environmental states. This requires a precautionary approach to setting environmental limits that incorporates a ‘buffer’ of redundancy corresponding to risk and uncertainty, including in environmental data.
76. In order to address concerns about how New Zealand’s natural environment is managed, a future environmental management framework must therefore ensure:
    • biophysical environmental limits ‘have teeth’ within a reformed system
    • limits are set in a way that ensures sustainability and resilience
    • instruments and incentives are available to deliver environmental improvement and restoration when needed.
77. This is as much about Part 2 of the Act, as it is the underlying institutions and processes used for setting and enforcing environmental rules and standards.
78. In response to these design challenges, our view is that our environmental management system should include a series of specified limits, outcomes and targets. These would be required under the Act to avoid the pitfalls of implementation failure experienced under the RMA. Figure 1.1 below is a visual representation of the conceptual relationship between five key environmental terms (bottom lines, limits, outcomes, targets and the precautionary approach).
79. Environmental bottom lines represent the boundaries or points at which significant and potentially irreversible harm to the environment and associated human health and wellbeing occurs. The use of bottom lines in this report conceives of them being a biophysical tipping point or threshold that is determined in accordance with the laws and interactions that exist in nature.

Outcomes and targets are needed to orient the management approach towards continuous environmental improvement.

Environmental limits are used to set the lower boundaries of a ‘safe operating space’ recognising that there could be several safe operating spaces, from pristine to degraded, above the bottom line. Limits could be quantitative or qualitative, but would be set at a level above the bottom line to serve as warnings that bottom lines are being approached, to provide triggers for remedial action and to establish cut-off points where damaging activities must cease.

Reliance on limits alone risks creating a ‘race to the bottom’ mentality where exploitation of all available resources above the limit may be seen as acceptable. It may also mean that our environmental management system is not responsive to the need for positive change to improve and enhance the environment and long-term human health and wellbeing. And it creates more risk that cumulative effects will breach bottom lines and that buffers put in place to address uncertainty will come under pressure. As such, outcomes and targets are needed to orient the management approach towards continuous environmental improvement where a healthy and flourishing environment is sought, rather than one that can merely endure human modification. Outcomes are intended to be high-level enduring goals reflecting a desired future state. Targets are time-bound steps for improving the environment and moving towards achieving outcomes.
Figure 1.1: The conceptual relationship between outcomes, targets, limits and bottom lines

82. The enduring nature of environmental outcomes means they should be established in legislation. Given their significance as the overall goals which the resource management system aims to achieve, our view is that a set of ‘outcomes’ should be included in the purpose and principles of the Natural and Built Environments Act. The ‘outcomes’ would complement the overall purpose of the legislation as a series of statements that collectively create a vision of the better future that is to be desired and worked towards. For ease of interpretation, they should be grouped into the general domains in which the system operates:
    • natural environment
    • built environment
    • tikanga Māori
    • rural
    • historic heritage
    • natural hazards and climate change.
83. It would be less appropriate to express detailed environmental limits and targets within legislation itself. Limits and targets need to be set and expressed in such a way that they are able to accommodate a range of circumstantial, geographic, and temporal variations and changes. That said, to ensure appropriate protections for the biophysical environment are established, our view is that the Minister for the Environment should be obliged to set limits and targets through national direction for certain biophysical matters described in the Act.

The Minister for the Environment should be obliged to set limits and targets through national direction.

To ensure a sustainable and resilient management approach, these limits would be required to provide a margin of safety above the conditions in which significant and irreversible damage may occur to the natural environment. Decision-makers would also be required to take a precautionary approach to setting limits where effects on the natural or built environment are uncertain, unknown or little understood but have potentially significant and irreversible adverse consequences.

Limits and targets would also be expressed in various other planning documents. Depending on the content, coverage and detail of national targets and limits, combined plans would need to retain the ability to set targets and limits at local authority level (see chapter 8).

Our proposals under the purpose and principles section of the Natural and Built Environments Act to focus on specified outcomes, limits and targets are discussed in the recommendations section of this chapter.

Addressing concerns with management of urban and other development

87. The RMA enables use and development of natural and physical resources to support the wellbeing of people and communities. As discussed earlier, a long series of official inquiries has confirmed that the RMA has not provided a useful framework for urban planning and infrastructure provision. While section 5 of the RMA is sufficiently broad to encompass urban development, there is no particular reference in the purpose and principles of the RMA to the planning requirements of urban areas.
88. In its recent first principles inquiry into urban planning in New Zealand, the Productivity Commission argued that by applying an environmental management approach to planning for the built environment, Part 2 of the RMA led councils to pursue “land use regulations that have weak links to genuine externalities.”^[107] For example, under the broad definition of the ‘environment’, and in pursuit of ‘amenity values’, district plans prescribe rules such as minimum lot or apartment sizes and floor-to-ceiling heights on the basis of ‘sustainable management’.^[108]

We have sympathy with the view that the RMA has not provided a useful guiding framework for urban planning.

While there are different views about the extent of regulation needed in urban areas, it is clear that the link between these sorts of controls and ‘sustainable management’ is tenuous. In fact, these prescriptive rules are quite contrary to the original intention of the RMA. For example, in a 1997 speech Simon Upton argued similar rules “have absolutely no plausible foundation in the RMA and have nothing to do with environmental effects”.^[109] Rather, many of our detailed district plan rules are vestiges of plan-making approaches under the earlier Town and Country Planning Acts from 1953 and 1977 that have proved remarkably resistant to change.

We therefore have sympathy with the view that the RMA has not provided a useful guiding framework for urban planning. The challenges of managing urban development are quite distinct to those of protecting the natural environment. According to 2018 population estimates, 86 per cent of New Zealand’s population lives in urban areas, ranging from cities to small towns. However, our urban areas make up a small proportion of the country. In 2012, less than 1 per cent of New Zealand’s total land area was classified as having urban land cover.^[110] As a result, the vast majority of urban planning effort under the RMA is in fact directed at regulating the ‘effects’ of activities on property rather than the natural environment – be it through rules to protect access to sunlight and other amenities, or to manage impacts on infrastructure networks. Of course, this is not to say that biophysical environmental limits do not exist or should not apply in urban areas.

Many submissions pointed out that the RMA could be adapted to provide a more useful framework for urban planning. For example, Auckland Council argued the purpose and principles of the RMA should be expanded to promote the delivery of quality urban environments, ensure sufficient appropriate capacity for development, and recognise key infrastructure and community amenities. Similarly, the Resource Management Law Association argued that sections 6 and 7 of the RMA should be reframed to include the provision of urban development capacity and infrastructure. It also called for separate statements of principles for the natural environment and built environment/urban issues. To better enable urban development, the Property Council submitted that the purpose of the RMA should be amended to reflect that decision-making has “a preference towards change with clear enabling provisions, rather than favouring the status quo.” In its view, sections 6 and 7 could either be removed entirely, or revisited with greater attention to the built environment.

The purpose and principles of new legislation should identify specific ‘outcomes’ for urban planning that correspond to the distinct environmental qualities of urban areas.

Recent efforts have already begun to build an urban planning framework inside the RMA. This has primarily been through development of national policy statements, first on urban development capacity^[111] and now on urban development more generally.^[112] These recognise the national significance of urban environments and provide direction to local authorities about when and how cities should plan for growth. However, there are some limitations to this approach. While this national direction will influence local plans, it does so within the RMA’s ‘effects-based’ approach. This means that while some planning ‘outcomes’ have now been prescribed through national direction, and in particular the need to ensure sufficient development capacity is available for housing and business land, the overall structure of regional and local planning and consenting is still focused on the management of ‘effects.’

93. Our view is that more should be done to recognise and guide the distinct practice of urban planning under the Natural and Built Environments Act. The purpose and principles of new legislation should identify specific ‘outcomes’ for urban planning that correspond to the distinct environmental qualities of urban areas. This would ensure both that there is a clear mandate for urban planning within New Zealand’s resource management system and there are some clear principles to guide good practice. The ‘outcomes’ set in the purpose and principles could then be used to guide combined plans that achieve greater clarity and certainty for development, while continuing to protect the natural environment.
94. Urbanisation is a complex process driven by the interaction of markets for housing and business development capacity, public investment in infrastructure and amenities, and land use regulation. Urbanisation is also dynamic. Economic and social forces drive continuous change in demand for land use, capital investment, infrastructure and neighbourhood social characteristics.
95. This complexity and dynamism underlies many of the benefits that urban areas offer through ‘agglomeration economies’. The scale, density, diversity and opportunities for interaction that cities offer enable people to make connections, learn, specialise and improve their social and economic wellbeing.^[113] However, as new uses come with new externalities, urban planning must resolve a continuous stream of disputes.
96. This complexity and dynamism challenges the feasibility of detailed land use plans beyond a certain point. It is important that, while protecting the environment, regulatory plans facilitate rather than prevent urban areas growing and changing. While the current shortage of housing and infrastructure to support urban growth is not only the result of the RMA, it is crucial that land use plans enable development capacity in urban areas. If this is not the case, increasing demand for access to the jobs and opportunities that urban areas provide will inevitably drive higher costs for housing and business land, with significant social and economic impacts.
97. That said, it would be a mistake to think urban planning should be entirely driven by market forces. There is a strong public interest in the overall pattern of development of urban areas that is not represented by individual developers. This includes:
    • natural environmental impacts – for example, impacts on highly productive soils and transport-related carbon emissions
    • economic impacts – for example, on the overall productivity of cities and the capacity and efficiency of infrastructure networks
    • social impacts – for example, ensuring broad community access to essential services
    • cultural impacts – for example, ensuring affordable housing is available where communities have existing ties.

Urban planning should be more focused on setting the high-level patterns of land use for urban development and less focused on overly complex regulatory controls.

Our view is that to achieve good environmental outcomes and make the greatest contribution to the overall wellbeing of communities, urban planning should be more focused on setting the high-level patterns of land use for urban development and less focused on developing the elaborate and overly complex regulatory controls that are characteristic of current district plans. In the words of Jane Jacobs, urban planning is a science of “organised complexity.”^[114] The best response to this complexity is to combine strategic direction with simple rules. The ‘outcomes’ set to guide urban planning should therefore recognise the dynamic nature of urban areas, ensure development capacity is available for growth and change, and ensure that the way in which overall urban form contributes to wellbeing is broadly understood. How our proposals for urban planning ‘outcomes’ are intended to flow though into regulatory plans is discussed in chapters 7, 8 and 11.

Of course, urban planning is as much about investment in infrastructure and public goods as it is about land use and environmental regulation. A second challenge for urban planning under the RMA has been its links with other important statutes relating to urban development, and in particular the LGA and LTMA. As enabling new capacity for development will often require changes to both land use rules and infrastructure investment, achieving integrated decision-making under these Acts is essential. The ‘outcomes’ set to guide urban planning should therefore also help ensure strategic integration of land use and infrastructure. We discuss additional proposals for new legislation to achieve better integrated strategic planning for urban and other development in more detail in chapter 4.

100. While urban development has been a significant focus for our review, the RMA manages the environmental effects of a much broader range of activities including farming, forestry and extractive industries. We heard from some submitters that the benefits of this kind of development were not given adequate weight within the RMA. For example, the Petroleum Exploration and Production Association of New Zealand submitted that “Part 2 of the Resource Management Act (“RMA”) currently has an unreasonable presumption in favour of environmental protection but without a clear framework to constrain what this management should relate to”. In its view the ‘overall broad judgement’ interpretation of the RMA that applied before the King Salmon decision was more favourable towards development “but a strict interpretation of “avoid” directives has shaped the approach towards one favouring protection.” Likewise, Straterra said the purpose of the RMA “sets up a hierarchy where social, economic and cultural well-being and health and safety are subsidiary to sustainable management.” In its view this leads to “legitimate development activities facing barriers in achieving consents.” New Zealand King Salmon’s view was that “Part 2 as it is currently drafted, by in large, means all things to all people...What the Act needs to do is to provide a pathway to improve New Zealand’s environment.”
101. Other submitters representing the primary production sector contended that the purpose of the RMA broadly strikes the right balance between development and environmental protection. For example, Federated Farmers said “section 5(2) appropriately acknowledges that alongside environmental objectives and expectations, there should be provision for social, economic and cultural wellbeing (and health and safety) ... A balanced view on resource use and benefits does not forestall aspirational and long-term goals for improved environmental outcomes.” In its view, Part 2 of the RMA “should not be subject to a complete re-write”. Instead, the primary focus should be on minor “amendments and better implementation” of what is already there, not wholesale change of existing contents. This may include “consideration of recent case law and guidance around interpretation.”

An ‘outcomes-based’ system can provide greater certainty for development interests if it provides for stronger and clearer plans so that decisions are not re-litigated through resource consent processes.

There have been many years of debate about the hierarchy of environmental and development considerations in decision-making under the RMA. Our view is that this needs to be clarified through reform of Part 2. We have some sympathy with the view that development interests have not been well recognised under the RMA. In our view this is largely a product of the ‘effects-based’ framework that has pitted environmental and development interests against one another in resource consent processes. These issues are often contested when development proposals are at an advanced stage, leading to wasted effort if proposals are declined.

103. The better way forward is to plan to achieve better outcomes for both the natural and built environments in a way that is mutually beneficial. This can be achieved if plans provide adequate guidance on the kind of development that is appropriate. This requires a broad set of ‘outcomes’ to be specified in the purpose and principles of a future system to guide plans, including ‘outcomes’ for rural development. It also requires a resource management system that places greater emphasis on resolving resource conflicts in national direction and plan-making, rather than at the consenting stage (as discussed in later chapters). An ‘outcomes-based’ system can provide greater certainty for development interests if it provides for stronger and clearer plans so that decisions are not re-litigated through resource consent processes.

Better recognising Te Tiriti and te ao Māori

104. The RMA recognises both Te Tiriti and Māori interests and values. However, as discussed earlier, the way the RMA has been implemented has not met the expectations of Māori.

Our view is that strengthened recognition both of tikanga Māori and Te Tiriti is warranted.

Successive Waitangi Tribunal reports have now documented the shortcomings of the RMA’s implementation. The recent stage 2 of the National Freshwater and Geothermal Resources inquiry was particularly critical.^[115] The Tribunal noted that the requirement in section 8 to ‘take into account’ the Treaty principles is sometimes interpreted as a procedural requirement, implying only consultation is required. In other cases section 8 is interpreted in terms of sections 6(e) and 7(a), with the result that wider Treaty principles, including partnership and active protection, are not considered. In the Tribunal’s view, “the reference to the Treaty principles in the Act should encompass all those principles and impose an obligation or duty upon RMA decision-makers. An amendment to section 8 ... is required to make the RMA Treaty-compliant”.^[116]

Other environmental legislation, such as the Conservation Act 1987, gives greater weight to the principles of Te Tiriti. More recently developed legislation is also more explicit about what the Crown’s responsibility to give effect to the principles of Te Tiriti in a particular context entails.

The majority of submitters on our review supported strengthening recognition of te ao Māori and reference to Te Tiriti. We also heard this message directly during a series of regional hui.

108. Our view is that strengthened recognition both of tikanga Māori and Te Tiriti is warranted. Our proposals in this regard are discussed briefly in the section that follows, and in more detail in chapter 3.

Proposals for reform

109. Our proposals for reform are set out below with supporting commentary. Our proposals in relation to Te Tiriti and te ao Māori are discussed in more detail in the next chapter. We have also developed a number of supporting definitions that are included in appendix 1 of this report.

A new Natural and Built Environments Act

110. In light of the significant change in focus of the Act, we consider a new name to be appropriate. Our suggested title is the Natural and Built Environments Act.

Our view is that sustainable management should be replaced with a clearer and more positive focus on enhancing the quality of the natural and built environments.

Our view is that sustainable management should be replaced with a clearer and more positive focus on enhancing the quality of the natural and built environments. In order to capture the full range of protection and development issues, the environment would be defined broadly to include ecosystems, people and communities and the natural and built environments in both urban and rural areas. For the sake of clarity, we have suggested including this definition in the purpose statement of a new Act. The new focus on enhancing the environment will enable planning practice to be reoriented towards the pursuit of positive ‘outcomes’ in these various aspects of the environment. It will also put to bed the debate about the meaning of the word ‘while’ in the current definition of sustainable management.

112. Ultimately, resource management is about both protecting the environment and enabling development within clearly defined environmental limits. In doing so, it should support social, economic, environmental and cultural wellbeing now and in the future. Environmental and development interests should not be framed in competition with one another.

Resource management is about both protecting the environment and enabling development within clearly defined environmental limits. In doing so, it should support social, economic, environmental and cultural wellbeing now and in the future.

To reflect this approach, the concepts of wellbeing, sustainability and managing adverse effects on the environment that are present in the current definition of sustainable management have been supplemented with a new focus on restoring and enhancing indigenous biodiversity and ecosystems and promoting positive outcomes for the environment as a whole.

It should be noted that while we consider a broad definition of the environment to be necessary within an integrated system of resource management, our proposed definition excludes reference to ‘amenity values’ and the ‘social, economic, aesthetic, and cultural conditions’ associated with aspects of the environment. These are highly subjective matters which have led to considerable uncertainty and litigation. They are also commonly relied on by submitters as an argument for protecting the status quo. Our suggested way forward is to remove these references from the definition of the environment and to require the features and characteristics that contribute to enhancing the quality of the natural and built environments to be specified in mandatory national direction. This is discussed shortly.

We have also proposed to add recognition of the concept of Te Mana o te Taiao to the purpose statement of the Natural and Built Environments Act.

An important aspect of our review has been to consider how New Zealand’s resource management framework can better reflect te ao Māori. In some ways Part 2 of the RMA embodies New Zealand’s common environmental ethic. In a bicultural New Zealand, we consider it important that the way in which Māori relate to the environment is at the heart of this story. We have therefore also proposed to add recognition of the concept of Te Mana o te Taiao to the purpose statement of the Natural and Built Environments Act. This is defined as the importance of maintaining the health of air, water, soil and ecosystems and the essential relationship between the health of those resources and their capacity to sustain all life.

116. Te Mana o te Taiao expresses in te reo the concept of safeguarding the life-supporting capacity of natural resources which has been a longstanding part of section 5 of the RMA. Our intention is that this will help to promote a shared environmental ethic.
117. For convenience we have numbered the sections of our new purpose and principles section 5 to section 9, to roughly align with the section numbering in the RMA.

Recognising Te Tiriti

Our view is that future resource management legislation should require decision-makers to ‘give effect’ to the principles of Te Tiriti. How this is to be done would be specified in a mandatory national policy statement.

Our view is that future resource management legislation should require decision-makers to ‘give effect’ to the principles of Te Tiriti. How this is to be done would be specified in a mandatory national policy statement. It will be important to make clear that giving effect to Te Tiriti is not intended to create a priority right for Māori to the allocation of resources, other than in respect of land or resources they own or as recognised by legislation or Tiriti settlements.

119. While the definition of ‘Te Tiriti o Waitangi’ in the new legislation would have the same effect as the current definition in the RMA, use of te reo is an important symbolic step. Our proposals in this regard are discussed in more detail in chapter 3.

A defined set of planning outcomes to guide the system

120. To support the revised purpose statement, we have developed a set of planning outcomes to guide the development of instruments under the Act. These recognise that there should be some specific goals for planning in different contexts. The outcomes build on and more clearly define the existing principles in sections 6 and 7 of the RMA. They are intended to identify the particular aspects of the natural, built and rural environments that warrant protection and enhancement, or issues that require a specified management approach, as is the case with tikanga Māori, historic heritage, and natural hazards and climate change (discussed in greater detail in chapter 6).
121. In addition, in order to build flexibility into the framework, we have included a general requirement to enhance the features and characteristics that contribute to the quality of our natural and built environments. These would be identified by the Minister for the Environment through mandatory national direction.
122. It is important to note that within the ‘outcomes-based’ approach proposed, the matters specified will play a different role to that of sections 6 and 7 of the RMA. First, there is now a positive obligation to pursue specified outcomes. In our view, this will increase their influence over plans. Second, the purpose and principles section of the Natural and Built Environments Act is no longer intended to serve as a list of matters to consider in deciding resource consents. Rather, the outcomes will guide national direction and combined plans, which will in turn guide consideration of resource consents. This is intended to increase certainty in the system as a whole. Finally, to simplify the Act, there is no hierarchy among the outcomes specified. Any conflict in or doubt about the application of the matters specified is required to be reconciled and clarified through national direction and plans.
123. We emphasise that the specific outcomes identified are not intended to be exclusive to each category. For example, the outcomes identified for the natural and built environments are relevant to each of those categories. This reflects the simple truth that elements of the natural environment occur in the built environment and vice versa.
124. Many of the existing matters specified in sections 6 and 7 of the RMA have been reframed and refined.
     • The current matters of national importance in sections 6(a), (b) and (c) regarding protection of the natural character of the coastal environment, wetlands, lakes and rivers, outstanding natural features and landscapes and significant indigenous vegetation and habitat, have been strengthened. There is now a focus on protection and enhancement of these aspects of the environment. There is also a new requirement for the Minister to identify targets to achieve continuing progress towards these outcomes. Finally, to achieve greater certainty for both environmental protection and development, there is a requirement on the Minister for the Environment to identify nationally significant features, landscapes, areas and habitats in national policy statements. Local authorities have similar functions as we discuss in chapter 8.
     • The current matter of national importance in section 6(d) regarding the maintenance and enhancement of public access to and along the coastal marine area, lakes, and rivers has been retained.
     • The current matter of national importance in section 6(e) regarding the relationship of Māori and their culture and traditions with aspects of the environment has also been broadened and strengthened. There is now a requirement to protect and restore the relationship of iwi, hapū and whanau and their culture and traditions with their ancestral lands, cultural landscapes, water and sites. There is also a specific requirement to protect wāhi tapu and protect and restore other taonga. The recognition of protected customary rights under the Marine and Coastal Area (Takutai Moana) Act 2011 is retained.
     • The current section 6(f) regarding the protection of historic heritage has been clarified and focused on significant historic heritage.
     • The current section 6(h) regarding the management of significant risks from natural hazards has been clarified and focused on the reduction of risks.
125. To ensure a comprehensive approach, new outcomes have been added in relation to the natural environment, the built environment, rural matters and climate change:

Natural environment

• There is a general requirement to enhance features and characteristics that contribute to a quality natural environment. There is a corresponding requirement for the Minister for the Environment to identify these features and characteristics.
• A new focus on enhancement and restoration of ecosystems and viable populations of indigenous species has been added.

Built environment

• There is a general requirement to enhance features and characteristics that contribute to quality built environments. This reflects the broad role of the Natural and Built Environments Act in managing the use and development of resources. There is a corresponding requirement for the Minister for the Environment to identify these features and characteristics.
• A new focus on sustainable use and development in urban areas including the capacity to respond to growth and change has been added. This reflects the important role of urban planning in setting the overall urban form of cities.
• A stronger focus on availability of development capacity for housing and business purposes to meet expected demand has been added. This reflects the important role of the resource management system in enabling competitive development and housing markets to operate.
• A new focus on the strategic integration of infrastructure with land use has been added. This reflects the importance of integrated planning for both urban and other development.

Rural

• A specific reference to sustainable use and development in rural areas has been added. This recognises the significance of primary production for rural communities and economic development more generally.
• There is a new requirement to protect highly productive soils to ensure their availability for primary production for future generations.
• There is also a requirement to accommodate land use change in response to social, economic and environmental conditions.

Climate change

• A new focus on the reduction of greenhouse gas emissions has been added.
• Support for promoting activities that mitigate emissions or sequestrate carbon has been included.
• The current section 7(j) has been strengthened and focused on promoting increased use of renewable energy.
• A new focus on improved resilience to the effects of climate change including through adaptation has been added.

126. We also consider some matters are no longer required:
     • the current section 7(a) relating to kaitiakitanga is more appropriately recognised as an implementation principle (discussed shortly)
     • the current section 7(h) relating to the protection of the habitat of trout and salmon should be removed. We see no good reason why these species are singled out over others in the RMA. In any case, we consider future legislation should not refer to particular species
     • the other rather general matters in current section 7 are no longer needed in light of the new matters identified above.

A clear requirement to establish environmental limits to protect the biophysical environment

127. The purpose and principles of the Natural and Built Environments Act should also include a specific section on environmental limits. As discussed earlier, we consider it important to provide for environmental limits as distinct from other planning ‘outcomes’. The intention of this distinction is to recognise and circumscribe a safe operating space for human activity and to avoid significant biophysical tipping points in which irreversible harm and damage to the environment results in significant impacts on human health and wellbeing.

We propose a duty on the Minister for the Environment to set environmental limits for key biophysical domains: freshwater, coastal water, air quality, soil quality, and habitat for indigenous species.

We propose a duty on the Minister for the Environment to set environmental limits for key biophysical domains: freshwater, coastal water, air quality, soil quality, and habitat for indigenous species. The limits would be required to be set within a margin of safety to ensure tipping points are avoided.

129. We consider our proposed combination of specified planning ‘outcomes’ and ‘environmental limits’ responds to former Parliamentary Commissioner for the Environment Jan Wright’s call to better prioritise what matters in environmental management based on scientific analysis and environmental trends, while also prioritising aspects of the environment that are particularly important to New Zealanders.

Achieving clarity through specified implementation principles and duties

130. In light of the significant interpretation and implementation challenges experienced under the RMA, we also consider it necessary to specify implementation principles, duties and the approach to resolution of conflicts under the Act as part of the purpose and principles of replacement legislation. The intention of this section is threefold:

We consider it necessary to specify implementation principles, duties and the approach to resolution of conflicts.

principles: to set clear guidelines for processes and decision-making under the Natural and Built Environments Act. The principles are largely self-explanatory and relate to integrated management of resources, public participation, Māori participation, cumulative environmental effects and the precautionary approach.

duties: to establish mandatory requirements for the Minister for the Environment (and where applicable the Minister of Conservation) to develop the national direction necessary to make the system work as intended.

• resolution of conflicts: to provide a mechanism to resolve potential conflicts in outcomes through national direction and combined plans.

Our indicative drafting of these principles is set out below.

The new purpose and principles preserve key elements of the King Salmon decision including the rejection of the overall broad judgment approach and the recognition of the hierarchical approach under the RMA.

The new purpose and principles contain an expanded list of outcomes that must be provided for, including the matters that were treated as matters of national importance under section 6 of the RMA. It is intended to preserve key elements of the King Salmon decision including the rejection of the overall broad judgment approach and the recognition of the hierarchical approach under the RMA.

132. While the distinction between the relative weight to be accorded to the matters in sections 6 and 7 of the RMA has been removed, section 9(5) clarifies that the use and development of the natural and built environments must first comply with prescribed environmental limits and with any applicable binding targets, national directions and regulations.
133. The strong emphasis on the prescription of environmental limits, the setting of binding targets to improve the quality of the natural and built environments, along with mandatory national direction, will provide direction to assist in resolving potential conflict between the outcomes in section 7. To the extent any remaining conflict or lack of clarity exists, section 9 (6) requires it to be resolved through national direction or, in the absence of any such direction, through combined plans. Again, to acknowledge the direction of King Salmon the intent is to address these matters in the plans rather than on an ad-hoc or case-by-case basis by way of resource consents. This is reinforced by our recommendation in chapter 8 to remove the consideration of Part 2 matters when determining resource consents.
134. The so-called cascading or hierarchical effect of the RMA from purpose and principles and national direction down to combined plans and consents remains under the National and Built Environments Act.

Expected outcomes

135. The objectives and principles for our review include ensuring our proposals for reform protect and enhance ecosystems and the natural environment, enable productive development, and set clear direction to guide decision-making. Our proposals for a new purpose and principles section in the Natural and Built Environments Act advance these objectives by refocusing New Zealand’s system of resource management on enhancing the quality of the environment through pursuit of a defined set of environmental ‘outcomes’ and ‘targets’ within ‘limits’. Our view is that this will set the clear direction needed to enhance the quality of both the natural and built environments.

Key recommendations

Chapter 3 Te Tiriti o Waitangi me te ao Māori

Current provisions

1. The RMA has been recognised as “the first genuine attempt to import tikanga in a holistic way into any category of the general law”.^[117] However, it is widely recognised that the resource management system has failed to deliver on the opportunities provided in the legislation. Further the current provisions may not reflect the approach the Crown has taken to partnership under Te Tiriti in other areas.^[118]
2. The RMA provides for Māori interests^[119] in several parts.

Table 3.1: RMA provisions for Māori interests

Despite the large number of provisions in the RMA designed to provide for Māori interests, these have not been implemented to enable mana whenua to engage meaningfully in the resource management system.

Despite the large number of provisions in the RMA designed to provide for Māori interests, these have not been implemented to enable mana whenua to engage meaningfully in the resource management system. As the Waitangi Tribunal reported in Ko Aotearoa Tēnei in 2011, “Nearly 20 years after the RMA was enacted, it is fair to say that the legislation has delivered Māori scarcely a shadow of its original promise ...”.^[121]

Issues identified

4. Our terms of reference include:
   • ensuring Māori have an effective role in the resource management system consistent with the principles of Te Tiriti
   • ensuring appropriate mechanisms for Māori participation in the system, including giving effect to Tiriti settlement agreements
   • clarifying the meaning of ‘iwi authority’ and ‘hapū’.
5. We have identified issues in the resource management system that prevent these aims from being achieved. These include:
   • lack of recognition and provision for te ao Māori in the purpose and principles of the resource management system. This also includes issues with the Tiriti clause in section 8 of the RMA
   • limited use of the mechanisms for mana whenua involvement in the RMA
   • Māori involvement in the resource management system has tended to be at the later stages of resource management processes, and there is an opportunity in a new system to provide for a greater role for Māori at the strategic end of the system
   • lack of monitoring central and local government Tiriti performance
   • capacity and capability issues for both government (central, regional and local) and Māori to engage on resource management issues, and lack of funding and support to address these issues
   • local authorities and applicants for resource consents can find it difficult to know who is mana whenua in an area and therefore which mana whenua groups to engage with. This often perpetuates the problems above.

Māori interests are ‘balanced out’ in the purpose and principles

6. The purpose and principles of the RMA provide for some matters that are particularly important to Māori interests but some argue they are often ‘balanced out’ against other Part 2 considerations.
7. The Waitangi Tribunal’s Wai 2358 report found no compelling evidence to dispute the claimants’ notion that Māori interests were often ‘balanced out’ when RMA decision-makers must consider sections 6–8 of the RMA. Further, the Tribunal noted in the Whanganui River Report, “[section 8] does not require those with responsibilities under the Act to give effect to Treaty principles but only to take them into account. This is less than an obligation to apply them. When ranked with the competing interests of others this means that guaranteed Treaty rights may be diminished in the balancing exercise that the Act requires.”^[122]

In successive reports the Waitangi Tribunal has found the resource management system often falls short of fully adhering to the principles of Te Tiriti.

In successive reports the Waitangi Tribunal has found the resource management system often falls short of fully adhering to the principles of Te Tiriti. In its recent Wai 2358 report, the Tribunal congratulated the Crown on “its commitment to address Māori rights and interests in a Treaty-compliant manner”, but it ultimately found “the RMA had significant flaws in Treaty terms ... and that the reforms the Crown has completed are not sufficient to make the RMA and the freshwater management regime Treaty compliant”.^[123]

There has also been a lack of clarity about local government’s role in the Tiriti partnership. As Hayward notes, “local government, historically and today, has exercised Crown kāwanatanga over resources of significance to Māori, without any legal obligation to meet the Crown’s Treaty guarantees to Māori”.^[124]

The Tiriti partners are mana whenua and the Crown. The definition of the Crown in the Public Finance Act 1989 specifically excludes local government. Nevertheless the RMA delegates some Tiriti obligations to local government through section 8. There are concerns that some local authorities are not adequately fulfilling their delegated Tiriti roles and functions and are using their non-Crown status to justify this.

Limited uptake of mechanisms for mana whenua involvement

11. There are mechanisms under the RMA for mana whenua involvement in the resource management system, but these have had extremely limited uptake.
12. The transfer of powers provision (section 33) has never been used to transfer powers or functions to an iwi authority,^[125] and joint management agreements (section 36B) have only been used twice in relation to iwi authorities outside those required by Tiriti settlements.

Iwi management plans have generally had a limited and inconsistent impact on the contents of policy statements and plans.

Mana whenua groups consider iwi management plans to be an excellent tool^[126] and many have been developed.^[127] The Wai 262 report notes that iwi management plans “provide the only mechanism by which iwi authorities are able to exercise influence on resource management decisions by setting out their own issues and priorities without any council or applicant filter. It is the only instance where Māori can be proactive in resource management without needing the consent of a minister, a local authority, or an official.”^[128]

However, despite the requirements under the current provisions, iwi management plans have generally had a limited and inconsistent impact on the contents of policy statements and plans.^[129] It is worth noting that, while the overall impact is low, some local authorities are better than others at taking iwi management plans into account and working with mana whenua generally.

Iwi management plans are just one of many matters that local authorities must consider when making policy statements or plans. However, certain matters (for example, national direction) are required to be ‘given effect to’, while others (for example, iwi management plans) only have to be ‘taken into account’. These weak directing words may be one reason why iwi management plans have not had the desired impact.

In some cases capacity and capability constraints within local authorities and/or mana whenua have limited the impact of iwi management plans. For example:

• some iwi management plans are not available online,^[130] making them much more difficult to use and take into account
• many local authorities do not have capability to take iwi management plans into account in their planning processes
• many mana whenua groups lack the resourcing, capability or expertise to produce iwi management plans which have the content and evidential base to enable ready translation into regional and district plans.

Participation is often focused on reactive, inefficient and labour-intensive processes such as responding to numerous resource consent applications, rather than on processes with strategic impact such as planning.

Despite the strong obligations in the RMA and LGA, local authority engagement with mana whenua (and Māori generally) has often been inconsistent and ineffective.^[131] Where engagement does occur, this is sometimes after policy has already been significantly developed and can be seen by some as a ‘tick box’ exercise. Mana whenua have consistently provided feedback^[132] that consultation is not enough and partnership in the resource management system is required to give effect to Te Tiriti.

Central government has tried to address these issues through both non-legislative guidance^[133] and legislative amendments, including the addition of Mana Whakahono ā Rohe (MWaR) to the RMA in 2017. However there has only been one MWaR arrangement to date with another in progress. These efforts have not achieved systemic change and both mana whenua and local authorities still face significant barriers when trying to engage with each other in resource management processes.

A more strategic role for mana whenua

19. In the absence of a strategic role for mana whenua, their participation is often focused on reactive, inefficient and labour-intensive processes such as responding to numerous resource consent applications, rather than on processes with strategic impact such as planning.^[134]

In some cases local authorities and applicants for resource consents find it difficult to know which mana whenua groups to engage with.

Our terms of reference require the resource management system to ensure mana whenua have a more effective role to be consistent with Te Tiriti and its principles. This includes recognising and providing for their roles as rangatira and kaitiaki as well as their aspirations for sustainable resource use.

21. An important principle of Te Tiriti is partnership. There are opportunities to better reflect this principle in the relationships between mana whenua and local authorities throughout a future resource management system, especially at the strategic level. This could involve partnership arrangements between Māori and other agencies for the governance and management of resources, and better providing for rangatiratanga so Māori can be active in the protection of their taonga.

Difficulties knowing which mana whenua groups to engage with

22. To clarify the meanings of ‘iwi authority’ and ‘hapū’ we must address the underlying issue, that in some cases local authorities and applicants for resource consents find it difficult to know which mana whenua groups to engage with.
23. There are several problems with the current approach to this issue:
    • engaging at the iwi or iwi authority level does not reflect the reality of kaitiakitanga, which may operate at the hapū or whānau level
    • current provisions constrain local authority engagement with hapū. Hapū often approach local authorities seeking to engage on resource management matters but the willingness of local authorities to do so at this level varies
    • local authorities should not be the body determining who represents an iwi for the purposes of the RMA
    • central government has not provided sufficient support to local authorities or mana whenua groups to help resolve these issues.
24. The current approach in the RMA is designed to allow mana whenua groups to self-identify. This is because only Māori can define who has the mana over the whenua. However, this makes it difficult for local authorities to work out which groups represent mana whenua for any specific resource management matter. In addition, local authorities can refuse to engage with any group other than an ‘iwi authority’, even if the appropriate group to engage with on a particular matter is a hapū or whānau.
25. Determining which mana whenua groups should be engaged with is complex. The rohe of mana whenua do not follow local government boundaries and may overlap or be contested. Mana whenua within an area may have differing views, as may Māori within mana whenua groups. Input from these groups may be multifaceted and require considerable effort from government to understand and act upon. It is challenging to provide information and guidance on such matters.
26. As noted in the list of current RMA provisions set out above, the Crown is required to provide information to help local authorities identify the iwi authorities and hapū groups in their area. This is done through the Te Kāhui Māngai website administered by Te Puni Kōkiri. However, the groups identified on the website are based solely on a self-nomination process, meaning there is little confidence that these are necessarily the appropriate groups for local authorities to engage with. This lack of a robust identification process has slowed the development of partnerships between mana whenua and local authorities, and has made engagement difficult (and costly) for resource consent applicants.

Limited monitoring of Tiriti performance

27. Lack of oversight and limited monitoring of Tiriti performance means it is difficult to know how well local authorities (and central government) are upholding the principles of Te Tiriti and the obligations resulting from Tiriti settlements.
28. While numerous reports, submissions, feedback from hui and other evidence indicate significant issues for Māori in the resource management system, the lack of monitoring and evaluation makes it difficult to know to what extent outcomes important to Māori are being achieved and how Māori wellbeing is affected.
29. Improved system oversight and monitoring of Tiriti performance would help to ensure the outcomes of the Natural and Built Environments Act are achieved.

Lack of funding and support to build te ao Māori capacity and capability

30. A major barrier to better aligning the resource management system with te ao Māori is the difficulty of embedding Māori concepts, such as tikanga, mātauranga and te reo, into a primarily ‘Western’ framework particularly when these concepts are not well understood by non-Māori. This difficulty is more pronounced where there is a lack of will, funding and support to build te ao Māori capacity and capability in central and local government.
31. In addition, local authorities and mana whenua often lack the capacity and capability to meaningfully engage and meet the requirements of the RMA. Just over half of local authorities provide financial support for mana whenua participation in policy statement and plan-making processes.^[135] But a lack of adequate resourcing continues to be a significant barrier to mana whenua participation in the resource management system.

Both legislative and non-legislative solutions will be needed to achieve real and long-lasting change.

Overall, while tools to address the issues have been available in the RMA, they have not been implemented in a way that improves Māori wellbeing. Both legislative and non-legislative solutions will be needed to achieve real and long‑lasting change.

Options considered

33. Options to address these issues have been drawn from our issues and options paper, the Tiriti and te ao Māori working group report, and suggestions from submitters and from our discussions with Māori at regional hui.

Purpose and principles

34. Options we have considered include the following.
    • Incorporate a Māori framework into the purpose clause of the Natural and Built Environments Act, as part of the purpose statement itself and/or as a sub-clause, to better reflect and embed te ao Māori perspectives in the core of the system. Alternatively, include a Māori framework in a preamble to the new Act.
    • Strengthen the Tiriti clause including:
      • ‒ increasing the weighting from ‘take into account’ to one of ‘recognise and provide for’, ‘have particular regard to’ or ‘give effect to’
      • ‒ placing the Tiriti clause earlier in Part 2
      • ‒ referring to the principles of Te Tiriti, to Te Tiriti itself or to both
      • ‒ determining whether it is ‘the Treaty of Waitangi’ (the English language version), ‘Te Tiriti o Waitangi’ (the Māori language version) or both versions that should be referred to in the Tiriti clause and the related section 2 definition of ‘Treaty’.
    • Develop guidance on how to implement the Tiriti clause, including further sub-clauses and/or a national policy statement on Te Tiriti.
    • Better align the RMA with other legislation, including the Te Ture Whenua Māori Land Act 1993, as well as the United Nations Declaration on the Rights of Indigenous Peoples.

Ways to improve mana whenua involvement

35. Options we have considered include:
    • removing barriers to and encouraging the uptake of opportunities for joint management agreements and transfer of powers
    • enhancing the MWaR provisions
    • enhancing the role and status of iwi management plans, including considering the Wai 262 recommendations
    • creating a legislative link between iwi management plan and the proposed regional spatial strategies
    • rationalising the RMA tools related to mana whenua involvement into a single integrated partnership process between mana whenua and local authorities
    • repealing and replacing the current definitions of ‘iwi authority’ and ‘tangata whenua’ with a new definition for ‘mana whenua’ that would provide for comprehensive involvement in a new resource management system
    • encouraging partnership arrangements more generally, including by providing non‑legislative guidance
    • improving Māori participation in the resource consent process and encouraging further use of cultural impact assessments.

A role for mana whenua at the strategic end of the system

36. Options we have considered include:
    • making provision for new approaches and partnership arrangements in the management of resources, drawing on the experience of Tiriti settlements
    • establishing bodies to promote issues of significance to Māori and to develop capability and capacity, building on the examples of the Independent Māori Statutory Board (IMSB) in Auckland, and the Environmental Protection Authority’s statutory Māori advisory committee, Ngā Kaihautū Tikanga Taiao
    • providing a role for mana whenua in spatial planning and/or combined planning
    • establishing a national co-governance institution, either for freshwater matters alone or with a wider focus
    • establishing an independent Tīkanga Commission that would have a watchdog and review role
    • establishing a National Māori Advisory Board
    • providing for regional co-governance committees for resource management matters
    • involving mātauranga Māori experts in the setting of limits and targets.

Monitoring and system oversight of Tiriti performance

37. We have considered providing for regular auditing of central and/or local government performance in meeting Tiriti requirements. This could done by a central government agency, mana whenua groups or an independent entity, or through self-monitoring.

Funding and support

38. Options we have considered include the following.
    • Utilising further funding mechanisms to assist with the development of iwi management plans and to fund Māori to undertake integrated partnership processes. The funding could come from a contestable fund, central or local government grants and/or enabling local authorities to fix charges payable on consumptive environmental uses.
    • Directly funding Māori engagement in spatial planning, combined planning and other resource management processes to ensure under-resourcing no longer prevents Māori from participating effectively. Funding could come from central government and local government.
    • Providing funding for advisors to build local authority capability and capacity to engage with Māori particularly in smaller local authorities.
    • Developing mechanisms for mana whenua with significant experience and success in the resource management system to share their knowledge with other groups. Some ways to facilitate this are already available^[136] but further resources could be provided.
    • Developing guidance (or enhancing existing guidance) to help organisations meet their legal obligations relating to Māori and identifying areas for Māori engagement in resource management.
    • Undertaking targeted capacity and capability building for resource management practitioners. This could include: commissioner training and accreditation; iwi practitioner training; te ao Māori knowledge-building for central and local government staff; and assisting kaitiaki to develop technical expertise to participate effectively in resource management processes.

Discussion

39. The options recommended in this section to better align the system with te ao Māori are those we consider best address the issues identified, although we recommend these options be developed further in subsequent engagement with Māori.

Purpose and principles of a future system

The purpose of the resource management system

Recognition of te ao Māori should be specifically reflected in the purpose and outcomes of the Natural and Built Environments Act.

If the resource management system is to better align with te ao Māori and be consistent with Te Tiriti, recognition of te ao Māori should be specifically reflected in the purpose and outcomes of the Natural and Built Environments Act.

We acknowledge further engagement will be needed to develop the detail of a Māori framework, but it is important the new purpose and principles contain amended provisions to better reflect Māori values.

Some submitters specified terms they considered should be used in the purpose and outcomes of the Natural and Built Environments Act. Patuharakeke suggested ‘Rangatiratanga’ be included in section 5 and cascade down through sections 6 and 7.^[137] Te Rūnanga o Ngāti Awa proposed the inclusion of ‘mauri’ in section 5, stating, “Mauri is in everything. Mauri is about life-supporting capacity. It needs to be recognised in the purpose of the Act.” The IMSB proposed that the principles of rangatiratanga and partnership be included as matters of national importance.

Local government submitters supported efforts to bring te ao Māori into the purpose and outcomes of the Natural and Built Environments Act. Auckland Council supported new methods to elevate and recognise te ao Māori, and to refine this in partnership with Māori.

The New Zealand Planning Institute (NZPI) also suggested a normative influence for te ao Māori, stating, “Māori thinking should be a guiding principle (if not the guiding principle) towards sustainable management, particularly in respect of integrated management and generational outcomes”. Beca thought the principle of partnership specifically needed strengthening.

45. We have considered several options for adding one or more te reo Māori phrases to either the purpose statement or its sub-clauses, or both.

Te Mana o te Taiao

46. In a recent report^[138] Te Kahui Wai Māori proposed a kaupapa Māori hierarchy of obligations starting with the health and mauri of water, moving to the essential health needs of people, and then to other consumptive uses. The framework could be expanded to apply not only to wai but to the natural environment as a whole, as expressed by Te Mana o te Taiao.
47. The Panel discussed with Te Kāhui Wai Māori the possibility of Te Mana o te Taiao being part of the purpose of the Natural and Built Environments Act. Te Kāhui Wai Māori wished to include Te Mana o te Taiao as a fundamental concept embodied in the purpose of the Natural and Built Environments Act.
48. The view of the Tiriti and te ao Māori working group was that the hierarchy of obligations approach included in the proposed concept of Te Mana o te Taiao does not require that water or the environment be managed in a way that protects the environment at all costs. As with the concept of environmental limits, Te Mana o te Wai recognises water needs to be protected as the basis of life before other uses can occur, but this does not preclude development.
49. As Te Kāhui Wai Māori notes in its submission on the review:

Tensions between use and development versus protection and restoration will remain when taking a whole of environment approach. Where the aforementioned settlement legislation has overcome that tension, it has done so by taking a stand, elevating one consideration over another, rather than relying on a balancing approach. Such an elevation does not have to be categorical.

For example, initial feedback on Te Mana o te Wai was that the hierarchy of obligations risks dictating a return to a pre-human natural water state. This was never the intention so the feedback was helpful in recognising the need for greater clarity – that there must first be expectations of water being available for it to then meet the needs of people and communities.

That including the concept of Te Mana o te Taiao in the purpose statement would better align the resource management system with te ao Māori.

The importance of safeguarding the life-supporting capacity of air, water, soil and ecosystems is already recognised in section 5(2)(b) of the RMA but we consider that including the concept of Te Mana o te Taiao in the purpose statement would better align the resource management system with te ao Māori. This would reflect the core value that the health of natural resources is integral to the health and wellbeing of people and communities, and give effect to the fundamental truth accepted in all communities that life itself depends on the health of our natural resources such as clean water and air, quality soils and uncontaminated oceans for food production. As already noted, the approach would not require environmental protection at all costs (a concern expressed by some submitters) but would enable development within environmental limits.

51. Three submitters, Patuharakeke Te Iwi, Engineering New Zealand and Ngāti Tahu – Ngāti Whaoa Rūnanga Trust, supported using a Te Mana o te Wai type of framework in the purpose and principles and also suggested it was a way of elevating Te Tiriti.
52. Feedback from the regional hui supported a Te Mana o te Wai-type framework. Several hui emphasised the environment should be put above economic concerns through creating a deliberate hierarchy rather than balancing them against each other. For example, we received feedback from the Gisborne hui that the environment must be considered as a taonga, not as a resource to be used and abused.
53. In a literal sense, Te Mana o te Taiao would translate to the mana (in this context meaning importance, prestige and status) of the environment (with taiao generally being used to refer to the natural environment).
54. We recommend that the concept of Te Mana o te Taiao be included in the purpose statement of the Natural and Built Environments Act and be defined as:

Te Mana o te Taiao refers to the importance of maintaining the health of air, water, soil and ecosystems and the essential relationship between the health of those resources and their capacity to sustain all life.

55. In an earlier draft of this definition we had included a form of hierarchy as supported by Te Kahui Wai Māori and other submitters but the definition we now propose makes no explicit reference to this. We have not included a hierarchy for three main reasons:
    • first, we consider the underlying philosophy of Te Mana o te Taiao is sufficiently recognised by its inclusion in the purpose statement and the recognition of the mana of natural resources and their essential relationship to health and wellbeing
    • second, the requirement in our revised purpose and principles for mandatory environmental limits is designed to ensure that the health of biophysical resources is protected and that the use of those resources may only occur within those limits
    • third, to include a hierarchy in the definition of Te Mana o te Taiao would risk clashing with the general approach we propose in our revised purpose and principles which contemplates the resolution of conflicts between identified outcomes by ministerial direction and through plans.

Tikanga Māori outcomes

56. As discussed in chapter 2, while there are a number of outcomes Māori seek from the resource management system, we have made the decision to specify separate outcomes for tikanga Māori in our new purpose and outcomes section of the Natural and Built Environments Act.

We concur with the large number of reports, expert opinions and submissions on the Tiriti clause that the current “section 8 of the RMA is entirely inadequate for the degree of recognition and protection of Māori interests that is required by the Treaty”.

These outcomes pick up and expand upon section 6(e) of the RMA with the new section 7(j) including the protection and restoration of the relationship (and tikanga and traditions) that mana whenua have with cultural landscapes. We propose cultural landscape to be “a defined area or place with strong significance for mana whenua arising from cultural or historical associations and includes connected natural, physical or metaphysical markers or features”. This is an important change. Recognition of interconnections and that a cultural landscape can be ‘more than the sum of its parts’ will enable the multi-faceted relationships that mana whenua have with land and water to be adequately protected and restored.

The Tiriti clause

58. We concur with the large number of reports, expert opinions and submissions on the Tiriti clause that the current “section 8 of the RMA is entirely inadequate for the degree of recognition and protection of Māori interests that is required by the Treaty”.^[139]
59. As briefly outlined in chapter 2, we propose a new Tiriti clause that would read as follows:

To achieve the purpose of this Act, those exercising functions and powers under it must give effect to the principles of Te Tiriti o Waitangi.

60. Numerous organisations,^[140] and Māori in previous feedback, have recommended the RMA should expressly give effect to the principles of Te Tiriti.
61. Most of the 46 submitters on our issues and options paper who addressed this question thought changes were required to the Tiriti clause. The most popular solution was to change the weighting to ‘give effect to’. Iwi and hapū submitters frequently cited section 4 of the Conservation Act 1987, which has a ‘give effect to’ weighting, as an example of how to address the issue. Te Rūnanga o Ngāti Ruanui Trust thought it was not just about greater weight, but a matter of expressing full commitment to the principles of Te Tiriti.
62. Several submitters suggested putting the Tiriti clause into section 6 as a matter of national importance. NZPI suggested putting Te Tiriti into section 5 at the top of the hierarchy. Forest & Bird agreed the Tiriti clause should be elevated, but the environment should be at the top of the hierarchy: “... if giving effect to the Treaty could not be done in a way that was within environmental limits, which would prevail?”
63. Twelve submitters stated changes were not required to the Tiriti clause and considered the existing clause was already clear. Future Proof was concerned elevating the Tiriti clause would complicate the RMA’s relationship to Tiriti settlement legislation.
64. Feedback from the regional hui also highlighted the need for greater recognition of Te Tiriti in the resource management system. There was support for a stronger clause than the current ‘take into account’. Participants in the Nelson hui thought the obvious solution was a ‘give effect to’ weighting.
65. Overall submissions and other feedback indicates strong support for our proposed change to ‘give effect to’ the principles of Te Tiriti. The change will modernise the RMA Tiriti clause and send a strong signal that those performing functions under the Act should give greater weight to it. This change will place the Natural and Built Environment Act in the company of at least seven other pieces of legislation that use the directing words ‘give effect to’ in regard to Te Tiriti itself or Te Tiriti principles.^[141]
66. We consider this change will have positive impacts including:
    • helping to address the lack of alignment between the Crown, local authorities and mana whenua on the role of local authorities in Te Tiriti relationship
    • providing a lens through which other sections of Part 2 will be viewed and a catalyst for the partnerships needed to achieve te ao Māori outcomes
    • helping to prevent future Tiriti breaches and claims.
67. We have also considered whether the Tiriti clause should refer to ‘the Treaty of Waitangi’ (the English language version), ‘Te Tiriti o Waitangi’ (the Māori language version) or both. As has been well established, the meaning of each version is different.
68. We propose to refer solely to Te Tiriti o Waitangi as an important symbolic step and also to acknowledge that Te Tiriti o Waitangi is now widely recognised. However we have defined ‘Te Tiriti o Waitangi’ as having the same meaning as the word Treaty as defined in section 2 of the Treaty of Waitangi Act 1975. This states the “Treaty means the Treaty of Waitangi as set out in English and in Māori in Schedule 1”. This means our change in wording will not affect the legal application of the term which will still consider both versions of the document.
69. We have also considered whether the Tiriti clause should refer directly to Te Tiriti, or to the principles of Te Tiriti or to both.
70. Some consider the clause should refer directly to Te Tiriti, rather than to its principles, so particular attention is paid to the obligations set out in Te Tiriti’s articles. For example, at the Tauranga hui participants queried the focus in the RMA and other legislation on the principles of Te Tiriti rather than on the articles.
71. The Cabinet Office Circular CO (19) 5: Te Tiriti o Waitangi / Treaty of Waitangi Guidance sets out guidelines agreed by Cabinet for policy-makers when considering Te Tiriti in policy development and implementation. This circular specifically requires attention to be given to the articles of Te Tiriti – that is, not just Te Tiriti principles.
72. Another view is that the articles are specific and limit what could be achieved in a modern society between two equal partners, while the principles are generic and can adapt and change to meet the needs of the Tiriti partners. For instance, a strict interpretation of the obligations in Te Tiriti may not result in partnership, as both versions of the document are silent on this important principle that has become the cornerstone of how the modern relationship between mana whenua and the Crown is described.
73. In many ways Te Tiriti has come to mean more than just the words on the parchment, and is considered by many to be the founding document of Aotearoa. Referring to the principles arguably enables the Tiriti partnership to go beyond the transaction that was made in 1840 and evolve. In other words, Te Tiriti should be treated as a living document. Hence, we consider it is preferable to refer to the principles of Te Tiriti.

Changing the words in the Tiriti clause is not in itself likely to resolve the current problems with Māori engagement in the resource management system.

As some have noted,^[142] changing the words in the Tiriti clause is not in itself likely to resolve the current problems with Māori engagement in the resource management system. Further guidance on how to give effect to the Tiriti clause will be required.

There are two primary options for this: further sub-clauses in the Natural and Built Environments Act to direct how specific powers and functions under the Act are to be exercised and/or national direction. Either of these could provide greater specificity on how to give effect to the principles of Te Tiriti.

We consider the best option is to provide further guidance and direction on the Tiriti clause in a national policy statement.^[143] A national policy statement would be at least as directive as additional sub-clauses, if not more so, because local authorities would need to give effect to it.^[144]

A number of submitters supported national direction about how to give effect to the Tiriti clause. However, some local authority submitters wanted more information on whether this would be possible or appropriate.

In chapter 2 we noted that under section 9(3)(i) of our revised purpose and principles section, the Minister for the Environment must, through national direction, identify and prescribe how the principles of Te Tiriti will be given effect to through functions exercised under this Act. This is the same national direction instrument we are referring to here and would be the purpose of the national policy statement.

We consider it important that a proposed Tiriti national policy statement be developed through an appropriate process with Māori prior to it undergoing a board of inquiry process as outlined in chapter 7. While acknowledging that the content of the Tiriti national policy statement should be developed with Māori, we envisage that it could assist with or enable:

• a genuine partnership between Crown and Māori in resource management
• consistency and explicit identification of the key principles of Te Tiriti relevant to resource management issues
• linking Tiriti settlements to the resource management system including sharing innovative ideas developed through settlement processes
• Māori housing initiatives, papakāinga and other Māori residential developments, and recognition of Māori design values in planning and development
• the adoption of mātauranga Māori, including integrated management of natural and cultural resources such as biosystems, water, urban areas and climate
• an integrated approach to climate change adaptation issues of relevance to Māori.

80. It will, however, be important to make clear that giving effect to Te Tiriti is not intended to create a priority right for Māori to the allocation of resources, other than in respect of land or resources they own or as recognised by legislation or Tiriti settlements.
81. It will also be important for the Tiriti national policy statement to link to our other recommendations in this chapter (particularly the integrated partnership process arrangements, the involvement of mana whenua in spatial and combined planning, and the monitoring of Tiriti performance) and to our recommendations in other chapters of this report where appropriate (including the need to review the national policy statement at least once every nine years).

Providing for mana whenua involvement

82. As identified above, there are processes in the RMA providing for mana whenua involvement including iwi management plans, Mana Whakahono ā Rohe (MWaR), transfers of power and joint management agreements. Each of these has the potential to provide better outcomes for mana whenua which are not being realised.
83. We recommend that the MWaR process be redesigned and renamed to provide greater opportunities for local authorities and mana whenua to discuss and agree upon a mutually beneficial partnership. We propose an integrated partnership process to provide a better avenue to use the current mechanisms. This process would be an opportunity to discuss how mana whenua aspirations for the transfer of powers and joint management agreements can be realised and how iwi management plans can influence spatial and combined planning through the mana whenua representation in those processes (discussed further in chapters 4 and 8 respectively).
84. Strengthening, or removing barriers to, the uptake of MWaR agreements was a common theme of submissions. Ngāti Whātua Ōrākei considered MWaR agreements should be mandatory and initiated by local authorities as did Barker & Associates. Ngāi Tahu supported legislative amendment and dedicated funding to better enable participation.
85. Heritage New Zealand Pouhere Taonga supported existing and new approaches to partnership, and thought the long planning cycles had delayed the use of MWaR agreements. It also noted there are barriers to iwi authorities becoming heritage protection authorities, but that these barriers also applied more generally.

Changes are required to the current system to better enable partnerships between mana whenua and local authorities. Our proposed integrated partnership process would address the fragmentation and underuse of tools in the current RMA.

All the regional hui highlighted the importance of moving to a true partnership at central and local government levels within the resource management system. They emphasised that mana whenua are not ‘stakeholders’ but Tiriti partners and the system needs to move beyond mere ‘consultation’ with mana whenua. For example, participants at the Whangarei hui emphasised that proper partnership involves local people who live and breathe the environment.

87. The Waitangi Tribunal’s Wai 262 report made recommendations along the lines of an integrated process and we have considered its recommendations. The Tribunal in Wai 2358 considered while “Mana Whakahono a Rohe has the potential to improve relationships and to ensure that iwi are consulted on policy statements and plans”, the Tribunal is “not convinced that the final version of the Mana Whakahono a Rohe mechanism, in the form that it was enacted in 2017, will have a material impact on the situation. For this new participation arrangement to be more than a mechanism for consultation, legislative amendment is required and resources must be found.”^[145]
88. We agree changes are required to the current system to better enable partnerships between mana whenua and local authorities. Our proposed integrated partnership process would address the fragmentation and underuse of tools in the current RMA as identified in Wai 262 and Wai 2358. It would also provide a consistent approach to settled and non-settled mana whenua and foster partnerships throughout the resource management system.
89. We suggest that ideally, before an integrated partnership process is initiated, a mana whenua group should have developed an iwi management plan. The iwi management plan does not need to be constrained to particular matters; it could cover a wide range of mana whenua aspirations including:
    • restoration and protection of the environment
    • papakāinga and other developmental aspirations
    • matters relating to article 2 of Te Tiriti, including tino rangatiratanga for whenua, kāinga and taonga katoa.
90. The key is for the iwi management plan to become a record of an agreed position within the mana whenua group, which then forms the basis of discussing a partnership with local government through the integrated partnership process. An iwi management plan should also identify the rohe or takiwā of the mana whenua group for resource management purposes. Many mana whenua groups already have iwi management plans that fulfil these functions. We support multiple mana whenua groups working together (should they wish) to develop an overarching iwi management plan for their combined rohe.
91. The ability to provide an iwi management plan, with evidence it has been mandated by the group it purports to represent, could be one way of identifying mana whenua groups with whom a local authority should be engaging (discussed later in this chapter). To be clear, we are not proposing an iwi management plan is needed to initiate an integrated partnership process. We are merely pointing out it would be a helpful way both to ensure the mandate of the mana whenua group and to outline their aspirations within their rohe.

We recommend local authorities be obliged to investigate opportunities to initiate integrated partnership processes with mana whenua.

We recommend that either one or more mana whenua groups or one or more local authorities may initiate an integrated partnership process. As the Tribunal in Wai 2358 noted, “the fact that a Mana Whakahono a Rohe can be initiated by iwi, and local authorities are compelled to negotiate and reach agreement if they do, is an important improvement over other RMA mechanisms”.^[146] For this reason it is essential any new process retains the ability for mana whenua to be the initiator.

Further, we recommend local authorities be obliged to investigate opportunities to initiate integrated partnership processes with mana whenua in their region, and local authorities be required to report on this though the National Monitoring System to a monitoring and oversight body (discussed later in this chapter).

We recommend the integrated partnership process follow the basic structure set out in the current MWaR provisions but provide for more flexible timeframes and funding. Both local authorities and mana whenua need to be able to defer or schedule discussions. Integrated partnership process arrangements would be legally binding and should only be amended or terminated by mutual agreement.

The integrated partnership process should also include a dispute resolution process similar to the current MWaR provisions which provide for binding or non-binding dispute mediation (by agreement) if a dispute arises among parties in the course of negotiating a MWaR. If the mediation is non-binding, and the dispute remains unresolved, the parties may seek the assistance of the Minister who can appoint a Crown facilitator to assist with resolving the dispute.

As with the current MWaR provisions, the integrated partnership process should be able to involve multiple mana whenua groups and local authorities who can jointly enter into agreements. This provides opportunities to work efficiently and maximise existing and new relationships.

97. We propose the integrated partnership process arrangement be required to include agreement on:
    • giving effect to Tiriti settlement obligations and commitments at local authority level, including providing for statutory acknowledgements and any other arrangements
    • processes to provide for aspects of the iwi management plan(s) of one or more mana whenua groups to be taken into account in the spatial and/or combined planning processes
    • processes to enable mana whenua groups to nominate candidates for mana whenua representation on spatial and/or combined planning committees
    • opportunities for the parties to implement power-sharing mechanisms under the new resource management system, including transfers of power and joint management agreements
    • how land owned by mana whenua will be identified and how the owners will be engaged when they may be affected by policy or plan changes
    • how and when mana whenua will be engaged in resource management matters, including consenting decisions
    • how mana whenua will be engaged in and informed about all the monitoring activities undertaken within the resource management system as described in chapters 12 and 13.
    • how mana whenua can access opportunities for commissioner training, and how potential nominee(s) from mana whenua groups can be added to the list of nominees that the Principal Environment Judge will select from to appoint independent hearing panels (see chapter 8)
    • how mana whenua group(s) can provide support to one or more local authorities in order to implement the requirements of the Tiriti national policy statement in their rohe
    • what protections, if any, should be provided for wāhi tapu and whether mana whenua group(s) wish these places identified in the combined plan maps
    • matters relating to climate change adaptation and natural hazards relevant to the rohe of the mana whenua group(s) and the area of the local authority(ies)
    • what the relationship(s) should be with council controlled organisations within the rohe of the mana whenua group(s)
    • a conflict of interest process
    • a dispute resolution process for the implementation of the agreement
    • funding for mana whenua participation in resource management processes
    • mutual capacity and capability building, including mana whenua-led training and capability building for local authorities on the cultural connections and local Māori knowledge specific to their rohe
    • timeframes for the implementation of matters in the integrated partnership process arrangement
    • when and how a regular review of the effectiveness of the integrated partnership process arrangement will occur.
98. An agreement does not mean the parties will take action on these particular points immediately or even at all. Rather it means the parties must discuss these issues and confirm the partnership approach they wish to take in respect of the resource management matters in their particular area. For example, parties could agree not to transfer functions or powers, or could agree to defer discussions for an agreed period.
99. Significant funding and support will be required for these processes. The Ministry for the Environment has provided guidance, funding and support to some iwi for the development of iwi management plans, and in 2018 the Ministry published comprehensive guidance on the MWaR process, but more will be needed. A consistent approach will be required to support the development of both iwi management plans and integrated partnership process so all mana whenua have the opportunity to use these processes.
100. One matter to address is how to respond when two or more mana whenua groups claim mana whenua in the same area and do not wish to work together. Ideally such issues would be resolved by the mana whenua groups themselves during development of iwi management plans. However, if mana whenua cannot reach agreement, there should be a graduated approach to resolving the issues. This would begin with a facilitated hui or wānanga, before moving to formal dispute resolution and ultimately referral to the Māori Land Court^[147] as the final arbiter in disputes, in the unlikely event this is required.
101. The integrated partnership process we propose will have significant benefits and we envisage it will also reduce complexity in the system due to a wide range of matters being resolved up front.
102. We have also considered the current ‘take into account’ weighting for iwi management plans when local authorities are preparing or changing a regional policy statement, regional plan or district plan. We consider this weighting should remain. In our view, the main reason iwi management plans have failed to influence these policies and plans is the lack of relationships between local authorities and mana whenua. The governance roles mana whenua will have in the spatial and combined planning processes (discussed in chapters 4 and 8), as well as the integrated partnership processes, will help develop the relationships needed for iwi management plans to exert greater influence.

Improving transfer of powers and joint management agreement provisions

103. We consider the legislative mechanisms relating to mana whenua involvement should be grouped together in a new part of the Natural and Built Environments Act including transfer of powers and joint management agreement provisions as they relate to mana whenua. As with the current provisions, these should continue to be available for use by other public authorities.
104. Several iwi and hapū expressed frustration at the failure of local government to act in partnership under the RMA. For example, Te Kaahui o Rauru noted, “We, the Mana whenua of this land have continued to be disenfranchised by the non-delivery of the co-governance that was encapsulated in section 36B of the RMA”. Te Rūnanga o Ngāi Tahu observed, “While section 33 has long held out the promise of iwi exercising a degree of rangatiratanga in their takiwā, to date there have been no instances of powers being delegated to iwi under that provision. Furthermore, iwi management plans are often not given sufficient weight or regard, or are misunderstood. Te Rūnanga also agrees with the Waitangi Tribunal that legislative amendment and dedicated resources are needed in order for Mana Whakahono ā Rohe agreements to be more than a mechanism for consultation”.
105. We propose that the legislative barriers to the use of these mechanisms be removed. In particular, we recommend removing reference to the grounds under section 33(4)(c) of the RMA upon which both authorities must agree before powers are transferred. The three grounds are: the authority represents the appropriate community of interest; efficiency; and technical expertise. Similarly for joint management agreements we propose repealing the section 36B(1)(b) tests which are that: each party represents the relevant community of interest; each party has the technical expertise; and a joint management agreement is an efficient method.

We also propose that a positive obligation be placed on local authorities to investigate opportunities to use the transfer of power and joint management agreement provisions.

Removing barriers to the use of these mechanisms received support from a number of submissions. Bay of Plenty Regional Council noted funding would help address the efficiency criteria, which is a significant barrier. Nelson and Wellington City Councils suggested the provision of guidance or national direction. Ngāti Whātua Ōrākei and Barker & Associates thought these tools should be mandatory for ancestral Māori land and land included in Tiriti settlements.

We also propose that a positive obligation be placed on local authorities to investigate opportunities to use the transfer of power and joint management agreement provisions, and this be reinforced by their inclusion for discussion as part of an integrated partnership process. Further, local authorities would be formally required to give due consideration to any mana whenua requests to use these tools.

Local authorities should be required to report on their activities in this area via the National Monitoring System and also to a monitoring and oversight body (discussed further below).

Lastly, as per the Wai 2358 recommendation, section 33 should be amended so that transfers could be made to hapū where appropriate.

These changes would not by themselves address issues of risk and liability, which are potential barriers to the use of these sections. Issues of risk and liability are likely to be particular to the individual circumstances of the transfer of power or joint management agreement in question. Where risk and liability would lie should be a matter discussed and agreed between the parties involved.

An effective strategic role for mana whenua in the system

111. Our terms of reference include “ensuring that Māori have an effective role in the resource management system that is consistent with the principles of the Treaty of Waitangi”. Our overall package of proposed options includes an enhanced role for mana whenua.
112. As discussed above, the resource management system tends to be ‘bottom-heavy’ in regard to Māori involvement. If mana whenua are more involved at the strategic end of the system, decisions should be more consistent with te ao Māori, and the burden on mana whenua to be actively involved in lower-level decision-making should be reduced. This would be a more efficient approach.
113. This does not mean there should be no role for mana whenua in areas such as consenting (our views on this are in chapter 9). Rather a more effective role at the strategic end of the system may mean less onerous involvement in lower-level decision-making.
114. Local authority submitters provided examples of mana whenua involvement in decision-making, such as inclusion on hearing panels for plan-making and some consents.
115. Fletcher Building considered there was value in local authorities enabling greater decision-making for Māori at the plan-making stage, instead of leaving engagement to consent processes. Future Proof identified Ngā Karu Atua o te Waka, its own tangata whenua reference group, as an example of sustainable and successful participation.

We consider it important to provide a more effective strategic role for Māori in the resource management system.

Some submitters saw Tiriti settlements as good models for partnership. However Federated Farmers expressed concern that partnership could erode wider democratic principles: “Farmers would strongly oppose any reform of the RMA that led to the democratic principles by which the RMA is administered, and indeed the democratic principles on which the country is based, being undermined”.

We consider it important to provide a more effective strategic role for Māori in the resource management system. Our recommendations on this are covered in other chapters, but in brief we recommend there should be mana whenua representation on regional spatial planning committees (chapter 4) and combined planning committees (chapter 8). We also consider mātauranga Māori experts should be involved in setting environmental limits and targets to complement biophysical science and impact analysis (chapters 6, 7 and 8).

Monitoring and system oversight of Tiriti performance

118. Central and local government performance in meeting our proposed obligation to give effect to the principles of Te Tiriti should be monitored.
119. This chapter only discusses monitoring in relation to Tiriti performance. However there are broader monitoring considerations including: monitoring the state of the environment at a national and local level; monitoring the effectiveness of policies in achieving environmental outcomes and targets and staying within limits; and monitoring compliance with consent conditions and rules (see chapters 12 and 13). There is a relationship between these other areas of monitoring and the monitoring of Tiriti performance, for instance when poor indicators from environmental monitoring become a Tiriti performance issue.
120. Monitoring of Tiriti performance could fulfil a number of purposes, for example:
     • evaluating how local authorities are implementing the Tiriti national policy statement
     • gauging progress in developing integrated partnership process arrangements
     • identifying how well government agencies and local authorities are fulfilling obligations to mana whenua, and Māori more generally, in the resource management system. This would include identifying which methods are or are not effective, the ‘pain points’ and gaps in the system, and which agencies and/or local authorities need assistance. This would also highlight successful approaches and identify areas for greater investment or methods to be employed more widely.
     • providing transparency and accountability to the Tiriti partners which in itself could improve performance.
121. Options relating to monitoring of Tiriti performance received fewer responses from submitters. Te Rūnanga o Ngāi Tahu summarised what it saw as the current state: “It is unacceptable that mana whenua must educate both councils and communities on their rights and concerns, and then use their already scarce resources to defend the need for these matters to be included and considered in planning processes”.
122. Waikato Regional Council remarked “system custodianship need not be punitive” and measures should be crafted in collaboration with local government, focusing on quality and continuous improvement.
123. Ngāti Tahu – Ngāti Whaoa thought central government should take responsibility for regular audits of local authorities, and this approach could be more effective than amending legislation, as what is currently in the RMA is not being implemented properly. Waikato-Tainui suggested the group responsible for the auditing should have 50 per cent Māori governance. Te Korowai o Ngāruahine wanted iwi involvement in both Tiriti performance monitoring and state of the environment monitoring. Auckland Council supported having a national body that could monitor the efficiency and effectiveness of the RMA. Te Rūnanga o Ngāi Tahu were against the idea of a national body, unless they could run such a group in their own area.
124. Most regional hui touched on monitoring the performance of local authorities. However there was no consensus on whether this should be undertaken by a national body or regionally. Māori were looking for a role on any monitoring body.
125. The IMSB has had good success in achieving change at Auckland Council through its Tiriti audits which assess whether the Council is acting in accordance with its statutory Tiriti responsibilities.
126. In its submission on the review, the IMSB supported the establishment of “a new national body that includes a Māori Board (with members selected by an iwi selection panel) ... that sets direction for the resource management system and undertakes audits of performance including meeting Treaty responsibilities”.
127. We consider some form of National Advisory Board, broadly in line with options previously put forward by the Productivity Commission and Waitangi Tribunal, is the best option for monitoring Te Tiriti performance.

National Māori Advisory Board

128. We recommend a National Māori Advisory Board be established to monitor Te Tiriti performance from a Māori perspective.

We recommend a National Māori Advisory Board be established to monitor Te Tiriti performance from a Māori perspective.

Members of the Board should have a range of expertise including planning, law, tikanga and mātauranga Māori as well as technical and audit skills.

The Board should provide advice and recommendations but should not impinge on the Tiriti partners’ rights to speak for their own Tiriti interests and undertake their own monitoring or other actions as needed. We suggest the duties and functions of the Board should include:

• a system oversight function that would focus on monitoring how the resource management system gives effect to the principles of Te Tiriti
• participating with the Crown in the development of the Tiriti national policy statement
• advising central government agencies with resource management functions or responsibilities and local government on policies, regulations, processes and methods that will best give effect to the principles of Te Tiriti
• considering ways to address resource management Tiriti issues of national importance and/or issues that are common to multiple regions
• maintaining records of mana whenua groups in the areas of local authorities, and a duty to assist local authorities and mana whenua to identify who to engage with on resource management matters
• regularly auditing central government agencies with resource management responsibilities and local government on their Tiriti performance and making recommendations for improvement

131. The audits could follow a six-yearly cycle during which each of the local authorities and central government agencies is audited once. The National Board should be required to report to Parliament and (depending on the report in question) central and/or local government should be required to respond. After receiving a report, bodies would report on what actions they propose to take in response to the recommendations and, where they propose not to act on a recommendation, outline the reasons why.
132. For the duty of maintaining records discussed above, this could include expanding the records kept on the Te Kāhui Māngai website and the information collected under the current section 35A of the RMA. The National Board would have a clear and active role to assist local authorities and mana whenua with identifying who to engage with. This would provide certainty and reduce costs to all parties involved.
133. To assist with this and other functions, National Monitoring System data and any other relevant monitoring data held by central or local government should be made available to the National Board to support the effective execution of its tasks.
134. Local authorities should be able to set up boards for their area, similar to the IMSB, to assist understanding of the particular Tiriti issues in their area and to proactively improve Tiriti performance before audit by the National Board. Mana whenua are best placed to articulate how obligations, particularly regarding article 2 of Te Tiriti, directly affect them in their area and how they should be given effect to. We encourage large local authorities to give serious consideration to this approach.
135. Any boards established by a local authority should be required to report to the National Board and Ministry for the Environment on their monitoring activities and findings.
136. Audits can be adversarial, although this does not need to be the case. One of our objectives for the future resource management system is to move towards a positive outcomes-focused approach. We recommend that both the National Board and any local authority established boards adopt a positive approach where mana whenua and local authorities can collaboratively work together to improve performance.

Assisting local authorities to identify mana whenua groups

137. As noted above, local authorities and applicants for resource consents can sometimes find it difficult to know which mana whenua groups to engage with on resource management issues.
138. Eight of the local government submissions which referred to the option of clarifying the meaning of iwi authorities and hapū, cite a lack of clarity on who has a mandate to initiate agreements. Overlapping interests were a source of confusion, particularly for the Far North District Council which has a great number of iwi authorities, hapū and marae within its area. A further four responses from business/industry, infrastructure and agricultural interests^[148] supported clarification, citing inefficiency, delay and extra expense.
139. Iwi and hapū groups were more circumspect in their responses on this matter. Ngāti Whātua Ōrākei acknowledged there was an issue with shared interests and lack of clarity and suggested that the meaning be co-designed. Ngāti Tahu – Ngāti Whaoa expressed concern that clarification would be done inappropriately and erode the rights of some Māori groups. Patuharakeke supported clarification but wanted to ensure the exercise recognised the importance of hapū in the resource management system.
140. Ngā Rangahautira thought such efforts may not be useful, as they would not move local authorities forward in meaningful engagement. They considered engagement should be based on relationships, and not on whether those relationships were with iwi or hapū.

Our preferred approach is to use the term ‘mana whenua’ throughout the Natural and Built Environments Act, replacing the currently used terms including ‘iwi authority’ and ‘tangata whenua’.

We consider the policy solution is to provide for comprehensive involvement of mana whenua throughout the new resource management system. Our preferred approach is to use the term ‘mana whenua’ throughout the Natural and Built Environments Act, replacing the currently used terms including ‘iwi authority’ and ‘tangata whenua’. The term ‘mana whenua’ would be defined as “an iwi, hapū or whānau that exercises customary authority in an identified area”.

Where there is a dispute about who has mandate that cannot be resolved, the graduated dispute resolution process for the integrated partnership processes should be used.

There is a desire from all parties for certainty in resource management decision-making processes. The key to provide that certainty is a pathway for all parties to know who to engage with on particular resource management matters. In the first instance, mana whenua groups should self-identify and have a transparent mechanism for identifying mandate to discuss resource management matters on behalf of their group, for example through an agreed and mandated iwi management plan. As discussed in the previous section, we suggest that the National Māori Advisory Board should have an active duty to maintain records and assist local authorities and mana whenua groups to identify who to engage with on resource management matters. Where there is a dispute about who has mandate that cannot be resolved either by the mana whenua groups themselves or the National Māori Advisory Board, we suggest the graduated dispute resolution process outlined earlier for the integrated partnership processes should be used.

There is a potential risk that a definitional change from the current terms used to ‘mana whenua’ could result in extensive engagement for local authorities with many hapū and whānau mana whenua groups which local authorities have neither the capacity nor capability to undertake. However, we consider the proposals we outline in this chapter and others will adequately mitigate this risk, as well as providing for the benefits associated with engagement occurring with the most appropriate mana whenua groups.

To be clear, our intention is not a widespread devolution of engagement activities in all circumstances from an iwi level to a hapū or whānau level. That being said, different engagement needs will call for different approaches and in some circumstances a hapū or whānau level mana whenua group is the appropriate group to be engaging with on particular matters. As a general principle, consistent with the implementation principles in section 9(2)(b) and (c) of our proposed Natural and Built Environments Act, engagement should occur at a scale, within timeframes and with a degree of effort that is commensurate to the scale and potential impact of the decisions being made.

Overall, there will be more opportunities for mana whenua engagement in the new resource management system and this will help clarify which mana whenua groups should be engaged with on particular resource management matters. Further, the system we propose has more direct opportunities for mana whenua involvement (see chapters 4 and 8) which should result in greater agreement on planning matters earlier in the process. Our proposed system should also result in fewer consents overall (see chapter 9). Both of these system shifts would mean there should be fewer matters to engage on in subsequent processes, and the current time and cost pressures of this engagement would be eased for local authorities, applicants and mana whenua groups.

Funding and support

Where Māori undertake resource management duties and functions, and these duties or functions have public benefits, the reasonable costs incurred should be provided for.

A lack of adequate funding and support has been one of the main reasons why resource management outcomes for Māori have not been delivered (see chapter 14 for our broader discussion on institutions and capacity and capability in the resource management system).

We also note that better support for Māori involvement in the resource management system could have a number of broader public benefits. For example, better enabling Māori to fulfil their kaitiaki role could produce benefits for the natural environment as well as for Māori.

We recommend a principle be added to the Natural and Built Environments Act and/or the LGA. This would specify that where Māori undertake resource management duties and functions, and these duties or functions have public benefits, the reasonable costs incurred should be provided for. We also recommend the funding and support options discussed earlier in this chapter be considered and acted upon.

We are mindful that public funding generally comes with the need for public accountability and a requirement to identify the public benefits that the funding will deliver, although public funding is also used to deliver benefits to targeted groups.

Funding should be provided by central government and/or local authorities on a case-by-case basis depending on the function. For example, involvement in combined planning would be funded by local authorities, involvement in developing national direction would be funded by central government, and involvement in spatial planning would be jointly funded by local authorities and central government.

There was widespread support from submitters for additional funding and support for Māori involvement in the resource management system. LGNZ noted it is not just financial resources, but more time, that is required for meaningful participation. Local authorities and mana whenua identify a lack of resourcing to support mana whenua engagement as a major access and equity issue and are looking to central government to provide those resources. For example, the Bay of Plenty Regional Council noted in its submission that success of both RMA-enabled participation and treaty settlement-mandated participation hinges on adequate funding.

Feedback from all regional hui also highlighted that a lack of funding and support made it more difficult for Māori to participate in the system. There was general consensus that the current model is resource-intensive for Māori and not effective. For example, the Auckland hui highlighted the need for dedicated funding for kaitiaki. Participants commented that Māori often work for free and are stretched thin without funding.

We agree with the view expressed at a number of hui that funds received through Tiriti settlements should not be expected to cover day-to-day resource management matters.

Alongside regulatory change, it is also essential to address the capacity and capability of Māori and local authorities to carry out their Tiriti-related functions within the new system. A significant reason for the current issues in this area is the lack of resourcing. As Te Arawa Lakes Trust noted in its submission, “while the purpose, principles and processes of the legislation may be reviewed, reinforced and improved they are of little use unless hapū and iwi have the resources to engage effectively in the processes”.

Expected outcomes

155. The objectives and principles for our review include ensuring our proposals for reform provide for greater recognition of Te Tiriti and te ao Māori and that due recognition is given to the relationship between the Crown and Māori. Our proposals in this chapter on Te Tiriti o Waitangi me te ao Māori advance these objectives through several mechanisms. We are proposing greater recognition of te ao Māori and Te Tiriti in the purpose and principles section of the Natural and Built Environments Act. The provision for partnerships through the integrated partnership process arrangements and a governance role for mana whenua in spatial and combined planning gives due recognition to the partnership relationship between the Crown and Māori. Our recommendations on resourcing and audit functions will improve implementation. Our view is that these changes will set the clear direction needed both for the greater recognition of Te Tiriti and for better aligning the system with te ao Māori.

Process for the next stage

156. Cabinet has noted “that the Minister for the Environment will direct officials to look for appropriate opportunities to collaboratively refine and co-design policy options with Māori during the next phase of the review in line with Cabinet’s agreed Guidelines for Engaging with Māori”.^[149]
157. Any subsequent process will need to balance the value of engagement with Māori, with the need to maintain the constitutional role of the responsible Minister and that of Cabinet to make decisions on potential legislation to take to Parliament.
158. To assist the subsequent process between the Tiriti partners, we have identified some specific areas this process could explore further:
     • the details for a national policy statement that provides guidance and direction on how to give effect to the principles of Te Tiriti and on the te ao Māori outcomes expressed in the purpose and principles section of the Natural and Built Environments Act, as recommended above
     • specifics of the integrated partnership process we have recommended
     • use and definition of Māori terms and kupu. This process could consider the pros and cons of defining Māori terms in statute and the value of greater clarity versus greater flexibility
     • options not canvassed in this report, for example, a process for the creation of legal entity status for particular taonga.

Key recommendations

Chapter 4 Strategic integration and spatial planning

1. Our terms of reference require the Panel to consider the integration of processes under the RMA, LGA and LTMA and to review opportunities to use spatial planning as a means of achieving better alignment of this legislation. This chapter discusses our proposals for achieving strategic integration across the resource management system including the use of regional spatial planning. The aim of these proposals is to embed a long-term, strategic and integrated approach to planning, the provision of infrastructure and associated funding and investment.
2. We propose mandatory regional spatial planning, which would substantially reshape the resource management system. Our proposals for achieving this are closely linked to topics discussed in other chapters of this report.

Current provisions

3. There is currently no consistent framework for spatial planning in New Zealand. Only Auckland Council is legally required to have a spatial plan.^[150]
4. Some councils are making progress with developing integrated and long-term spatial plans without a legislative framework,^[151] but there are barriers to achieving their full potential, including:
   • insufficient legislative mandate and weight, including formal links between spatial plans and detailed resource management and funding plans
   • fragmented governance and decision-making arrangements (within and between councils) and insufficient central government involvement and coordination
   • infrastructure funding and financing constraints and poor understanding of the costs and benefits of growth
   • poor incentives for councils to join forces to coordinate, provide for and fund infrastructure in order to efficiently respond to growth and change.

Issues identified

5. The review has identified a broad range of interrelated factors that hamper strategic integration of the resource management system.
   • Lack of an outcomes focus in the RMA: many have argued that the ‘effects-based’ framework in the RMA has not provided a useful basis for strategic planning. It has also led to a ‘culture’ in planning with a focus on the negative rather than positive outcomes from good use of resources. For example, in its submission to the Panel, Infrastructure New Zealand notes “the permissive, effects-based orientation of the current system heavily devolves resource management decisions down to affected parties and away from strategic public outcomes”.

Central government has generally not been an active participant in strategic land use planning.

Poor alignment of land use and infrastructure plans: misalignment between land use plans under the RMA and infrastructure plans under the LGA and LTMA has led to poor outcomes both for development and the environment. For example, LGNZ argues “the current planning system (comprising RMA, LGA and LTMA) is unwieldy and not well integrated. There is little alignment between strategies, funding, regulation and decision-making to integrate land use and infrastructure development, set spending priorities, and manage growth”.^[152] This misalignment prevents decision-makers from addressing important challenges in a coordinated, effective and efficient way. For example, in the context of policy to address climate change, the Organisation for Economic Co-operation and Development (OECD) points out “reducing emissions from urban transport is most effective when transport and land use policies are integrated. A combination of policies are required to incentivise modal shifts, reduce emissions intensity per kilometre and reduce total distances travelled”.^[153]

Insufficient long-term focus: there appears to have been a lapse in long-term land use planning in New Zealand. This is perhaps as a result of the shift, described in chapter 2 of this report, from the Town and Country Planning Act’s approach of prescribing outcomes and activities to the ‘effects-based’ focus of the RMA. For example, evidence shows that since the major urban transport plans in the 1960s and 1970s, New Zealand has done little to protect and acquire future infrastructure corridors in advance of planning for development in tho[154]areas.¹⁵⁴

Lack of engagement and coordination by central government: central government’s allocation of the National Land Transport Fund and decisions about education and health infrastructure spending influence land use planning. However, with the exception of the New Zealand Transport Agency (NZTA), central government has generally not been an active participant in strategic land use planning. Central government’s approach to infrastructure spending across health, education, transport, among other things, lacks coordination. The involvement of central government agencies in voluntary spatial planning for growth areas has increased recently under the Government’s Urban Growth Agenda. There is an opportunity to formalise and strengthen this role through legislation.

Poor relationship between central and local government: the Productivity Commission has identified the poor state of relations between central and local government as a recurrent theme across its inquiries. Its view is that “this failure arises from a lack of understanding of each other’s roles and of the constitutional status of local government”.^[155]

6. A number of other issues relating to the RMA planning framework also hamper strategic integration of the system. In particular, the complexity driven by the number and variation of regulatory instruments under the RMA. This is discussed in chapter 8 of this report.
7. Many commentators have called for a new legislative framework for spatial planning in New Zealand to address these issues.^[156] Stakeholders, including the Environmental Defence Society (EDS) and the Productivity Commission, have carried out a significant amount of work on spatial planning that has informed our considerations.
8. Our work has also been informed by international examples, such as the Greater Sydney Regional Plan and its relationship to sub-regional ‘City Deals’. However, any option for improving strategic integration will need to reflect New Zealand's unique circumstances, including the roles of central and local government and Māori in the resource management system.

Three main planning statutes

9. New Zealand’s resource management system has three main planning statutes. The RMA regulates the sustainable management of natural and physical resources. The LGA establishes our system of local democracy. The LTMA sets out requirements for the operation, development and funding of the land transport system.
10. Many other statutes either include or have implications for resource management functions. National policies for climate change mitigation and adaptation developed under the Climate Change Response Act 2002 (CCRA) will play an increasingly important role in the system. Other examples include the Conservation Act 1987, Public Works Act 1981 and Kāinga Ora–Homes and Communities Act 2019.

Improving strategic integration across the system requires an effective mechanism for integrating planning, the provision of infrastructure and associated funding, and investment under the RMA, LGA and LTMA.

Improving strategic integration across the system requires an effective mechanism for integrating planning, the provision of infrastructure and associated funding, and investment under the RMA, LGA and LTMA. There is also a need to link spatial planning to plans and processes under other legislation, such as the CCRA.

As described in table 4.1, the RMA, LGA and LTMA have different purposes and processes. For example, the RMA and LGA refer to ‘social, economic, environmental and cultural wellbeing’ in their purpose statements, while the LTMA does not, and only the RMA provides for appeals to a court.

Table 4.1: Comparison of RMA, LGA and LTMA

13. There are good reasons for the differences in purposes and processes across the three statutes. However, we need aligned and coordinated decision-making to get good and timely outcomes. For example, enabling new capacity for urban development requires changes to land use regulation (under the RMA) and infrastructure investment (under the LGA and LTMA). A new large-scale urban development proposal will need decisions under the RMA (designations and consents), the LGA (infrastructure funding) and LTMA (transport funding). To facilitate this, decision-making criteria across the system need to be coherent and processes as streamlined as possible.

Options considered

14. Our issues and options paper put forward the following options to improve strategic integration across the resource management system:
    • new legislation setting overarching long-term policy goals that would sit above and direct decision-making under the RMA, LGA and LTMA, and potentially other legislation
    • new provision for strategic integrated planning (spatial planning)
    • expanding the scope and influence of regional policy statements under the RMA
    • strengthening and clarifying legislative links between the RMA, LGA and LTMA to improve the alignment of plans and processes across the three statutes.

Overarching long-term strategic goals

15. This option is for new legislation that sets out overarching long-term strategic goals, or requires the government to identify them, to provide focus and consistency across the resource management system and beyond. These overarching goals might address cross-cutting challenges beyond the sole remit of the RMA, LGA or LTMA (for example, urban development pressures, biodiversity loss and climate change adaptation).
16. The overarching goals could either direct or guide decision-making under other legislation.

Strong approaches

• Legislation sets goals: the legislation would require decision-making under relevant statutes, including the RMA, LGA and LTMA, to be in accordance with the overarching goals. These goals would flow through the existing cascade of plans under relevant statutes, effectively hard-wiring certain goals into the system.
• Legislation requires government to identify goals: alternatively, the legislation could require the government to identify overarching goals for the system as a whole through a national priorities statement (similar to the role the Government Policy Statement on Land Transport plays in decision-making under the LTMA). This would provide more flexibility for the government of the day to shape the agenda.

Weak approach

• Overarching goals: these would not have any formal legal weight, but would be used as a monitoring framework to assess the performance of the system as a whole. An independent body might be given powers to make recommendations for changes to policies and plans to deliver the goals (similar to the roles of the Climate Change Commission or the Parliamentary Commissioner for the Environment (PCE)).

17. Our work on the overarching goals option was informed by international examples of similar approaches.
    • Strong approach – legislation sets goals: the Well-being of Future Generations (Wales) Act 2015 sets out seven wellbeing goals, which public bodies must take ‘all reasonable steps’ to meet. The goals are high level and relate to Wales being prosperous, resilient, healthier, more equal, having cohesive communities, having a vibrant culture and thriving Welsh language and being globally responsible.

Welsh Ministers must set national indicators and milestones and publish annual reports on progress towards achieving the goals. Public bodies, including planning authorities, must set objectives to maximise their contribution to achieving the goals and report annually on progress. A Future Generations Commissioner is responsible for providing guidance, monitoring progress and reporting findings in a Future Generations Report released a year before the national election.

• Strong approach – goals set by government: the United Kingdom Environment Bill 2019–21 requires the government (Secretary of State) to set long-term targets with respect to four priority areas – air quality, water, biodiversity and resource efficiency and waste reduction. A target must specify a standard, to be achieved by a certain date, which must be capable of being objectively measured. The government must set interim targets through environmental improvement plans and report annually on progress.

The Bill also requires public authorities to prepare local nature recovery strategies relating to biodiversity. A new institution called the Office for Environmental Protection is responsible for monitoring and enforcing implementation of the new legislation.

New provision for spatial planning

18. This option would provide a legislative framework for spatial planning. ‘Spatial planning’ is a form of strategic integrated planning that ideally covers a large geographical area, such as a region or major urban centre, and looks out 30 years and beyond. Spatial plans typically provide a visual illustration at a high level of areas suitable for development, areas that should be protected from development, areas subject to constraints and the broad pattern of existing and future infrastructure.^[157] We refer to ‘spatial planning’ as the process and a ‘spatial strategy’ as the key output of a spatial planning process.^[158]
19. The spatial planning process is as important as the resulting spatial strategy. A good process can establish partnerships and build consensus amongst decision-makers and communities. In the New Zealand context, spatial planning provides an opportunity to improve the relationship between central and local government and provide a stronger role for mana whenua in strategic planning. Elements of a good process include information and data sharing, an agreed evidence base, involvement of stakeholders as participants and engaging with a diverse range of people in the community.
20. Our work has focused on terrestrial spatial planning that also considers the impact of land use on the marine environment and activities within the coastal marine area (to the 12 nautical mile limit) that are currently regulated under the RMA.
21. Internationally, marine spatial planning is well established, with Sea Change – Tai Timu Tai Pari for the Hauraki Gulf providing a New Zealand example. However, the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012 (EEZ Act) and the Fisheries Act 1996 are out of scope for this review. Providing a legislative framework for terrestrial and limited marine spatial planning would not preclude the introduction of a fully integrated marine spatial planning framework in the future that incorporates functions under the RMA, EEZ Act, Fisheries Act 1996, Marine Reserves Act 1971, and potentially other legislation.
22. As discussed later in this chapter, there are many design choices for a spatial planning framework.

Repurposed regional policy statements

23. This option would repurpose regional policy statements to make them more like regional spatial strategies, including strengthening their links to funding plans under the LGA and LTMA.
24. Some submitters on our issues and options paper put forward this option as a way of avoiding the addition of a new layer of planning to the system. For example, NZPI submitted that regional policy statements should provide a regional spatial plan that contains direction for resource management and the delivery of objectives; maps key development and infrastructure projects; coordinates objectives and activities of key stakeholders including central and local government agencies; and integrates funding for central and local government agencies.
25. In the current system, regional policy statements perform an integration role. They provide an overview of the resource management issues of the region, and policies and methods to achieve integrated management of the natural and physical resources of the whole region.^[159] Regional policy statements must be ‘given effect to’ in regional and district plans under the RMA,^[160] and they must be ‘taken into account’ in the development of regional land transport plans under the LTMA.^[161] There is no specific legal link between regional policy statements and infrastructure strategies or long-term plans under the LGA. However, councils are required to identify any significant inconsistencies between a decision under the LGA and a strategy or plan required by another Act.^[162]
26. Regional policy statements must ‘give effect to’ national direction under the RMA but central government has no role in their development.

Improved links and alignment between RMA, LGA, LTMA

27. This option would improve horizontal integration across the resource management system by focusing on the interaction of the RMA, LGA and LTMA. It would include one or more of the following.
    • Strengthened legislative links: links across the RMA, LGA and LTMA are weak and approached differently in the three statutes. There is an opportunity to strengthen the links and make them more consistent. In general, the direction of any weighting should be from the RMA to the LGA and LTMA, and not the other way around, because resource management decisions have a more robust process (are subject to appeals). However, resource management decisions should not be binding on funding decisions under the LGA and LTMA because investment is a political budgeting decision. The desired policy ambition should be that the various plans across the system are working towards a common strategic direction, and national policies should set the direction for regional and local plans.
    • Aligning time horizons: a problem identified in the resource management system is a bias towards the status quo. One aspect of this is the time horizon of planning across the RMA, LGA and LTMA. There is an opportunity to increase the long-term focus of planning under the RMA and LTMA to align it with the 30 year approach to infrastructure strategies under the LGA.
    • Aligning review periods: review periods under the LGA and LTMA are currently aligned with the three-yearly electoral cycle, while RMA plans must be reviewed ‘at least every 10 years’. As discussed in chapters 7 and 8, we recommend a nine-year review period for national direction and combined plans under the Natural and Built Environments Act.
    • Aligning consultation provisions: consultation processes under the LGA and LTMA are already well aligned. Both Acts use the special consultative procedure in the LGA and consultation on a long-term plan or annual plan (under the LGA) and a regional land transport plan (under the LTMA) can be combined. RMA processes prior to notification could provide greater recognition of consultation undertaken under the LGA or LTMA to avoid duplication.

Design challenges

28. There are broadly three ways in which strategic integration can be improved across the system:
    • strategic direction: ensuring environmental protection and development goals are clearly stated so we know what we want the resource management system to achieve for New Zealand
    • vertical integration: ensuring objectives set nationally flow through local government plans to influence what happens on the ground
    • horizontal integration: clarifying the intended interaction of plans for development, protection and funding across the RMA, LGA and LTMA (and the wider resource management system).
29. We identified a number of important design challenges.
    • Different decision-makers for different processes: as noted, only the RMA provides appeal rights to a court. Land use regulation directly affects private property rights, although these rights have never been unhindered, particularly with regard to external effects from the use of property. Electoral accountability provides insufficient protection for individuals, and appeals are therefore required for natural justice reasons. In contrast, electoral accountability is both important and sufficient for decisions on strategic direction and funding that affect the community generally. This has implications for the legal weight of a spatial strategy that is not subject to appeals over RMA plans that are.
    • Changing political priorities: the resource management system needs to strike a balance between setting long-term outcomes in the public interest and enabling a response to new political priorities, particularly for funding decisions. Enduring goals should be set in legislation. More flexible tools should enable new governments (central and local) to determine priorities within the legislative goals informed by current circumstances.
    • Incentives on decision-makers: decision-makers in the resource management system are accountable to different geographic communities of interest (central, regional or local). Careful allocation of decision-making roles is needed to ensure incentives for good decision-making and accountability. In general, decision-makers on plans should be those responsible for the later decisions required to implement those plans.
    • Limitations with regard to budget processes: central and local government budget processes consider a broad range of issues, including those beyond the scope of the resource management system. It is undesirable to reduce the flexibility of these budget processes. That said, a strategic planning process could usefully identify the high-level funding needs of infrastructure networks that are likely to endure over time. This would inform investment priorities and funding requirements as an input to budget processes. The final decisions on the quantum and timing of commitments would be left to budgets to confirm.

Discussion

Options assessment

30. Our assessment of whether the options identified above will address the issues and improve strategic integration across the system is summarised in table 4.2.

Table 4.2: Options assessment

31. Both the options for overarching policy goals and spatial planning have the potential to improve integration across the resource management system by providing ways for government to set long-term policy direction. Depending on how a spatial planning framework is developed, it has the additional benefit of improving the integration of decision-making between central and local government and mana whenua.
32. The repurposed regional policy statement and strengthened legislative links options are likely to be less effective in achieving integration as decision-makers would still be operating under separate processes and different decision criteria. A repurposed RPS would therefore have limited ability to influence infrastructure provision and associated funding and investment.
33. In terms of practical considerations, both the overarching goals and spatial planning options are fundamental changes to the system and would have significant associated costs. However, the overarching goals option is more likely to add additional complexity to the system than new provision for spatial planning. For example, the Government Policy Statement on Land Transport is currently required to ‘give effect’ to the purpose of the LTMA. Under the overarching goals option, the Government Policy Statement would presumably be required to ‘give effect’ to both the overarching goals and the purpose of the LTMA, with the overarching goals prevailing in the case of conflict. This is a significant change to the LTMA that may both be controversial and lead to unintended consequences for the land transport management system. Further consideration would be needed of this option’s potential implications for the LTMA in its entirety. As we note below^[164] we recommend a change to the purpose of the LTMA to better integrate it with the Natural and Built Environments Act and the LGA but we do not expect this change to be controversial.
34. Most submitters on our issues and options paper supported a stronger role for spatial planning in the system, and many referred to it as an important tool in an outcomes-focused approach. Some submitters on our issues and options paper were concerned about the additional complexity that overarching goals could add to the system. For example, Otago Regional Council submitted: “ORC does not support creating an integrated planning statute above the RMA... The RMA's purpose and principles, along with other relevant legislation, should be written in such a way that they are the primary legislation for their subject and where issues straddle legislation, the legislation is horizontally integrated. Creating a further level of planning above them would only add unnecessary duplication, complexity and exacerbate existing resourcing issues”.

Our preferred option is a new legislative framework that embeds spatial planning as the key mechanism for improving strategic integration across the resource management system.

In our view, regional spatial planning, together with a comprehensive set of national direction could achieve the same outcomes as overarching goals while being less disruptive to the system. The costs of introducing a new spatial planning framework can be offset by rationalising other aspects of planning under the RMA (see discussion of our proposal for regional combined plans in chapter 8).

Preferred option

36. Our preferred option is a new legislative framework that embeds spatial planning as the key mechanism for improving strategic integration across the resource management system. Spatial planning has the potential to improve strategic integration in a number of ways:
    • across statutes (RMA, LGA, LTMA and CCRA, and potentially others)
    • across functions (by integrating land use regulation, environmental protection, restoration and enhancement, infrastructure provision and associated funding and investment)
    • across outcomes (social, economic, environmental, cultural)
    • between different tiers of central and local government including asset managing agencies (eg, NZTA) and council controlled organisations (eg, Watercare).
37. The advantages of spatial planning relative to other options are summarised in table 4.2 above. Other significant benefits of spatial planning include:
    • it can facilitate more efficient land and development markets to improve housing supply, affordability and choice
    • it has an obvious potential use in relation to the regulation of land use to address climate change, including both adaptation and mitigation measures
    • a major strength will be its ability to better address the cumulative effects of land use and other activities impacting the environment
    • long-term strategic planning is essential to avoid or reduce ad hoc decision-making in response to perceived issues as they arise.
38. As discussed in the overview of the proposed system, the response to COVID-19 will require a strategic and integrated approach to infrastructure and development that helps achieve New Zealand’s emission reduction targets and other important goals. Greater collaboration will be required between central and local government and mana whenua. As noted in a recent McKinsey Quarterly article about addressing climate change in a post-pandemic world, there is a need to “reinforce national and international alignment and collaboration on sustainability, for inward-looking, piecemeal responses are by nature incapable of solving systemic and global problems”.^[165]
39. A legislative framework for spatial planning will build on existing voluntary spatial planning processes, providing more consistency and increasing their weight in the resource management system. In its submission on our issues and options paper, the SmartGrowth Leadership Group stated that: “Spatial planning is already underway in a number of local government jurisdictions. Despite this, because it is not directly aligned to the RMA or LGA, its mandate is weak. This needs to be fixed and spatial planning become a core part of the RM regime”.

Design choices for a spatial planning framework

40. The extent to which strategic integration across the resource management system is achieved will depend on the design of the spatial planning framework. Examples of design choices we considered are set out in table 4.3.

Table 4.3: Key choices for the design of a spatial planning framework

Interdependencies

41. There are significant interdependencies between the design choices. For example, as discussed above, decisions about the level of detail and legal weight of regional spatial strategies have implications for the decision-making process, including whether appeal rights are required. These interdependencies are shown in figure 4.1 below.

Figure 4.1: Decision tree for legal weight, level of detail, appeals

42. As shown in figure 4.2 below, there are also interdependencies between the design choices for the scope of spatial planning, where it is required, and governance.

Figure 4.2: Decision tree for breadth, application, accountability, governance

43. The following section discusses these design choices in more detail.

Purpose and scope of spatial planning

44. The purpose of spatial planning as we envisage it is to promote the social, economic, environmental and cultural wellbeing of current and future communities by improving strategic integration across the resource management system. The purpose of spatial planning should be broadly framed because every region in New Zealand will face a different mix of opportunities and challenges.

The purpose of spatial planning as we envisage it is to promote the social, economic, environmental and cultural wellbeing of current and future communities by improving strategic integration across the resource management system.

Most submitters on our issues and options paper supported a broad approach to spatial planning. It was described as a way to establish a vision for a region or other area and achieve a range of social, economic, environmental and cultural outcomes. The matters put forward for inclusion in spatial planning included aspirations of Māori, the built environment, urban growth, social and network infrastructure, transport, environmental protection, identification of areas of significant biodiversity and landscape value, climate change mitigation and adaptation, potential renewable energy sites, and more. Ngāti Whātua Ōrākei submitted that “in order to maximise the true potential of spatial plans... spatial planning as part of a plan led system needs to consider at least place making, urban design, urban growth, infrastructure, environmental issues, iwi aspirations, transport, protection of heritage and funding”.

In our view, spatial planning should encompass functions of the RMA, LGA and LTMA in relation to the regulation of the use of land and activities in the coastal marine area, and the provision of infrastructure with associated funding and investment. It should also link to other relevant legislative functions, including under the CCRA and Conservation Act 1987. This breadth of scope is necessary if spatial planning is to address the issue of poor alignment of land use and infrastructure plans.

47. A potential purpose statement and associated definition for spatial planning legislation is set out below.

Timescale

Spatial strategies should set a strategic direction for at least the next 30 years, informed by longer-term data and evidence as appropriate (such as 100 plus year projections for climate change).

One of the issues with the current resource management system is insufficient long-term focus across the system. Long-term spatial planning is an important tool to avoid or reduce ad hoc decision-making in response to perceived issues as they arise. As articulated by international cities and spatial planning expert, Greg Clark, spatial planning “looks into the future in ways which go beyond the usual vision of governments and public bodies and seeks to express the future demand for a wide range of public goods that can then be anticipated better in the present”.^[166]

49. Spatial strategies should set a strategic direction for at least the next 30 years, informed by longer-term data and evidence as appropriate (such as 100 plus year projections for climate change). The level of detail could vary across the time horizon of the spatial strategy as certainty reduces over time. For example, the high-level vision and objectives for the region might look out 100 years and beyond, while proposals (such as a new transport corridor) could have an indicative timeline of 30–50 years. The separate implementation agreement (discussed below) could provide project-level detail about steps to be undertaken in the first three, six and 10 years.

Geographical scale

50. We support provision for spatial strategies at a regional scale, with a Ministerial power to direct two or more regions to prepare a joint strategy or to collaborate on cross-boundary issues. Inter-regional spatial planning may be appropriate, for example, where two regions (or parts of regions) function as a single metropolitan area with significant commuter movement across the regional boundary or where two regions cut across a single marine area such as the Kaipara Harbour.
51. We also considered provision for sub-regional spatial planning. There are many current and emerging examples of this, such as Future Proof and the Urban Growth Agenda partnership for Queenstown. Requiring spatial strategies to be regional or inter-regional does not mean that a spatial planning process needs to consider all parts of a region in the same amount of detail. The focus could be on those parts of a region where significant change is happening, anticipated or required.
52. The legislation should provide flexibility to tailor a spatial strategy to the region’s circumstances provided it complies with requirements specified in the legislation, including core content requirements (discussed below) and provides sufficient strategic direction for the combined plan for the region (discussed in chapter 8).

Regional application

53. We considered three options for the application of a spatial planning framework:
    • mandatory for regions containing a large and/or fast growing urban area (voluntary for other regions)
    • mandatory for regions where specified criteria are met (voluntary for other regions)
    • mandatory for all regions, with provision for prioritisation and sequencing by the responsible Minister or Ministers.
54. Our assessment of these options is set out in table 4.4.

Table 4.4: Options assessment for regional application options

55. Most submitters who commented on the issue supported spatial planning being required for all regions in New Zealand. However, a small number of submitters considered that spatial planning should either be optional or should only be mandatory for some regions. For example, Federated Farmers of New Zealand submitted that spatial planning should not be a requirement for all regions but based on a need, with a trigger point such as high urban growth or significant housing shortages.

Our view is that spatial planning should be mandatory for all regions.

Our view is that spatial planning should be mandatory for all regions. Some of its potential benefits apply specifically to urban areas experiencing growth. For example, spatial planning could facilitate an abundance of urban development opportunities, while avoiding areas that are vulnerable to coastal inundation or natural hazards or which have special environmental, cultural or economic value. However, other benefits could apply equally to urban, rural and coastal areas. For example, climate change is increasingly going to be a driver of land use change and that will affect all regions of New Zealand. Also, spatial planning could be an important tool to improve the management of cumulative impacts of land use on waterways and harbours.

Significant resourcing will be required from central and local government and mana whenua if spatial planning is to be effective and the required capability and capacity will take time to build. We therefore support provision for the prioritisation and sequencing of the first regional spatial strategies under the new Act. This could be achieved through a national priorities statement (discussed below) and an ability for the responsible Minister to extend the default timeframe for developing the first spatial strategy for some regions. The initial focus would be on regions with the most pressing needs. Transitional provisions could also provide that existing spatial plans, agreements between central government and councils and current spatial planning processes are deemed to meet requirements of the new legislation as appropriate. One region should be selected to develop the first regional spatial strategy, followed by development of the combined plan, to provide a model for other regions. This process should be led by the Ministry for the Environment and could be advanced alongside development of the legislation and updates to guidance in the national planning standards.

Application of spatial planning to the coastal marine area

58. Current regional boundaries include the coastal marine area (CMA), which is the area between mean high water springs (MHWS) and the 12 nautical mile limit of the territorial sea.^[167] It is a given that regional spatial strategies should include the coastal environment to MHWS, however there is a choice about whether spatial strategies should extend into the CMA.
59. Differences in the way the RMA regulates the CMA compared with land use are relevant to the design of a spatial planning framework. For example:
    • while terrestrial land is mostly privately owned, most land in the CMA is managed as a public resource
    • the New Zealand Coastal Policy Statement (NZCPS) and regional coastal plans are compulsory^[168]
    • there is strong central government oversight of regional coastal planning with a requirement for regional coastal plans to be approved by the Minister of Conservation^[169]
    • regional councils do most of the planning work for the CMA and territorial authorities only have a minor role
    • existing tools, including the NZCPS, could be used to identify suitable locations for ports, navigation routes and marine aquaculture, for example.
60. There are, however, barriers to achieving an integrated approach to the CMA through the NZCPS and regional coastal plans. For example:
    • the NZCPS covers the ‘coastal environment’, but that does not include all areas that generate impacts on the CMA (for example, land uses generating sediment that flows down rivers to estuaries) or that depend on good infrastructure provision at the coast (such as forestry developments that rely on good shipping infrastructure)
    • many relevant matters (such as subdivision) are regulated through district plans rather than regional coastal plans
    • allocation of space is often driven by individual applicants not the national interest
    • biodiversity planning and decision-making is carried out under multiple statutes (fisheries, marine species, marine protection)^[170]
    • the RMA does not directly influence active management/restoration work in the CMA, such as estuary or shellfish bed restoration, which require public funding. The RMA can, however, protect areas from most activities for non-fisheries management reasons, control effects of fishing on values other than fish stocks,^[171] and reduce impediments to active restoration.

Our view is regional spatial strategies should extend into the CMA as this will promote integration between land use, the coastal environment and water quality. The extent to which they do this will vary depending on regional circumstances.

Our view is regional spatial strategies should extend into the CMA as this will promote integration between land use, the coastal environment and water quality. The extent to which they do this will vary depending on regional circumstances. Spatial strategies will be required to be ‘consistent with’ the NZCPS, which will continue to be the main tool to regulate activities within the CMA, along with regional coastal plans. Regional coastal plans will be required to ‘give effect to’ the NZCPS and be ‘consistent with’ spatial strategies. As discussed in chapter 8, regional coastal plans will be incorporated into combined plans but will still require the approval of the Minister of Conservation.

This would not represent a fully integrated approach to the management of the coastal and marine environment. The spatial strategies could cover matters currently regulated under the RMA, such as aquaculture in the CMA, but they would not extend beyond the 12 nautical mile limit or cover functions under the EEZ, Fisheries or Marine Reserves Acts. EDS has supported comprehensive reform of legislation and institutions relating to the marine environment, including the establishment of an Oceans Agency, a national Oceans Plan and national and regional marine spatial planning that extends into the exclusive economic zone and is integrated with terrestrial-based spatial planning.^[172]

A number of submitters on our issues and options paper also supported provision for a fully integrated marine spatial planning framework. For example, New Zealand King Salmon submitted: “New Zealand should institute a comprehensive marine spatial planning regime. Marine spatial planning regimes should extend into the exclusive economic zone. It should better integrate environmental protection and the human uses of the coastal environment including aquaculture”.

64. The EEZ and Fisheries Acts are specifically excluded from the scope of this review. However, providing a legislative framework for regional spatial planning that includes limited marine spatial planning for the CMA would not preclude the introduction of a fully integrated marine spatial planning framework in the future.^[173]

Provision for a national priorities statement

65. Many stakeholders have called for a national approach to spatial planning. For example, in its submission on our issues and options paper the Canterbury Mayoral Forum stated that “a national spatial strategy could help coordinate nationally significant strategic infrastructure projects and help integrate regional spatial strategies, particularly the relationship between major urban centres and national infrastructure”. Similarly, Infrastructure New Zealand submitted that central government should provide guidance to regions through a national development plan.
66. While our preference is for spatial planning at the regional level, as this is the scale that best lends itself to tangible decision-making about land use and infrastructure provision, we recommend providing for a national priorities statement as both a coordination and communication tool.
67. A national priorities statement for spatial planning could be used to set out:
    • the sequence in which central government intends to engage in regional spatial planning processes (noting that resource constraints are likely to mean engagement in all regions concurrently may be difficult)
    • particular nationally significant issues central government wishes to resolve at a regional level (for example, housing supply issues, certain infrastructure corridors or networks that may be of interest, suitable locations for renewable energy generation, or certain environmental concerns)
    • how any cross-boundary issues might be accommodated through the design of an inter-regional process (for example, through use of flexible governance arrangements for particular issues).
68. While a national priorities statement would not be a national ‘plan’, as considered necessary by some submitters, it would go some way to addressing these concerns by providing a tool for central government to signal its intention to address certain nationally significant issues through regional processes.

Legislative design

69. We considered three options for the location of a spatial planning framework: the RMA, LGA or a new act. The LTMA was not considered because the land transport focus of that Act is too narrow to be a good fit for spatial planning.

A new act would not override other legislation but regional spatial strategies prepared under it would have strong influence on policies and plans developed under the Natural and Built Environments Act, LGA and LTMA.

Of the submitters who commented on where spatial planning should sit within the legislative framework, most supported a new act. However, submitters also supported including it within the RMA or LGA, or within regional policy statements or the proposed National Policy Statement on Urban Development. Regardless of which option submitters preferred their priority was for improved integration across the RMA, LGA and LTMA.

A new act would not override other legislation but regional spatial strategies prepared under it would have strong influence on policies and plans developed under the Natural and Built Environments Act, LGA and LTMA. A new act is our preferred option for the following reasons:

• it would send a strong signal about the important role of spatial planning in the new system and allow for a specific purpose statement focused on strategic integration (such as the example set out above)
• neither the RMA nor LGA are a straightforward fit for spatial planning. The RMA is regulatory-focused and lacks direct linkages with central and local government funding decisions, including infrastructure investment. The LGA is about local government and its accountability to communities; it therefore has few provisions that apply to central government. In addition, the LGA does not have a strong focus on land use planning (beyond infrastructure) or environmental management
• it may be more straightforward to amend a separate act over time, for example, to apply lessons from the development of the first spatial strategies or to provide for fully integrated marine spatial planning
• as noted above, submissions on our issues and options paper indicated the strongest level of support for locating a spatial planning framework in a new act.

72. A new act would require a Treaty of Waitangi clause – this could be aligned with the new Tiriti clause discussed in chapter 3. Consequential changes to the LGA and LTMA, and potentially other legislation, would also be required.

Amendment to the purpose of the LTMA

73. We recommend amending the purpose of the LTMA to refer to social, economic, environmental and cultural wellbeing. This would establish the four wellbeings as a common thread across the spatial planning legislation, Natural and Built Environments Act, LGA and LTMA, promoting strategic integration of decision-making across the system.

Links between spatial strategies and national instruments

74. To embed regional spatial strategies into the existing system, they should be required to be ‘consistent with’ the purposes of the Natural and Built Environments Act, LGA and LTMA. In our view, they should also be ‘consistent with’ national instruments, including:
    • national policy statements and national environmental standards including environmental limits (this is discussed in more detail in chapter 7)

To embed regional spatial strategies into the existing system, they should be required to be ‘consistent with’ the purposes of the Natural and Built Environments Act, LGA and LTMA.

the national adaptation plan (which is informed by the National Risk Assessment) under the CCRA

the Government Policy Statement on Land Transport under the LTMA

the Government Policy Statement on Housing and Urban Development under the Kāinga Ora–Homes and Communities Act 2019.

75. Spatial strategies should also be required to ‘take into account’ other national strategies and plans, including the Emissions Reduction Plan under the CCRA and the national 30-year infrastructure strategy to be developed by the recently established New Zealand Infrastructure Commission – Te Waihanga.

Linkages from national instruments to regional spatial strategies will ensure the national interest is reflected in regional spatial planning.

Together with the proposed national priorities statement (discussed above), these linkages from national instruments to regional spatial strategies will ensure the national interest is reflected in regional spatial planning and reduce the potential for disputes between central and local government during the development of spatial strategies. The system would also provide for feedback loops where regional spatial planning processes could inform the development or review of national instruments.

Legal weight of spatial strategies on lower level plans

77. An important question is the level of influence that regional spatial strategies should have on combined plans under the Natural and Built Environments Act, LGA infrastructure strategies, long-term plans and annual plans, and LTMA regional land transport plans.
78. Of the submitters who commented on the issue, most considered that spatial strategies should be legally binding. For example, Ngāti Whātua Ōrākei submitted that:

... requiring compulsory regional spatial plans, with strong legal weight over environmental management and land use plans, is key to ensuring a more strategic focus is taken within land use and environmental planning. Requiring Spatial Plans with strong legal weight is potentially the most powerful of all things that could be done to improve planning in New Zealand. Properly undertaken spatial planning could be the core solution to address many of the current problems, inequalities and inefficiencies identified in the issues and options paper.

79. Some submitters expressed concern that requiring legally binding spatial plans would add another ‘layer’ to the planning framework, which has the potential to add complexity. We agree and consider it important to streamline the resource management system where possible (options are discussed in subsequent chapters).
80. We considered options for regional spatial strategies with weak legal weight. For example, where detailed regulatory plans are required to ‘have regard to’ or ‘take into account’ the spatial strategy. We also considered options for spatial strategies with strong legal weight where resource management and funding plans are required to ‘give effect to’ or ‘be consistent with’ the spatial strategy.
81. A spatial strategy that guides rather than directs other plans and processes would likely be more easily agreed between central and local government and mana whenua. However, our view is that spatial strategies with stronger legal weight will do more to improve strategic integration across the system.

We prefer a requirement for combined plans to be ‘consistent with’ spatial strategies.

Unlike RMA plans, spatial strategies under the new act could not reasonably bind individual land owners in the absence of a formal process for participation and appeal. Accordingly, we consider that a requirement for regulatory combined plans to ‘give effect to’ spatial strategies would be inappropriate. We prefer a requirement for combined plans to be ‘consistent with’ spatial strategies. This gives clear guidance and broad direction but provides councils with some flexibility when translating spatial strategies into detailed land use rules.

We also recommend requiring LGA infrastructure strategies, long-term plans and annual plans, and LTMA regional land transport plans, to be ‘consistent with’ spatial strategies. This would provide better integration but still retain flexibility for central and local government budget processes to consider a broad range of issues, including those beyond the scope of the resource management system. Figure 4.3 illustrates the legislative structure we propose.

Figure 4.3: System linkages

Other legislative links

84. Regional spatial strategies should be informed by other regulatory instruments as relevant, such as:
    • any national or regional risk assessments or adaptation plans (discussed in chapter 6)
    • iwi management plans developed by mana whenua groups and incorporated into combined plans (discussed in chapter 3)
    • conservation management strategies and plans under the Conservation Act 1987
    • civil defence emergency management plans under the Civil Defence Emergency Management Act 2002
    • heritage listings under the Heritage New Zealand Pouhere Taonga Act 2014
    • regulations and plans under the Marine and Coastal Area (Takutai Moana) Act 2011.

Specified content for regional spatial strategies

85. The spatial planning legislation should set out core content that must be included in spatial strategies, to the extent applicable to the particular region. This will ensure consistency in approach across New Zealand, while providing flexibility to tailor the spatial planning process to a region’s circumstances. As discussed above, the content of regional spatial strategies will need to be consistent with national direction, the national adaptation plan under the CCRA and relevant government policy statements.
86. Specified content for regional spatial strategies should include:
    • long-term objectives and strategies to improve the quality of the natural and built environments, provide sufficient development capacity, promote Māori interests and values, promote the sustainable use of rural land, protect historic heritage, address natural hazards and climate change
    • indicative future transport corridors
    • major existing and future infrastructure such as ports, airports, wastewater treatment plans, water treatment plants, and opportunities to make better use of existing infrastructure networks
    • additional development capacity required to accommodate growth, and scenarios for how the region may develop in the future
    • indicative locations for new social infrastructure needed to support population growth, including hospitals and schools
    • indicative costs and timing of future infrastructure and growth scenarios
    • indicative locations for regionally significant new recreational or community facilities
    • nationally significant natural features in the region (as identified through national direction)
    • regionally significant ecological areas, landscapes and recreational space that should be protected or enhanced
    • areas of historic heritage value and areas or resources of significance to mana whenua that should be protected or enhanced
    • areas where significant change in land use is required to reduce impacts of land use and development on lakes, rivers, wetlands and the marine environment
    • areas for enhancement and restoration, such as wetlands and green corridors
    • areas that may be affected by climate change or other natural hazards, and measures that might be necessary to address such issues.

Level of detail

Regional spatial strategies should concentrate on the major strategic issues and opportunities for a region, including significant anticipated changes in land use, environmental management and major infrastructure.

Given their intended long-term focus, our view is that regional spatial strategies should concentrate on the major strategic issues and opportunities for a region, including significant anticipated changes in land use, environmental management and major infrastructure. They should not attempt to comprehensively address all resource management or infrastructure issues, because less significant or non-spatial issues can still be planned for under Natural and Built Environments Act, LGA and LTMA processes.

That said, to be effective in setting direction and achieving integration, spatial strategies should include some detail regarding these strategic issues. For land use and environmental management, spatial strategies should set long-term measurable objectives and milestones and provide a visual illustration of their implications for the region (at a high level).

Regional spatial strategies should identify major social and network infrastructure and future transport corridors needed to accommodate projected growth.

As discussed in chapters 7 and 8, national environmental limits and targets will be set in national direction, and regional limits and targets to give effect to national direction will be set through combined plans for each region. However, spatial strategies could describe graphically at a high level how limits and targets set through Natural and Built Environments Act processes might be implemented through the regional spatial strategy. For example, the Shared Spatial Intent for the Hamilton to Auckland Corridor identifies the “development and implementation of a blue green open space and recreational networks programme for the corridor that has restorative, protective, cultural and recreational aims” as a significant initiative.

Regional spatial strategies should identify major social and network infrastructure and future transport corridors needed to accommodate projected growth, along with ways to make better use of existing networks. Spatial strategies should include indicative costs and timing of future infrastructure needs and corridors. Detailed information about project design, costs and timing would be provided in subsequent documents, including separate implementation agreements.

Spatial strategies that are focused on the major strategic issues and opportunities for a region and avoid getting into project or site-level detail would be quicker to develop and agree than detailed spatial plans. This would allow the strategic direction for a region to be set in a timely way to guide more detailed processes, including the development of combined plans under the Natural and Built Environments Act.

Separate implementation agreement to address project-level detail

92. A challenge for the design of a new spatial planning framework is the risk of misalignment between spatial strategies agreed at the regional level and changes in government direction at the national level. For example, this might occur in cases where a new Government Policy Statement on Land Transport is put in place that represents a significant change in direction from the previous Government Policy Statement, but spatial strategies are yet to be revised to be consistent with it. This may result in two inconsistent sources of direction for the development of regional land transport plans under the LTMA.
93. Our view is that this challenge is best addressed in two ways.
    • Long-term focus of spatial strategies: the long-term and evidence-based assessment of land use change, environmental trends and infrastructure demand that forms the basis of spatial strategies is less likely to be affected by changes in government direction. Likewise a focus on planning for infrastructure corridors, rather than particular projects, is less likely to be affected by changes in government priorities.
    • Provision for a separate implementation agreement to address project-level detail: the agreement to particular projects to implement a spatial strategy should be contained in a separate document. This would enable central and local government, and potentially mana whenua, other infrastructure providers and stakeholders, to agree to:
      1. advance more detailed project planning for certain infrastructure or environmental remediation projects
      2. begin business case processes and apportion funding responsibility across central and local government (subsequent to detailed project planning).
94. An implementation agreement would be more easily updated in response to changes in government direction. It could also be progressed by central and local government through standard budget processes, without the need to provide a direct legislative link to long-term plans or regional land transport plans. This would avoid the need for rapid revision of spatial strategies themselves in response to changes in short-term priorities.
95. This approach is similar to the ‘City Deals’ and associated implementation plans that implement the Greater Sydney Regional Plan. The following extracts relating to a new ‘North South Rail Link’ show the differing levels of detail between the regional plan (spatial strategy) and implementation plans.

96. The establishment of the Infrastructure Commission and the national 30-year infrastructure strategy it is required to develop,^[174] may lead to a more enduring approach to government infrastructure planning and investment over time. The Commission seeks to lift infrastructure planning and delivery to a more strategic level and, by doing so, improve New Zealanders’ long-term economic performance and social wellbeing. The national 30-year infrastructure strategy is required to:
    • include a statement as to the ability of existing infrastructure to meet community expectations for the next 30 years
    • identify the priorities for infrastructure for the next 30 years.

It may also include any other matters the Commission considers relevant.

97. The infrastructure strategy could both inform and be informed by regional spatial strategies.

Accountability and governance

Who would be responsible for the development and implementation of spatial strategies?

98. An important question for the design of a spatial planning framework is who should be responsible for the development and implementation of regional spatial strategies. We considered three high-level options:
    • a partnership between central and local government and mana whenua
    • a partnership between central and local government
    • local government led.

Our view is that regional spatial strategies should be jointly developed and agreed by central government, councils and mana whenua.

Our view is that regional spatial strategies should be jointly developed and agreed by central government, councils and mana whenua.

Reasons to provide a strong role for central government include:

• national interests are at stake: the challenges of urban growth, environmental management and climate change are nationally significant and require a partnership between central and local government to address
• central government resources are needed to address the challenges: central government is already a major player in the transport and social infrastructure funding decisions needed to support growth. What is needed is a more deliberate spatial process for coordination of this investment.

101. Reasons to provide a strong role for mana whenua are discussed in chapter 3. They include the opportunity to improve the quality of spatial strategies through the incorporation of mātauranga Māori; the principles of Te Tiriti; existing co-governance arrangements developed through Tiriti settlements; and existing agreements between iwi and local authorities.
102. In feedback on our issues and options paper, there was strong support for spatial strategies being developed in collaboration between central and local government and mana whenua. For example, Foodstuffs supported a requirement for “regional spatial planning to facilitate greater collaboration between councils and the relevant national agencies and to provide a more integrated, strategic, and consistent approach to resource management planning at a regional level. Spatial planning should be required for all regions, be led by central government, and be developed in a collaborative process involving central and local government, the developer community, and Māori”.
103. Many submitters noted that spatial planning provides an opportunity to better reflect Te Tiriti partnerships and incorporate mātauranga Māori knowledge by providing for mana whenua to participate in spatial planning processes as partners. For example, Ngāti Whātua Ōrākei submitted that: “Crucially, spatial planning provides an ideal vehicle to enable a true partnership approach to planning, fulfilling local authorities' obligations under Te Tiriti o Waitangi and giving effect to its principles. Ngāti Whātua Ōrākei sees active and meaningful engagement in spatial planning, undertaken with a true partnership approach, to be fundamental in enabling a step change in Māori participation”.

How would accountability be assigned?

104. For central government, the spatial planning legislation could provide that a responsible Minister or Ministers is accountable for delivery.^[175] It would not be necessary to specify the responsible Minister or Ministers in the legislation.^[176] The responsible Minister or Ministers could be required to consult with other Ministers affected by the spatial planning process at key points in the process. In practice, ministerial consultation would happen in any event through the Cabinet process.^[177]
105. For local government, accountability would sit with all councils in the region (or regions in the case of a joint strategy).^[178]
106. Unlike central and local government, mana whenua do not have access to the funding and regulatory tools required to implement a spatial strategy, so could not be accountable for implementation. However, as discussed above, our view is that mana whenua should be partners in the development of spatial strategies. They should be provided with an opportunity to invest in infrastructure and other initiatives to support implementation of the spatial strategy on a voluntary basis. They could also potentially play a role in monitoring the implementation of spatial strategies.

How would the spatial planning process be governed?

The governing body would be responsible for overall leadership of the process, consulting with Ministers, central government agencies, councils and mana whenua, and making decisions, including to approve the spatial strategy.

Some form of governing body such as a joint committee would need to be established at the start of a spatial planning process. The governing body would be responsible for overall leadership of the process, consulting with Ministers, central government agencies, councils and mana whenua, and making decisions, including to approve the spatial strategy.

The governing body would have members from central government, the councils of the region and mana whenua and be independently chaired. All members would need to be suitably skilled and experienced and have the confidence of the bodies they are representing. Good collaboration and communication skills would be essential, for example. The central government member should be a senior official appointed from an agency that serves the responsible Minister or Ministers, or another relevant agency. The council members should generally be senior executive officers.

The members would be required to consult with the bodies they are representing, for example:

• the lead central government official would be responsible for consulting with the responsible Minister or Ministers and all relevant central government agencies
• council representatives would be responsible for consulting with the councils of the region, including relevant committees, council-controlled organisations and other council entities
• mana whenua representatives would be responsible for consulting with mana whenua using their preferred processes, such as hui.

110. For regions with large numbers of territorial authorities and mana whenua, selection processes may be required to keep the body to a practical size. For example, the Independent Māori Statutory Board and the Mana Whenua Kaitiaki Forum (both in Auckland) have processes to identify nominations and appoint members from a substantial number of iwi.^[179]
111. Where selection processes are used, territorial authority members would be responsible for representing the views of all councils that selected them. Similarly, the mana whenua members would be responsible for representing the views of mana whenua generally, rather than the views of their particular iwi and hapū.
112. We do not consider that a selection process should unduly delay the development of a spatial strategy. Having fixed timeframes and ‘circuit breakers’ embedded into the process could be one method for ensuring this does not occur. We discuss below a dispute resolution process to address this issue.
113. Before approving the spatial strategy, the governing body should make best endeavours to satisfy itself that:
     • the responsible Minister or Ministers and the regional council (or unitary authority) support the draft spatial strategy
     • territorial authorities in the region support the draft spatial strategy as it relates to or affects their district
     • mana whenua support the draft spatial strategy as it relates to or affects their rohe and their relationship with it.

Decision-making

114. Important to successful spatial planning will be the processes used to bring parties together and obtain buy-in to the spatial strategy and underpinning decisions. We considered two options for decision-making: consensus^[180] or majority vote (either a simple majority vote of 51 per cent or some other percentage).
115. The advantages of a consensus decision-making model are that:
     • consensus and approval of spatial strategies by central government, councils and mana whenua will be promoted to ensure the right incentives for implementation of the strategy
     • as noted above, in regions with large numbers of territorial authorities and mana whenua, a process to nominate and select members of the governing body may be required. Selection processes are easier to apply to consensus decision-making as voting rights are not at stake
     • it is more easily adapted to provide for cross-boundary issues.
116. The disadvantages of consensus decision-making are the potential for game playing, delays and failure to reach consensus.
117. The advantage of majority voting is that decisions can be made quickly. The disadvantages are that:
     • voting creates winners and losers, which can lead to implementation challenges (for example, central government may not want to invest in a transport corridor it voted against)
     • it would be difficult to specify representation requirements that are equitable for all regions
     • it would be difficult to apply selection processes to keep governing bodies to a manageable size.

In our view, a consensus approach to decision-making is the best option for the reasons noted above, but it will be important to have dispute resolution processes.

In our view, a consensus approach to decision-making is the best option for the reasons noted above, but it will be important to have dispute resolution processes to cover any dispute relating to the functions of the governing body, including disputes over membership, process, funding, content and approval of the spatial strategy. This could involve facilitated mediation in the first instance, and ultimately a final decision by the responsible Minister or Ministers to resolve disputes.

Incentives

119. Collaborative processes work best where the parties share a common goal and the incentives are right. Central government would be incentivised to reach agreement on regional spatial strategies because they are an important mechanism for implementing national direction and government policy statements. Spatial strategies could also result in more efficient and effective infrastructure investment due to better coordination between central government agencies and between central and local government and other infrastructure providers.
120. Councils would be incentivised to reach agreement on regional spatial strategies because of the link to the LTMA funding process and the potential for central government to fund or co‑fund other initiatives in the region through the implementation agreement. There may be an opportunity for new central government funding streams, such as those associated with the post-COVID-19 recovery, to be linked to spatial planning processes. Consideration could also be given to whether other new tools or incentives might be desirable to encourage agreement.

Stakeholder involvement

121. The legislation should require the spatial planning partners (central government, councils and mana whenua) to:
     • involve stakeholders, including district health boards, mātāwaka, infrastructure providers, the development community and environmental groups in the development of the spatial strategy. We envisage that stakeholders would be involved, alongside the spatial planning partners, in working groups and/or stakeholder reference groups that would develop the spatial strategies in accordance with the guidance and direction of the governing body
     • consult with the councils and mana whenua of neighbouring regions to ensure cross-boundary issues are addressed
     • seek advice from relevant organisations, including the Infrastructure Commission, the Climate Change Commission, the PCE, the Earthquake Commission, the Ministry of Civil Defence and Emergency Management and Kāinga Ora Homes and Communities during the development of the strategy.

Public participation

122. We consider that public participation should be robust but should not include appeal rights to a court (spatial strategies should be subject only to judicial review). The special consultative procedure in section 83 of the LGA is a good starting point as it provides suitable flexibility to tailor consultation to the circumstances of the region. It would need to be modified for the spatial planning legislation because all spatial planning partners would consult, not just councils. The use of innovative engagement tools should be encouraged, in order to reach a diverse range of people within the region.

Monitoring and review

Independent review of draft spatial strategies

123. Given spatial strategies will have strong legal weight, we support a requirement for draft strategies to be independently reviewed by a suitably qualified expert appointed by the governing body, with the reviewer to make recommendations to the governing body. The legislation should require both the review and the governing body’s response to be made public, to promote transparency in decision-making.

Review frequency and process

We recommend spatial planning partners be required to complete a full review of their spatial strategy at least every nine years.

We recommend spatial planning partners be required to complete a full review of their spatial strategy at least every nine years, with flexibility to review the strategy in full or in part within the nine-year period to make adjustments in response to significant change. For example, reviews within the nine-year period could be triggered by significant changes to national direction or other national policy, or by sudden changes to the environment, such as a significant earthquake or pandemic. The nine years would be counted from the date the strategy was approved by the governing body. Reviews should be carried out in accordance with the consultation requirements that apply to the development of the first spatial strategy, including use of the modified special consultative procedure.

125. In our view, this approach provides a good balance of certainty and responsiveness. A shorter review period may discourage long-term strategic planning and be unnecessarily onerous on central and local government and mana whenua. We prefer nine years to 10 years as it promotes alignment with councils’ three-year long-term planning cycles, although this may be more achievable from the second generation of spatial strategies. It is also consistent with our recommended review periods for national direction and combined plans. As discussed in chapter 8, reviews of combined plans should follow reviews of spatial strategies.

Monitoring and oversight requirements

126. Regional spatial strategies should be monitored and reviewed in line with international best practice. For example, the legislation should:
     • require a spatial strategy to include measurable objectives and milestones that can be monitored and reported against
     • provide that the spatial planning partners have an ongoing responsibility to monitor implementation of the regional spatial strategy and keep it under review
     • require a spatial strategy to describe how monitoring will be undertaken^[181]
     • require the spatial planning partners to jointly prepare and publicly release a report within three years of the approval of the spatial strategy on progress towards meeting the objectives and milestones in the strategy
     • provide for the Ministry for the Environment to monitor and report to the Minister for the Environment on the effectiveness of spatial strategies as part of the Ministry’s oversight of the resource management system
     • provide for the PCE to audit the effectiveness of spatial strategies as part of the PCE’s expanded auditing and reporting role as discussed in chapt[182].¹⁸²

Opportunities to streamline the system

127. The reformed resource management system needs to be simpler and more streamlined than the current system. The proposed requirement for combined plans under the Natural and Built Environments Act (see chapter 8), LGA infrastructure strategies, long-term plans and annual plans, and LTMA regional land transport plans, to be ‘consistent with’ regional spatial strategies will help achieve this.
128. Strategic directions agreed through spatial planning processes will flow into detailed regulatory and funding plans. This will focus appeals on the implementation of spatial strategies through combined regulatory plans (such as the proposed location of a new transport corridor) and discourage relitigation of agreed strategic directions (such as the need for a new transport corridor between two areas).
129. We have also considered options to reduce potential duplication between regional spatial strategies and other policies and plans, including:
     • replacing or narrowing the scope of regional policy statements, infrastructure strategies and/or regional land transport plans
     • providing for the content of approved spatial strategies to be included in regional policy statements, infrastructure strategies and regional land transport plans as relevant.

We prefer the approach of retaining existing policies and plans but we would expect the content of approved regional spatial strategies to be reflected in regional policy statements, infrastructure strategies and regional land transport plans as relevant and they would all be required to be consistent with spatial strategies.

Regional policy statements, infrastructure strategies and regional land transport plans cannot be replaced in their entirety by regional spatial strategies. The existing instruments contain both strategic aspects that would be suitable for inclusion in spatial strategies and more detailed methods and operational aspects that would not. In addition, infrastructure strategies are prepared by all councils individually as a significant element of their long-term planning (budgeting) process rather than on a regional basis.

We considered narrowing the scope of regional policy statements and regional land transport plans by removing the strategic elements that would be covered in regional spatial strategies. This would remove potential duplication. However, it would weaken the coherence and effectiveness of regional policy statements and regional land transport plans and raise natural justice issues by removing appeal rights on aspects of regional policy statements. Care would also need to be taken to retain the current legal weight of any strategies or plans provided for under Tiriti settlement legislation, such as the Vision and Strategy for the Waikato River that is deemed to be part of the Waikato Regional Policy Statement.^[183]

On balance, we prefer the approach of retaining existing policies and plans but we would expect the content of approved regional spatial strategies to be reflected in regional policy statements, infrastructure strategies and regional land transport plans as relevant and they would all be required to be consistent with spatial strategies. Further as discussed in chapter 8 we recommend incorporating regional policy statements and regional plans into combined plans. This is expected to result in very significant improvements by simplifying and streamlining policy and plan-making processes under the new Natural and Built Environments Act.

Implementation support and funding

133. A number of submitters on our issues and options paper expressed concerns about potential barriers to spatial planning, including designation processes that may not be fit for purpose to protect corridors or strategic sites far in advance of project design, infrastructure funding and financing constraints, and insufficient capacity and capability within central and local government and mana whenua.
134. Submitters emphasised the importance of addressing implementation challenges if spatial planning is to improve system outcomes. For example, Infrastructure New Zealand submitted:

For spatial planning to be effective, spatial plans must be delivered. To be delivered, spatial plans need to be funded. To be funded, bodies overseeing investments need to benefit from investments made and have the ability to raise resources. If entities responsible for delivering plans and elements of plans are not incentivised or capable of performing their role then implementation will fail and so will plans. We strongly encourage the Panel to consider whether, in their preferred model, public institutions have both the willingness and the ability to ensure plans, and therefore public outcomes, can and will be delivered.

135. New provision for spatial planning will need to be complemented by central government guidance, measures to improve capability and capacity within central and local government to carry out spatial planning effectively, consideration of what support is needed for mana whenua to participate in spatial planning processes, and effective supporting tools (including infrastructure funding and financing tools and designations). Designations are further discussed in chapter 10.
136. The new spatial planning function will need to be funded. Relevant considerations include the need to:
     • build capability and capacity within central government agencies and councils to participate effectively in regional spatial planning processes
     • support mana whenua and potentially mātāwaka to participate effectively in spatial planning processes (as discussed in chapter 3).
137. Attention will need to be given to:
     • options for the sequencing and timing of spatial planning processes
     • transitional provisions (as discussed in chapter 16).

Expected outcomes

138. An important objective of our review was to establish strategic and integrated planning for development and the environment. Our view is that this is best advanced through our proposal for a new Strategic Planning Act. The new Act will allow a broad range of matters to be reconciled in pursuit of social, economic, environmental and cultural wellbeing. This will provide a powerful tool for advancing the long-term planning that is vital to both environmental protection and development.

Key recommendations

The parameters of the recommended spatial planning legislation are summarised in appendix 2 of our report.

Chapter 5 A more responsive system: addressing status quo bias

The resource management system has long favoured existing uses and consented activities, protecting them from changes in plans, rules and standards designed to promote better environmental outcomes and to effect change for the benefit of communities.

The resource management system has long favoured existing uses and consented activities, protecting them from changes in plans, rules and standards designed to promote better environmental outcomes and to effect change for the benefit of communities. The range of protections of this kind in the system is pervasive with the result that the ability to respond to urban growth and the environmental challenges and opportunities we face is seriously impaired.

The inability of the resource management system to effect necessary change is a serious impediment to achieving better outcomes such as restoring degraded water bodies, responding to the effects of climate change and providing sufficient development capacity in areas experiencing significant population pressures.

3. In this chapter, we identify the provisions in the resource management system which protect existing uses and consented activities and propose options to support a more responsive system.^[184]

Background and current provisions

4. The RMA’s protections relating to existing uses were established under the Town and Country Planning Act 1977 and the Water and Soil Conservation Act 1967. They have therefore been part of the law for over 50 years. These protections were developed at a time when our knowledge of the state of the environment and our impact on it were very different. The pressures that exist today, including climate change, resource scarcity, urbanisation, pollution and biodiversity loss were not well understood 50 years ago.
5. The RMA provides protection for existing uses and consented activities in a variety of ways. Some protections arise from presumptions underpinning the Act, such as the distinction between the use of private property and the public estate. Other protections are explicit and collectively allow certain existing uses to continue (either indefinitely or until a resource consent application is decided) even when a new use for the same activity would require consent.^[185] There are constraints on the ability to modify or extinguish existing resource consents through national direction or reviews of consent conditions. The permitted baseline test we discuss in chapter 9 is a further indirect contributor to system bias in favour of the status quo.

Presumptions regarding land and resource use

6. The protections afforded by the RMA differentiate between the use of land and the use of public estate resources such as air, water and the coastal marine area. This reflects differing presumptions underpinning the use of these resources.
7. For the use of land, the RMA reflects the common law presumption that owners should be able to do what they wish with their land, unless explicitly constrained. This presumption underpins section 9, which effectively provides that any use of land is allowed if it does not contravene a national environmental standard, a regional rule or a district rule. It reflects the classical liberalism theory of private property, which suggests that people should be able to do what they wish with what they own.^[186] This presumption was a reversal of the position under the Town and Country Planning Act 1977 where “all uses of land were prohibited, unless they were expressly provided for under a district scheme, a resource consent, or an existing use protection”.^[187]
8. In contrast, for the use of ‘public estate’ resources the underlying presumption is that an activity is prohibited, unless expressly allowed.^[188] Users cannot presume a right to private use of public resources.

Explicit protection of existing uses

9. Section 10 of the RMA provides for the continuation of a lawfully established land use that contravenes a new rule in a district plan, subject to the activity not having been discontinued for more than 12 months and the effects of the use remaining “the same or similar in character, intensity, and scale”. If these requirements are met, there is very little ability for a territorial authority to modify that activity or require it to cease through use of a district plan rule.^[189] This protection of existing land uses was carried over from section 90 of the Town and Country Planning Act 1977 on the basis that most land is privately owned^[190] and fairness requires existing uses of land to be recognised when rules and plans change.^[191]
10. In contrast to land uses affected by new district plan rules, the RMA provides limited protection to lawfully established activities that contravene a new rule in a regional plan. Section 20A allows existing activities to continue but only until any application for a resource consent has been determined.^[192] Existing activities can therefore be modified (through conditions) or extinguished (if the consent is not obtained or the activity is given prohibited status). Section 20A applies to all uses and activities regulated by regional councils. This includes some types of land use, including for the purpose of the avoidance or mitigation of natural hazards.^[193]
11. The rationale for this approach is that regional plan rules should be able to override existing activities, however existing users should be given the opportunity to have their interest accommodated and to test the reasonableness of the rule before their investment is affected.^[194]

Resource consents and certificates of compliance

12. In addition to existing use protections, a number of resource consent provisions collectively operate in favour of existing resource users. These are discussed in chapter 11 and include:

Territorial authorities have virtually no ability to modify consents granted and implemented for land use activities within their jurisdiction.

the power under section 128 of the RMA to review the conditions of a consent granted by a regional council is tightly constrained and the decision-maker must have regard to the continued viability of the activity controlled by the consent. Cancellation of a consent is only possible if the activity has significant adverse effects on the environment and either there were material inaccuracies in the original consent application or the consent holder is convicted of an offence that contravenes the consent

territorial authorities have virtually no ability to modify consents granted and implemented for land use activities within their jurisdiction. In contrast to consents granted by regional councils, land use consents by district councils are not generally time‑limited

• consent authorities must have regard to the value of the investment of an existing consent holder when considering an application to renew a consent,^[195] and existing consent holders are prioritised in certain circumstances when there is more than one applicant seeking to use the same resource.^[196]

The ‘first-in, first-served’ approach to allocation hinders the ability to allocate resources to uses which offer the greatest environmental, social, cultural or economic value.

As discussed in chapter 11, the ‘first-in, first-served’ approach to allocation hinders the ability to allocate resources to uses which offer the greatest environmental, social, cultural or economic value. It can also disadvantage mana whenua and small rural communities, for example where they are unable to draw water from a local source that is already over‑allocated.

14. Certificates of compliance are used to safeguard an activity that is permitted at the time of application for a certificate (but not yet established) from a change to plan rules that would require a resource consent for the activity. If the activity is subsequently established it benefits from the existing use protections described above.^[197] Certificates of compliance may also be granted for activities already established and provide additional protection from future plan changes. They are commonly obtained as part of the due diligence process on the sale of a business or other activity.

Protections under section 85 of the RMA

In our view, the function of section 85 generally, and in the context of managed retreat and natural hazards, should be reviewed.

Section 85 of the RMA provides that an interest in land shall be deemed not to be taken or injuriously affected by reason of any provision in a plan unless otherwise provided for. This means that those with interests in land cannot claim compensation as a result of planning restrictions imposed under the RMA. This includes plan provisions that would modify or extinguish existing uses. However, provisions can be challenged on the basis they would make land ‘incapable of reasonable use’ and place ‘an unfair and unreasonable burden’ on a person who has an interest in the land. If these tests are met, the remedies available to the local authority are to modify, delete or replace the provision or, with the agreement of the person with the interest in the land, to purchase that land under the Public Works Act 1981.

16. We are aware of some difficulties in the application of this section. In particular, we consider the tests and associated remedies may hinder the proactive responses needed to address climate change issues, such as managed retreat. For example, if the section 85 tests are met, a person with an interest in the land must agree to it being purchased. If they do not agree the local authority must modify, delete or replace the relevant plan provision. This could undermine local authorities’ ability to enforce retreat from an area through use of planning rules (as discussed in chapte[198]).¹⁹⁸ In our view, the function of section 85 generally, and in the context of managed retreat and natural hazards, should be reviewed.

Relationship between national direction and existing uses and consents

17. Under the current system, existing uses and resource consents can present a barrier to the implementation of national direction. Most resource consents prevail over national direction. However, national environmental standards can trigger a review of regional consents.^[199] The relationship between national direction and existing uses and consents is discussed in chapter 7.

Discussion – creating a more responsive system

18. There are inevitable tensions between private interests in land use and development and the wider interests of communities and all New Zealanders in a high-quality environment. There is also a tension between providing for the needs of current residents and ensuring future generations will be able to meet their needs. These tensions increase in cases of rapid change or scarce resources.
19. Submitters on our issues and options paper expressed a range of views about existing use protections and the ability to change or cancel resource consents. Many submitters acknowledged the need for a more responsive system, particularly in relation to climate change adaptation. However, there was also significant concern about the potential impact on holders of existing use protections and consents. Forest & Bird captured this tension in its submission:

We agree that the current strong expectation that use rights will continue in perpetuity needs to change. Such an approach cannot continue while using a limits/outcomes approach. However we do have sympathy for users who have invested time and money etc based on a resource consent. Some kind of a priori rights are likely to be appropriate, within the framework of outcomes/limits still being met.

20. Some submitters supported increased reviews of regional consents, such as within a set time period after a relevant rule in a regional plan becomes operative. The New Zealand Fish & Game Council submitted that:

Consents need to be reviewed regularly. This is permissible under the current RMA, but Councils show reluctance to review existing consents and are particularly reluctant to review complex groups of consents for one activity, or groups of individual consents that are linked (for example all the water takes in a particular catchment). Consents that are inconsistent with limits set in national direction or in plans should not be able to persist. Councils should be required to (rather than having the option to, as is the current situation) to review consents (and this must be done collectively where appropriate) to ensure compliance within a limit. That review ought to be able to go so far as to collectively reduce the amount of the resource used, if that is necessary, without concerns about derogation holding sway over environmental outcomes.

21. The Resource Management Amendment Bill^[200] proposes to amend section 128 of the RMA to make it easier for regional councils to review conditions of water consents to support implementation of regional plan rules. The proposed changes include a power for regional councils to review the effects of multiple consents on maximum or minimum flows, rates or standards for water quality stated in a regional rule. Regional councils will also be able to review consent conditions as soon as the relevant rule is operative, rather than waiting until There needs to be greater ability for existing uses and activities, including regionally significant land uses, to change over time to respond to significant environmental issues.

the plan as a whole is operative. The intent is to facilitate faster implementation of the National Policy Statement for Freshwater Management.

In our view, the distinction in the RMA between the use of land and the use of public estate resources such as air, water and the coastal marine area generally remains appropriate. However, there needs to be greater ability for existing uses and activities, including regionally significant land uses, to change over time to respond to significant environmental issues. This is particularly relevant to climate change adaptation, including managed retreat.

A more responsive approach would also align the resource management system and the obligations on existing users and consent holders to address changing standards in a similar way to which building owners under the Building Act and building code are required to address earthquake strengthening work.

Principles for creating a more responsive system

24. We have identified the following principles, informed by submissions on our issues and options paper, to guide our consideration of options to make the system more responsive:
    • resources should be used sustainably to ensure the reasonably foreseeable needs of future generations can be met
    • fairness and equity should be considered when making changes to existing uses. This applies to both existing resource users, and potential users of the resource (particularly where a resource is over-allocated)
    • existing resource users should be provided with early notice and adequate transition time to make required changes
    • the need for a responsive system should be balanced with the need for certainty for resource users to invest.

Existing use protections

25. Our view is that the current protection in section 10 of the RMA for existing lawfully established land uses that contravene a new rule in a district plan should be retained. This is consistent with the principle of fairness and equity, particularly given the presumption in favour of land use in section 9 of the RMA which we consider should be retained.
26. However, we consider there should be two limited exceptions to the general rule to enable existing land use rights to be modified or extinguished:

We consider there should be two limited exceptions to the general rule to enable existing land use rights to be modified or extinguished.

where necessary to adapt to the effects of climate change or to reduce risks from natural hazards as we discuss in chapter 6

where there is high risk of significant harm or damage to health, property or the natural environment, for example by the breach of an environmental limit.

Changes to consents

27. We take a similar view in respect of land use consents granted by territorial authorities. These are not generally time-limited and should not be disturbed except in the two circumstances described above.
28. As noted, different presumptions apply to consents or permits granted by regional councils. As discussed in chapters 7 and 11, the existing powers to modify or extinguish consents or permits granted by regional councils should be strengthened where necessary to achieve agreed outcomes and be more responsive to change.

Changes in consequence of national direction

29. In chapter 7, we discuss the impact of new national directions on existing use rights and existing consents. Our recommendations in chapter 7 align with the approach we have described in this chapter and draw similar distinctions.
30. For matters relating to air, water and the coastal marine area, we recommend that new national direction should automatically trigger a review of any existing resource consents that may be inconsistent with it.
31. We recommend a number of changes to make consenting arrangements more flexible, including enabling review and readjustment if environmental conditions change. These changes are discussed in chapter 11 and include stronger powers to review and change consent conditions.

More strategic direction for development and urban growth capacity

32. As discussed in chapter 2, one of the frequent criticisms of the RMA is that it has been too slow to respond to increased demand for housing. This has led to higher housing costs and poor social outcomes. The current system’s bias towards the status quo is a barrier to dynamic urban environments that provide for the needs of current and future residents.
33. Factors we have identified as contributing to this include:
    • a lack of strategic focus for development (discussed in chapter 4)
    • more weight being placed on existing community values over future community needs

The current system’s bias towards the status quo is a barrier to dynamic urban environments that provide for the needs of current and future residents.

plan-making being slow, litigious and unresponsive to change thereby limiting local authorities’ ability to provide development capacity in a timely way (discussed in chapter 8).

34. In chapter 11 we discuss in detail ways in which better provision for urban growth could be made and a combination of recommendations covered in other chapters will also help address these issues and improve responsiveness. Most notably, our recommendation in chapter 2 to include specific outcomes for urban growth and development in the new Natural and Built Environments Act, and our recommendation in chapter 4 to develop a new Strategic Planning Act to mandate regional spatial planning for land use, infrastructure and associated funding. These will be complemented by changes recommended in other chapters to improve plan-making, designations and consenting.

Key recommendations

Chapter 6 Climate change and natural hazards

We are already experiencing the effects of climate change, including through flooding and coastal erosion that threaten our essential infrastructure and the safety of whole communities. We need to respond with urgency.

Climate change is often described as the defining issue of our time. Limiting global warming to 1.5 degrees Celsius above pre-industrial levels will require rapid, far-reaching and unprecedented changes in all aspects of society. We are already experiencing the effects of climate change, including through flooding and coastal erosion that threaten our essential infrastructure and the safety of whole communities. We need to respond with urgency.

New Zealand’s resource management system has an important role to play in ensuring that we both mitigate our impacts on the climate by reducing greenhouse gas emissions and adapt to the effects of climate change through well-informed decision-making about land and other resource use. As climate change will exacerbate a range of natural hazards, this chapter also addresses the distinct but related issue of how the resource management system can improve the country’s resilience to these hazards more generally.

A comprehensive approach is needed for central and local government decision-makers to address climate change and natural hazards as a matter of priority. Our proposals include:

• setting outcomes in the Natural and Built Environments Act to prioritise reducing greenhouse gas emissions, increasing resilience to the effects of climate change and reducing the risks from natural hazards as important goals for decision-makers
• providing the necessary mechanisms to achieve these outcomes, including mandatory national direction, the use of strategic spatial plans, and new legislation and powers to address the particular challenge of managed retreat from areas subject to climate change and natural hazard risks
• establishing clear mandates, roles and responsibilities for central and local government and relationships with other legislation including the Climate Change Response Act.

Background and current provisions in legislation

4. Emissions of greenhouse gases will cause warming and long-lasting changes in all components of the climate system, increasing the likelihood of severe, pervasive and irreversible impacts for people and ecosystems.^[201] Surface temperatures will rise over the 21st century under all assessed emission scenarios. It is very likely that heat waves will occur more often and last longer and that extreme precipitation events will become more intense and frequent in many regions. The ocean will continue to warm and acidify and global mean sea level will rise.^[202]
5. A future resource management system should anticipate and respond to these challenges. Furthermore, good decision-making will require integration across broader climate change and natural hazard legislative responses. We discuss the relevant legislative frameworks below.

Climate Change Response Act 2002

6. The Climate Change Response Act 2002 (CCRA) sets a legal framework to enable New Zealand to meet our domestic and international climate change obligations (mitigation) and adapt to the effects of climate change (adaptation).
7. In 2019 the Climate Change Response (Zero Carbon) Amendment Act committed New Zealand to reducing greenhouse gas emissions by 2050^[203] in line with global commitments under the Paris Agreement. To meet this target, central government must set a series of five-yearly emissions budgets and an emissions reduction plan showing how these will be met.^[204]
8. The Emissions Trading Scheme (ETS) is one of the tools for meeting these emissions budgets. Within the scheme, emissions units are tradeable at a price set by the market. It aims to encourage businesses to reduce emissions and incentivise planting carbon-absorbing forest sinks.
9. There is also a requirement for the Government to develop a national adaptation plan in response to a national climate change risk assessment. The national adaptation plan is a strategic document that sets out objectives, strategies, plans and policies for climate change adaptation.
10. The Climate Change Commission advises the Government on these emissions budgets and tracks the Government’s progress towards achieving them and the 2050 target to ensure political accountability. It also monitors progress on implementation of the national adaptation plan and will be responsible for delivering national climate change risk assessments (after the first one which is being developed by the Government).

Resource Management Act 1991

11. The RMA is limited in its approach to climate change mitigation. Amendments introduced by the Resource Management (Energy and Climate) Amendment Act 2004 removed the ability of local authorities to consider discharges of greenhouse gas emissions, unless a national environmental standard was developed.^[205] Central government has never developed such a standard.
12. Subsequently, the Supreme Court has interpreted the statutory bar on considering greenhouse gas emissions under the 2004 amendments as also precluding local authorities from considering greenhouse gases which result indirectly from activities under the RMA.^[206] This is the case except when the use and development of renewable energy enables a reduction in the discharge of greenhouse gases into air. The Court’s interpretation of the renewable energy exemption also limited its scope.^[207] The net effect of the Court’s interpretation and its impact on the perceptions and practices of councils and resource management practitioners is arguably more restrictive than Parliament’s original intent.
13. The purpose and principles of the RMA (Part 2) require decision-makers to have particular regard to ‘the efficiency of the end use of energy’ and ‘the benefits to be derived from the use and development of renewable energy. These matters are relevant, as achieving greater energy efficiency and use of renewable energy is an important aspect of reducing greenhouse gas emissions. The National Policy Statement for Renewable Electricity Generation 2011 has also been developed to promote a consistent approach to planning for renewable electricity generation in New Zealand.
14. The RMA addresses climate change adaptation and natural hazard risk management in several ways, some explicit and some implicit. The purpose and principles of the RMA include the management of significant risks from natural hazards as a matter of national importance that must be recognised and provided for. Those exercising RMA functions and powers must have particular regard to the effects of climate change.^[208]
15. Through policy statements and plans, regional councils set objectives, policies and methods for controlling the use of land to avoid or mitigate natural hazards. In district plans, territorial authorities control the effects of land use to avoid or mitigate natural hazards through zones or overlays, rules and performance standards for land use and subdivision. There are no explicit functions in sections 30 and 31 with respect to climate change adaptation.
16. The New Zealand Coastal Policy Statement 2010 (NZCPS) states policies on issues including preservation of natural character, and coastal subdivision, use and development, as well as coastal hazard risks. The National Policy Statement for Freshwater Management requires councils to consider the foreseeable impacts of climate change in water-take decisions. No other national direction considers natural hazards and risk management specifically. However, the Ministry for the Environment has developed guidance for local government on coastal hazards and climate change.

Other important legislation

17. The LGA sets out the administrative and management responsibilities of regional councils and territorial authorities covering land management, utilities and provision of services. Local government must have regard to avoiding and mitigating natural hazards and develop 30‑year infrastructure strategies to identify infrastructure issues and solutions. Funding for local government activities (including their RMA functions) is determined through LGA processes and is allocated through long-term plans and annual plans.
18. The Local Government Official Information and Meetings Act 1987 holds councils responsible for identifying and making information known (such as about potential erosion, falling debris, subsidence, slippage or inundation) through Land Information Memoranda, which apply to individual properties.
19. The Civil Defence and Emergency Management Act 2002 encourages communities to achieve acceptable levels of risk, managing hazards across the ‘4 Rs’ – risk reduction, readiness, response and recovery – and is responsible for local-level hazard management among other matters. The Act also defines risk as “the likelihood and consequences of a hazard”.
20. The Building Act 2004 manages natural hazards in relation to construction and modification of buildings, and contains provisions relating to building on land subject to natural hazards. The Building Act sets standards for minimum floor heights for flooding, and contains earthquake-strengthening provisions that are relevant to adapting to climate change and natural hazard risk management.^[209]

Climate change and natural hazard risk issues

21. The Panel has identified four main issues in regard to climate change and natural hazards. These are:
    • insufficient focus on reducing greenhouse gas emissions and planning for a low-emissions economy (mitigation)
    • insufficient focus on addressing the effects of climate change (adaptation) and the risks from natural hazards
    • poor integration across the system, in particular between the RMA and the CCRA
    • capacity, capability and funding barriers.

Insufficient focus on reducing greenhouse gas emissions and planning for a low-emissions economy (mitigation)

Although reducing greenhouse gas emissions has been identified as an important policy goal since at least the 1990s, New Zealand has still not developed comprehensive policy tools to support emissions reduction goals.

Although reducing greenhouse gas emissions has been identified as an important policy goal since at least the 1990s, New Zealand has still not developed comprehensive policy tools to support emissions reduction goals.^[210] The recent and proposed changes to the CCRA have resulted in legally binding targets to reduce greenhouse gas emissions. The ETS now aligns with this target through caps on emissions that reduce over time. However, a broad range of policy tools will be needed if New Zealand is to become a low-emissions economy over the next decade and meet the ambitious targets set under the CCRA.^[211]

As discussed above, the 2004 amendments to the RMA removed the direct control of greenhouse gas emissions from regional councils. At that time, the Government made a number of arguments supporting the conclusion that the RMA was not a useful policy tool for addressing climate change mitigation. Its main points are listed below.

• Climate change is an international issue and should be dealt with consistently at a national level. As greenhouse gas emissions have the same effect irrespective of where they occur, it would be inappropriate to have different emission standards in different regions. A price on carbon would provide a uniform incentive across the whole country to reduce emissions where that could be done at least cost.
• The national instruments available under the RMA, including national policy statements and national environmental standards, are unlikely to be cost-effective for controlling greenhouse gases because of the time and expense of developing and implementing them (particularly given the current RMA process).
• Rules in regional and district plans under the RMA do not in themselves encourage best-practice activities; rather they identify the thresholds above which a consent is required. This means that rules in plans are generally ineffective in encouraging best practice although, for those activities requiring a resource consent, best-practice outcomes could be achieved through a consent condition.
• It can be argued that, under the RMA, climate change effects of a particular activity seeking consent are de minimis and/or are part of the existing or permitted baseline.
• There is some uncertainty as to the ability of councils to impose consent conditions related to effects on climate change. For example, it is uncertain whether a council can consider ‘effects’ outside the boundary of the region and impose conditions requiring third-party involvement. ^[212]

24. When these arguments were made, it was anticipated a carbon tax would shortly be introduced in 2007. Notwithstanding recent positive moves by the Government, an effective and comprehensive emissions pricing scheme is yet to be established and still appears some years away.^[213] In hindsight, while the arguments made in favour of emissions pricing rather than a regulatory approach in the early 2000s had some merit, focusing almost exclusively on developing a pricing approach to reduce carbon emissions may have been a mistake.

Even if New Zealand were to achieve a comprehensive price on greenhouse gas emissions, a single price alone is unlikely to be an efficient or effective way to deliver the broad change required for
New Zealand to transition to a
low-carbon economy.

Even if New Zealand were to achieve a comprehensive price on greenhouse gas emissions, a single price alone is unlikely to be an efficient or effective way to deliver the broad change required for New Zealand to transition to a low-carbon economy. As argued by the Productivity Commission and others, “a single emissions price cannot ... reflect the varying range of co-benefits and co-harms associated with different land uses”.^[214] Additional incentives or regulation to secure benefits or avoid harms are required.^[215] Others believe that plan rules and/or consents for activities which emit substantial quantities of greenhouse gases should consider the climate change effects in order to prevent additional damage or to agree a time-limited transition.

A future system of environmental and land use planning and regulation has the potential to play an important role alongside emissions pricing. To be efficient, the approach developed would need to address the concerns above. It would also need to work alongside any pricing mechanism in place under the ETS. We discuss how this might be done shortly.

Land use planning also has an important role to play in enabling and supporting the land use change and infrastructure needed for a transition to a low-emissions economy. This is likely to include significant afforestation, further development of wind and other renewable electricity generation, changes in the way transport networks operate to reduce reliance on fossil fuels, and more efficient use of existing urban infrastructure, among other things. All of these matters intersect with resource management plans and will need to be provided for in one way or another. For example, the Productivity Commission’s recent low-emissions economy inquiry recommended councils “review and if justified remove, barriers to higher-density development, particularly in inner suburbs and in areas close to public transport routes. Councils should also ensure that infrastructure charges reflect the full costs of dispersed development.”^[216]

Insufficient focus on addressing the effects of climate change and the risks from natural hazards

28. In 2017 the Climate Change Adaptation Technical Working Group (CCATWG) built a comprehensive picture of the impacts of climate change on New Zealand. The following are some important impacts it identified in relation to natural and built environments.
    • Physical infrastructure: Most of New Zealand’s major urban centres and the majority of our population are located on the coast or floodplains of major rivers. Many of our communities, homes, marae, commercial assets and infrastructure will experience increased flooding and erosion from storm surge effects or rising groundwater levels from sea-level rise. Local Government New Zealand (LGNZ) estimated that $2.7 billion of council road, water and building infrastructure is at risk from 0.5 metres of sea-level rise, and $14.1 billion of that infrastructure from 3.0 metres of sea-level rise.^[217]
    • Biodiversity: The range of ecosystems and species will change, as will the timing of annual and seasonal events (for example, beech masting) and ecosystem functions (for example, food webs). Climate change will increase the range and abundance of many invasive species, which are currently a key driver of extinction of indigenous species.
    • Fresh water: Higher temperatures and lower rainfall, along with increased frequency and intensity of droughts, are expected to reduce soil moisture, groundwater supplies and river flows in some areas. Changes in seasonal rainfall patterns and extreme weather events will create secondary effects of erosion and sedimentation to waterways, affecting freshwater and marine ecosystems. Climate change related floods and droughts have cost the New Zealand economy at least $120 million for privately insured damages from floods and $720 million for economic losses from droughts over the last 10 years.^[218]
    • Oceans and coasts: Ocean warming and acidification caused by climate change pose a risk to many ecologically important species in the New Zealand region, including deep-water coral reefs that form habitat for many marine species.^[219] They will also affect marine-related industries including aquaculture and commercial fisheries.

Climate change adaptation will require a central focus in future environmental management and land use plans. It would be fair to say this task has only just begun.

While the effects of climate change will exacerbate some natural hazards like flooding and landslides, addressing the effects of climate change is clearly a much broader exercise than management of these hazards alone. The likely impacts of sea-level rise on physical infrastructure are now well known with significant costs anticipated. Climate change will also have a large impact on New Zealand’s biodiversity. Changing temperature and precipitation patterns are already shifting habitats and species distribution. Our efforts to protect biodiversity will need to be calibrated to these dynamic processes and will require research into the risks and impacts of climate change to native species.^[220] Overall, climate change adaptation will require a central focus in future environmental management and land use plans. It would be fair to say this task has only just begun.

As discussed above, Part 2 of the RMA includes the management of significant risks from natural hazards as a matter of national importance to be recognised and provided for when carrying out RMA functions and powers. Those exercising such functions and powers must only ‘have particular regard to’ the effects of climate change, as an ‘other matter’ in Part 2. Given the scale of the risks discussed above and the fact that climate change will exacerbate natural hazards, it seems anomalous that they are accorded different priority within the current RMA.

There is also a broader issue of how ‘risk’ is understood and planned for in the resource management system. The effects-based orientation of the RMA framework is a poor fit for risk management methods. This is because managing risks requires a proactive approach rather than a focus on the effects of activities. There is also no clear framework for how decision-makers should consider risk in the RMA, and the meaning of ‘risk’ is not defined, which further hinders development of a clear policy approach.

In addition to the issues in relation to Part 2 of the RMA, the planning framework has presented some difficulties in addressing the challenges of climate change adaptation and natural hazard risk management in recent years. We can only expect these problems to become more acute as risks increase and become more widespread. Important issues include those listed below.

• A lack of national direction and guidance from central government. While the NZCPS does address adaptation within the coastal environment, there is no national direction on adaptation or natural hazard risk management outside this area. The effects of climate change and natural hazard risks are locally specific; however the science, data and information needed, as well as best-practice planning approaches, could be developed at a national level to improve efficiency and ensure consistency and fairness around the country. (Our proposed improvements in national direction are discussed in more detail in chapter 7.)
• Difficulties addressing contentious issues in the development of local plans. Planning to address the effects of climate change and risks from natural hazards is contentious for local communities and expensive for those who are paving the way. This is because such planning often limits what people can do with their land and impacts property values. The effects of climate change and some natural hazards are also inherently uncertain in timing, magnitude and spatial distribution. When it comes to translating hazard information into risk-based plan rules through the RMA Schedule 1 process, uncertainties about what range of climate change scenarios to use for planning have led to a fear of (and actual) litigation. For example, in the Kāpiti Coast District, the translation of hazard maps into provisions in the district plan was legally challenged. Alongside greater direction and guidance from central government, improvements in planning processes would make it easier for local government to progress these issues. (Our proposed improvements in planning processes are discussed in more detail in chapter 8.)
• Lack of clarity in regard to roles and responsibilities. There are no explicit RMA functions for local government in regard to climate change adaptation. The functions of regional councils and territorial authorities in regard to the avoidance or mitigation of natural hazards are subtly different. In some cases, this has led to disputes about where the primary responsibilities lie, including in relation to sharing of costs. (Our proposals in relation to planning functions are discussed in more detail in chapter 8.)
• Planning for managed retreat. In order to address climate change adaptation and natural hazard risks, central and local government need to be confident in their ability to alter existing land uses in certain limited circumstances. For example, when risks are significant and occupation of a site is either no longer safe or likely to become unsafe. The RMA presumes land uses can occur unless specifically regulated otherwise, and land use consents have an indefinite duration by default. Even if district rules change over time, existing land uses (with effects that remain the same or similar in character, intensity and scale) and consented land use activities are generally protected.^[221] Some limited risk reduction measures may be possible through designations and the Public Works Act 1981, but only where the risk coincides with existing designation or public works purposes such as river or flood management. These avenues are not available for adaptation and natural hazard risk reduction as such. While the protection for existing uses does not apply to land uses governed by regional rules for the avoidance or mitigation of natural hazards, the combination of RMA provisions, along with the ambiguity in roles and responsibilities described above, does not provide a clear pathway for local government to address risks.^[222]

Experiences in the Christchurch red zone, Matatā in the Bay of Plenty and Haumoana in Hawke’s Bay have shown that many communities will opt to stay and defend their community and infrastructure. In Matatā this has proved to be the case, even where there is a clear natural hazard-related risk to life and compensation has been offered to the owners of affected properties.

• Particular issues in relation to risks for Māori. Managed retreat from the coast will be a significant issue for Māori. Coastal erosion and sea-level rise can affect cultural values, damaging wāhi tapu or causing difficulty for Māori access to traditional land, coastal urupā or mahinga mātaitai. It is important to consider the ability of Māori to determine how taonga and whenua are managed in response to climate change. (Chapter 3 discusses our proposals for ensuring mana whenua views inform and share in decision‑making.)

33. Many of these issues overlap with problems identified with the RMA more generally and are also addressed through proposals discussed in other chapters.

Poor integration across the resource management system and particularly between the CCRA and RMA

34. The CCRA now provides for an emissions reduction plan and a national adaptation plan. While the Natural and Built Environments Act we propose has the potential to provide important means to advance both emissions reduction and adaptation, little attention has been given to the alignment of these legislative frameworks.
35. There is also a range of other legislation relevant to climate change and natural hazard risk management – each with its own scope, objectives and mechanisms. Under the current approach, it appears likely efforts to establish and implement coherent policy responses will be hampered by the lack of connection between the various instruments.
36. Central and local government plans for resources and infrastructure need to be informed by anticipated risks from the effects of climate change. Given the permanence of most development and infrastructure, such risks should be considered over a period of at least 100 years. Without this long-term view, decisions on development and infrastructure location and resource use do not adequately consider the future conditions that will affect them.
37. Current RMA plans have a 10-year lifespan. The LGA requires local government to make infrastructure strategies over a period of 30 years and to take into account the need to provide for the resilience of assets through natural hazard risk management, including by making financial provision for the risks. Some natural hazard risks will be climate-related. However, there is no similar requirement to plan for climate change adaptation independent of infrastructure, and no requirement to include climate change adaptation in long-term planning.
38. Under the CCRA, planning to address risks from the effects of climate change is provided for at the national level, but there is no framework for undertaking regional climate change risk assessment or developing regional adaptation plans. While some regional adaptation planning is occurring, it is on an ad hoc basis.

Lack of direction and funding is a contributing factor to policy inertia and uncertainty about the future of vulnerable communities.

National mechanisms will not provide enough detail to use for local adaptation or natural hazard risk management. The choices that need to be made for adaptation and risk management can impact heavily on local communities, particularly if they lead to decisions on managed retreat, protection of infrastructure, rezoning or significant increases in rating, so need to be addressed locally.

Pursuing a policy of managed retreat, for example from the coast or in floodplains, does not sit easily in the CCRA, LGA or RMA given the likely components of such a framework and the differing objectives and scope of each Act. In particular, a comprehensive approach to managed retreat is likely to require consideration of both regulatory changes and funding, and require participation of both central and local government.

Capacity, capability and funding barriers

41. Current funding support from the Crown is largely limited to disaster relief after an event rather than being aimed at reducing risks and adapting to climate change. Lack of direction and funding is a contributing factor to policy inertia and uncertainty about the future of vulnerable communities.
42. Much of New Zealand’s urban development and infrastructure is located in coastal areas and along floodplains.^[223] This means that a resource with both economic and physical significance is vulnerable to natural hazards like coastal erosion, inundation (flooding) by the sea and sea‑level rise, and pluvial/flash flooding.^[224] Local government responses will vary depending on their planning, capability and capacity to obtain research and to undertake meaningful Ultimately, the scale of response required and the ability to fund some decisions are likely to be beyond the means of local authorities.

engagement.

43. Ultimately, the scale of response required and the ability to fund some decisions are likely to be beyond the means of local authorities. This is particularly the case when they are also faced with existing infrastructure and residential and commercial uses on the sites involved. In its 2019 report on local government funding and financing, the Productivity Commission concluded, “a mismatch exists between resources and capability at the local level, and the scale of the adaptation challenges that exposed communities face”.^[225] Central government will need to assist if decisions are to be made in a timely way.

Options considered

44. Our issues and options paper suggested the following options in relation to climate change (both mitigation and adaptation) and natural hazards.
    • Maintain the current focus on the ETS as the main policy tool to address climate change mitigation.
    • Add reference to climate change mitigation to Part 2 of the RMA.
    • Develop national direction to encourage the types of activities needed to facilitate New Zealand’s transition to a low carbon economy. This includes renewable energy, carbon capture and storage, uptake of low emissions technologies and efficient urban form.
    • Use spatial planning for land use and infrastructure as a tool for addressing climate change mitigation.
    • Develop a national environmental standard with controls on greenhouse gas emissions under the RMA. This might be targeted at particular emissions-intensive activities for which emissions pricing is unlikely to be effective.
    • Require the Minister for the Environment to develop or amend national direction under the RMA in response to the carbon budgets determined by the CCRA.
    • Develop national direction to provide clearer planning restrictions for development in high-risk areas.
    • Use spatial planning processes to identify future adaptation responses (in the context of the national adaptation plan) that connect with regulation, infrastructure provision and adaptation funding.
    • Improve implementation of risk assessments.
    • Clarify what changes might be needed to existing use rights in the context of managed retreat.
    • Introduce new planning tools such as ‘dynamic adaptive policy pathways’ and other measures.
    • Require the Minister for the Environment to develop or amend national direction under the RMA in response to the national adaptation plan developed under the CCRA.
45. We received a broad range of feedback on these options and further suggestions for reform from submitters and stakeholders. In the discussion below, we have grouped the full range of options considered as follows:
    • using the Natural and Built Environments Act to reduce greenhouse gas emissions and plan for a low-emissions-economy
    • improving the planning framework for climate change adaptation and natural hazards
    • increasing integration across the resource management system
    • addressing managed retreat under the proposed Natural and Built Environments Act
    • new legislation, funding and implementation support for climate change adaptation and managed retreat to reduce risks from natural hazards.

Discussion

Using the Natural and Built Environments Act to reduce greenhouse gas emissions and plan for a low‑emissions economy

46. Our issues and options paper sought comment as to whether the current focus on the ETS as the main policy tool to address climate change mitigation should be retained, or whether a reformed RMA should also be used to address greenhouse gas emissions, supported by national direction.
47. Maintaining the focus on the ETS had some support, largely from submitters in industry sectors, who felt that it remains the most efficient way to achieve emissions reductions. There was also a concern that a reformed RMA would regulate emitters twice by requiring consents when emissions had already been paid for under the ETS.^[227] Finally, there were concerns about considering emissions locally, given the national level of emissions obligations, impacts and information. For instance, Federated Farmers of New Zealand submitted, “there should be no amendments where these duplicate, contradict or circumvent the CCRA. The focus should be on alignment and better use of national direction.”
48. A large majority of submitters supported an expanded role for a reformed resource management system in climate change mitigation, complementing the CCRA. Supporters maintained that the ETS alone is not effective in motivating resource users to pursue emissions reductions. The Environmental Protection Authority made the point that:

The NZ ETS interacts with businesses. It is less able to provide direct signals to consumers about steps they could take to reduce their climate change impact ... Similarly, the NZ ETS is less able to provide direct signals to local government about taking action for climate change mitigation. Using instruments under the RMA as a way of providing complementary signals to the NZ ETS, in these circumstances, would be desirable.

49. There was a range of views on which mechanism within a reformed act should be used for climate mitigation, whether the effects on climate change should be considered at the national or local level, and whether individual consent applications should be assessed for their emissions impacts. Generally, submitters recommended the removal of the current statutory barriers in the RMA (sections 70A and 104E).
50. Emissions pricing is widely accepted internationally and in New Zealand as an important tool for enabling a transition to a low-carbon economy.^[228] We agree with this conclusion. However, the ETS has not yet had a significant impact on domestic emissions. While increasing carbon prices as a result of recent amendments to the Climate Change Response Act are expected to make the ETS more effective, it is also accepted that the scale of the challenge will require complementary mechanisms to be developed. These include sector-specific policies such as emissions standards for vehicle imports. They also include government-wide initiatives such as improved accounting for the emissions impacts of investment decisions. As the Productivity Commission put it in their recent inquiry “An effective system of emissions pricing should form the centrepiece of a strategy to reduce emissions. Yet the strategy needs other elements to back up pricing and take the lead in some situations where pricing is not powerful enough because of market or government failures, or distributional considerations.”^[229]
51. Our view is that greater policy coherence and effectiveness will be achieved if a future Natural and Built Environments Act includes a focus on reducing greenhouse gas emissions and planning for a low-emissions economy. The current Resource Management Amendment Bill proposes removing the statutory barriers to RMA consideration of greenhouse gas emissions. At the time of writing our report, the Bill is still before Parliament, but we support this proposal.
52. The way national direction and plans are used to reduce greenhouse gas emissions in a future system will need to be carefully considered. We see two distinct roles:
    • imposing direct controls on activities to prevent greenhouse gas emissions in certain limited and nationally prescribed circumstances
    • planning for the land use change and infrastructure required to transition to a low-emissions economy.

A regulatory approach to the direct control of greenhouse gas emissions should be designed to align with and work alongside emissions pricing.

Some of the rationale behind the 2004 amendments that limited the RMA’s role in reducing greenhouse gas emissions remains valid. The case for a nationally consistent approach to the direct control of greenhouse emissions remains strong, given the effects of emissions are not locally specific and most sources of emissions are mobile. Moreover, we agree that rules can be a blunt instrument and will not incentivise the most efficient behaviour in the same way as an effective price. Finally, it would expend unnecessary time and resources for a system to require local authorities, applicants and submitters to consider the potential implications for greenhouse gas emissions of every application, when most activities have relatively few emissions.

54. Our view is that a regulatory approach to the direct control of greenhouse gas emissions should be designed to align with and work alongside emissions pricing. To avoid the pitfalls identified above, it should be developed at the national level and targeted at addressing issues in which pricing is unlikely to be effective. Given an emissions price will only be effective if it is set at a high enough level and addresses all emissions, and this has not been achieved by successive governments, a regulatory approach could be considered to prevent new activities with significant emissions impacts until such time as an effective price is in place. For example, as part of transitioning to a low-emissions economy, New Zealand needs to phase out fossil-fuelled process heat. It is uncertain what level of reduction in coal use There is a role for plans to consider the indirect impacts that decisions about land use and infrastructure will have on emissions and to ensure they promote a transition to a low-emissions economy.

there will be by 2030 in response to a rising emissions price. A national environmental standard could be used to set rules requiring adoption of low emissions technologies which could be specific to particular industries. This would set clear direction for industry, and act as a regulatory backstop to support emissions pricing. These provisions would need to be designed in a way that did not impose unreasonable costs or deter new investment.

There is also a role for plans to consider the indirect impacts that decisions about land use and infrastructure will have on emissions and to ensure they promote a transition to a low‑emissions economy. This includes planning for renewable energy infrastructure, urban intensification, afforestation, and changes in the way transport networks move people and freight (including through the uptake of electric vehicles and ride-sharing technology), among other things. An emissions price set through the ETS is not a matter to be addressed by the central and local government decision-makers with responsibilities for land use and infrastructure, but rather by businesses and consumers downstream. This suggests the need for a clear obligation for planning decisions to take full account of these downstream emissions impacts.

To provide the basis for these types of approaches to be developed, our view is that our proposed Natural and Built Environments Act should specify the following outcomes in its purpose and principles:

• reduction of greenhouse gas emissions
• promotion of activities that mitigate emissions or sequestrate carbon
• increased use of renewable energy.

Mandatory national direction should be used to prescribe and guide the approach taken in plans.

To ensure consistency in the approach taken to these issues, and in light of the point made that climate change is a global issue, mandatory national direction should be used to prescribe and guide the approach taken in plans. To address the concerns raised by submitters about duplication of regulatory methods, our view is that national direction for the direct control of activities with greenhouse gas emissions should be developed on the following basis. It should be:

• aligned with and complementary to the CCRA, including the emissions reduction plan and the ETS
• targeted at activities in which emissions pricing is considered insufficient or too slow-moving to deliver the desired transition
• implemented through clear provisions that do not require a case-by-case assessment of the emissions impact of an activity in resource consents.

58. National direction to guide planning for a transition to a low-emissions economy should also be developed to guide how the indirect effects of planning decisions on emissions are considered and to promote the necessary infrastructure development and land use change needed. This would ensure local government identifies areas for development (eg, for renewable energy and transport infrastructure) consistent with the needs of the country as a whole, and provides flexibility in land use plans to accommodate necessary changes in land use (eg, urban intensification and afforestation).
59. Finally, our view is that strategic spatial planning will also be a vital means of assisting the transition to a low emissions economy. Our proposals for this are discussed shortly.

Improving the planning framework for climate change adaptation and natural hazards

60. Our issues and options paper made several suggestions about how the planning framework for climate change adaptation and natural hazard risk might be improved, including through development of national direction, use of strategic spatial plans, adaptive planning techniques and better implementation of risk assessments.
61. Submitters were generally in favour of these ideas and, in particular, the use of national direction to address climate change adaptation and natural hazard risks. The reasons given were that: all communities will need to adapt to climate change; national consistency will ensure equitable treatment of different communities; leaving individual councils to deal with the issue is inefficient and costly; and it is an advantage to lift consideration of these issues out of the local political arena, where they may be trumped by competing priorities.

Our proposed Natural and Built Environments Act is an opportunity for a much-needed reset of the planning framework for climate change adaptation and natural hazard risks.

Methods for determining the suitability of areas for future development was a particular area where submitters suggested national direction could assist. For example, Greater Wellington Regional Council views national direction as “critical to ensure that new use and development (both urban and rural) avoids areas presently at high risk from natural hazard and those places that are increasingly becoming high risk from the unfolding impacts of climate change.” Some councils also put forward preferred approaches for community engagement in relation to these issues.

Our proposed Natural and Built Environments Act is an opportunity for a much-needed reset of the planning framework for climate change adaptation and natural hazard risks. In particular, the shift to an outcomes-based approach better lends itself to planning for risk. Our view is that this new legislation should specify the following outcomes:

• reduction of risks from natural hazards
• improved resilience to the effects of climate change, including through adaptation.

64. Our proposals are intended to provide a more proactive approach to the management of risk than has been taken to date. We have therefore strengthened the RMA’s current reference to natural hazards by specifying that risks are to be reduced. Of course, this is not an absolute or site-specific direction, but rather a way of setting overall expectations for combined plans at a regional level. We also propose that risk should be defined to include reference to both the likelihood and consequences of a hazard, as is the case under the Civil Defence Emergency Management Act 2002. The principle of the precautionary approach that we have included in our proposal for reform of Part 2 of the RMA is also relevant to planning for climate change adaptation.
65. Local government has called for national direction to clarify the planning approach needed for these matters for many years, and our view is that this should be mandatory under a future system. National direction would reduce unnecessary duplication of effort, ensure fairness in outcomes around the country through consistency and bolster the mandate of local government to progress needed plan changes. National direction and supporting guidelines could be used to provide:
    • adaptation and natural hazard risk assessment methods and priorities for risk reduction
    • specific risk information and mapping to be relied on (for example, projected sea‑level rise)
    • preference for nature-based solutions for climate change adaptation (see box below)
    • approaches to facilitating the adaptation of indigenous species
    • best practices for accommodating uncertainty, for example dynamic adaptive policy pathways planning (see box below)
    • other technical specifications.

Building adaptive management into plans can make the resource management system more responsive by allowing response pathways to be embedded in plans as they are developed, instead of requiring multiple subsequent plan change processes.

Within the context of national direction, the planning framework for climate change adaptation and natural hazards could also be improved through better enabling and supporting the use of adaptive planning techniques. Adaptive planning involves the use of scenarios with specified thresholds, signals and triggers which are used to determine when a change in policy response within a pre-determined pathway is required. Once an adaptation pathway has been approved for an area, a less involved process would be required to undertake the actual works in the future, as long as they are within the approved parameters. This has the potential to better enable regulation to respond as circumstances change, for example, if a predicted climate impact occurs sooner or later than expected, or has more significant consequences. Building adaptive management into plans can make the resource management system more responsive by allowing response pathways to be embedded in plans as they are developed, instead of requiring multiple subsequent plan change processes. We recommend future legislation provides the flexibility needed for these sorts of approaches. We discuss one example of this type of planning that has been promoted by the Ministry for the Environment in recent years in its guidance on coastal hazards and climate change in the box below on Dynamic Adaptive Policy Pathways.

67. An important aspect of improving the planning framework for climate change adaptation and natural hazards is clarifying roles and responsibilities. We considered limiting responsibility for these issues to regional councils only, as matters of regional significance. However, our preference is to:
    • assign responsibility for policy for climate change adaptation and reducing risks from natural hazards to both regional councils and territorial authorities (in the combined plan development process), given the broad implications of the issues for both levels of local government
    • clarify the current role of territorial authorities in implementing land use controls as they relate to these issues (our approach to this division of responsibilities is discussed further in chapter 8 on the policy and planning framework).
68. We acknowledge that joint functions in the current sections 30 and 31 of the RMA have led to some confusion; however our view is that this is best addressed through development of regional spatial strategies (discussed in chapter 4) and regional combined plans (discussed in chapter 8). These processes will ensure agreement on policy is reached among the relevant decision-makers. It is also addressed by clarifying that implementation of land use controls is the responsibility of territorial authorities alone, rather than a joint function. We also consider climate change and natural hazard risk management responsibilities should be made explicit in the LGA through requirements to plan for these matters in long-term plans, to ensure infrastructure and transport plans are integrated with climate change adaptation and natural hazard risk reduction planning.
69. The 2018 report of the Climate Change Adaptation Technical Working Group identified the importance of building Māori views into how to respond to climate change, and having a platform for expressing values and preferences for adaptation.^[231] Our proposals for Māori participation in the system generally discussed in chapter 3 include recommendations to ensure this can happen.

Increasing integration across the resource management system, and particularly with the CCRA

Addressing climate change mitigation and adaptation under our proposed Strategic Planning Act

70. Our issues and options paper sought feedback on the idea of using spatial planning for land use and infrastructure as a tool for addressing climate change mitigation, and for identifying adaptation responses to connect regulation with infrastructure provision and adaptation funding.
71. For climate change mitigation, some submitters saw opportunities to use spatial strategies to ensure infrastructure planning does not lock in long-term transport or energy emissions. Moving towards ‘green infrastructure’ and prioritising land suitable for use in generating carbon credits under the ETS were also suggested. Te Whakakitenga o Waikato Incorporated considered:

there is a role for high-level spatial planning to complement the NZ ETS in reducing greenhouse gasses. The panel should recommend that spatial planning specifically prioritise and target the type of land that should be utilised for the purpose of generating carbon credits under the NZ ETS.

72. For climate change adaptation, submitters saw opportunities to use spatial planning to ensure development does not occur in high-risk areas, including areas at risk of coastal erosion or on floodplains, and to provide for habitat and species migration protection.
73. Our proposal for a new Strategic Planning Act to improve integration across the resource management system is discussed in chapter 4. Our view is that this has the potential to be a valuable way to address climate change mitigation, adaptation and natural hazards. An important aspect of strategic planning under this new legislation is to integrate the provisions of the CCRA with regional combined plans under the Natural and Built Environments Act.
74. For mitigation, regional spatial strategies will be informed by emissions reduction budgets set under the CCRA so that long-term decision-making about land use and infrastructure is aligned with goals to reduce greenhouse gas emissions. In particular, this includes the need to ensure future transport and energy infrastructure supports the country’s transition to a low-carbon economy. This might be through identification of new sites for renewable energy generation, such as wind turbines. It might also be through planning for future transport infrastructure (roading, rail and ports, among other things) that will enable the efficient flow of people and goods in ways that are consistent with emissions reduction goals.

Regional spatial strategies under the Strategic Planning Act will allow a long-term and risk-informed lens to be used in strategic planning for climate change adaptation and natural hazards.

The value of our proposal for regional spatial strategies is to provide a platform for central and local government and mana whenua to reach agreement on these issues in a way that integrates competing priorities, including climate change mitigation, urban development, regional development and other environmental goals. Regional spatial strategies will then inform detailed planning for land use and infrastructure in our proposed Natural and Built Environments Act, under the LGA, and through central government budget processes.

76. For adaptation, regional spatial strategies will allow the national adaptation plan developed by central government under the CCRA to be translated into regional-level decisions in partnership with local government and mana whenua. To achieve communities and ecosystems that are resilient to the effects of climate change and natural hazard risks, comprehensive information over long timeframes (of 100 or more years) and integrated decision-making is needed. Regional spatial strategies under the Strategic Planning Act will allow a long-term and risk-informed lens to be used in strategic planning for climate change adaptation and natural hazards. This might include identification of areas where residential land use will no longer be possible in coming decades or where alternative servicing infrastructure will be needed. It might also include ensuring new habitats are available to support biodiversity in response to evolving ecosystems.
77. As in the case of climate change mitigation, our view is that adaptation and natural hazards planning is best pursued in a way that integrates competing priorities. Regional risk assessments consistent with the national risk assessment methodology under the CCRA should form an important aspect of regional spatial strategies and regional combined plans in a future system.

Improved legislative links

The Panel agrees there should be better alignment between the CCRA and a reformed RMA.

Our issues and options paper asked how the RMA should be amended to align with the CCRA. The New Zealand Planning Institute and some councils suggested formal links should be established between the RMA and CCRA, but also with the LGA and LTMA, to ensure that land use planning is consistent with infrastructure investment.

The Panel agrees there should be better alignment between the CCRA and a reformed RMA.^[232] Future national direction on climate mitigation and adaptation developed under our proposed Natural and Built Environments Act should be informed by the emissions reduction plan and national adaptation plan under the CCRA. This would ensure combined plans work towards our national climate change goals. That noted, addressing integration issues will require more than one plan connecting with another. In particular, improved integration requires bringing together important decision‑makers in relevant areas. This is an important aspect of our proposal for regional spatial strategies discussed above.

Addressing managed retreat under the Natural and Built Environments Act

80. Managed retreat is a particularly challenging adaptation and risk management response that is likely to be required in limited circumstances both for climate change adaptation and to respond to natural hazards risks more generally. Our issues and options paper raised the possibility that changes may be needed to how existing use rights and consented activities are provided for under the RMA to better enable managed retreat (including for natural hazard risk reduction for non-climate related hazards).
81. Many submitters supported developing a clear pathway for resolving these issues. For example, Auckland Council notes national direction about managed retreat would “provide certainty to affected communities, clear pathways and options for resolving issues, and better enable equitable outcomes for affected parties at a regional and national level.”
82. We have considered a range of ways managed retreat might be better facilitated under relevant legislative frameworks. In our view, while changes will be required to provide for existing uses and consented activities under the RMA, this will be insufficient by itself. A more comprehensive approach is required to allow a range of regulatory and funding mechanisms to be used concurrently. We first discuss the provisions in the RMA that will need to change to address managed retreat. We then discuss why a more comprehensive approach is necessary and our proposal for a new Managed Retreat and Climate Change Adaptation Act.

Changes to RMA protections for existing uses and consented activities in our proposed Natural and Built Environments Act

Developing a strategy for managed retreat will require consideration of a spectrum of possible changes to established uses.

Developing a strategy for managed retreat will require consideration of a spectrum of possible changes to established uses. This includes imposing conditions on the use of land, such as requirements to adapt residential uses through relocatable housing. It also includes decreasing the intensity of land use, for example, to replace commercial and residential uses with temporary and other activities which are less vulnerable. And it includes consideration of different land tenure mechanisms, such as sunset clauses to provide for transition periods. As discussed earlier, there is no clear pathway for developing these types of options under current RMA provisions.

To ensure central and local government have the necessary powers, our view is that following tools should be available under the Natural and Built Environments Act.

National direction should have power to modify or extinguish existing use protections and consented activities in circumstances relating to climate change adaptation and natural hazard risks.

National direction should have power to modify or extinguish existing use protections and consented activities in circumstances relating to climate change adaptation and natural hazard risks. This will enable central government to address these issues when a centrally driven solution is thought necessary (this is discussed further in chapter 7 on national direction).

Regional councils should also have a role in setting policy for the avoidance or mitigation of natural hazards and for climate change adaptation. Powers for regional councils to review and modify consents and conditions should also be strengthened (as discussed in chapters 5 and 11).

Territorial authorities should also be able to modify or extinguish established land uses in these circumstances.

Territorial authorities should also be able to modify or extinguish established land uses in these circumstances as discussed in chapter 5. As noted above, there is no power at the territorial authority level to modify or extinguish existing activities or consents through use of a district land use rule. This can frustrate the ability to manage activities that are no longer considered appropriate in a particular location. Addressing this requires an extension of the current powers of territorial authorities and an associated amendment to the protections for existing land uses provided under section 10 of the current RMA. Our view is that this is warranted in these limited circumstances if territorial authorities are to have responsibilities for land use regulation for climate change adaptation and natural hazards.

Section 85 of the RMA will also require clarification in these circumstances. Under section 85, provisions in plans can be challenged on the basis they would make land ‘incapable of reasonable use’ and place ‘an unfair and unreasonable burden’ on a person who has an interest in the land. Conditions that may lead to the need for managed retreat, such as inundation from sea level rise, are inherently uncertain in magnitude and timing even if the eventual outcome is inevitable. The current section 85 creates what has been termed a “timing conundrum”^[233] as, in the absence of a risk reaching a certain level, it may not be possible to act proactively through imposing planning provisions. And yet when the risk is realised the opportunity to take proactive (and more cost-effective) action has passed. In chapter 5 we note that section 85 should be reviewed more generally but in the specific context of managed retreat, the operation of section 85 (or its replacement in the Natural and Built Environments Act) should be addressed in the proposed separate legislation for managed retreat which we discuss below.

85. These changes will ensure that the necessary powers are available under the RMA. However, we anticipate they will be used in conjunction with a more comprehensive response involving central and local government developed under the separate legislation we propose.

A Managed Retreat and Climate Change Adaptation Act

86. Many complex matters need to be addressed in cases of managed retreat. These include issues relating to funding, land acquisition, compensation, liability, and insurance, both for land owners and local authorities. There is also a need to consider the obligations on local government to maintain infrastructure services in areas under threat.

We consider that discrete legislation is required to specifically address managed retreat where it is required for climate change adaptation or to reduce risks from natural hazards.

While the changes we propose to land use planning will assist, we consider that discrete legislation is required to specifically address managed retreat where it is required for climate change adaptation or to reduce risks from natural hazards. We suggest this be called the Managed Retreat and Climate Change Adaptation Act. In summary, we reach this conclusion for these main reasons:

• it is necessary to address an array of complexities that are beyond the powers available under the Natural and Built Environments Act and the capacity of local government alone to deliver. These include the issues we have discussed in the preceding paragraph
• there is a need for a consistent approach developed at a national level
• issues associated with land acquisition in affected areas and the potential for compensation are likely to arise and should be addressed by both national and local government
• the definition of a ‘public work’ under the Public Works Act 1981 and its valuation approach appear to be an awkward fit as we discuss below
• section 85 of the RMA (or its replacement under the Natural and Built Environments Act) is not well adapted to the managed retreat context as we have noted above.

There is a strong case for establishing a national funding mechanism for pre-emptive adaptation and risk-reduction measures.

Perhaps the most significant issues are funding and compensation for affected communities. In many cases the cost of responding to climate change and natural hazard risks exceeds the ability of the local population base to fund and deliver solutions, particularly in coastal areas.

LGNZ, EDS and the Productivity Commission have all recommended a central fund to assist with climate change adaptation, including the redesign, relocation and rebuild of three-waters, flood protection, and local infrastructure and assets. LGNZ estimated in 2013 that $1 spent on risk reduction saves at least $3 in future disaster costs (but there will be a limit to this).^[234]

Our view is that it is untenable to let adaptation costs lie where they fall, and a systematic approach is preferable to ad hoc solutions. Given the scale of the challenges and the current constraints on local government, there is a strong case for establishing a national funding mechanism for pre-emptive adaptation and risk-reduction measures.

We agree with Boston and Lawrence^[235] that funding should have the goals of long- term cost-minimisation and equitable burden sharing. Relevant underlying principles to guide decision-making include:

• avoidance of ‘moral hazard’
• the 'benefit' and 'subsidiary' principle (balanced against considerations of the ability to pay)
• fairness and equity including across generations, and
• the principles of the Treaty of Waitangi.

92. Decisions would need to be context specific and based on local risks, the vulnerability of local communities and assets and ability to pay. This will require cost-sharing arrangements between central and local government and private or commercial agencies to be developed.

Consideration should also be given to the use of economic instruments that can provide incentives to modify behaviour over time, in addition to the use of regulatory controls.

The definition of a public work under the Public Works Act 1981 and its approach to the valuation of land appear are not well suited to climate change adaptation and natural hazards. This is because in many cases, the response to these issues will not come within the definition of a public work. Further, in the high-risk situations in which managed retreat is likely to be needed, the land in question is likely to have lost much of its value. The Public Works Act requires payment at market value, and in cases where this is significantly diminished, it will likely be insufficient to enable affected people to move on with their lives by re-establishing themselves elsewhere.

The new legislation we propose could establish principles that are better tailored to these circumstances than those in the Public Works Act and would also address the application of the equivalent to section 85 in our proposed Natural and Built Environments Act where severe restrictions on land use are necessary.

Finally, the complexity of the issue suggests consideration should also be given to the use of economic instruments that can provide incentives to modify behaviour over time, in addition to the use of regulatory controls. For example, targeted rates might be used to fund local adaptation solutions for those willing to bear the costs in cases where risks are not yet deemed unacceptable.

In our view, the main issues new legislation would need to address are therefore:

• a fund to support climate change adaptation and reducing risks from natural hazards, including principles for cost-minimisation and burden sharing, and cost-sharing arrangements
• power under the proposed Natural and Built Environments Act to modify existing land uses and consented activities
• power to acquire land, with potential compensation determined through specified principles rather than market-valuation
• power to use taxes, subsidies or other economic instruments to incentivise changes in land and resource use
• engagement with affected communities
• engagement with Māori to address cultural ties to land
• impacts on insurance arrangements for land owners and local authorities
• obligations on local authorities to provide infrastructure
• liability issues for local authorities
• the potential role of the Environment Court for aspects of the proposals.

Implementation support for local government

97. Finally, the capability and capacity of local government to lead a response to climate change adaptation and certain natural hazards risks was a significant concern for local government submitters. Considerable efficiencies can be achieved by developing a centralised pool of expertise to assist local government with policy development for climate change adaptation, including the ability to apply experience, broker partnerships, and supply templates, information and other common resources. For example, the Climate Change Adaptation Technical Working Group recommended incorporating consideration of the future costs of climate change into current investment criteria to help manage risk.^[236] This would promote better long-term thinking. Central government is well placed to develop mechanisms and practice guidance to take this forward.
98. Our proposals for national direction for climate change adaptation and natural hazard risk is one vehicle through which assistance can be provided. However, our view is that implementation support, and guidance on a broader range of matters beyond environmental management and land use regulation will be needed.

Expected outcomes

99. Our proposals in relation to climate change mitigation, adaptation and natural hazards address key issues raised in our terms of reference and align with the objectives and principles adopted for our review. They will ensure climate change and natural hazards are given sufficient focus and attention within a future system, are addressed in ways that integrate with broader land use and infrastructure planning by central and local government, and that the necessary range of regulatory and funding tools are available to decision-makers.

Key recommendations

Chapter 7 National direction

1. The RMA devolves decision-making about resource use to local authorities but central government is able to provide guidance by setting policies on issues of national significance and environmental standards. These policies and standards are collectively called ‘national direction’. They include national policy statements (NPSs), national environmental standards (NESs), national planning standards and regulations.
2. This chapter discusses how national direction in a reformed RMA may be used more effectively to achieve intended outcomes.
3. Our proposals in this chapter should be read in conjunction with chapters 2 and 3, which relate to the purpose and outcomes to be achieved through a new resource management system, and recognising Te Tiriti. However, there are also linkages to chapters 4, 8, 9 and 13 as national direction is intended to be influential in guiding the preparation of plans, decisions on resource consents, and monitoring.

Background and current provisions

Origin and current role of national direction

National policy statements and national environmental standards

4. The RMA provisions for national direction were developed as part of a response to problems identified by the Resource Management Law Reform Project (RMLR) in the late 1980s, which eventually led to the RMA.
5. The RMLR identified a need for central government to determine priorities and make clear decisions about the overall outcomes it wanted to achieve for resource management. The RMLR considered there was a lack of an effective mechanism for identifying, expressing and resolving matters of national interest, and this had contributed to a failure of the resource management system operating at the time.
6. The types of issues identified by the RMLR thought to have significance at the national level were those that no one region or sector group would provide for. It was argued “if the Crown does not represent the national interest, who will?” The issues fell into four categories:^[237]
   • broad objectives in law to guide the overall resource management regime
   • global or national environmental policy requiring recognition in the decision-making process
   • projects or proposals for consents having a ‘national importance’ dimension
   • first order allocation decisions such as the designation of land in the Crown conservation estate.
7. Examples included national responses to global environmental problems, the preservation of wetlands, and the protection of indigenous forests. The RMLR’s findings provided the rationale for listing some broad environmental management objectives as matters of national importance in section 6 of the present RMA, as well as for the development of the NPS mechanism.
8. In designing the RMA, a balance was needed between over prescription of national policy and avoiding ad hoc decision-making. It was decided a distinction would be made between matters of national importance specified in resource law, and matters of national policy emerging from time to time.^[238] The law would specify how these matters would be taken into account by decision-makers.^[239]
9. By the time the Resource Management Bill was introduced in 1989, the purpose of NPSs was being described as guidance or the expression of the government point of view on matters of national significance.^[240]
10. The development of minimum environmental standards (which became NESs) and statements of national policy (now called national policy statements (NPSs)) was intended to be closely linked. The review group appointed to review the bill envisaged detailed NESs, which were technical and prescriptive in nature, would not be suitably expressed through NPSs. These were intended to be more narrative.^[241] NPSs could be used to establish objectives and policies relating to NESs and to support prescriptive standards laid down by other means such as regulations or rules in local authority plans.
11. NESs and NPSs were therefore intended to be complementary, with the NPS providing the overarching narrative, and the NES providing the national ‘rules’. This, along with the way in which NPSs and NESs would need to be implemented (the former having to be translated into plans by way of plan changes, while the latter could have direct effect as a regulation), was the reason for separating NPSs and NESs. Although standards could be prescribed in regulations, it was recognised this would not always be feasible.^[242]
12. Although the purpose and expression of NESs and NPSs are still different today, the passing of the Resource Legislation Amendment Act 2017 saw the introduction of a single consultation and board of inquiry process for both NPSs and NESs. This change was intended to increase flexibility in developing national direction and improve the integration of NPSs and NESs related to the same topic. The amendments also enabled NPSs to provide more specific direction on how objectives and policies were to be given effect to, that is, through methods, or by setting constraints or limits.

Regulations

13. Regulations are a form of delegated legislation subject to primary legislation and were part of the design of the RMA from the start (appearing as clause 390 in the Resource Management Bill). Regulations are generally intended to be for matters of detail and the implementation of policy, and not the means of making policy itself.^[243] The original regulation-making powers in the RMA were consistent with this approach and were intended to prescribe administrative matters but they also allowed for the setting of some standards.
14. Section 360 of the RMA sets out the matters for which regulations may be made. Between 1993 and 2017 this section has been amended on more than 12 occasions, doubling its length. Over this time, section 360, and later sections including 360A and 360D, have become an ad hoc collection of administrative matters and more substantive powers (such as the exclusion of stock from waterways, placing aquaculture provisions into plans and prohibiting or permitting discharges from ships).

Planning standards

15. National planning standards were introduced into the RMA in 2017.^[244] These are a standardised national framework for RMA policy statements and plans intended to provide greater national consistency, reduce complexity and cost, and help make plans more user-friendly. Before the introduction of the national planning standards there was very little national guidance on how councils should structure or format planning documents.^[245]
16. The first set of national planning standards, gazetted in 2019, was on the structure and form of plans, some common definitions and required plans to be made accessible online.
17. Sections 58B–58J of the RMA set out the purpose, scope, contents and process for developing the national planning standards. They enable further national planning standards to be developed for any matter the Minister considers requires national consistency, or is needed to support the implementation of national direction.

Summary of the types of national direction

18. As shown in table 7.1, each of the four types of national direction available under the RMA has its distinct characteristics but overlap in terms of content.

Table 7.1: Overview of current RMA national direction instruments

Issues identified

Insufficient national direction

Historic lack of national direction

19. The lack of national direction to support the purpose and principles of the RMA has been a key issue in the implementation of the Act. As noted by the Environmental Defence Society (EDS) in 2016, it “left the 78 regional and local government agencies to formulate their policies and plans in the absence of any clear notion of the end game”.^[248] This resulted in inconsistencies in the way the environment is managed, and created duplication of effort among councils and additional litigation (along with the associated costs and diversion of scarce resources from other priorities).
20. Until 2013 central government was slow to develop NESs and NPSs. Only the mandatory New Zealand Coastal Policy Statement (NZCPS) was in existence prior to 2004. Explanations as to why the government has been slow have ranged from lack of will to lack of resourcing to prepare national direction and to cumbersome NPS development mechanisms.^[249]
21. Although there has been an increase in national direction since 2013, the historic lack of national direction is still commonly cited as a reason why the RMA has not been as efficient or effective as it should have been. Submitters on our issues and options paper largely supported this view and made comments such as:

Until recently, the lack of national direction has been a considerable issue with the RMA. This has led to poor environmental outcomes and long and expensive processes dealing with resource management matters that could have been resolved by national direction. (Canterbury Mayoral Forum)
...a lack of national direction has led to duplication and inconsistency with RMA policy and planning documents developed by local authorities. This has resulted in increased cost for councils, communities and resource users which has not necessarily led to better environmental outcomes. (Fonterra)

Gaps in national direction

The historic lack of national direction is still commonly cited as a reason why the RMA has not been as efficient or effective as it should have been.

Sections 6 and 7 of the RMA set out matters of national importance and other matters decision-makers must have regard to in making decisions. While the existing set of national direction topics covers some matters of national importance, there are clear and notable omissions. These include biodiversity, landscape, historic heritage, the effects of climate change, and the management of significant risks from natural hazards.

A particular gap in national direction identified by the Productivity Commission was how local authorities should put provisions relating to Te Tiriti into practice.^[250] This theme was also picked up by a number of submitters on our issues and options paper, such as the Albert-Eden Local Board and the Independent Māori Statutory Board in Auckland, Te Korowai o Ngāruahine Trust, Patuharakeke Te Iwi Trust Board Incorporated and Forest & Bird.

Other submitters also made suggestions as to what they saw as gaps in national direction. Those gaps included climate change adaptation, urban form, spatial planning, infrastructure, noise controls, food production and assessing cumulative effects.

Lack of strategic oversight and coordination

25. Since 2013 the number of national direction instruments promulgated or under development has increased considerably. However, it is not clear when national direction should be developed, and in what order it should be prioritised.
26. The approach to deciding which issues to prioritise for national direction has tended to be ad hoc and reactive. At times, this has resulted in the development of national direction driven by the priorities of particular groups or agencies, rather than what is in the best interests of the resource management system, the environment or what is most needed to implement the RMA successfully.

The approach to deciding which issues to prioritise for national direction has tended to be ad hoc and reactive. At times, this has resulted in the development of national direction driven by the priorities of particular groups or agencies, rather than what is in the best interests of the resource management system, the environment or what is most needed to implement the RMA successfully.

Some submitters on our issues and options paper commented that the current system is heavily influenced by the wider political environment, which results in frequent changes in direction and priorities.

There are currently 21 national direction instruments with a further 11 under development (this includes 4 amendments or replacements of existing instruments). Taken as a whole, the current collection of national direction instruments is neither cohesive nor functioning effectively or efficiently. As more national direction is released and comes into effect the risk of conflict and increasingly complex interactions between and within national direction instruments increases.

Local authorities and others trying to comply with RMA requirements have said the ad hoc approach to developing national direction has made it difficult to balance competing requirements (for example, those in the NPS on Urban Development Capacity and the proposed NPS on the protection of highly productive land). Both EDS and the Productivity Commission argue councils are finding it difficult to balance important and less important environmental and resource management matters, and a lack of guidance on prioritisation in the system exacerbates this confusion.^[251]

The need for alignment was a particularly strong theme in submissions on our issues and options paper from industry groups, local government and resource management professionals. Some submitters said although national directions should not conflict, where they do, there should be clear guidance in national direction on which takes precedence. An overarching national direction framework, possibly in the form of a Government Policy Statement, was suggested as a possible solution. An example of comments received from submitters included:

In our view, issues are now with a lack of coordination, alignment, consistency and clarity within the overall government programme of national direction. We consider there is a place for greater clarity and certainty through defined additional matters of national direction, and greater coherence and consistency between existing matters, but that is not to say we support an influx of additional direction. It is about getting the programme itself right, rather than an inundation of new matters.
We are open to further considering the Environmental Defence Society’s suggestion for the set of national policy statements to be delivered through a single Government Policy Statement. We agree that there is potential for this to enable strategic direction across the programme and better enable councils to translate these into lower level planning instruments. (Federated Farmers)

National direction is slow to develop and insufficiently directive

31. The development of NPSs and NESs is fragmented and slow^[252] and as a result these instruments become unresponsive to emerging issues, technologies and trends.

The development of NPSs and NESs is fragmented and slow and as a result these instruments become unresponsive to emerging issues, technologies and trends.

As noted, the 2017 amendments to the RMA enabled a single consultation process to be undertaken for NPSs and NESs and removed the need for a two-step process for national policy statements. The policy intent of the changes was to speed up the development of national direction instruments, improve integration and reduce costs where instruments are developed concurrently.^[253]

As a result of these amendments, both a NPS and a NES can be developed using either a board of inquiry process or following an alternative process which incorporates a requirement for iwi and public input to proposals.

We received comments from some submitters raising concerns over the robustness of the alternative process for developing national direction, which has not traditionally seen submitters being heard (as there is no explicit legislative requirement for hearings). A number of submitters suggested national direction should be developed using a board of inquiry process that includes a hearing.

The 2017 RMA amendments also made changes to allow NPSs to provide more specific direction on how objectives and policies are to be given effect by local authorities. For example, by methods or specific requirements councils must apply or by direction requiring a council to monitor and report on matters relating to the NPS.

36. These provisions were used in the 2017 amendments to the NPS for Freshwater Management 2014 and enabled the NPS to set a national objectives framework and require regional councils to use specific methods for monitoring freshwater.

Time and cost to implement and effect change

37. In a devolved system, implementation of national direction is by local authorities through plan documents and making decisions on resource consent applications.
38. Local government submitters raised concerns with the constant cycle of change to implement new or amended national direction and the significant costs involved. An example was given of national direction for freshwater, which was promulgated in 2011, amended in 2014 and 2017, with another set of amendments now being considered.
39. NPSs must be ‘given effect to’ through local planning documents. In almost all cases this requires a full plan change process, although some objectives and policies can be inserted directly into plans. Plan-making is time consuming, and this results in significant delay before the effects of NPSs are seen. This is particularly concerning for issues where the environment is already under pressure.
40. NESs are regulations and take effect on commencement. These directly override existing local authority rules (unless specified otherwise), and are able to require some types of existing consent to be reviewed. However, a NES does not override the existing objectives and policies in local authority plans. This can create inconsistencies that can only be resolved by the local authority changing their plan to better align with the NES provision.
41. The impact of national direction is further hampered by the concept of existing use rights in the RMA. Generally existing consents prevail, although a NES can trigger a review of certain types of consents. National directions have little power to override existing use rights for many types of permitted land use, except if a land use has been discontinued for a period and plan provisions have changed during that time.
42. Fast developing societal or environmental challenges require a faster response than can be provided using the current national direction tools.
43. A number of submitters on our issues and options paper referred to the significant costs for local authorities to implement national direction and the impact of the number of amendments and changes occurring in national direction. Smaller local authorities in particular have found these changes burdensome and consider greater support should be given to local authorities. For example:

Horowhenua District Council also seek that national direction be accompanied by a greater level of central government support, both in the form of implementation guidance and assistance and in the form of financial support. The extent of national direction being imposed on local government at present has the potential to have a significant cost impact for local communities and in instances where these costs reach the point of being unaffordable, and will likely come at the expense of locally focused action that responds to more pressing local issues.

Insufficient monitoring, evaluation and feedback loops

44. Current practice for monitoring and evaluation of individual national direction instruments is variable and inconsistent. The national direction programme does not have clear, measurable overall outcomes against which its performance can be assessed. Monitoring of individual instruments is irregular and it is difficult to source data and evidence on a national basis.
45. Section 24(f) of the RMA is one of the few provisions in the Act indicating the Minister for the Environment has the function of monitoring the effect and implementation of national direction. However, this provision is worded very generally, and is complemented by the even more generally worded section 24(ga), which enables the Minister to monitor and investigate any matter of environmental significance as the Minister sees fit.
46. Neither section 24(f) nor section 24(ga) specifies a duty for national direction to be reviewed within a set timeframe. As such, monitoring is not generally prioritised by central government. This has meant important feedback needed to evaluate the effectiveness of existing national direction, or inform future national direction, has tended to be ad hoc. In our view, this is a risk to achieving good environmental outcomes and is inconsistent with the purpose of the RMA.

Options considered

47. From consultation and submissions on our issues and options paper, we have identified options under the following topics:
    • clarify the role of national direction and improve the distinction between the different types of national direction
    • improve the efficiency and effectiveness of national direction
    • require a mandatory set of national direction including a NPS on Te Tiriti
    • deliver aspects of national direction through a single combined instrument
    • improve the processes for developing and reviewing NPSs and NESs.

Discussion

Clarify the role of national direction and improve the distinction between the different types

There should be a single purpose for national direction in a reformed RMA to set objectives, policies, limits, targets, standards and methods in respect of matters of national significance.

A single, clear purpose statement for national policy statements and national environmental standards

48. National direction under the RMA has various purposes which either differ slightly in wording or, for some instruments, appear to be absent or must be implied from the sections relating to their content or development.
49. National direction should help guide decision-making at all levels of the system on matters of national significance that are best addressed at national level for consistency and efficiency.
50. In our view there should be a single purpose for national direction in a reformed RMA. For NPSs and NESs, that purpose should be to set objectives, policies, limits, targets, standards and methods in respect of matters of national significance to achieve the purpose of the Natural and Built Environments Act and give effect to our proposed principles. Indicative drafting for this purpose is provided in appendix 3 to this report.

Clearer distinctions between the role of national direction instruments

51. Since the enactment of the RMA in 1991 the number, role and content of national direction instruments has expanded and they increasingly overlap with each other, for example:
    • the breadth of content able to be included in NPSs has expanded, and the provisions have taken on more directive forms
    • the scope of the content able to be included in NESs has also broadened
    • regulation-making powers have been added progressively which move beyond administrative matters into more substantive issues
    • new national planning standard provisions have been added which enable standards to cover some of the same material as NPSs and NESs.

The Panel considers a clearer distinction should be made between the respective roles of NPSs and NESs, including roles in setting environmental limits and environmental targets.

The Panel considers a clearer distinction should be made between the respective roles of NPSs and NESs, including roles in setting environmental limits and environmental targets.

We are concerned the current use of regulations and national planning standards is taking them well beyond the administration and implementation support functions for which they were originally intended. Unless the role of these instruments is narrowed and more clearly defined there is a risk they will be used as a substitute for NPSs and NESs whenever the more intensive analysis and scrutiny associated with these appears inconvenient.

We recommend the four existing types of national direction be retained, but their roles and use be should more distinctly defined as outlined in table 7.2.

Table 7.2: Proposed roles of national instruments under a reformed RMA

55. We emphasise the array of national direction instruments is intended to be complementary. For example, an NPS should be able to be accompanied by a NES when desirable. This would ensure rules, limits and standards are accompanied by objectives, policies and narrative important to guide local policy and decision-makers.
56. We consider having a clear purpose for national direction and making the roles of all four national direction instruments more distinct will:
    • set a clearer direction for decisions as to which form of national direction should be used
    • help ensure functions and processes for setting national direction are efficient, effective and proportionate to the significance of the matter at issue
    • reduce the risk of unintended consequences arising out of using the wrong national direction instrument
    • make better use of existing national directions, so avoiding the disruption associated with substituting an entirely new set of national directions.

Improve the efficiency and effectiveness of national direction

Greater use of directive national policy statements and national environmental statements

57. A range of submitters on our issues and options paper, such as resource management professionals, Fletcher Building Limited and Ngāti Whātua Ōrākei, broadly supported greater use of directive national instruments. However there were differing views on how far these should go. For example, Auckland Council supported more directive instruments for matters where scientific measurement is required while other submitters considered there should be provision for local flexibility.
58. However some submitters (West Coast Regional Council, Kāpiti Coast District Council) raised concerns the use of more directive instruments will increase the broad-brush approach, which does not necessarily achieve good outcomes for all regions. National direction tends to be a blanket ‘one size fits all approach’. Regional differences need to be incorporated into any national direction approach.
59. There are different ways to provide for greater use of directive instruments in any new system and a balance is needed between setting clear direction to guide decision-making and maintaining appropriate levels of subsidiarity.
60. The 2017 amendments to the RMA enabled NPSs to be more directive, but to date the provisions have only been used once for the 2017 NPS for Freshwater Management (and are currently being considered for the amendments to the NPS on Urban Development Capacity). These changes allow for greater specificity within NPSs and better support councils to implement national direction. We consider more use could be made of directive instruments in future.

Clarifying the scope of regulations and their development process

61. The Panel notes the scope and complexity of regulations within the RMA have grown significantly since the Act first came into force. In our view, the use of regulations under the RMA has become incoherent and prone to misuse or overreach. While regulations may be quicker to make and change than a NPS or NES, we are concerned:
    • the content of regulations has crept beyond the scope of the subject matter for which regulations are generally intended
    • the process for making them can often circumvent opportunities for public input on what can be important matters of policy.

Regulations should be returned to the more traditional role of supporting the implementation of legislation through prescribing the detail of administrative matters.

Under the Natural and Built Environments Act, regulations should be returned to the more traditional role of supporting the implementation of legislation through prescribing the detail of administrative matters. These are not substantive policy issues so do not require the more complex and robust processes associated with the preparation of legislation, NPSs or NESs.

63. The matters we envisage should be covered by regulations include:
    • forms and notices associated with various processes under the Natural and Built Environments Act
    • fees and administrative charges (including how they are to be calculated and the circumstances under which they may be waived, postponed or refunded)
    • infringement fees for minor offences (but not the offences themselves)
    • coastal occupation charges and charges for the occupation of the beds of lakes and rivers.
64. However there are still some circumstances where regulations should be able to cover more substantial policy issues, for example where quick action is needed to meet international obligations, manage an immediate risk of significant environmental damage or risk to safety, and legislative, NPS or NES processes would take too long to come into force.
65. The making of regulations on any of the more substantive environmental policy matters should provide for public input as the regulations may have significant implications for the environment and the rights of people to undertake activities or enjoy the use of their property.
66. It is important the use of regulations to address urgent environmental policy matters does not complicate the administration of the Natural and Built Environments Act or confuse the distinction between regulations and NPSs and NESs, by becoming a convenient and permanent substitute for a more fulsome policy process. We therefore consider regulations on any substantive policy matters should incorporate a sunset clause or review clause tied to the time it would take to complete legislative changes or a NPS or NES to replace the regulation.
67. Assuming the above approach is taken, the Panel considers the regulation-making powers of the type found in sections 360A to 360H of the RMA are too broad and not necessary. If national direction is required on the subject matter of those sections then it should be provided for either in principal legislation or in a NPS or NES.

Making the role and development process for national planning standards clearer and more robust

68. Submitters on our issues and options paper gave general support to the use of planning standards to facilitate nationally consistent plan content. A number of submitters recognised the national planning standards could be used to achieve greater consistency in interpretation, implementation and application of national direction, and can support addressing issues that are common across the country. Auckland Council noted the planning standards are useful as they allow councils and communities to focus on more strategic issues.
69. The RMLA submitted that greater vertical and horizontal integration is needed across planning documents. Better horizontal integration can be achieved, for example, through the use of consistent structure and definitions. The first tranche of national planning standards was useful in this regard. The RMLA would support more national direction, particularly on rule structure and the status of particular activities.
70. We agree national planning standards serve a useful purpose in supporting the implementation of resource management legislation but are concerned:
    • their scope is too broad^[254] and they risk straying into substantive policy matters more appropriately addressed through other national direction instruments
    • the provisions related to them (currently sections 58B–58J) are overly complex and detailed.

Clarifying the content of national planning standards

71. We consider NPSs and NESs should be the primary instruments for substantive policy matters, with the national planning standards and regulations supporting implementation of primary legislation, NPSs and NESs.
72. The content of national planning standards should be limited to match the supporting role and purpose we envisage for them, which is to:
    • set standards to achieve a common plan structure, format and layout
    • provide for consistent expression of terminology through a set of common definitions
    • set standards to achieve consistency in map presentation (from example, size, colours and symbols)
    • set out requirements as to plan availability and accessibility.
73. We also consider national planning standards have a worthwhile role in specifying the use of common standards or rules that are minor and technical in nature, and for which there appears to be no benefit in having local variations.

NPSs and NESs should be the primary instruments for substantive policy matters, with the national planning standards and regulations supporting implementation of primary legislation, NPSs and NESs.

Technical national planning standard provisions could include matters such as the approach to measuring noise or light spill. We believe these could replace the practice of individual local authorities having to go through a full plan preparation or plan change to incorporate material that exists in New Zealand Standards such as NZS6802:2008 (which relates to noise) or NZS4282:2019 (which relates to lighting). As we discuss in chapter 8, national planning standards could provide guidance on evaluation methods in the assessment of policies and plans.

75. Flexibility should be provided in national planning standards to incorporate non-regulatory guidance to enable the provision of additional assistance and direction to councils. This could follow a variation of approaches used overseas, such as the South Australian Planning Policy Library.^[255] Such guidance could be useful in helping councils understand what is expected of them when drafting plans, or indicating where provisions from NPSs or NESs may be relevant to a particular matter.

A clearer, robust process for developing national planning standards

76. Provided national planning standards do not venture into more substantive policy matters and rules which have a material impact, their development does not need to follow a board of inquiry process. However, oversight by an independent expert panel should be an essential component of the development process to ensure what is produced reflects best practice and is objective in both approach and content.
77. The process for developing national planning standards should be made clearer, quicker and more certain. Our view is the following process should be followed.
    • The Minister for the Environment establishing the need for and purpose of any new national planning standards. In making this determination, the Minister should not make a planning standard unless it:
      • ‒ is required to support the administration or implementation of the Act, a NPS or NES

The process for developing national planning standards should be made clearer, quicker and more certain.

relates to plan accessibility, plan presentation (format, structure, layout or mapping standards), or technical or minor policy matters which are not more appropriately managed through principal legislation, a NPS or NES

will promote a nationally consistent approach to the matter to which the standard applies.

• Development of the national planning standard being overseen by an advisory group with appropriate knowledge and expertise in the matter to which the national standard will relate and representatives of the main stakeholder groups.
• An ability to invite stakeholder comments on a discussion document.
• An evaluation such as a section 32-type report or regulatory impact statement being prepared in relation to the content of the national planning standard.
• The advisory group making recommendations to the Minister for the Environment that a planning standard be made and gazetted and those recommendations being made public.
• The Minister for the Environment making a decision whether to accept, reject or accept in part (or with modifications) the recommendations of the advisory group.

78. We are of the view that planning standards should be in place before plans are reviewed to comply with the Natural and Built Environments Act.
79. Development and use of national planning standards along the lines we recommend will:
    • help provide clearer national direction under the Natural and Built Environments Act by better supporting the implementation of NPSs and NESs
    • provide for efficient responses to issues through the ability to standardise approaches to plan structure and definitions where the use of a board of inquiry is unnecessary
    • be workable, cost-efficient (in terms of reducing duplication and unnecessary processes for central government and local government) and will avoid disruption as they build on an existing approach which submitters have said works well.

A mandatory set of national directions

We recommend a mandatory set of national directions on the matters listed in section 9 of our proposed purpose and principles. We also recommend retaining the Minister’s ability to issue national directions at his or her discretion on other matters of national significance where a need has been demonstrated.

The term ‘mandatory national direction’ used in this report refers to national direction instruments which a Minister must, by law, prepare and issue. Legislative requirements regarding mandatory national direction take different forms around the world, but a notable example is the requirement for the Secretary of State in the United Kingdom Environmental Bill 2019 to issue and report on targets for defined environmental matters.

The only mandatory national direction under the RMA has been the NZCPS prepared and administered by the Minister of Conservation. The first NZCPS was issued in 1994, a review was completed in 2010, and a further review is currently under way.

The concept of mandatory national direction was one of the more popular options supported by submitters on our issues and options paper. Most of those who chose to submit on this option supported it, for example:

Providing for mandatory national direction would streamline and reduce complexity across the resource management system and would complete the framework architecture of the RMA by putting in place a suite of national planning instruments designed to set standards and maintain and enhance environmental quality. Absent mandatory national direction, the RMA is unlikely to deliver sustainable outcomes in a timely way. The relative absence of national direction under the RMA has left a policy vacuum that has been filled by experimentation by local authorities via regional and district plans. (Dr Trevor Daya-Winterbottom)
It is critical that there is more mandatory national direction and setting of environmental standards at the highest level to aid in environmental protection. The failure of the RMA over the past 30 years to protect the environment is in large part due to a lack of mandatory national direction. There needs to be strong NPS’s, on all domains covering matters of national importance. (New Zealand Fish & Game Council)

83. Overall, we consider a set of mandatory national directions would:
    • set clear direction to guide decision-making
    • provide greater recognition of Te Tiriti and te ao Māori
    • make functions and processes more efficient and proportionate by ensuring more matters of national importance are determined at the national level, and by reducing unnecessary duplication of effort by local authorities.
84. We recommend a mandatory set of national directions on the matters listed in section 9 of our proposed purpose and principles. We also recommend retaining the Minister’s ability to issue national directions at his or her discretion on other matters of national significance where a need has been demonstrated.
85. We discuss two important cases of mandatory national direction briefly below: A mandatory New Zealand Coastal Policy Statement and mandatory national direction on Te Tiriti o Waitangi. Mandatory national direction for climate change is discussed in chapter 6.

A mandatory New Zealand Coastal Policy Statement

86. We recommend that preparation of the NZCPS should continue to be mandatory in the Natural and Built Environments Act.
87. The Minister of Conservation would retain responsibility for the NZCPS in recognition of the role of the Minister in the management of the coastal marine area, and the Minister’s role in approving regional coastal plans (or the equivalent provisions in a future combined planning document).
88. To better recognise and provide for integrated management and the overall responsibility of the Minister for the Environment for the resource management system as a whole, we recommend the development and monitoring of the NZCPS be the responsibility of the Minister of Conservation in consultation with the Minister for the Environment.
89. As the NZCPS represents an overarching statement of the government’s environmental priorities and management approach to nationally important coastal issues, we are of the view the NZCPS must include environmental limits for the matters listed in section 8 of our proposed purpose and principles.^[256] We consider limits should be set by the Minister of Conservation in consultation with the Minister for the Environment.

Mandatory national direction on Te Tiriti o Waitangi

90. The principle of partnership between Māori and the Crown inherent in Te Tiriti is well established. The development of a NPS should, amongst other things, enable more effective contribution and participation of Māori in environmental policy, planning and management, and monitoring.
91. We consider it is important a NPS on Te Tiriti be developed with Māori and this should be provided for in the Natural and Built Environments Act. This is discussed further in chapter 3.

Deliver aspects of national direction through a single combined instrument

All national policy statements and national environmental standards
in one document

92. This option would consolidate national direction into a single instrument, and has previously been considered by the Productivity Commission and EDS.
93. Submissions on our issues and options paper expressed broad support for a single combined instrument. Submitters considered this could be used to coordinate topics of national importance and provide a long-term approach, while reducing the number of documents. For example:

... council believes the preparation of a combined instrument such as a Government Policy Statement would assist central government in tackling the integration challenge/opportunity previously mentioned, and therefore sees potential merit in such a document. Council supports central government further exploring the option of delivering national direction through a single combined instrument. (Auckland Council)
...further consideration should be given to the adoption of a Government Policy Statement to provide an integrated understanding of the key resource management directives of the Government. This approach would be preferable to a selection of national policy statements that create unresolvable tensions for decision-makers on resource consent applications and district / regional planning documents to resolve. (Tilt Renewables)

94. Conversely some submissions raised concern with a single combined NPS and NES instrument, namely that it would result in a more high-level document that would lose its purpose and value.
95. In its Better Urban Planning report^[257] the Productivity Commission investigated whether a single government policy on environmental sustainability could replace the existing NPSs and NESs. The Commission concluded a single document could become unwieldy and would not be an appropriate model for setting environmental standards.
96. Our work has been informed by the United Kingdom’s National Planning Policy Framework (NPPF). This replaced the previous set of guidance with one document which sets the overall direction for the planning system and introduced the concept of sustainable development. The NPPF has been criticised for being too high-level, overly focused on housing delivery and providing insufficient direction to guide the system long term.
97. We consider the delivery of all national direction through a single document creates notable drawbacks by:
    • creating an overly lengthy and complex document
    • delaying some provisions from coming into effect as they may be dependent on the preparation of provisions in other parts of the document that are not yet developed
    • creating a situation where a challenge to one part of the combined document would hold up provisions that would have been beyond challenge if they were in a separate document.

Instead of replacing all existing national direction instruments with a single instrument the Panel considers many of the benefits of a single document could be replicated through having all NPSs and NESs in the same place so they can be viewed together.

Transpower Limited, drawing on its experience of national planning standards, said consolidating national direction into one government policy statement would result in a more high-level and less helpful document. Transpower noted efforts to address a range of matters through national planning standards were pared back to a bare minimum in the face of opposition.

However we agree better integration is needed across the set of national directions. National direction should form a coherent package and provide the link between the outcomes, targets and environmental limits set out in the purpose and principles of the Natural and Built Environments Act and their implementation by local authorities.

100. Instead of replacing all existing national direction instruments with a single instrument the Panel considers many of the benefits of a single document could be replicated through having all NPSs and NESs in the same place so they can be viewed together. A non-regulatory commentary could be provided to give guidance on how they are to be read as a whole.

A combined national policy statement and national environmental standard instrument

101. We considered whether a new system should enable NPSs and NESs to be developed together as one instrument. This option would allow national direction to be developed that could set targets and limits (including in relation to the same subject matter) and contain objectives, policies, methods, technical standards and rules.
102. In 2015 the then Parliamentary Commissioner for the Environment, Dr Jan Wright, detailed in her submission to the 2015 RMA amendment bill why in her view there should be a national direction instrument that contained both NPSs and NESs:^[258]

For some time I have thought that NPSs and NESs should not be separate documents. Objectives, policies and if needed, technical rules should be fully integrated in one document. A rule should be linked directly to the reason for its existence, that is, the objectives and policies it serves. These documents could be termed statements of national direction.

The ability to combine NPSs and NESs into a single document would add flexibility to the expression of national direction.

A single instrument that sets out the high-level policy and subsequent technical standards and environmental limits would help address some of the issues in the current system regarding timeliness of implementation and the mismatch between environmental standards and the underlying objectives and policies. A single instrument may also help reduce overall complexity and implementation costs faced by local authorities in implementing the Act where they would otherwise be faced with multiple, overlapping national direction instruments on the same subject matter.

We envisage a single combined NPS and NES instrument would complement, rather than replace, individual NPSs and NESs. The ability to combine NPSs and NESs into a single document would add flexibility to the expression of national direction where a high degree of integration and cohesion of national direction is essential to effective and efficient implementation. Where integration is not essential, or national direction requires only a narrative or standard, then the existing NPS or NES instrument options should be used.

However, we are also mindful that the power to issue a combined instrument would need to include appropriate checks and balances to ensure appropriate use and limitation on ministerial powers of intervention.

Consideration would also need to be given to the timing and implementation mismatch currently experienced between NPSs and NESs. The latter can have immediate effect whereas NPSs generally require translation and modification into local plan provisions. We consider this could be addressed within each instrument by identifying those parts of the combined instrument that are to have immediate effect and those that would follow the plan process at local level. Transitional policies could also be stated in the instrument to help with implementation.

We acknowledge having a third option for the expression of NPSs and NESs risks adding complexity to the national direction provisions of the Natural and Built Environment Act. However, we consider these risks are outweighed by the benefits in being able to comprehensively provide direction on complex issues in one instrument, especially for matters such as climate change and the management of land–water interface. Indicative drafting for a combined instrument is in appendix 3.

Overall we consider the ability to issue a single combined NPS and NES instrument would:

• provide clarity for decision-makers on the intent and reason for the subsequent rules and/or limits as these are directly supported by relevant objectives and policies
• support a more efficient and effective system, reducing duplication of effort by agencies
• help ensure national direction is able to be more responsive to change and may better support innovative approaches to providing direction on outcomes, targets and environmental limits
• reduce complexity, both in the legislation itself and for those implementing and using it.

Improve the processes for developing and reviewing national direction

109. National direction has the force of regulation (either directly or indirectly through RMA plan rules) and so can have important legal implications for those who may be affected as well as the sustainable management of the environment. However, unlike primary legislation, national direction is not subject to the full scrutiny of parliamentary processes such as select committees and debate in the House.
110. Submitters on our issues and options paper raised a number of concerns about the process for developing national direction. These concerns primarily relate to the robustness of the alternative process, issues with integration between differing pieces of national direction, and the potential for processes to be designed that do not provide for sufficient input and participation in the process. For example, Fletcher Building Limited’s submission considered greater transparency was needed and the current process was considerably less open to challenge and refinement than processes for developing regional or district plans (a view shared by LGNZ and Transpower Ltd).

National policy statements and national environmental standards

Preparation and review process

We recommend there be a single process for the preparation and review of both NPSs and NESs. That process should be by independent board of inquiry.

In our view NPSs and NESs should only be prepared by the Minister for the Environment (with the Minister of Conservation being the Minister responsible for the NZCPS). We consider the development of NPSs and NESs by other Ministers risks undermining the integrity and cohesion of national direction and the outcomes they seek to achieve.

We recommend there be a single process for the preparation and review of both NPSs and NESs. That process should be by independent board of inquiry. This would ensure a robust process, allow for a full range of views from participants to be expressed and provide an independent safeguard against the risk of abuse of process. The ‘alternative process’ should only be available for less significant or technical changes to existing national direction between reviews (which we term ‘intermediate changes’).

We recommend the board of inquiry be chaired by an independent judicial officer, being a sitting or retired Environment Judge. Other members would be appointed by the Minister according to their expertise in the subject area of inquiry, with the number of members dependent on the nature, scale and significance of the inquiry. We consider three to five members in addition to the Chair would be appropriate.

114. To provide for greater Māori involvement, consistent with the principles of partnership in Te Tiriti, we recommend the board of inquiry makes provision for Māori in the development of, and decision-making on, a NPS or NES. Dependent on circumstances this could take the form of membership of the board, being part of a team developing the national direction or being an expert adviser to the board (or some combination of these).

Use of mātauranga Māori in the development of national direction

115. The participation of Māori in the development of national direction will be particularly relevant and useful where national direction sets environmental limits or targets that need to incorporate and reflect te ao Māori outcomes, Māori values or take an approach consistent with mātauranga Māori.^[259] In these circumstances, we recommend the national direction process not only makes provision for but encourages the input of experts in mātauranga Māori.
116. To action this, a pool of persons with relevant knowledge and expertise in mātauranga Māori could be employed or contracted by central government^[260] and be available to work on national direction limits and targets.

Matters the Minister should take into account before preparing national direction

117. Although we consider increased mandatory national direction is necessary, it remains important for the Minister to have the power to issue other national direction at his or her discretion. However we consider there should be guidelines to ensure national direction is exercised for proper purposes. National direction:
     • should be confined to matters of national significance
     • should not be used where other more appropriate means are available
     • should not unnecessarily constrain the ability of local authorities to determine what is appropriate according to their circumstances.
118. We recommend the Minister should take into account a list of matters broadly similar to the current RMA section 45(2). This would apply to the preparation of both NPSs and NESs. Our indicative drafting is in appendix 3. It covers both mandatory and discretionary national direction.

Application of section 32 or equivalent

119. The Panel is concerned about the potential for national direction processes to be used to manage issues not of national significance or that, given close scrutiny, would not justify the use of national direction. Making both NPSs and NESs subject to a section 32-type process^[261] from the outset and at key stages of their development would serve as a useful check on the need for the instrument and improve the transparency and robustness of national direction development. We discuss evaluation methods of this kind in chapter 8.
120. We recommend there be an evaluation for each NPS or NES and any review, similar to the process proposed in chapter 8 for evaluation of plans. This should include interim evaluations at critical stages of developing the policy or standard:
     • decisions to manage any matter through national direction and the choice of national direction instrument
     • provisions in a proposed national direction on which public submissions are sought
     • decisions on recommendations
     • final decisions made by the Minister.

These analyses should be made publicly available.

Review of national policy statements and national environmental standards

121. Submitters on our issues and options paper supported national directions being reviewed on a regular basis, although there was no consensus on what an appropriate review timeframe should be. For example, Beca, Transpower Ltd and Greater Wellington Regional Council suggested a review period of 10 years, Auckland Council suggested 15 years and the New Zealand Planning Institute suggested three years.

We considered various review cycle timeframes and concluded a nine-year review period is the most appropriate.

We agree the Natural and Built Environments Act should include specific and stronger duties for the Minister for the Environment (and Minister of Conservation in respect to the NZCPS) to monitor, report on and review NPSs and NESs.

We considered various review cycle timeframes and concluded a nine-year review period is the most appropriate because:

• nine years better synchronises with three-year central government electoral cycles and three-year local authority electoral and planning cycles
• it provides sufficient time to establish whether policy on matters with lengthy lead-in or lag times is having the desired effect and ensures there is good evidence to determine what, if any, changes may be needed
• a nine-year review cycle provides greater certainty and consistency in policy direction than a three- or five-year review cycle, which can be important for general confidence in the resource management system and for investment decisions (such as large urban developments, which can sometime take a decade to come to fruition)

We recognise changes will need to be made to NPSs and NESs outside regular, scheduled review cycles.

it will be less resource intensive for central and local government to administer and to respond to (given multiple national direction instruments would almost be in a continuous review cycle if review periods were shorter).

124. If circumstances, such as changing environmental conditions, require a review of national direction earlier than nine years then we are confident this can be accommodated through providing legislative flexibility to hold an earlier review (requiring there to be a review ‘within nine years of the national direction instrument coming into force’, for example).
125. We envisage the review process being the same as for the preparation of national direction, including the application of a section-32-type duty and process.

Intermediate changes to national policy statements and national environmental standards

126. We recognise changes will need to be made to NPSs and NESs outside regular, scheduled review cycles. The need for changes may arise from the results of monitoring that indicates a NPS or NES is failing to achieve the results desired, on in response to a change of circumstances or an emergency situation (as occurred with the contaminated land NES following the Canterbury earthquake in 2011^[262]). Such changes may be substantive or minor.
127. Where an ‘intermediate change’ is substantive in nature (requiring a major change in policy direction or a re-write of the NPS or NES) then the board of inquiry process should be followed, as though the change were a review.
128. Where an intermediate change is minor, then an alternative process may be used. This alternative process should be overseen by a panel chosen for their expertise, be chaired by an independent person, and should provide the opportunity for public participation to ensure the preparation of the change to the NPS or NES is fair and robust. The panel would have the role of scrutinising the proposed change, considering what changes should be made in response to external feedback, and making recommendations to Ministers on any changes.
129. To reduce the risk the alternative process is used inappropriately we consider Ministers should not be able to use the alternative process unless it can be demonstrated the following have been considered:
     • the advantages and disadvantages of preparing changes to national direction quickly, including the consequences of not acting
     • whether the scale and nature of the proposed change would represent a significant departure from, or require substantial amendments to, an existing NPS or NES
     • whether the proposed changes could have been achieved by another national direction instrument
     • the extent and timing of public debate and consultation that has already taken place
     • any other relevant matter.

Corrections of errors and minor alterations to a national policy statement or national environmental standard

We recommend all existing NPSs and NESs be reviewed to resolve all known and potential conflicts between them.

We are of the view it is appropriate and efficient for a reformed RMA to continue to provide for the correction of minor errors and to accommodate minor updates without the need to follow either the board of inquiry process or the alternative process.

131. To ensure this power is not misused, its use should be limited to changes of a minor and technical nature or changes which have no material effect on the rights of parties who may be affected.

Providing greater cohesion and coordination between national policy statements and national environmental statements

132. To provide greater cohesion and coordination between NPSs and NESs we recommend:
     • all existing NPSs and NESs be reviewed to resolve all known and potential conflicts between them, or provide guidance on how those conflicts may be resolved, before the Natural and Built Environments Act comes into force
     • the preparation of any new NPS or NES should identify and resolve conflicts with any existing NPS or NES, or provide direction on how the conflicts are to be resolved.
133. The Panel considers the Ministry for the Environment should make all NPSs and NESs available to be viewed in one place and provide a short, non-regulatory, explanation of how they are to be read as a whole.

Monitoring and reporting the effect of national direction

134. The Panel recommends there be a duty on the Minister for the Environment and Minister of Conservation to monitor and review the effectiveness of the NPSs and NESs for which they are responsible. We consider this is crucial to knowing whether national direction is achieving the outcomes desired and whether changes are required.
135. More detail on our proposed approach to monitoring and oversight in a reformed RMA is contained in chapters 12 and 13.
136. We consider improving the clarity and robustness of NPS and NES processes in these ways will help:
     • ensure national direction is more responsive to risk, change and evidence
     • keep decision-makers in the system accountable, well informed and incentivised to achieve the purpose of the system
     • lessen the risk of unintended consequences and ensure there are more appropriate levels of public participation.

Relationship with spatial strategies

137. The concept and content of spatial strategies is covered in chapter 4 (Strategic integration and spatial planning).

A more responsive system is needed to ensure that long delays do not occur in implementing national directions designed to enhance environmental outcomes.

We recommend spatial strategies be consistent with NPSs (including the NZCPS) and NESs under the Natural and Built Environments Act.

Relationship with combined plans

139. Under the RMA, sections 44A and 55 deal with the way in which local authorities must respond to national direction. Depending on the circumstances, provisions must be inserted into plans at local authority level without following the usual plan change process. We consider a more responsive system is needed to ensure that long delays do not occur in implementing national directions designed to enhance environmental outcomes. We recommend that these existing provisions should be reviewed with that objective in mind.
140. Local authorities should be able to set environmental limits and targets of their own through normal plan change processes where they are not the subject of national direction and where the local authority wishes to set a higher target or a more stringent limit than specified in a national direction.

Relationship with existing consents and existing uses

There should be a mandatory requirement to review conditions of existing regional permits and consents when a national direction is issued.

We have discussed in chapter 5 the principles that should apply to improve responsiveness and the circumstances in which existing consents and existing uses may be modified. For similar reasons to those discussed above in relation to plans, a reformed RMA needs to deal effectively with what happens to existing consents when a new national direction is issued. Currently section 43B of the RMA contains a complex set of provisions prescribing what is to happen when a national direction is made. This provision differentiates between land use consents (which are generally to prevail) and allows for the continuation of regional consents until they are modified or reviewed.

Section 128(1)(ba) of the RMA enables, but does not require, the conditions on permits and consents granted by a regional council to be reviewed when a NES or national planning standard is made. This includes coastal, water or discharge permits and regional land use consents. Under the RMA there is no similar ability to review land use consents granted by a territorial authority.

There should be a mandatory requirement to review conditions of existing regional permits and consents when a national direction is issued. This is needed to ensure, for example, that the restoration of degraded water bodies is not impeded by the existence of consents with conditions that do not meet more stringent standards set by a national direction.

The review of conditions would need to take into account the benefits and costs of activities controlled by the consent and should allow a transition period where significant change is required. We recommend that the national direction should stipulate how the new direction is to be implemented and relevant principles to guide the review process. This should be part of the board of inquiry process in which all affected parties would be able to participate. We view this as an important safeguard.

Land use consents granted by a territorial authority fall into a different category to those granted by regional consents. Under the RMA, implemented land use consents granted by a territorial authority are not generally time limited. There are few provisions enabling such consents or their conditions to be reviewed. We consider it would be a major and very disruptive step to allow the review of land use consents granted by territorial authorities whenever national direction occurs. We recommend review of land use consents should only occur in exceptional circumstances where:

• it is necessary to address the effects of climate change or to reduce risks from natural hazards as we discuss in chapter 6
• there is a high risk of significant harm or damage to health, property or the natural environment, for example by the breach of an environmental limit.

146. We take a similar view in relation to the ability to review or override existing use rights in relation to the use of land. The ability to rely on existing use rights for land uses is currently subject to criteria designed to ensure that the nature and effects of the activity are maintained at a broadly similar level. We recommend national direction should not be able to modify or override existing rights for land use except in the two circumstances described above. The circumstances in which this could occur should be included in the national direction.

Expected outcomes

147. We consider our proposals for reform of national direction provisions address the key issues in our terms of reference and align with the objectives and principles we adopted for our review. They ensure the necessary powers are available for central government to act. They also ensure these powers are appropriately constrained with the right checks and balances. As such, they will contribute to a more robust and coherent system as a whole.

Key recommendations

Chapter 8 Policy and planning framework

1. The policy and planning framework administered by local authorities holds a critical place in the resource management system overall. Regional and district plans interpret the purpose and principles of the Act and apply national direction in the context of their area’s priorities and issues. Regulation is developed from this policy framework to clarify what activities are managed in the environment and how consent applications are to be considered. Clear, well‑considered rules should ensure the system is implemented in an efficient, effective and fair way.
2. In this chapter we propose two important changes in the policy and planning framework. The first is to clarify the functions of regional councils and territorial authorities to minimise unhelpful overlap. The second is to provide for combined plans prepared and determined by joint committees with a hearing process similar to the independent hearing panel model used in the Auckland unitary plan process.
3. We also propose a significant shift in the way plans and resource consents interrelate as we discuss in chapter 9.
4. Our chapter on allocation of resources also discusses issues important to the policy and planning framework, in particular with regard to freshwater, aquaculture and urban development capacity.

Current provisions

5. The policy and planning framework under the RMA consists of regional policy statements, regional plans and district plans. These plans must also give effect to national direction, including the NZCPS. They must also adhere to any relevant national planning standards.

Regional policy statement

6. The regional policy statement (RPS) sits at the top of the hierarchy. Its purpose is “to achieve the purpose of the Act by providing an overview of the resource management issues of the region and policies and methods to achieve integrated management of the natural and physical resources of the whole region”.^[263] It is the part of the framework that relates most closely to the recognition of matters of national importance in section 6 of the RMA and sets the overarching objectives and policies that provide for them within the region.

Regional plans and regional coastal plans

7. Regional plans provide the policy framework for regional councils to carry out their functions under the RMA. Regional coastal plans help regional councils to carry out the purpose of the RMA over the coastal marine area, in conjunction with the Minister of Conservation.^[264]
8. The regional plan includes objectives, policies and rules for aspects of the broader environment including soil conservation, water quality and quantity, air quality, ecosystem functioning as well as management of natural hazards. Regional plans also include provisions for managing allocations of water extraction, discharge rights, the use of the coastal marine area and geothermal resources.

District plans

9. A district plan provides the policy framework for a territorial authority to carry out its functions under the RMA. District plans contain objectives, policies and rules: “to achieve integrated management of the effects of the use, development, or protection of land and associated natural and physical resources of the district”. The Resource Legislation Amendment Act 2017 (RLAA) added to this framework, “objectives, policies, and methods to ensure that there is sufficient development capacity in respect of housing and business land to meet the expected demands of the district”.^[265]
10. In addition to integrated management, district plans contain provisions to avoid or mitigate natural hazards, manage the development of contaminated land, and maintain indigenous biological diversity. They also address the effects of noise and activities in relation to the surface of water in rivers and lakes. These functions overlap with regional councils to some degree.

Integration of regional and district plans

11. Local authorities have the ability to produce combined plans under section 80 of the RMA. The legislation allows for a broad scope of combinations, so long as the plan includes two or more of the three main elements of the policy framework (RPS, regional plan, district plan). This allows councils to create joint regional or district plans in areas that cross a shared boundary, or to encompass the whole of their combined districts. It enables a regional council and all territorial authorities in their region to prepare, implement and administer a combined RPS, regional and district plan (either one for each district or one combined district plan).
12. The joint committees set up under section 80 to prepare, implement and/or administer combined planning documents are subject to clauses 30 and 30A of Schedule 7 of the LGA, meaning they are subordinate to the local authorities and/or public bodies they represent.
13. To date, there has been limited use of the combined plan provisions of section 80, with only one plan combining multiple districts. Table 8.1 shows seven combined RMA plans in existence as at 2014. Significant barriers to greater use include lack of political support for a combined plan, concerns about loss of autonomy and local representation and the fair and equitable sharing of costs. ^[266]
14. One other combined plan, the Auckland Unitary Plan was created under the Local Government (Auckland Transitional Provisions) Amendment Act 2013. We address its influence on our proposed reforms later in the chapter.

Table 8.1: Combined RMA plans across New Zealand, as at 2014

New plan and plan change process

15. Rules in regional and district plans have the force and effect of regulations.^[271] Given this legal significance, councils are required to undertake an extensive process for making and changing plans. This process is set out in Schedule 1 of the RMA. Among other things Schedule 1 sets out requirements for consultation, decision-making and rights of review and appeal. These various processes are central to the way plans and policies are prepared and changed under the RMA.
16. Anyone can request changes to a regional or district plan,^[272] but not to a RPS where only changes instigated by the Minister, the regional council or territorial authorities within the region are permitted.^[273] Private plan changes are the most common method for accommodating these requests, though councils can also choose to adopt the proposals of a private plan change as their own. These kinds of changes can be useful when they address an aspect of the plan that has not kept up with the higher order issues addressed by the plan. However, they can also be disruptive to the land use and environmental outcomes in the plan, particularly when it is newly operative.

Issues identified

17. The Panel’s issues and options paper identified problems with the RMA’s current policy and planning framework, listed below. We based our initial assessment on a number of relevant reports commenting on this issue:^[274]
    • the system has not provided sufficient protection to the natural environment against inappropriate resource use and development
    • the plans produced by councils are often of poor quality
    • plans are often not well integrated
    • the effects-based approach has not worked
    • planning processes are slow, litigious and unresponsive.
18. These problems relate to several parts of the resource management system, linking problems with the policy framework to issues with a lack of strategic direction, resource consenting and system monitoring.
19. The responses we received on the issues and options paper show broad consensus on these issues, which we have grouped into three to address in this chapter:
    • inefficiency of the plan-making process: including lack of coordination between planning agencies on shared issues, potential for disruptive, ad hoc planning, and an overall slow, litigious and unresponsive process
    • complexity and ineffectiveness of plans: particularly their lack of vertical integration, tendency to get more complex and fragmented over time, poor system stewardship, and lack of data to support good decisions in plan review
    • tensions in the system go unresolved: creating too much reliance on consenting processes and the Environment Court to set precedents.

Inefficiency of the plan-making process

Lack of coordination on shared issues

20. Many of the big problems faced in New Zealand have national, regional and local dimensions. The declining quality of freshwater, for example, is a national issue that affects our environment, quality of life, cultural wellbeing and livelihoods. Standards for freshwater are set nationally to reflect this. Freshwater is managed by regional councils under regional plans that give effect to national standards. Regional councils process consents related to water allocation and discharges into land and water. Local land use is managed by district councils. This includes the approval of uses or practices that can degrade the quality and availability of freshwater through increased runoff of polluted stormwater, erosion of soils, increased water use, and cumulative discharges that are not individually regulated. Freshwater catchments and the lakes and rivers they flow into are divided between districts and sometimes between regions as well.
21. The proliferation of Te Tiriti settlements legislating for co-managed cross-jurisdictional partnerships on freshwater taonga suggests that freshwater management through the RMA has not achieved good outcomes for mana whenua. In its submission to our issues and options paper, Te Rūnanga o Ngāti Ruanui Trust noted:

Māori have been marginalised by the current systems and approach by Local Government even when participation is entered into. Joint decision making roles are the only way a partnership approach required by the Treaty can work.

22. It is useful to see this issue through the perspective of Māori because their rohe often cross territorial authorities and multiple plans. They seek an integrated approach, ki uta ki tai, from the mountains to the sea. Yet what they encounter is a poorly coordinated response and difficulties holding polluters to account.^[275]
23. Housing is another well-known issue that affects us nationally but is managed regionally and locally. National interventions such as special housing areas, the National Policy Statement on Urban Development Capacity, and Kāinga Ora–Homes and Communities legislation have been required in high-growth regions to provide greater development capacity. Some local authorities have responded through increased coordination on growth corridors and planning for greater intensification, but this is still not an integrated approach.

Disruptive, ad hoc planning

24. Because plan-making is slow and plans cannot anticipate everything there will always be a role for plan changes. There are many beneficial reasons for carrying out a plan change. Fixing errors in the plan, staying responsive to changes in the environment, identifying additional natural and physical resources worth protecting, giving effect to spatial planning, and responding to national direction are some. These seek to keep a plan true to its own strategic vision and the purpose of the Act.
25. Private plan changes can be developed for these beneficial reasons, especially when a plan has not been substantially reviewed for a long time. However, sometimes private plan change proposals seek new development that is out of sequence, far from supporting infrastructure, or is at odds with other outcomes sought in the plan. A private plan change may start out as a resource consent that appears destined to be declined under the plan as it is, and seeks to gain approval by becoming part of the plan.

Slow, litigious and unresponsive process

Council plan-making is often criticised for being slow, prone to litigation and unresponsive to changes in technology, community values and economic drivers.

Council plan-making is often criticised for being slow, prone to litigation and unresponsive to changes in technology, community values and economic drivers. This also affects plan quality. The Organisation for Economic Co‑operation and Development states it can take up to eight years to prepare and complete a land use plan and up to four years to change one.^[276] Trends from the National Monitoring System over the past five years show that while most plan changes are completed well within the two-year statutory time limit, a few take far longer. These lengthier plan change processes are attributed to the complexity associated with particular topics, including genetically modified organisms, zoning, freshwater, subdivision, heritage, utilities, biodiversity and traffic.

Complexity and ineffectiveness of plans

Lack of vertical integration

27. The hierarchy in the policy framework is intended to flow from the regional to the local, the high level to the specific, and from strategic to regulatory in nature. Issues articulate what is happening and prompt the need for intervention. Objectives set the high-level outcome to be achieved by policy intervention. Policies provide the legal framework for the interventions needed and the rules are themselves the interventions. From there the framework identifies how to know whether the intervention is working, by specifying environmental results and establishing a monitoring regime.
28. However, in practice, plan development does not necessarily end up this way. Political intervention may introduce policies resulting in an outcome never sought in the objectives or which sometimes do not address the issue. Rules that once cascaded from higher order policies but have since been revised may be carried forward as ‘tried and true’ in a plan review.
29. Councils can be resistant to changing other parts of a policy framework for the purposes of vertical integration as it introduces the risk of relitigating settled matters and ‘losing ground’ on contentious local issues. Conversely, councils may address an important but difficult issue in their plan by creating objectives and policies that are not followed through with rules, or are actively stymied by rules preventing the policies from being carried out.
30. A related criticism is that plan-making has a poor focus, which has been attributed to the limited, and often end-of-process, application of section 32 assessments of policies and plans. Judge Hassan of the Environment Court proposes section 32 should be used more purposefully within policy- and plan-making as well as ensuring a greater focus on the strategic direction expected of policies and plans.^[277]

Greater complexity and fragmentation over time

Plan reviews rarely result in the complete revision of an operative plan.

Plan reviews rarely result in the complete revision of an operative plan. Even the Auckland Unitary Plan, an entirely new document, contains text inherited from the operative district plans preceding it. This is not an issue if the old and new are well integrated, logically consistent, and achieve the vertical integration described earlier. But incentives exist to retain rules that ‘work’ and text that everyone considers settled, adding any new policy as a ‘bolt on’ that must work around fragments being retained.

32. Another source of complexity and fragmentation is agreements between council and land owners that carve out special provisions just for their land. Better system stewardship by ongoing monitoring of plan development and implementation could be beneficial in ensuring policies are given effect and that policy intent comes through implementation. Fewer plans would make this easier to achieve.
33. One aspect of the Town and Country Planning Act 1977 was the highly directive nature of its purpose and the level of control retained by central government over planning. All regional planning schemes were required to be approved by the then Minister of Works and Development, who could direct amendments to the plan. However, along with that came the obligation of all parties, including central government, to adhere to the provisions of the scheme.^[278]

Lack of data used in plan review

34. Section 35 of the RMA requires, among other things, every local authority to monitor the state of the environment in its region or district, as well as the efficiency and effectiveness of the policies, rules and other methods in its plan. They must also take appropriate action on this data “where this is shown to be necessary”.^[279]
35. The provisions of section 35 are not always followed by most local authorities, at least not to the extent that would create a link between the data it has a duty to collect and critical evaluation of the efficiency and effectiveness of plans. This problem is explored more in chapter 12 however it is worth emphasising the connection between good data and quality plans.

Tensions in the system go unresolved

A critical problem with plans is the failure to resolve the tensions within them between important resource management issues.

A critical problem with plans is the failure to resolve the tensions within them between important resource management issues. Tension is created to some degree in the purpose of the RMA, including the requirement for sustainable management. This tension has been elevated in recent years with the introduction of national direction requiring greater planning for urban development capacity alongside other national direction for greater environmental protection, continued provision for matters of national importance under section 6, and existing rules in plans managing effects on neighbours and local amenity.

37. Although greater intensification of the urban environment can take pressure off resources in the rural and natural environments, these environments are not completely separate places. Plans have a more important role than ever to address these tensions in a way that fits within their local context and reflects community values.
38. The consequence of not addressing these tensions is that rules in plans fail to express any resolve, leaving resource consents to assess adverse effects under multiple conflicting objectives and policies without expressing what an acceptable balance would involve. Consent planners are left having to make ‘apples and oranges’ comparisons of different effects to reach a decision.
39. The balance is shaped instead by successive resource consent cases and resort to decisions from the Environment Court. Good decisions can come of these processes, and plans cannot anticipate every difficult resource management decision. However, plans should as much as possible seek to resolve their own internal tensions and reduce pressure on downstream decision-making.

Options considered

40. Our issues and options paper included the following options to improve the resource management policy framework:
    • require regional spatial strategies with effect across the RMA, LGA and LTMA
    • require combined plans for a region
    • reconsider the functions of regional and district councils under the RMA and the effect they have on the content of plans
    • provide for an ‘outcomes-based’ approach to the content of plans
    • provide for a more flexible plan-making process (greater ability to choose steps and timeframes) so that minor plan changes can be progressed using a streamlined process
    • adopt a ‘single stage’ plan-making process or retain the Schedule 1 process with or without modification
    • if a ‘single stage’ process is developed, require:
      • ‒ the decision-making body to reach a final decision, or the decision-making body to make recommendations to the initiating council
      • ‒ plan changes to be determined by the Environment Court, with appeal rights limited to questions of law only to the High Court, or plan changes to be determined by an independent hearing panel, with appeal rights limited to questions of law, either to the Environment Court or to the High Court
      • ‒ further rights of appeal to the Court of Appeal and Supreme Court with leave or special leave of the appellate court
    • if an Independent Hearing Panel (IHP) model is used, require:
      • ‒ the members to be appointed by the Minister for the Environment
      • ‒ the members to be appointed jointly by central and local government, with iwi participation
    • require draft plans to be approved by a Minister or central government authority prior to notification, and/or prior to finalisation
    • give greater status to iwi management plans in Part 5 of the RMA
    • establish a central mechanism to provide assistance to councils with plan-making
    • expand or restrict the ability to apply for a private plan change.

Discussion

41. We received some useful comments on these options from submitters. Specific feedback is included in the following discussion of the preferred approach. General comments were as follows:
    • submitters agreed the plan-making process can be lengthy and costly for everyone involved. Several submitters supported the concept of combined plans and agreed more are needed. Many submitters were open to a single-stage planning process (or a different process in some form) and a simplified process for minor plan changes.
    • Iwi and hapū submitters frequently called for co-governance in plan-making, and supported greater status for iwi management plans. Most submitters highlighted the importance of early consultation in the plan-making process.
    • submitters appeared open to national level oversight at the planning level but many did not agree with draft plans being approved by a Minister or central government agency.

Functions of regional councils and territorial authorities

42. Sections 30 and 31 of the RMA set out the respective functions for regional councils and territorial authorities.
43. Both regional councils and territorial authorities have responsibility for integrated management, but over different matters. The function of a regional council is to achieve “integrated management of natural and physical resources of the region”. A territorial authority is to achieve “integrated management of the effects of the use, development, or protection of land and associated natural and physical resources of the district”. To achieve these functions, both regional and territorial authorities are required to establish, implement and review objectives, policies and methods – essentially to produce a statutory plan.
44. Overall, regional council functions relate to natural resources or the natural environment
    – air, land, freshwater and the coastal marine area. This differs from territorial authorities where the focus is on the use, development or protection of land including subdivision. Regional functions are extensively listed and include resource allocation, whereas territorial functions are more generally reflected in the term ‘land use and subdivision’.
45. Several functions are listed for both regional councils and territorial authorities but include subtle differences that create a lack of certainty regarding primary responsibility or where the split between regional and territorial occurs. These double-up functions include:
    • development capacity
    • natural hazards
    • contaminated land
    • indigenous biodiversity
    • noise
    • surface water.
46. The reasons for sharing of functions were dependent in part on which council had the expertise or historical knowledge. Part 3 of the RMA^[280] establishes restrictions of resource use and directs where the responsibilities lie, consistent with the functions in sections 30 and 31. The RMA anticipated that where there was overlap, RPSs would specify where management responsibility should lie for natural hazards and indigenous biological diversity.

Current issues with local government functions

47. Different roles and responsibilities not clearly articulated can create tensions in resolving resource management issues and achieving integrated outcomes. The two most common sources of tensions are:
    • dual consents from regional and district councils for similar activities (for example, earthworks) creating extra costs
    • conflicting regional and district policies.
48. Ambiguity also exists about responsibility for several of the existing Part 2 matters such as outstanding natural features and landscapes. This is because management of these resources is not explicitly reflected in the functions of regional councils or territorial authorities. Therefore these resources tend to be determined differently across the country and may be addressed by either or both councils.
49. Currently the only function identified in sections 30 and 31 that relates to climate change mitigation or adaptation is the responsibility to respond to natural hazards. Other provisions of the RMA relating to climate change place significant constraints on the ability of councils to deal with this problem, as we discuss in chapter 6.
50. The RMA enables land use controls at both a regional and district level.^[281] Section 30 enables regional councils to control the use of land for the purpose of managing natural resource issues. For example, earthworks or land disturbance are often managed by both regional councils and territorial authorities. Control of land for the purpose of managing water quality leads regional councils to manage earthworks to mitigate the effects of sediment on water quality, often with a focus on areas of bulk earthworks rather than small-scale earthworks. Territorial authorities often require resource consents to address the impact of earthworks on amenity and landscapes, and to control nuisance effects like noise and dust, and traffic movements from off-site disposal. The split between responsibilities is not always clear and both regional and district consents are often required for a large project.
51. Flooding is another matter where both regional councils and territorial authorities are able to include rules that address the effects of surface water (flooding) on other properties.^[282] This has been an issue recently, where regional rules that allow for the extinguishing of existing use rights are being used in preference to district-level controls where a managed retreat is considered necessary.
52. Another issue is contaminated land. Currently, regional councils are required to investigate issues for the purpose of identifying and monitoring, but territorial authorities are responsible for management of land use to prevent or mitigate adverse effects. Regional councils monitor old contaminated land sites such as landfills. The national environmental standard for managing contaminated land currently focuses on health and safety rather than environmental impacts.

Many submitters voiced concern over the continuing ambiguity about the responsibilities of regional, district and city councils and suggested a new planning framework could eliminate some of this.

Many submitters voiced concern over the continuing ambiguity about the responsibilities of regional, district and city councils and suggested a new planning framework could eliminate some of this.

Options considered

Option one: functions determined by combined plans

54. The first option we considered is plan-led allocation of functions. Here the primary responsibility for most functions would be assigned to the regional council, with a requirement for further allocation of functions to be determined through the RPS. This approach would ensure no functions fall through the gaps because regional councils would remain responsible for them until determined otherwise.
55. Although this approach would enable functions to be allocated based on the scale and expertise of local government, it would introduce too much variability between plans and their implementation. Potential confusion might be created for stakeholders that operate across multiple regions due to the inconsistencies across the country, making it harder to realise the wider benefits of the reformed system.

Option two: split the functions between the natural and built environments

56. One way of splitting functions to avoid duplication is by identifying regional councils as having primary responsibility for all elements of the natural environment and district councils as having primary responsibility for all elements of the urban environment.^[283] The exception to this rule would be infrastructure where both levels of local government would need to have responsibilities to ensure integration with land use planning.
57. The suggestion is that a sharper delineation between the built and natural environments and between local government functions, along with clearer objectives (outcomes) would promote greater resilience within the system as well as better environmental and economic outcomes.
58. An important issue with splitting responsibility between natural and urban is how the rural environment would fit. This is identified in our proposed purpose and principles in the Natural and Built Environments Act, where the rural environment, and the role it plays, would be explicitly recognised as would the opportunities that rural areas provide for future urban capacity. In addition, issues or resources such as heritage, climate change and Māori cultural values all occur throughout the natural, rural and urban environments. Splitting their management would be problematic.
59. A natural/urban environment split of responsibilities may set in place tensions that are not easily resolved during plan preparation and implementation unless there is a combined plan. Expansion of an urban area into an area of environmental value may be seen to be efficient from a transport and infrastructure point of view, yet conflict with environmental values. If responsibilities were split, then there is the potential for a ‘yes’ from one consent authority and a ‘no’ from the other unless the outcomes are at a regional level. As we concluded in chapter 1, the built and natural environments are inherently interconnected, and should be approached through integrated decision-making. Option two clearly does not support this approach.

Option three: rationalisation of roles

60. The third, and preferred, option considered by the Panel, is rationalising the roles to minimise duplication and overlapping functions. This option also seeks to provide greater clarity about the division between policy setting and implementation responsibilities.
61. The starting point for considering how functions are allocated is to consider the delivery of the outcomes specified in our proposed purpose and principles and the appropriate division of roles between policy setting and implementation.

Principles for allocating functions

62. The following principles were considered to help determine the allocation of functions.
    • Significance and scale: where an outcome identified in our proposed purpose and principles of the Natural and Built Environments Act (or other regionally significant issue affecting the environment) needs to be addressed at a regional level, or the scale is such that it has a regional impact, this should be a regional function.
    • Integration and coordination: where achieving an outcome or target or complying with an environmental limit requires regional direction to achieve a consistent approach across a region, where an environmental issue crosses a regional boundary, or where one system may impact on another such as water catchment and the coastal marine area, this should be a regional function.
    • Regional resources and allocation: where public resources exist at a wider or catchment-based level and require approvals for allocation, including for competing users, then these should be addressed by regional councils such as for air and water resources.
    • Capacity and capability: where capacity and capability are located across the local authorities may guide a decision on allocating function but will not be determinative.
    • Implementation: the extent to which a responsibility needs to be allocated in a way that ensures the outcomes and targets will be implemented so that policy does not lose touch with implementation.
    • Built environment: where resources are related specifically to the built or urban environments and outcomes are controlled by land use and subdivision, this should be a district function.
    • Local impacts: where an outcome is localised control should be achieved at the district council level.

Recommended approach to functions

63. In a broad sense all local authorities are to perform their functions in a way that gives effect to our proposed purpose and principles in the Natural and Built Environments Act. All councils will have to give effect to national directions, environmental limits and binding targets.
64. Some functions will be purely policy setting while others will have control functions requiring the making of rules. In general we propose a similar division of control functions to the allocation currently under the RMA. There is good reason for regional councils to continue dealing with domains such as water and air since these transcend district boundaries and regional councils have developed considerable expertise in these fields. Territorial authorities are better equipped in the preparation of detailed land use provisions.

Both levels of local government should continue to be involved in issues, such as climate change and development capacity.

Applying the principles we have developed for the allocation of functions, some control functions will be exclusively the responsibility of regional councils and others exclusively within the functions of territorial authorities. Functions exercised by territorial authorities will have to give effect to the RPS and any relevant regional outcomes, targets, policies or rules.
It is inevitable that some functions will need to be shared because both levels of local government should continue to be involved in issues, such as climate change and development capacity. Our proposal for combined plans described in this chapter and the provision of an ‘open portal’ for resource consents described in the next chapter will support these shared functions and reduce the potential for conflict.
Although some of the finer detail should be the subject of further consultation we would see the broad division of the main responsibilities as follows.

Regional councils

• setting policies on matters of regional significance to achieve the purpose of the Act and to promote integrated management
• identifying the regionally significant matters included in section 7(b)(i), (ii) and (iii)
• setting policies for, and the control of, water, air, the coastal marine area and flood protection
• setting policies for the maintenance of indigenous biological diversity and restoration of viable populations of indigenous species, and supporting territorial authorities in respect of land use controls to implement these policies.

Territorial authorities

• setting policies on matters of district significance to achieve the purpose of the Act and to promote integrated management
• setting policies for, and the control of, land use (in urban and rural areas), subdivision, noise, contaminated land, hazardous substances, and heritage.

Joint responsibilities of regional councils and territorial authorities

• setting policies for measures to address natural hazards and climate change, urban growth capacity (including integration of infrastructure with land use), soil conservation, the natural environment outcomes and tikanga Māori outcomes identified in proposed section 7
• control of these matters as they apply to land use is by territorial authorities.

Combined plans

68. We have developed a new approach to plan-making that will help address the problems identified and reinforce other parts of the new resource management system. This approach follows on from joint spatial planning for each region described in chapter 4, and feeds directly into better consenting processes and outcomes recommended in chapter 8. Plan contents are influenced by the national direction recommended in chapter 6, including national planning standards.

69. The thrust of our reform proposals was supported by the Resource Management Law Association:

The RMLA generally supports a single stage plan making process with restricted appeal rights, such as that used for preparation of the Auckland Unitary Plan and Christchurch Replacement District Plan. That is, Independent Hearings Panels (IHP) being established to facilitate plan making, with merits appeals to the Environment Court only where the Council rejects the IHP’s recommendation. This should replace the current Schedule 1 process (i.e. there should only be the one plan making process, rather than three as there are currently), while retaining the ability to apply for private plan changes.

Main benefits of this approach

The most compelling benefit of jointly developed combined plans is the reduction of resource management plans from over 100 to just 14.

The most compelling benefit of jointly developed combined plans is the reduction of resource management plans from over 100 to just 14, one for each planning region in New Zealand.^[284] This change alone will greatly simplify coordinated planning within a region and create efficiencies. It will also increase the capacity of central government to provide better system stewardship because there are fewer plans to monitor. The Environment Court can likewise build its expertise in regions through its judges and commissioners assigned to IHPs and appeals.

71. Another important benefit is the greater efficiency in hearing processes resulting from the removal of the initial local authority hearing and providing instead for IHPs and a more limited appeal process. We envisage this will take less time than the current process of hearings and appeals, meaning more of these plans will be operative sooner. IHPs should develop methods for ensuring the process retains a high level of rigour, inclusiveness and accessibility for all parties who participate. We expect the expertise provided by IHPs and a robust process prior to notification will produce better quality plans. As a result, fewer appeals are expected to reduce cost and delay without a significant reduction of access to justice.

Combined plans will require regional councils and territorial authorities to work together, in partnership with mana whenua.

Lastly, combined plans will require regional councils and territorial authorities to work together, in partnership with mana whenua, to resolve resource management issues across the region and develop an integrated approach to issues that cross jurisdictional boundaries. This is the kind of integrated management needed to respond to local context and deliver on broader mandates for the environment.

Governance models for preparation of combined plans – options considered

73. In developing this approach, we considered two options for the joint committee developing, notifying and ultimately deciding on IHP recommendations for the new combined plans. Most of the key features of the approach are the same, but the defining difference is the level of autonomy the joint committee has to make decisions about the form and content of the plan. The two options within the overall approach are:
    • a fully autonomous joint committee which decides all matters related to the making of the combined plan and any later changes to it
    • a LGA type joint committee, where members remain beholden to their constituent councils.

We have concluded that a fully autonomous joint committee is essential.

We have considered the two options in light of the problems we identified in the current system, as well as other key differences such as which is better for community buy-in. Table 8.2 includes the results of this consideration.

75. We have concluded that a fully autonomous joint committee is essential to address the problems the current system has and to achieve the benefits we see for our overall approach. The disadvantages of the system, namely the loss of autonomy and potentially lower commitment to local implementation can be mitigated to a satisfactory degree in the approach we are taking. Councils will lose the ability to approve their local plans, but this will be offset by their continued role in the spatial planning process we have discussed in chapter 4 and in the IHP process, through submissions and appeals. Of course we expect councils will work very closely with their delegates on the joint committee to ensure their point of view is advanced.
76. The fundamental risk in using LGA-type committees is that a single council could reject the combined plan and defeat the purpose of the combined planning process.

Table 8.2: Side-by-side comparison of the two governance options

Constitution of joint committee

77. We believe it is important that any combined planning process is led by a joint planning committee which is closely representative of the region’s constituents and has a strong mandate. Joint planning committees are not joint committees under the LGA; they will be established for the purpose of preparing, changing and administering combined plans under the Natural and Built Environments Act.
78. We recommend joint planning committees include a representative of the Minister of Conservation and appointees from:
    • the regional council
    • constituent territorial authorities
    • mana whenua within the region.

Joint planning committees include a representative of the Minister of Conservation and appointees from:

• the regional council
• constituent territorial authorities
• mana whenua within the region.

The Minister of Conservation is represented on the committee due to his or her role in managing resources in the coastal marine area and approving regional coastal plans. We considered including a representative of the Minister for the Environment, but concluded that other responsibilities of the Minister (including resolving disputes within joint committees and ministry audit of plans) created a conflict for committee membership.

For unitary councils, the composition of joint planning committees will vary from this slightly, as regional and territorial council functions are already combined. However, Department of Conservation and mana whenua inclusion is still required. Appendix 5 shows the regions and combination of regions we suggest for the purpose of creating combined plans. We recommend the Nelson, Tasman and Marlborough unitary authorities jointly produce a combined plan for their regions.

We are aware that, for some regions, having a representative from every iwi or hapū with mana whenua in the region will mean committees are simply too large to function. The representatives on a joint committee cannot be so numerous that the committee is impeded in carrying out its task. We recognise this will sometimes mean delegates will have to represent the interests and perspective of more than one group.

To recognise these committees are not always fully representative of every iwi and hapū in the region, we consider it is important to use consensus-based decision-making as much as possible, so voting rights are not at stake. We envisage this as the same approach taken for the regional joint committees for spatial strategies, as described in chapter 4 and summarised below.

Each constituent group will continue to be entitled to make submissions on the notified plan and be heard by the IHP on points where they do not agree or request amendments to the approach taken by the joint committee. They will also continue to have standing for appeal, within the limits of the overall approach.

We note that local authorities have a dual role as regulator and infrastructure provider. Because the combined plan is a regulatory plan it is important that these different roles are clearly articulated. As infrastructure provider a local authority, council controlled organisation, or central government agency should be able to submit and provide information or evidence. It may be appropriate at the start of a combined plan process that local authorities specify how their role as asset manager (including through council-controlled organisations) will be separated from their role as regulator (and constituent of the joint committee).

Resourcing joint planning committees

85. Each committee will need a secretariat for administration, plan drafting, policy analysis, coordination of public engagement and commissioning expert advice. Funding for this secretariat would need to be agreed between the constituent councils. Setting the budget each year would depend on the scope of work anticipated for the committee, whether it is the initial combined plan process, subsequent plan changes, or effectiveness monitoring for future plan review. Mana whenua will need to be resourced to enable them to participate effectively.

Dispute resolution

86. During the formation of the committee and the plan development process, the committee may encounter contentious issues that it cannot progress using its regular consensus approach. We propose a dispute resolution process that can be used for disputes over funding, representation, processes to be adopted by the committee, the form and contents of the plan for notification, and the decision to accept or reject IHP recommendations. This is envisaged to be by facilitated mediation but if this does not resolve the issue, then the Minister ultimately decides.

Process for preparation of combined plans

87. The process for combined plan preparation would be contained in a schedule of the Natural and Built Environments Act with greater detail than we recommend here. It is based largely on the Auckland Unitary Plan process.
88. Figure 8.1 below shows a visual representation of this approach. It includes the following steps:
    • joint planning committee drafts the proposed plan, drawing from extensive community and stakeholder engagement
    • Ministry for the Environment facilitates an audit of the proposed plan prior to notification
    • joint planning committee notifies the proposed plan for submissions
    • hearings are held by an IHP, which includes pre-hearing mediation and expert conferencing
    • IHP releases recommendations, which are approved or rejected by the joint planning committee
    • rejected recommendations are open to appeal to the Environment Court on their merits, while accepted recommendations are open to appeal to the High Court on matters of law
    • the provisions in the combined plan not subject to an appeal become operative.

Figure 8.1: Proposed process for creating combined plans

Influence of the Auckland Unitary Plan model

89. Our approach is based on the experience of and lessons learned from the Auckland Unitary Plan process. This amalgamated eight district plans with the combined regional plan, regional coastal plan and regional policy statement. It integrated district plan objectives, policies and rules over an entire region. Its early drafting happened concurrently with the development of the first 30-year spatial plan for Auckland and it was heard by an IHP with limited appeal rights as we propose. We have concluded this process provides a good upper limit for scale and complexity, given it occurred in our most populous region and was the first time employing the entire approach in the sequence we consider ideal.

Components of the plan-making process

Joint planning committee prepares the plan

90. The joint planning committee commissions its secretariat to develop a discussion document for the new combined plan, drawing from:
    • national direction
    • the purpose and principles of the Act
    • outcomes established by the regional spatial strategy
    • existing policy effectiveness and state of the environment data for the region and districts, and additional data and analysis commissioned as needed
    • mana whenua planning documents and ‘scene-setting’ hui.
91. Once approved for release, the discussion document becomes the subject of widespread engagement with the public and stakeholders. It is not a draft of the plan, but explains what it needs to contain, the issues and outcomes it will address, and highlights where tensions will need to be resolved.
92. Engagement should be done in a way that is inclusive, respectful of different perspectives and contexts, and results in clear feedback from members of the community on their preferences.
93. We considered the release of a draft plan for public comment, as was done in Auckland prior to the Auckland Unitary Plan. There are issues with this approach, including the risk of confusing members of the public, who may think they are making submissions on the actual plan. Our preference is to use something that does not look like a plan and lends itself to targeted discussions and community debate across the region.
94. The results of engagement on the discussion document provide the joint committee with the information needed to draft a plan that is responsive to local communities. The secretariat produces a proposed combined plan for the joint committee’s approval.

Ministry for the Environment facilitates an audit

95. The joint committee forwards the proposed plan to the Ministry for the Environment, which commissions an expert reviewer to review the plan. The purpose of the audit is not to exercise approval powers over the plan but to provide an opportunity for system stewardship. The audit could focus on three questions to be addressed only at a broad level.
    • Is the proposed plan aligned with national direction, targets and environmental limits?
    • Is the proposed plan consistent with the outcomes provided by the regional spatial strategy?
    • Is the policy logic of the plan sufficiently robust?
96. While councils supported early central government involvement in plan-making, they were concerned with the option to require ministerial approval of plans. Auckland Council did not support it, and Christchurch City Council saw it as an unnecessary “second merits assessment” that would make the process less efficient.
97. Te Rūnanga o Ngāti Awa saw the value in an audit role for central government:

Central government agencies must audit district and regional plans. To do so they must be more than ministries – they must be departments – that deliver guidance and advice on the mandatory directions required by the Act, and check and report on whether they have been given effect.

An audit is an important way to help ensure national direction and guidance is borne out in the form and content of plans. We see this as a middle approach between the current ‘manage by exception’ approach in the RMA and the direct control exercised by central government under the Town and Country Planning Act 1977.

The Panel agrees that an audit is an important way to help ensure national direction and guidance is borne out in the form and content of plans. We see this as a middle approach between the current ‘manage by exception’ approach in the RMA and the direct control exercised by central government under the Town and Country Planning Act 1977.

The joint planning committee notifies the proposed combined plan

99. Notification is a statutory boundary in the development of the plan that shifts the focus from plan development to a formal call for submissions. At this point, parts of the plan will have immediate legal effect, though operative plans will still carry substantial weight in resource consent decisions.
100. We anticipate the details of the phase immediately leading up to and including notification will have similar rules to those currently contained in Schedule 1 of the RMA, including pre‑notification consultation with mana whenua, submissions and further submissions. The pre-notification consultation could happen concurrently with the Ministry for the Environment audit.

Appointment of independent hearing panel

The Panel envisages the IHP would be chaired by an Environment Judge appointed by the Principal Environment Judge.

The Panel envisages the IHP would be chaired by an Environment Judge appointed by the Principal Environment Judge. The Principal Judge would also appoint three to five environment commissioners or other accredited people to serve as IHP members. The joint planning committee could nominate candidates for consideration. At least one appointee should have an understanding of tikanga and mātauranga Māori. Establishing the IHP and the appointment process would be authorised by provisions under the Natural and Built Environments Act.
In our issues and options paper we considered whether IHP commissioners should be appointed by either the Minister or jointly by central and local government and mana whenua. Submissions supported joint appointments over appointments by the Minister. Forest & Bird raised a concern over political appointments more generally:

We would be comfortable with a single stage process. However we would be concerned if local authorities had the ultimate responsibility. Nor would we want to see decisions on plans being passed to other politicised people (Independent Hearings Panel members can be selected according to their political views). We strongly suggest that the Environment Court should have a central role in any single stage planning process. Appeal rights to the High Court on points of law should be retained.

103. We agree with submitters; political appointment of IHPs is not a desirable approach. The IHP should be free from political interference and embody sound independent legal and technical expertise.

The IHP should be free from political interference and embody sound independent legal and technical expertise.

It is important for each IHP to have access to technical and professional advice on the plan, which is independent from the advice that prepared a draft combined plan. They will also need administrative staff to manage the details of hearings and liaise with the joint committee and submitters, the public and the media. Each IHP should be supported by its own secretariat, which we suggest should be funded through local government rates.
Over time, Environment Judges and commissioners will be able to build up expertise in conducting IHP processes. As a result their approaches to hearing submitters and developing recommendations will become more effective and rely on lessons from previous IHPs. Rather than hear appeals on aspects of plans, they will understand plans in their entirety, with benefits for future plan changes and resource consent appeals.

Independent hearing panel process

106. IHP hearings will be similar in structure to those of the Environment Court, but with changes to make them less formal for the benefit of lay submitters. Legal representation would not be necessary for anyone who wishes to be heard by the IHP. Parties should be encouraged to provide evidence to support their views beforehand, and some limited cross-examination may be allowed. The desired result is a process that is rigorous but encourages everyone to participate without regard to legal representation or resources. Creative opportunities to improve access to justice such as the use of process advisers should be encouraged as well as informal processes to mediate disputes.

IHP hearings will be similar in structure to those of the Environment Court, but with changes to make them less formal for the benefit of lay submitters.

The presiding judge would have sole authority to determine all matters relevant to procedure and the processes of the Panel. For reasons discussed in the chapter on consents, it is inappropriate to place time limits on judicial officers serving on IHPs. We are confident the IHP process will be given appropriate priority and that hearings will be conducted efficiently so long as sufficient resources are provided.

108. The secretariat of the joint committee will remain involved in the IHP process, helping the IHP through advice on their approach to plan drafting and addressing disputes directly with submitters where directed by the presiding judge. Their continued participation will enable them to help the joint committee reconsider their approach in the face of new evidence and ensure the evidence supporting plan revisions remains robust.
109. Recent experiences with IHP processes in Christchurch and Auckland have yielded several lessons already for good practice guidelines for IHP processes.^[285] These would be developed by the Environment Court and applied to ensure a uniform approach for IHPs.
110. The IHP’s recommendations may be broad and include consequential amendments to preserve the policy structure, but they should not depart from the scope of submissions to the degree that natural justice issues could arise.

Joint planning committee decides on independent hearings panel recommendations

111. On receipt of recommendations from the IHP, the joint planning committee decides whether to accept or reject them, in whole or in part. The dispute resolution procedures described earlier may be used as well to help the committee with contentious decisions.
112. When deciding to reject a recommendation, the committee will have to decide what changes they will make to give effect to their decision. This could be different from the notified plan, provided it is within the scope of submissions and consistent with any amended position the committee took in the course of the hearings.

Appeals

113. Our approach follows a similar model to the Proposed Auckland Unitary Plan process set out in legislation.^[286] Where the joint planning committee accepts a recommendation of the IHP, then appeals are limited to the High Court on points of law.

Limiting the scope of appeals is justified by the more robust IHP process, which makes broad rights of appeal to the Environment Court less necessary.

Where the committee rejects a recommendation, then an appeal on the merits to the Environment Court is available to anyone who has standing to appeal. In both cases, there are further rights of appeal to the Court of Appeal and Supreme Court, but only with the leave of those courts. We do not consider these further rights of appeal would lead to significant delay overall. Any parts of the plan that are not appealed will become operative, and we expect appeals to be few in number, as is currently the case.^[287]
We have considered whether any difficulty is likely to arise from the Environment Court hearing an appeal from an IHP chaired by an Environment Judge. We are satisfied that procedures can be established within the Court to ensure any perceived conflict of interest is avoided. We have been advised that no difficulty of this kind occurred in respect of appeals in the Auckland Unitary Plan process.
In our view limiting the scope of appeals is justified by the more robust IHP process, which makes broad rights of appeal to the Environment Court less necessary. If there is a dispute about how the IHP has interpreted the law in carrying out its duties, then appeal to the High Court on points of law is still available.

Submitter views

117. The Panel’s recommendations here respond to feedback from submitters, who supported IHP administered hearings, the streamlined planning approach, and combined plans. Many complained about the length of time it took to compile and complete plans and that delays meant plan-making was cumbersome and unresponsive. No comprehensive proposals were put forward on how plan-making could be speeded up, but most expressed support for some or all of the aspects of this approach. Opposition to an IHP planning process was greatest from industry groups.
118. The idea of an IHP process, with appeal rights being more constrained, was attractive to some submitters, although others warned this may discourage public participation and mean complex issues were not properly considered. Nelson Marlborough District Health Board related an experience from Christchurch:

Whilst the use of independent meditators was accessible for lay people, the hearing process was run akin to High Court proceedings which were difficult for lay submitters to navigate. Organisations such as Health Boards and non-profit organisations were directed by the Hearing Panel to have legal representation which brought unnecessary cost barriers to participation.

119. We acknowledge that many submitters who are concerned may not have had an opportunity to see Auckland’s unitary planning process unfold. The IHP in that case was especially concerned with public participation and encouraged the Council to meet with submitters to discuss issues directly, to engage in mediation and to focus the views of experts through caucusing.
120. These methods helped to resolve hundreds of submission points on the plan, and many submitters did not even need to attend the hearing to have their concerns addressed. At the hearing, submitters were not required to have a legal representative, but could engage with the Panel members directly.

Purpose and content of combined plans

121. The overall purpose of combined plans is to achieve the purpose of the Act. A combined plan will achieve integrated management by better coordination and alignment of policy, both vertically and horizontally.
122. Combined plans will cover the same range of policy and planning functions as at present. They will include a regional policy statement, a regional coastal plan (where relevant), a regional plan and district plans that include both common content for all territorial authorities as well as specific local content. The structure and layout of the combined plan could follow the structure and format established in the national planning standards, but we consider it is likely the first combined plan would establish a model for others.

Content of a combined plan

The structure and layout of the combined plan could follow the structure and format established in the national planning standards, but we consider it is likely the first combined plan would establish a model for others.

As part of the integrated nature of this proposed policy and planning framework, some of the content of the combined plan would be determined or guided by higher order documents; national policy statements, NESs, national planning standards (in relation to definitions) and the regional spatial strategy.
The regional policy statement gives effect to these higher-order components of the system, putting them in a regional context. It translates the purpose and principles of the Natural and Built Environments Act and regional spatial planning goals into strategic outcomes that cascade to regional and district plan outcomes, policies, and rules. It is critical that the regional policy statement is developed first, and although the whole plan should be notified at once, it is likely that IHPs will consider the regional policy statement as the first stage in the hearing process to guide later stages of the hearing process.
Regional and district plans need to give effect to the regional policy statement, so we expect that changes made within the drafting or IHP processes at that level will require consequential change to regional and district plan provisions.
We anticipate that combined plans will include district plans with consistent objectives, policies and methods for the territorial authorities where the issues and outcomes are common. Local variation is expected where land use patterns, resource pressures or ecological values are unique to the area. Local variability might also arise where a community supports higher environmental standards than those set at a national or regional level.
The standard content for the combined plan should follow a similar format already provided for in the RMA.^[288] However it will need to reflect the proposed emphasis on outcomes, stronger national direction with environmental limits and targets, and the role the regional spatial strategy has in developing long-term strategic direction for land use.

Combined plans will include district plans with consistent objectives, policies and methods for the territorial authorities where the issues and outcomes are common. Local variation is expected where land use patterns, resource pressures or ecological values are unique to the area.

Combined plans should also contain information that identifies the mana whenua groups present within the region and which groups local authorities will engage with in particular parts of the region and on what resource management issues those groups will be engaged on. Combined plans should also provide sufficient information to outline how mana whenua will be engaged in consenting processes, consistent with any integrated partnership process arrangements that have been made.
In chapter 11 we discuss methods and options to improve the allocation of resources in respect of both built and natural environments. This includes the use of economic instruments either alone or in conjunction with regulation through rules. With our proposed shift to an outcomes approach for the resource management system, we anticipate that use of these methods will be increasingly important. One key example of this is in delivery of competitive land markets to address outcomes for quality built environments, capacity for urban growth and integration of land use and infrastructure.
Table 8.3 shows the mandatory content currently specified in the RMA compared with the proposed changes.

Table 8.3: Comparison of current mandatory plan content with proposed content

Shifting to outcomes

131. The starting point for preparing a regional policy statement should be the identification of strategic outcomes. These should address the outcomes specified in section 7 of the Natural and Built Environments Act and environmental targets specified in national direction, and be consistent with regional spatial strategies.

The starting point for preparing a regional policy statement should be the identification of strategic outcomes.

The move from an effects-based system to an outcomes-focused planning framework is supported by most submitters. Submitters felt an outcomes approach would better frame development and allow communities to engage on what can be achieved in environmental terms. Some submitters felt a focus on outcomes would provide more certainty for development and be better able to deal with cumulative effects. Reservations were expressed at the scale of effort required to modify the effects-based approach and some submitters suggested any new planning framework requires both effects- and outcomes-based approaches.
RMA objectives were always intended to focus on environmental outcomes^[289] but this did not often happen in practice and instead the tendency was to repeat the provisions in the Act. The Panel proposes that throughout the combined plan ‘outcomes’ should replace ‘objectives’ to reinforce the intent of these provisions, particularly to align with the section 7 outcomes, and to change the focus of plans.
To achieve the strategic outcomes, problems or issues of significance should be identified. These should include known or anticipated issues, those of significance to iwi, as well as issues that cross regional boundaries.
To achieve the purpose of the Natural and Built Environments Act, the regional policy statement should clearly provide the guidance decision-makers need to resolve conflicting policy choices. The Panel considers a specific section be included in the combined plan to ensure this happens.
The explanation of the policies and principal reasons for adopting objectives, policies and methods has generally been regarded as a repeat of the section 32 assessment that is required before deciding on a provision. These provisions, therefore, should stay outside the regional policy statement.
Generally, ‘environmental results anticipated’ were not expressed well in regional policy statements. Often these provisions simply restated the objectives, creating an unhelpful tautology. To make a stronger link with monitoring we propose there be strategic indicators included that are measurable and able to be evaluated when assessing whether outcomes are achieved.
Policies in plans should be more directive and contain parameters, or clear limits, that define the extent of an effect or activity. These policies should be implemented by rules that clearly link the management of activities to whether they support plan outcomes, and set out clear parameters for consenting issues such as notification. The rationale for each activity status within combined plans is described further in chapter 9.

Plan review

139. At present, plans must be reviewed every 10 years, although this timeframe has already accelerated due to the recent introduction of national planning standards. Submitters such as Heritage New Zealand Pouhere Taonga noted these long planning cycles are harmful to the environment where knowledge about significance and risks is continually improving. Their example was the lag between the time places go on their list^[290] and are then subsequently protected by district plan heritage schedules. This also resonates with aspects of the environment that have prompted national direction, such as freshwater quality, air quality and indigenous biodiversity.
140. Our reformed system will require time for the development of legislation, national direction and regional spatial strategies, ideally ahead of combined plans. However, as discussed in chapter 15 the first generation of combined plans may proceed without all of these elements fully in place. In this case, it will be important to complete the transition in second‑generation plans.
141. To find the ideal review schedule it is useful to consider the other timeframes at work in our proposed resource management system, and the appropriate sequencing of activities. Elements of the system that provide the strategic foundation for plan-making include integrated partnerships with mana whenua, regional spatial strategies and national direction.
     • The development of integrated partnership processes discussed in chapter 3 will be ongoing, but ideally councils and mana whenua would try to have the relevant parts of them agreed before the start of spatial planning and combined planning. It is likely these agreements will influence the rest of the system in an iterative way, with increasing effect over time as more councils and mana whenua develop their integrated partnership processes.
     • Regional spatial strategies are proposed to be reviewed in full at least every nine years, with flexibility to review in full or in part within the nine-year period to make adjustments in response to significant change.
     • National direction is proposed to be reviewed every nine years, with allowances to review earlier if circumstances require it.
142. The reliance of the higher order provisions of the plan on the regional spatial strategy means it would logically be reviewed soon after the nine-yearly review of the regional spatial strategy. The two processes together represent a significant region-wide investment in setting up forward-looking integrated outcomes and the policies and rules that will help to achieve them.
143. The main benefit of this approach is the combined plan would never be more than a few years behind the regional spatial strategy, and the link between strategic and plan outcomes would remain strong and relevant. More frequent reviews of the combined plan could be of benefit to accommodate updated national direction and ensure the plan is more responsive to changing environmental conditions and development capacity needs.

Plan changes will take less time than they do currently and could address changes to multiple district plans at once.

Linking spatial planning and review of the combined plan would also focus monitoring activities on measures needed to improve performance on the most current outcomes, and drive reassessment of rules in the plan that are not linked to higher-order outcomes. This focus is needed to bring greater discipline to the gathering and use of monitoring data by giving it a clear driver in the system.

Plan changes

145. We envisage the process for plan-making proposed in this chapter would apply to plan changes as well. The variable scale, nature and complexity of plan changes will necessarily require details of the process and timeframes to be adjusted to suit. Plan changes will take less time than they do currently and could address changes to multiple district plans at once. This is why we recommend the joint committee be a standing committee to provide continuity of process and decision-making when plans are reviewed and changed.

146. The joint committee should propose changes to the plan where they are necessary:
     • to give effect to national direction
     • to respond to changes in environmental conditions that threaten environmental limits
     • to address new evidence or issues as they arise where they should not wait for a general review.
147. Plan changes can also be proposed to the joint committee by the constituent councils or mana whenua. The joint committee would consider matters such as:
     • whether the proposed change supports the achievement of plan outcomes
     • whether the proposed change needs to be modified, for example to maintain vertical and horizontal integration in the plan
     • whether the proposed change is sufficiently discrete and/or localised that it can be developed without requiring changes to other parts of the plan.
148. Where changes are discrete and localised, the constituent council involved could be responsible for the preparation of the change subject to joint committee oversight. The joint committee would remain responsible for notifying the plan change and would determine how the process would be funded and all other matters in the plan change process.
149. A joint committee should have the power to make minor changes to combined plans as is currently available under Schedule 1, clauses 16 and 20A of the RMA.

Private plan changes

150. Submitters, especially business submitters, continue to support retaining provisions for private plan changes. Some submitters thought acceptable private plan changes could be aligned with the proposed regional spatial strategies. We agree a role remains for private plan changes in the system but restrictions are needed to ensure the integrity of plans is maintained.

We agree a role remains for private plan changes in the system but restrictions are needed to ensure the integrity of plans is maintained.

First, there should be a general moratorium on private plan changes for three years after the relevant provisions become operative. We see this as necessary to ensure the integrity of the newly operative plan remains intact to allow for good implementation practice to develop. An exception to this moratorium could be an error in the plan or where a development or change has been agreed with a council as being beneficial. In such a case the joint committee would consider adopting the private party’s proposal or allowing the plan change to proceed on a cost recoverable basis.
Once the moratorium period has passed, private plan changes would be considered by the joint planning committee using the same considerations as proposals from constituent councils. If the proposal is aligned with the outcomes of the plan, does not require broader vertical or horizontal changes to the combined plan, and is sufficiently discrete, then the private plan change could be accepted on a cost-recoverable basis.
We acknowledge some private plan change proposals could introduce beneficial broader changes that support plan outcomes. This could especially be true of development proposals in areas that have been anticipated by regional spatial planning and help the region to upgrade infrastructure where needed. Private parties should consider how their proposal affects the wellbeing of the region, and proposals that truly add value should be adopted by the joint committee.

Evaluating proposed plans and changes to plans

The Panel recognises the general importance of the assessment required by section 32 but considers the requirements are now too complex and have departed from their original purpose.

The current RMA provides a prescriptive process and reporting structure for the evaluation of policy statement and plan provisions, including whether the proposal is the best way of achieving the Act’s purpose and the costs and benefits that are associated with it. Specifically, section 32 in the current RMA provides for an evaluation of proposals to create or amend any proposed standard, national policy statement, national planning standard, regulation, regional policy statement, plan or plan change. Section 32AA provides for a further evaluation report where a change to the proposal evaluated under section 32 is needed.
The Panel recognises the general importance of the assessment required by section 32 but considers the requirements are now too complex and have departed from their original purpose. The original section 32 established a duty to consider alternatives, assess costs and benefits, and adopt the most efficient means. The intention was the evaluation would be undertaken at the outset and followed through the policy development process. However current practice has tended to result in the process and documentation of it after the policy decisions have already been made.
In our view and from the comments made by submitters, we see four issues with the current processes as provided for by the RMA:

• the legislation is overly complex and prescribes requirements rather than evaluation commensurate and appropriate to the matter being considered;
• reporting has been used as justification of the end result, rather than supporting good decision-making
• there is often insufficient data to inform the consideration of options and development of statement and plan provisions
• the process of assessing costs and benefits can be difficult especially assessing non-monetary elements.

157. We recommend a process in which policy statements and combined plans are informed by an even-handed examination of the issues that might otherwise prevent the resource management system from delivering the strategic outcomes of the Natural and Built Environments Act. Options should be identified and include consideration of whether there are methods other than regulation which could achieve the outcomes, including the use of economic instruments to provide land capacity for example, as we discuss in chapter 11. We also consider the assessment should not be undertaken at the end of the process but should commence at the beginning of the policy development process and continue at key later stages.
158. The process we recommend would identify:
     • expected outcomes: how the proposed provisions will achieve the purpose of the Act and higher-order outcomes expressed in the Act and spatial strategies

Assessment should not be undertaken at the end of the process but should commence at the beginning of the policy development process and continue at key later stages.

options: what options have been considered, including regulatory or non-regulatory measures and the option of doing nothing or the minimum necessary

reasoning: identifies the reasons for and against adopting any particular approach.

justification: for the option chosen.

159. Our proposed changes are to some extent a return to the original principles set out by the RMLA Review Group on the Resource Management Bill 1991, which led to the creation of the section 32 duties.^[291] Principles for the above process should provide for:
     • robust analysis informed by data to deliver early analysis of issues and identification of options with the relevant subject-matter experts
     • assessment proportionate to the scale, nature, and complexity of the provisions being assessed
     • scope for development of the analysis in response to the emergence of new evidence, feedback from mana whenua, and input from submitters in the overall plan‑making process.
160. We consider the process of evaluating plans and proposing change to be part of an ongoing review process informed by high-quality data on progress toward strategic outcomes, examinations of system failure, and in response to the state of the environment. Good quality proposals rely on datasets that are unfortunately largely afterthoughts in the current system. Our chapters 12 and 13 on system oversight and compliance, monitoring and enforcement underscore the value of good monitoring and compliance data, and make the case for central and local government investment in maintaining long-term datasets that support plan review.
161. The Panel is supportive of the use of evaluation methods for option assessment. In many instances cost-benefit analysis is a useful method to support good decision-making. However, there are other instances where such a method is limited particularly where the use of mātauranga Māori alongside western science will be essential to improve the holistic nature of assessment. The Panel recommends that the Natural and Built Environments Act require an evaluation process for combined plans (and changes to them) that embodies the approach we have described and deals with evaluation methods by providing national guidance on the principles and practice to be adopted through national planning standards.

Streamlined plan process and collaborative planning

Our proposals for joint planning committees and combined plans mean the streamlined and collaborative planning provisions will not be necessary.

The current streamlined planning process allows councils to seek dispensation from various requirements set out in Schedule 1 of the RMA “in order to achieve an expeditious planning process” for changing plans and considering notices of requirement. Such dispensations are sought from the Minister for the Environment under provisions in sections 80B and 80C of the RMA. We note the collaborative planning provisions are proposed to be repealed by the Resource Management Amendment Bill 2019.
Our proposals for joint planning committees and combined plans mean the streamlined and collaborative planning provisions will not be necessary. We do not recommend retaining these provisions.

Expected outcomes

164. We consider our proposals for reform of plan-making provisions address the key issues in our terms of reference and align with the objectives and principles we adopted for our review. They provide for an appropriate balance of central and local government decision-makers, involvement of mana whenua and the use of the independent expertise of the Environment Court. They will result in major efficiencies across the planning system while improving the quality and integration of plans.

Key recommendations

Chapter 9 Consents and approvals

1. This chapter discusses opportunities to reform resource consenting processes. For many New Zealanders, the resource consent process is their primary interaction with the resource management system.

The changes we propose bring about a fundamental shift in the way activities are managed in plans.

Under the RMA, effective implementation of the purpose and principles of the Act relies on high-quality plans and clear, consistent and efficient decision-making at the consent stage. These downstream functions are devolved to 78 local authorities with variable capacity, politics, pressures and local environments. It relies on the knowledge of the Court, planners and technical experts; the resources of applicants and ratepayers; iwi and hapū; and the vigilance of affected people and groups who represent the public interest. The challenge is to ensure the consenting process is on the whole efficient and fair, while carrying out the purpose of the new legislation we propose to replace the RMA.

As described in chapter 8, the changes we propose bring about a fundamental shift in the way activities are managed in plans. We envisage that plans will be clearer and more directive with the result that the categories of activities will be more clearly delineated. This is expected to lead to greater use of permitted activity status with performance standards as well as prohibited activity status to reinforce environmental limits. Fewer consents should be needed overall and for those activities that require consent, we expect a shift from the relatively undefined discretionary activities towards more tightly defined controlled and restricted discretionary activities. Fewer full discretionary consents will be required but those that remain can expect to be fully notified.

Background and current provisions

4. Resource consents are a key instrument for achieving ‘sustainable management’ under the RMA. A resource consent allows a person to carry out an activity that would otherwise contravene section 9, 11, 12, 13, 14, 15, 15A or 15B of the RMA, as long as it complies with any conditions attached to the consent. A resource consent is required for any activity regulated by a rule in a district or regional plan or a national environmental standard. It is common for a project to include multiple activities requiring multiple resource consents from more than one resource consent authority.

Brief history

5. Prior to the RMA, the Town and Country Planning Act 1953 was the first New Zealand planning law to introduce specific types of resource use permits. These were “predominant uses, conditional uses and specified departures, and included requirement for notification of developments other than predominant uses”.^[292] This Act encouraged town and regional planning, conferring additional responsibilities on local government. District-wide schemes were then required for every urban area and these had to meet a wide variety of provisions including for zoning, heritage interests, recreational, amenity, public infrastructure and building design. Only directly affected land owners had a right to object to development proposals.
6. There was a shift towards more strategic and policy focussed planning in the 1960s and 70s which led to the creation of the Town and Country Planning Act 1977. The formative process of this Act provided an opportunity to comprehensively rework the existing planning framework. Matters of national importance were added to assist consideration of environmental and social matters, which broadened planning considerations. The Act also directed local government to give consideration to Māori culture and traditions. Under this Act, public consultation was simplified and streamlined, but also widened. A consultation process was established for district schemes and planning applications, where the public could express their views as objectors.
7. Whereas the purpose of the Town and Country Planning Act 1977 had been the “wise use and management of resources” and the “direction and control of the development of regions, districts, or areas”,^[293] the RMA has focused on the sustainable use and management of natural and physical resources. Relevant to consenting, the RMA:
   • introduced the ‘effects-based’ assessment
   • included a hierarchical relationship between the RMA, national direction, policy statements and plans
   • enabled, but did not require, traditional urban planning
   • provided for consideration of social and amenity impacts
   • clearly set out the requirements for consent applications and developed a consistent process for all applications
   • included provisions for public participation and determining whether an application should be notified.
8. Since 2001, numerous amendments have been made to the RMA, with many rounds of substantive reform. Each of these reforms has dealt with aspects of the resource consent system, focusing especially on notification requirements and consent timeframes. Some notable changes to the consents process include introduction of limited notification in 2003, strict statutory timeframes in 2009, and limitations to the scope of objections and consent conditions (2009 and 2017). Notification requirements have changed with each successive reform, narrowing the use of public notification and becoming more prescriptive about when it can and cannot be required.

Components of the resource consent process

9. The provisions of Part 6 can be broken into component parts of the resource consent process including: lodgement; assessing if further information is needed; determining whether it is notified; the notification, submission and hearing process; decision-making, including drafting conditions; and appeals. Table 9.1 identifies these parts in bold along with their corresponding sections in the RMA. Pre-application meetings, while not provided for in the RMA, also form an important voluntary first step in the process.

Table 9.1: Component parts of the resource consent process

10. Part 3 of the RMA sets out the need to obtain resource consent, and Part 6 contains the provisions for processing resource consents, from application to decision. It also includes provisions for different consenting tracks in different circumstances, from the issue of ‘consent waivers’ for boundary and marginal and temporary activities, to the direct referral of resource consents to the Environment Court. Part 6AA contains special provisions for proposals of national significance.

Consent types

11. Section 87 outlines five different types of resource consents:
    • land use consent (sections 9 and 13)
    • subdivision consent (section 11)
    • coastal permit (sections 12 and 14–15B in the coastal marine area)
    • water permit (section 14 other than in the coastal marine area)
    • discharge permit (section 15).
12. Many applications need more than one type of consent to proceed. The most common example is where both a land use and a subdivision consent are needed to on-sell a new dwelling. Other examples such as jetties, emitting factories, farm irrigation schemes and farm culverts all frequently generate the need for more than one consent, usually from two or more different authorities with completely separate processing tracks. Joint hearings are required under section 102 where two or more consent authorities are involved, with limited discretion to depart from this.

Activity status, notification and public participation

13. Rules in regional and district plans determine the category within which an activity falls (permitted, controlled, restricted discretionary, discretionary, non-complying and prohibited). Each has a corresponding consenting pathway, which may be more or less restrictive. Permitted activities do not require a consent and prohibited activities cannot receive a consent.
14. Public participation in resource consenting processes has changed through amendments to the RMA over the years. The original presumption in favour of notification has been reversed and the scope of who can participate in the process has narrowed. Only 710 resource consents of a total of 35,539 (2 per cent) were publicly notified last year.^[294] Another 1.8 per cent of resource consents were limited notified, meaning participation is limited to a few affected parties. As a result of this low rate of notification, there are no rights to make a submission or appeal for the large majority of resource consents.

Decision-making

15. Although all consents have their own matters to consider, they follow similar application and decision-making processes, which are intended to be proportionate to the activity being considered. All consents are considered under section 104, which includes assessing, subject to Part 2, any adverse effects and relevant planning documents.
16. Local authorities decided the majority (96 per cent) of resource consents over the previous five years, with the rest being decided by independent commissioners, elected representatives or the Environment Court.^[295] A small number of consents follow one of the different tracks provided, including direct referral to the Environment Court or as proposals of national significance.
17. Most resource consent applications are granted (around 99 per cent of the approximately 38,000 decided each year).^[296] The majority (approximately 80 per cent) of consents are for section 9 or 11 matters (land use or subdivision).
18. Less than 0.5 per cent (147 last year) of resource consent decisions are appealed to the Environment Court, and the Court estimates that only 5 per cent of these end in a hearing (that is, around seven last year). Appeal rights are only provided for applicants and submitters on limited or fully notified resource consents. There is currently no avenue to challenge councils’ resource consent notification decisions in the Environment Court. The only legal avenue is to challenge the decision through judicial review in the High Court.

Nationally significant proposals and direct referrals

19. The proposals of national significance and direct referral processes are two pathways available for large-scale, complex or potentially contentious applications. Generally proposals of national significance are used for public infrastructure applicants, such as in energy, infrastructure and roading-related applications. Cases heard through the direct referral process tend to comprise proposals for larger commercial or infrastructure proposals.
20. The provisions for proposals of national significance enable the Minister for the Environment (or Conservation if in the coastal marine area) to determine whether a project is a matter of national significance and, if so, to put it on an elevated and time-limited processing track. The proposal is heard by a board of inquiry or the Environment Court instead of the local authority, with rights of appeal limited to points of law. The Environmental Protection Authority (EPA) has a role in processing the application and making recommendations to the Minister on whether a proposal should be ‘called in’, as well as in administering the board of inquiry.
21. The direct referral process was introduced into the RMA in 2009. It allows applicants to request direct referral to the Environment Court from their local authority. It is different from the proposals of national significance process as central government does not have a role, and no statutory criteria apply to how a local authority determines whether an application should be directly referred.

Issues identified

22. Issues identified with the resource consent process are:
    • the resource consent process continues to be complex, costly and slow
    • the need to balance efficiency with access to justice, as well as reflecting Te Tiriti o Waitangi
    • unnecessary debate, litigation and process involved in notification
    • the impact of existing use rights and the permitted baseline test
    • the process does not effectively address cumulative effects
    • the capacity and capability of all parties in the process, including the capacity of mana whenua
    • monitoring of environmental change through consent approvals and enforcement of consent conditions.
23. The scope and magnitude of each of these issues varies between councils. But one central theme emerges overall: too many decisions impacting on the wider direction of environmental management are happening at the resource consent level, rather than being addressed at the plan-making stage. More effort needs to be directed towards improving the quality of plans and, in this way, reducing the room for debate during consent processes.

The process is complex, costly and slow

That resource consents are complex, costly and slow has been a constant refrain throughout the life of the RMA. The data shows this widespread perception is true, at least for a good portion of consents.

That resource consents are complex, costly and slow has been a constant refrain throughout the life of the RMA.^[297] The data shows this widespread perception is true, at least for a good portion of consents. Central and local governments alike have made popular political promises to speed up the system and make consents easy, which has led to the imposition of strict timeframes and discounted fees when those timeframes are exceeded.

Recent measures of the time it takes to obtain consent show that half of consents are granted within 31 working days (about six weeks), 34 per cent take 27−100 working days (about five months) and 16 per cent take over 100 days to be granted (figure 9.1).^[298] Notification and information requests are the most common factor in extending timeframes beyond 20 working days, in some cases doubling or tripling the time a consent takes to be processed.^[299]

While timeframes can be slow, over 96 per cent of all consents were approved non-notified last year, and only 1.4 per cent of all consents went to a hearing. For the half of consents that ran well over 31 working days, other factors were clearly at work besides participation in the hearing process. For some consents it may be that the length of time represents an iterative process of improvement, where the applicant makes changes to the project in order to get a non-notified consent. For others it may be that the consent authority requires further technical reports from the applicant to make its own assessment. Both these factors can contribute to better-quality outcomes, but they can also be sources of unexpected costs and delays for the applicant.

Figure 9.1: Distribution of the number of working days to grant new resource consents, 2018/19

Figure 9.2: Percentage of consents granted in 2018/19 by the type of notification and if hearing was held^[300]

27. Reforms to the RMA over the past 20 years have attempted to improve the efficiency of consent processing and reduce their cost to applicants. Direct referral, streamlined consent provisions, statutory timeframes and attempts to narrow the scope of public notification were all introduced to address the issue. However, these provisions have added to the complexity of the consenting system overall.
28. Complexity also impacts on the costs of the application. The median council processing fee of a non-notified resource consent in 2018/19 was $2,143, while the median fee for a notified consent with a hearing was $18,414.^[301] This does not include the applicant’s own costs for planning and technical advice, which is needed more than ever to navigate an increasingly complex system that can potentially end in court. In addition, where a consent is limited or publicly notified, each party engaged in the process may be obliged to hire their own professionals to avoid the risk of being disadvantaged in negotiations or at a hearing.
29. Although the large majority of consents are not appealed or judicially reviewed, the perception that this could occur is powerful enough to drive risk-averse behaviour from both councils and applicants.^[302] The Productivity Commission has noted that council planners spend around 20 per cent of their time deciding whether to notify an application, either publicly or to limited affected parties.

The need to balance efficiency with access to justice

30. Some experts have argued the focus on efficiency in consenting has come at the expense of access to justice. Environment judges Newhook, Kirkpatrick and Hassan note:

there was emphasis in the early stages [of the RMA’s implementation] on an expectation that applications for resource consent would be notified, something that has changed since.
Perhaps understandably, Parliament has since felt the need to balance rights of public participation against the desirability of timeliness of delivery of processing applications and decisions. It was widely believed that the sheer breadth of open standing to participate in the early stages often resulted in inefficient and costly delays for proponents of development and other activities. Subsequent reforms of the RMA have made changes to that situation and could be argued to have sought to find a balance between public participation and efficiency of decision making.

They also point out that recent amendments have led some commentators to question:

whether efficiency might in many instances have been better served by enhancing access to justice and balancing that with more streamlined procedures rather than emphasising the latter to the virtual exclusion of the former.^[303]

31. As with other parties, Māori have very limited ability to influence decisions on resource consents when a consent application is non-notified or limited notified. Mana whenua are not always included in a limited notified application, although section 95E(2)(c) requires the consent authority to consider statutory acknowledgements when determining who is an affected person. Where mana whenua are included and express an interest, a cultural impact assessment is sometimes commissioned, which can stretch time and resources for both the applicant and mana whenua. The resulting document often has limited influence because it is considered too late in the process and is not translated into relevant conditions.

The system lacks a middle process, whereby affected parties, mana whenua and groups that represent the public interest can participate in the assessment of a consent without the formalities of a hearing or the potential cost and uncertainty of an appeal.

The choices under the RMA for public participation in consents are limited to either having no information and no involvement in a consent or having full rights to a hearing and appeal to the Environment Court. The system lacks a middle process, whereby affected parties, mana whenua and groups that represent the public interest can participate in the assessment of a consent without the formalities of a hearing or the potential cost and uncertainty of an appeal.

Unnecessary debate, litigation and process involved in notification

33. Sections 95A–G provide a multitude of matters to consider to determine whether an application should be publicly or limited notified. Each reform has added complexity to the determination. There are two decision trees to follow that help the consent authority decide whether an application should be publicly notified or limited notified. The steps set out in section 95A are:
    • step 1: determine whether there are mandatory reasons for public notification
    • step 2: determine whether it is in a category of activities that are precluded from notification
    • step 3: determine whether notification is required by a national environmental standard or the effects are ‘more than minor’
    • step 4: determine whether, even if public notification is precluded or not ‘more than minor’, special circumstances exist that require public notification.

For all parties a lot can be at stake in the decision to notify or not. Notification has in the past dramatically increased the costs, timeframe and uncertainty of an application, but non-notification or excluding a party that believes it is affected can mean a breach of natural justice.

Following the steps for determining limited notification, some sections are intended to help the consent authority determine who is an affected person, whether an effect is more than minor and who are affected customary marine title and protected customary rights groups. The determination hinges on two factors: whether a party is entitled to be called an ‘affected person’ and whether the effects on them are ‘minor or more than minor (but not less than minor)’.

This summary simplifies an overly complex collection of matters to consider, with years of caveats added on both sides of the ‘must notify’ and ‘cannot notify’ ledger. The consent authority has a limited time to make this determination and its decision is open to judicial review.

For all parties a lot can be at stake in the decision to notify or not. Notification has in the past dramatically increased the costs, timeframe and uncertainty of an application, but non-notification or excluding a party that believes it is affected can mean a breach of natural justice. Decisions without public input can miss critical matters that would reframe the consequences of a decision. Excluding mana whenua from engaging on an application that affects their taonga causes avoidable damage, both physically and to local relationships.^[304]

Notification can result in a longer and more expensive process, but it also makes for a better‑informed process. Mana whenua and organisations that represent the public interest have contributed to numerous landmark decisions over a half-century of environmental management. The Environment Court values their participation in appeals.^[305] More hearings and appeals do not necessarily follow from greater participation by mana whenua and public interest groups; proposals can be improved through direct discussions and mediation and may be granted without ever going to a hearing.

Existing use rights and permitted baseline test

38. An approved consent gives the applicant a right to use resources or pursue development in accordance with the conditions of the consent. This right is transferable to the applicant’s successors for a set period of time (in some cases, like subdivision, in perpetuity). In addition, existing uses of land are ‘grandfathered’ in, enabling a use to continue even if it is contrary to plan objectives and policies and would be declined if an application were made today. A permitted activity can become an existing use right for someone through the issue of a ‘certificate of compliance’, enabling them to carry out an activity managed in a plan as though it were still permitted.^[306] An existing use right can also allocate exclusive rights to use a scarce resource over other potential users.
39. Existing rights are an important surety for a rights-holder, protecting investments they have made for the social, cultural and/or economic wellbeing of their family or society. They enable important public infrastructure to proceed and insulate small operators from shocks due to changes in the system. The problem arises when these existing rights enable the holder to use and develop land in ways that are at odds with community objectives or are now understood to be harmful to the environment. The recommendations we have made in chapters 5, 7 and 11 are intended to address these problems.

The effect of the permitted baseline on consenting is that the focus is on the additional effects of any activity that requires the consent, as it explicitly seeks to disregard those effects that would be permitted as of right.

The principle of the permitted baseline under the RMA is to take the effects of a permitted activity and effectively discount them in considering consent applications. It derives from section 104(2), which allows the consent authority “to disregard an adverse effect of the activity on the environment if a national environmental standard or the plan permits an activity with that effect”. This principle is relevant not only to the assessment of effects but also to the decision whether to notify an application or who may be an affected person, and to how cumulative effects are managed.

The effect of the permitted baseline on consenting is that the focus is on the additional effects of any activity that requires the consent, as it explicitly seeks to disregard those effects that would be permitted as of right. Case law has established that the permitted effects of one activity can be used as a baseline for the effects of another that requires consent.

Process does not effectively address cumulative effects

42. Cumulative environmental effects result from a number of effects that are minor on their own but, when combined with each other or other factors, lead to poor environmental outcomes. While cumulative effects are often thought of in terms of effects on the natural environment, the concept is also applicable to accumulated decisions in a social, economic, aesthetic and cultural sense. The fact that RMA decisions are accumulating to degrade the environment is a plan-wide issue, but several factors relate specifically to resource consents:
    • there are gaps and broken feedback loops between environmental data and plan provisions, making rules in plans ineffective at holding use and development to environmental limits
    • permitted activities can lead to unmonitored ‘environmental creep’
    • approved applications move the threshold for what is acceptable change in the environment (the permitted baseline)
    • unimplemented consents are not always factored in to assessments of the existing environment
    • consent conditions are sometimes poorly drafted and monitored for compliance, meaning even well-intentioned attempts to mitigate effects can fail
    • existing use rights, consent lifespans and lengthy planning processes allow harmful practices to continue unchecked, and make it hard to act on new information.

Capacity and capability of all parties in the process

Where iwi and hapū have the ability to influence resource consent decisions, it is frequently in an unpaid capacity as an affected party or a submitter on a publicly notified application.

Recent data on consent processing suggest that another key driver of inefficiency is the capability and capacity of councils. Councils in high-growth areas struggle to keep up with the volume of consents required to support the pace of development.^[307] Smaller councils often do not have access to technical experts needed to assess criteria in their plan, leading them to rely on technical reports supplied by the applicant.

Affected parties, and parties that would represent the public interest in a limited or notified consent, often lack capability and capacity as well. Many of these parties are laypeople or volunteers with no professional background in planning or resource management. Some parties may not participate because they cannot take time off from other obligations in their life to attend hearings.

Where iwi and hapū have the ability to influence resource consent decisions, it is frequently in an unpaid capacity as an affected party or a submitter on a publicly notified application. In a 2012 survey, half of kaitiaki rated their capacity to engage in RMA processes as ‘poor’ or ‘very poor’.^[308] While an increasing number of iwi authorities have professional staff to assist with RMA work, only 42 per cent of councils have a budgetary commitment to help mana whenua participate in resource consents.^[309] When a council does pay for such assistance it must decide whether to pass that cost on to the applicant or absorb the cost into its own budgets. Māori also cite a lack of capability among consent planners to translate their cultural values into the terms required for justifying decisions and consent conditions.^[310]

Monitoring and enforcement

46. Consents are usually approved with a number of conditions intended to guide how the activity is carried out. Conditions can include mitigation measures, requirements from mana whenua, protocols for accidental discovery of archaeological sites and effects/compliance monitoring during phases of work. Conditions can involve reporting data generated by the activity, such as noise, vibration or water pollution, with the ability to modify the activity if any thresholds are breached. Consent conditions should be drafted in a way that is enforceable and the consent authority should have the capacity to monitor them and enforce compliance. However, this is often not the case in practice, with the result that the activity harms the environment in ways that it was supposed to avoid, remedy or mitigate.
47. Additionally, permitted activities are difficult to monitor because there is not necessarily a record of where and when they are undertaken. Proxy measures, such as tracking building consents and other consents triggered alongside the activity, are crude methods that cannot capture the full consequences of all activity that changes the environment. Councils also have no charging mechanism to recover the cost of such monitoring from the party undertaking the activity.
48. State of the environment measuring and reporting can capture the effects of environmental change, but is disconnected from causal factors. Poorly drafted conditions, untraceable activities and poor compliance, monitoring and enforcement break the feedback loop between policy effectiveness monitoring and the state of the environment monitoring, making the entire system less effective in achieving its purpose.

Options considered

49. The options we advanced in the issues and options paper included:
    • simplify the categories of activities
    • reduce the complexity of minor consent processes by only requiring certain applications to conduct a full assessment of environmental effects
    • establish a separate permitting process and dispute resolution pathway for residential activities with localised or minor effects (building on the current process for marginal or temporary non-compliance or boundary activities)
    • more clearly specify permitted development rights for residential activities
    • simplify notification decisions by:
      • ‒ notifying all activities but removing automatic requirements for hearings and appeals, or
      • ‒ requiring that plans specify the activities that must be notified, or
      • ‒ more clearly defining who an ‘affected party’ is or when ‘special circumstances’ that require notification would apply
    • maintain a separate consent pathway for nationally significant proposals
    • improve transparency by requiring all applications and consents issued to be electronically available to the public
    • facilitate lower-cost consent processes by mandating online systems.

Discussion

50. We received a significant amount of feedback on the consents and approvals section of the issues and options paper. Most submitters agreed with the issues the paper identified, including:
    • the need to protect certain environmental bottom lines
    • the RMA should have greater focus on environmental outcomes.
51. Submitters also expressed a variety of opinions on the current consenting and approval system, including:
    • a reduction in complexity in general is required
    • consenting types are generally fit for purpose but may require some review
    • a need for more central government involvement or national direction
    • there are issues with the current system for the notification of consents
    • the current dispute resolution process and the role of the Environment Court raise some challenges
    • public participation in the system has certain costs but also brings certain benefits
    • there is a need for a centralised, accessible, electronic database of consents and for greater standardisation in the system
    • there may be scope for expanding the role of national planning standards and notification provisions
    • the concept of deemed permitted activities is currently fit for purpose
    • capacity and capability issues are affecting the quality of resource consents

The resource management system as a whole should improve plan quality, support appropriate participation in the process and reduce the time and effort involved in obtaining and administering resource consents.

environmental bottom lines could be a useful tool in addressing the cumulative impact of multiple resource consents.

52. Our proposals in regard to consents need to be considered in the context of our overall recommendations for resource management reform. The intent is that these options cascade from higher-order changes; including new purpose and principles, a focus on specifying outcomes and targets, provision for combined plans, use and development within prescribed environmental limits and increased mandatory national direction. The resource management system as a whole should improve plan quality, support appropriate participation in the process and reduce the time and effort involved in obtaining and administering resource consents.

Retain or reduce the types of consents

53. The consent types outlined in the RMA have been part of the RMA from its outset and add some complexity, due to both the different process provisions and the need for multiple types of consent for some proposals. We have considered whether in an outcomes‑based system all five types of consents are necessary or whether there is benefit in combining them.
54. The Panel did not see any merit in removing any of the consent types. These focus on distinct systems within natural and urban environments, and continue to support our proposals for Part 2. They are effective in practice and free of any unintended consequences. We do not propose that the RMA should cease managing any of the activities defined by these types.

A single ‘open portal’ for lodging consents could simplify the applicant’s experience and require local and regional authorities to coordinate more closely on related consents.

The option of combining two or more of the consent types was also considered, but is not recommended by the Panel. One key difference between them is that the presumptions in the RMA differ between restrictions on property development (land use and subdivision consents) and use of the natural environment and ‘the commons’ (water, coastal and discharge permits). The presumption for property development is to permit land owners their private property rights unhindered, except where broader public interest matters are at stake. For the natural environment, the emphasis is on proactively managing activities that could pollute or over-allocate aspects of a shared environment. We consider this distinction remains important.^[311]

In our view, the permitted, controlled, restricted discretionary, discretionary and prohibited activities remain useful activity classes. However, we recommend the removal of non-complying from the list of activities.

Other ways to address these complexities became apparent through the Panel’s consideration of other parts of the resource management system. For example, combined plans would consolidate the planning framework for regional and locally-administered consent types. We propose a single ‘open portal’ for lodging consents, which could simplify the applicant’s experience and require local and regional authorities to coordinate more closely on related consents. For more detail see the section below on the ‘open portal’ for resource consents.

57. In general, the Panel’s view is that these categories remain necessary and appropriate, and that combined plans and online consenting will help address the complexity issue.

Retain or reduce activity classes

58. It is noteworthy that the RMA prescribes what the consent authority may and may not do in relation to the various activity classes but does not provide any guidance on when to use any of them. As a result, plans do not use them in a way that is consistent with their higher‑order provisions and, by extension, with the purpose and principles. The development of an outcomes-based framework provided the Panel with an opportunity to consider how activity classes should be used and whether they were all necessary.
59. We think some guidance should be given as to the circumstances in which it is appropriate to use each of the categories. The nature of the different classes of activities has an important bearing on whether and to what extent applications need to be notified.
60. In our view, the permitted, controlled, restricted discretionary, discretionary and prohibited activities remain useful activity classes. However, we recommend the removal of non-complying from the list of activities. Our rationale for continuing with some categories and not others is discussed below.

Permitted activities

61. Permitted activities are not only generally acceptable and anticipated but are sometimes encouraged to achieve the outcomes expressed in the plan. Permitted activities enable active maintenance and management of the environment, allow for acceptable use and enjoyment of resources and provide certainty for what a property owner can do as a matter of right.
62. Performance standards put clear boundaries on these activities so they are limited only to those actions that are acceptable without further control.
63. No resource consent is needed to undertake these activities and, as a result, they can be difficult to monitor. Enforcement of performance standards is usually limited to obvious compliance issues and complaints. This is addressed further in chapter 13.

Controlled activities

64. The controlled activity class is appropriate where the proposed activity is generally acceptable and anticipated in the locality, but where the local authority or other consent authority wishes to keep control of the performance standards.
65. Consent must be granted, but the consent authority wishes to retain the ability to impose conditions over matters for which it has reserved control. (Note that these matters may include conditions that differ from those offered by the applicant.)
66. Because consent must be obtained, there are records of these activities that can be monitored.

Restricted discretionary activities

67. The restricted discretionary activity class applies where:
    • the proposed activity is generally appropriate, but the council wishes to retain the discretion to refuse consent, because in specific circumstances the activity may be inappropriate
    • there is certainty over the matters on which the local authority wishes to reserve discretion such as building height, height in relation to boundary and site coverage.
68. The consent authority may decline the application and, if granted, conditions would be limited to those matters over which control was reserved in the relevant plan.

Discretionary activities

69. The discretionary activity class is appropriate for all other applications, including many currently identified as non-complying activities. For discretionary activities, the local authority would have the ability to grant the application and to impose conditions or to decline it. No restriction would apply to the matters a local authority could consider and impose by way of condition, in contrast to the restrictions placed on controlled or restricted discretionary applications.

Prohibited activities

70. Prohibited activities are those identified in plans that should be avoided to meet the outcomes of the plan and/or national direction. The Supreme Court has clarified that policies requiring certain activities or adverse effects to be avoided must have prohibitions to give effect to that requirement.^[312]
71. Consent applications cannot be made for these activities, because it is never considered appropriate to give consent. This provides a clear boundary and greater clarity on what is not acceptable. However it is also highly restrictive and the use of this activity type in plans can be contentious. With our recommendation to move towards clearer and more directive plans we envisage that the prohibited activity category will be used more often in a future system.

Removal of non-complying activities

72. Generally, non-complying activities are activities that are not anticipated in the plan, triggering a ‘gateway test’ in section 104D.^[313] Their use in plans, however, has led to unintended consequences.
    • The restrictions in section 104D result in substantial and unnecessary debate on what constitutes a minor adverse effect.
    • Because the gateways are expressed in the alternative, an application considered to have only minor adverse effects may be granted, despite it being contrary to the objectives and policies of the relevant plans.
    • The real focus should be on the extent to which the grant of the application would contribute to the positive outcomes contemplated by the relevant plans. This could be better achieved through a discretionary activity.

Removal of the non-complying activity class will reduce complexity, while retaining activity classes that are clear, necessary and proportionate to supporting assessment processes.

Non-complying status has been used in plans to signal that an activity is discouraged to a greater degree than a discretionary activity, without going as far as justifying a prohibited activity. Because of the gateway test, this status is not necessarily borne out in practice, and the activity can often effectively be treated in the same way as a discretionary activity.

73. Submissions received on the non-complying activity class support either refocusing or removing it. One of those seeking its removal is Auckland Council, which considers discretionary and non-complying activity classes overlap. Its submission also suggests that if objectives and policies are robust enough, there should be little difficulty in declining a discretionary activity where it is considered undesirable relative to the plan’s intent. Bay of Plenty Regional Council also expressed support for removing the non-complying consenting category as it has become indistinguishable from a discretionary activity in practice.
74. Those submitters promoting the retention and refocus of non-complying activity suggested making the section 104D gateway test more distinct from discretionary activities, or including statements within the RMA to clarify non-complying activities are generally considered inappropriate.
75. We are also aware of the 2009 Technical Advisory Group (TAG) findings that for the gateway test:

It would be unusual that a council would decline consent for an activity the effects of which were indeed no more than minor; and to grant consent to an activity which was “repugnant” (for that is the sense in which the Courts have interpreted the words of the Act) to the plans objectives and policies.
Yet, much staff time and consideration is given in the early stages of consent processing, and much greater attention given at the later hearing, to the issue as to whether the activity meets either or both of the gateway tests. In the TAG’s view nothing is gained by this analysis that would not be gained merely by undertaking the same sort of consideration that is given to discretionary activities under section 104. We therefore recommend the abolition of the non-complying consent category.^[314]

76. In considering these suggestions and previous reviews and reflecting on our recommended new purpose and principles, we take the view that the non-complying activity class should be removed. The removal of the non-complying activity class will reduce complexity, while retaining activity classes that are clear, necessary and proportionate to supporting assessment processes.

Applications and information requirements

77. Application and information requirements are set out in sections 88–92B and Schedule 4 of the current RMA. These include the method for lodging applications, the timeframes for consent authorities to determine whether the application is complete, timeframes for processing and exceptions to those timeframes, including the request for further information. The request for further information is the one point at which a consent authority can unilaterally ‘stop the clock’ on the processing of a consent.
78. A decade ago, the TAG reported that information requirements were “one of the more frequent complaints as regards the complexity of the processes”. Its concern was that consent authorities were using the request as a way to stay within their statutory timeframes, rather than to fulfil a genuine need for further information. Its recommendations included limiting the halt of the statutory timeframe only to the first request for further information, rather than allowing it for each successive request.
79. At the time of the TAG’s recommendations, 40 per cent of all applications were reported as having further information requirements.^[315] In 2018/19 it was 45.3 per cent. An information request can make a resource consent take 2.6 times longer than it would under a non-notified land use consent.^[316] Disproportionately complex information requirements for lower-order consents were a risk the TAG had acknowledged but did not address beyond hoping that consent authorities would apply a sense of proportion to their dealings with minor applications.
80. Submitters who commented on information requirements generally agree that those requirements need to be proportionate to the scale and complexity of the issue. Christchurch City Council suggested amending the present Schedule 4 to limit the assessment of plan objectives and policies to discretionary and non-complying activities, leaving controlled and restricted discretionary activities to the matters of control or discretion outlined in the plan.
81. The Panel considers the statutory timeframes introduced in earlier reforms have generally functioned well and are still appropriate. The information requirements for resource consent applications are also still appropriate, but should be proportionate to the nature, scale and complexity of the issue. The present Schedule 4 will have to be revised to focus on how the application would help achieve the outcomes in a reformed RMA and the proposed combined plans, as well as dealing with adverse effects.
82. In regard to proportionate information requirements, our view is there is a good case for limiting the information requirements for controlled activities. However, some care would be needed with respect to restricted discretionary applications, because they may involve a wide range of impacts from small to large.
83. In addition, local authorities need to work proactively with mana whenua to determine appropriate information requirements and assessment of effects for resource consents where mana whenua are affected, including in their statutory acknowledgement areas, as customary marine title holders and protected customary rights groups. As a starting point, iwi management plans could be an authoritative source of relevant outcomes to assess applications against. Making these requirements clear, consistently used, efficient and mutually beneficial should be a key point of discussion within the integrated partnerships process discussed in chapter 3.

Notification of consents

84. Notification is an important issue to resolve. The reform of notification relates to a number of the issues identified, including the following:
    • whether or not an application should be notified has led to a great deal of contention and litigation through the courts, including applications for judicial review in the High Court where the consent authority proposes to proceed on a non-notified basis
    • the notification provisions of the current RMA have led to numerous amendments that have not allayed public concerns or reduced the scope for debate
    • the balance between efficiency and public participation in resource management processes continues to be a matter of deep concern in the community

Many submissions consider that the current notification provisions are complicated and fraught with issues. A number emphasised the importance of clarity over when notification is required and requested the system change to ensure certainty.

applicants and local authorities focus too much time and effort on addressing notification issues, rather than considering the merits of the application.

85. Many submissions consider that the current notification provisions are complicated and fraught with issues. A number emphasised the importance of clarity over when notification is required and requested the system change to ensure certainty.

Given the risk averse nature required through the RMA, under the current RMA legislation it is considered that full reviews of all consent[s] need to be undertaken. The current Consenting process is thought to [be] very litigious at the present time. In particular the s95 and notification process is an overly complex and time consuming process. It is not uncommon for Resource Consent reports to be 40 - 60 pages long, even for simple applications such as Restricted Discretionary Activities. Much of the complexity of these reports are due to the notification assessment. (Hastings District Council)

86. Others expressed concern that the lack of clarity in the system disenfranchises community groups.

We agree that notification requirements should be modified. We expect in a future system they will be dealt with at the plan-making stage rather than in every resource consent.

In our view, if s95 of the RMA is allowed to stand in its current form, then groups such as ours and communities generally will continue to be disenfranchised from the planning processes; in short it is an anti-democratic part of the legislation that serves to undermine the principles and integrity of that Act. Without public participation, local authorities may often simply not be in a position to determine who is affected and whether the effects are more than minor. (Russell Protection Society)

87. A number of submissions made the point that consenting pathways must be matched to the scale and risk of the activity, and that in practice many of these are currently inappropriate. Development of more appropriate consenting pathways was a key element of feedback.
88. We agree that notification requirements should be modified. We expect in a future system they will be dealt with at the plan-making stage rather than in every resource consent. In summary, our proposals are:
    • the current statutory focus on whether the activity is likely to have adverse effects on the environment that are more than minor should be abandoned
    • for controlled activities, the presumption would be no notification unless special circumstances exist (such as where the proposal has aroused widespread community concern)

The current statutory focus on whether the activity is likely to have adverse effects on the environment that are more than minor should be abandoned.

restricted discretionary applications could be notified or not, but the local authority would specify in its plan whether this was the case. For notified restricted discretionary activities, the local authority would also identify the circumstances for limited or full notification and in the case of limited notification, the parties subject to such limited notification

all discretionary applications would be fully notified.

89. We note this position, though clear, is not supported by all submitters. Councils may see this as oversimplification, as expressed by Greater Wellington Regional Council (GWRC):

GWRC does not support a requirement for plans to specify the activities that must be notified. GWRC supports the current approach in the RMA (Section 77D) whereby plans may make a statement as to whether a rule is to be publicly notified, limited notified or non-notified. There are many instances with the Proposed Natural Resource Plan where activities with vastly different scales of effect would require consent under the same rule. Requiring plans, and thereby rules, to specify activities that must be notified would increase the complexity of plans. There would have to be additional rules, carefully crafted to only be triggered by activities of a notifiable scale.

Plans under the new resource management system will have far fewer discretionary activities and more prohibited, restricted discretionary, controlled and permitted activities.

We acknowledge the concern some submitters expressed over requiring all discretionary activities to be fully notified. Under the current system this would result in more public notifications each year, because only about seven per cent of applications for discretionary activities are notified in practice.^[317] However, our system aims to reduce the number of consents through a clearer focus on strategic outcomes and environmental limits in regional spatial planning and national direction. Furthermore, by applying our rationale for the status of activities above, plans under the new resource management system will have far fewer discretionary activities and more prohibited, restricted discretionary, controlled and permitted activities.

We also understand that the scale, nature and severity of effects can vary for activities that require consent under the same rule. We expect that our recommended shift to whether an activity achieves the outcomes in the plan will guide plan-makers in drafting new rules that can draw these distinctions more clearly. Ultimately, we are seeking a system that better anticipates these issues and plans for them.

Specifying affected parties

Limited notification should only occur where it is possible to identify in advance the neighbours, statutory agencies and mana whenua and others who may be potentially affected.

The circumstances in which limited notification is appropriate and what form limited notification should take have also given rise to much debate. Under the current legislation (section 95 and following), the decision as to whether to order full or limited notification depends on matters such as: whether or not the activity would be likely to have adverse effects on the environment that are judged with some confidence to be more than minor; and consideration of who an ‘affected person’ is.

This leads to further debate about who an affected person is. Our recommendation is that limited notification should only occur where it is possible to identify in advance the neighbours, statutory agencies and mana whenua and others who may be potentially affected by the matters over which the local authority has reserved discretion under the plan.

The local authority’s plan should specify for each restricted discretionary activity the categories of persons who may be potentially affected by the relevant application. If it is not possible to identify in advance the categories of persons potentially affected by the relevant application, then there should be full public notification.

Our preference is to clarify in plans who is a neighbour for the purposes of adjudicating boundary infringements.

The 2017 RMA reforms introduced the term ‘neighbour’, which section 87BA describes as the owner of an allotment with an infringed boundary. In this context, a proposal that would require consent due to an infringed boundary could be deemed a permitted activity if the neighbours provide their written approval. This same definition applies to a potentially affected party who might be notified of a resource consent under section 95B(7)(a).

Though it seems straightforward, determining adjacent boundaries does involve issues and inconsistencies. The process can miss neighbours across the road as affected parties and needlessly include adjacent roads. Rural landholdings may be quite large and adjacent land owners may be far from the activity, and for some activities (such as those that generate odour or noise) a different measurement that accounts for a radius of potential affect is needed.

Our preference is to clarify in plans who is a neighbour for the purposes of adjudicating boundary infringements. National planning standards can help with this by using principles that address the issues and inconsistencies identified above.

Role of mana whenua in consent applications

98. Mana whenua have broad interests in their rohe that relate back to RMA plans in a variety of ways. However, RMA provisions for determining whether full or limited notification is appropriate are, despite their complexity, a crude approach to determining whether and how they should be involved. Mana whenua could be part of the process as an affected person, as a submitter, as a technical expert required by rules in a plan, as an applicant or through relationships (with either the consent authority or the applicant). But in practice they are not involved in decisions that determine their status in the process.
99. Some plans are better than others at identifying when mana whenua views or values form part of the matters of discretion, and some local authorities have worked with mana whenua to clarify an acceptable approach. We think this is where the recommendations made in chapter 3 could assist, including the recommendations for national direction on giving effect to Te Tiriti and the development of integrated partnerships that include agreed protocols for mana whenua participation in resource consents.

Consent processes

100. We have addressed consent processes, including for hearings and appeals, in chapter 15. Our proposal is for a comprehensive schedule in a reformed RMA to house all procedural matters for both plan changes and resource consents. We do not go into further detail on consent processes in this chapter, but recognise they need to be reorganised and reviewed.

Permitted baselines and cumulative adverse effects

We see the permitted baseline test as wholly incompatible with a system that is focused on outcomes.

There is currently a tension between the permitted baseline and the rules in plans. In a plan, establishing permitted activities involves a balance of the potential positive and negative effects (benefits and costs) of that activity on the environment, and considering whether it is necessary for the intended use of the land. For example, a barn and a bach in a rural area may be of a similar size and have a similar relative effect on the wider landscape, but one is necessary to support rural production in the zone while the other is not.

We see the permitted baseline test as wholly incompatible with a system that is focused on outcomes. The reasons for this are twofold.

• Assessing whether a resource consent proposal achieves the outcomes in a plan is a fundamentally different exercise from just assessing adverse effects. Achieving outcomes is about determining an appropriate balance of the social, economic, cultural and environmental effects in resource management. As a result, the potential adverse effects of an activity may be deemed appropriate because of the activity’s overall contribution to an outcome. That conclusion does not mean a different activity with the same effects that does not contribute to plan outcomes should be granted. An effect that is acceptable in one case is not necessarily acceptable in another.
• An increased focus on plan-making will require plans to address any conflicts in the outcomes identified in section 7 of our proposed purpose and principles and to ensure plan policies and rules reflect local context. As such, we expect more permitted activities in plans. These will need tightly written performance standards that limit cumulative effects, and more robust compliance monitoring as described in chapter 13. As noted above, permitted activities do not necessarily create a baseline for other activities, because they have not been viewed through the outcomes lens.

103. The management of cumulative effects is a system-wide issue we expect to be addressed by regional spatial planning and the setting of appropriate environmental targets and limits. A critical review of plan effectiveness through data on consents and state of the environment reporting is also important. Plans usually recognise the need to avoid, remedy or mitigate cumulative adverse effects in their higher-order policies, but it is the rules that must stay current with data on approaching environmental limits and ‘course correct’ for achieving outcomes. Chapter 12 addresses this critical link.

A shift to decision-making that focuses on outcomes and environmental limits will help to reduce or eliminate the permitted baseline and consider cumulative adverse effects.

Existing uses and consents that are not yet implemented may not be taken into account in the assessment, meaning the receiving environment may go past its environmental limits with the exercise of existing rights before the impacts of a new application are considered. There is the potential to exploit this problem by stringing together several small consents over time, so that each stays beneath a threshold of significance for adverse effects whereas the full proposal will cause significant change overall. The “Open portal” for resource consents’ section later in this chapter discusses an opportunity to curtail this ‘gaming of the system’ through a requirement to bundle related activities into consents using an ‘open portal’.

Ways to limit the unrealised harm that could be caused by existing use rights are addressed in chapter 5. Finally, a shift to decision-making that focuses on outcomes and environmental limits will help to reduce or eliminate the permitted baseline and consider cumulative adverse effects. This is discussed in the next section.

Decisions – matters to be considered

106. As the result of higher-order changes to the resource management system, the Panel found a number of changes to the current section 104 would be necessary. The purpose of these changes is to:
     • shift decision-making from assessing the magnitude of effects to focusing on whether the proposal contributes to outcomes in the relevant plan, which will by extension give effect to the purpose and principles of the Natural and Built Environments Act
     • remove the reference in current legislation to the assessment being ‘subject to Part 2’^[318]
     • limit the influence of a permitted baseline test on effects on the natural and built environments
     • introduce environmental limits and binding targets
     • remove references to non-complying activities
     • remove redundant references and needlessly complex clauses.
107. We have prepared the following indicative redrafting of a new section defining the matters to be considered on a resource consent application.

Direct referral

The Panel considers the applicant should be able to apply directly to the Environment Court for direct referral if the consent authority refuses to refer their application.

Currently, under sections 85D–I an applicant may request a consent authority refer an application for a resource consent directly to the Environment Court for decision. The direct referral process is intended to save time and costs for both the applicant and submitters where the application is likely to be appealed to the Environment Court in any event. Recent examples include proposals for the America’s Cup in Auckland, a runway extension for Wellington International Airport, and Marine Spatial Planning in the Bay of Plenty. Five cases were lodged with the Court through direct referral in 2018 and four in 2019.^[319]

The consent authority may agree or refuse to refer an application directly to the Environment Court. Under 87E(9), the consent authority must provide its reasons for declining the request, but there are no substantive criteria for making the decision. The applicant can object to the consent authority’s decision, in which case an independent commissioner must decide on it under section 357A(1)(e), but there is no further recourse.

Section 87 instructs the consent authority to determine whether the application is complete and whether it should be notified. If a consent authority agrees to refer the application, it is done after the application is publicly notified.

Section 87E requires a council to grant a request for direct referral for a resource consent application if the value of the investment in the proposal is likely to meet or exceed a threshold amount, unless exceptional circumstances exist. However, the threshold to be used for this requirement has not been set in regulations, leaving full discretion to the consent authority. In its 2018 annual review, the Environment Court stated, “Members of the court consider that the Court and parties would not be overwhelmed if the need for Regulations were removed in any amending legislation”. We can reasonably assume that the number of direct referral cases would increase if our proposals are accepted.

The Panel considers the applicant should be able to apply directly to the Environment Court for direct referral if the consent authority refuses to refer their application. There ought to be criteria to guide decisions by the consent authority and the Court on an application for direct referral. These could include, for example:

• the scale, significance and complexity of the proposed activity
• whether there is any particular need for urgency
• whether participation by the public would be materially inhibited if the application were granted
• any other relevant matter.

113. Because the grant of an application for direct referral would remove a first-stage hearing that would normally be available, it is important to ensure removal of the first-stage hearing does not significantly prejudice submitters. Section 285(5) of the RMA contains a presumption that costs will not be awarded against submitters or section 274 parties in direct referral cases. The Natural and Built Environments Act should continue to provide for this, unless the submitter has acted in a vexatious manner or has needlessly or unreasonably prolonged the hearing.

Alternative dispute resolution process for minor disputes

A number of minor issues could be resolved more simply, quickly and cheaply than through normal consent hearing processes.

A number of minor issues could be resolved more simply, quickly and cheaply than through normal consent hearing processes. This view was echoed by submitters, including Nelson City Council, which supported an alternative process for minor disputes. Submitters identified a need for an approach to mediating disputes that is more inquisitorial than adversarial and suggested that the system should focus on desired outcomes, rather than on rules that must be followed. Others pointed out that the approach will need to address dispute resolution methods and costs.

The Panel recommends alternative processes to resolve such disputes. We envisage that the alternative process would be available in the case of controlled activities and restricted discretionary activities. Where, for example, neighbours were in dispute over minor infringements of development controls, such as height or height in relation to boundary, the alternative process could be used. It might also be appropriate where there is a localised or discrete public interest in the design of an activity, such as the landscaping plan for a development or a modification to a heritage building. We will not identify every potential activity for this process, but suggest that plans should identify where this alternative process may be appropriate. We have two potential options.

The Panel recommends alternative processes to resolve such disputes. We envisage that the alternative process would be available in the case of controlled activities and restricted discretionary activities.

The first option would be for the parties to agree to submit the issue to an independent adjudicator, who would decide the issue by a simplified process with no further right of appeal. The lower costs and certainty of no appeals may act as an incentive for parties to choose this option freely.

The second option is for the local authority to specify in its plan the types of activities to be decided by an independent adjudicator, who would decide the issue after considering the views and information provided by all parties. The right of appeal to the Environment Court would be preserved, but the parties would have to seek leave to appeal. Should it be granted, the outcome of the adjudication would be a factor to be taken into account.

116. Authority to use the alternative process should be provided in the Natural and Built Environments Act and guidelines could be included in national planning standards. Where alternative processes are proposed in combined plans, their application can be tested by submitters and considered by the Independent Hearings Panel before they are operative. Criteria for using them include cases where:
     • a limited number of parties are involved
     • the dispute is of a discrete or localised nature
     • the alternative process would be proportionate to the nature, extent and significance of the matters at issue.
117. We envisage an accredited panel of adjudicators from which a single member would be appointed to each dispute. The adjudicator would be at liberty to determine how to resolve the dispute fairly and in accordance with natural justice principles. An oral hearing would not be essential and the matter could be dealt with by written submissions. Potentially the legislation could provide that legal practitioners could not appear, as is the case with the Disputes Tribunal. The independent adjudicator would be bound to apply the provisions of the legislation in the same way as a normal hearing (other than as to process).
118. These options could help create an alternative process for minor disputes that is faster, simpler and less expensive.
119. Some submissions supported the removal of automatic hearings and appeal rights, and for them our proposal might still not go far enough. However, others emphasised the importance of these rights for good decision-making and public participation, and we agree they should not be removed without very good cause. We anticipate that the requirement to seek leave to appeal presents a slightly higher barrier but does not disadvantage any party whose argument truly merits the opportunity to appeal.

Standing of submitters

120. Under the current RMA, anyone may make a submission on an application for a resource consent. This was the recommendation of the 1991 review group appointed to consider the Resource Management Bill.^[320] Given only a tiny proportion of resource consent applications is publicly notified, the Panel considers that open standing should remain. Debates over how to limit standing are likely to generate dispute and there is little to suggest that open standing has caused any major concerns to the extent that the present rule should be changed.

Appeals

121. The Panel considers the Environment Court should deal with de novo (full rehearing) appeals on resource consent applications in the same way as under the current legislation. This includes standing to appeal (section 140) and the circumstances in which others may join the appeal (section 274).^[321] Appeals to the High Court on points of law would also continue as they are currently.
122. While we understand that concerns about a potential appeal drive risk-averse behaviour by consent authorities and applicants, we consider the extremely low rate of appeal for resource consents shows that the fear of appeal need not drive curtailment of appeal rights.

The extremely low rate of appeal for resource consents shows that the fear of appeal need not drive curtailment of appeal rights.

Judicial review should not be permitted unless the applicant has exercised a right of appeal on a question of law as is currently the case. Any appeal to the Court of Appeal should require leave as at present under section 308.^[322] There should be a further right of appeal to the Supreme Court, but only with the leave of that Court.^[323]

In terms of section 74 of the Senior Courts Act 2016, the Supreme Court may only grant leave if the appeal involves a matter of general or public importance; or a substantial miscarriage of justice may have occurred or may occur unless the appeal is heard; or the appeal involves a matter of general commercial significance. The Supreme Court has delivered landmark decisions on resource management law and we consider it appropriate that Environment Court cases continue to have access to this rarely needed but important avenue for appeal.

We are aware of concerns about delays through appeals but the number of appeals is very low. The average number of appeals to the High Court from cases originating in the Environment Court over the last five years is only 17 and it is likely a significant proportion of these were settled by agreement or withdrawn.^[324]

126. Chapter 14 includes further recommendations on processes and procedures in the Environment Court.

‘Open portal’ for resource consents

127. The Panel notes a combined plan would already provide for an integrated and simplified process. There also needs to be a downstream change to the consent process, in which the system treats an application as a cohesive whole rather than breaking it up into components of effects to be assessed.
128. An assessment of effects examines several different issues within the context of an application but the current system focuses too much on discrete aspects of each issue. This tendency is driven by myriad standards and assessment criteria set out in multiple sections of multiple plans. The concept of an ‘open portal’ is to bring these issues together across consent authorities when an application is made.

The concept of an open portal is based on coordination between agencies to address applications holistically under one planning framework.

While we acknowledge the technical aspects of an online consenting system still need to be dealt with, the concept of an open portal is based on coordination between agencies to address applications holistically under one planning framework. This would be achieved through:

• requiring applicants to bundle applications for a proposal to the greatest extent practicable, acknowledging that some activities are predicated on the approval of others
• making one local authority responsible for administering the portal in a region, ensuring all relevant consent authorities receive the application and facilitating a joint process
• presuming the application, if notified, will receive a combined hearing, unless there are good reasons (such as those currently outlined in section 102 of the RMA) to proceed with portions of applications ahead of others.

Interaction with the Building Act

130. The relationship between the RMA and the Building Act has given rise to some difficulties which we consider should be addressed. In part, these difficulties arise from the different purposes of the two pieces of legislation.
131. The Building Act is primarily concerned with compliance with the building code and the performance of buildings as designed and constructed. But the legislation has wider purposes as well, including the health and safety of those using buildings, wellbeing and ensuring that the design and construction of buildings promotes sustainable development.^[325]
132. Despite this wide purpose, the main focus of the Building Act is on the internal quality of buildings and there is little to address the effects of buildings beyond their footprint. The focus of the Building Act on the internal quality of buildings stems from the building code, which provides minimum standards for buildings without incentives to encourage building to higher standards. If the building code does not provide an appropriate minimum for achieving the wellbeing or sustainable development purpose, then there are no other mechanisms within the Building Act to provide for that purpose. Requirements for performance above the building code cannot be imposed on a building by other legislation.^[326]
133. A number of resource management cases as well as the Independent Hearing Panel for the Auckland Unitary Plan have considered the relationship between the building code and the RMA. An example of this relates to minimum floor levels where Auckland Council wanted a minimum floor level included in the Unitary Plan under the RMA, but the Hearing Panel recommended (on the basis of lack of evidence to justify regulation) that this is a matter that should be more appropriately controlled by the building code. However, there are other cases where regulation has been identified as appropriate under the RMA, such as the relationship of windows facing adjoining buildings and the potential impacts on privacy between these buildings. Generally, the determination appears to be based on whether or not the control relates to the internal effects of the building (usually considered building code matters) or to the external effects of that building on others in the environment (which can be considered under the RMA).
134. This distinction between internal effects and externalities is generally reasonable. However, this approach does not address the issue of the impacts of a building form (as part of the built environment) on the wider context, which is often related to urban design and street appearance factors. These are matters that have more regularly been the domain of the resource management system, but have led to concerns the system is being used to police design rather than to manage effects. The Panel considers this matter could, at least in part, be addressed through the proposed focus on planning for outcomes in the planning system (which would, for example, set outcomes for the quality of a built environment at a community level). However, such a change does not address the relationship between the building code and the resource management system.
135. There are issues that could potentially cross the boundary between the internal and external effects of buildings that need consideration. For example, should the Natural and Built Environments Act regulate for increased shade in urban environments, recognising future increases in temperature expected from the effects of climate change? It would be helpful if the matters that potentially relate to both the internal and external environment were identified by central government and guidance provided on which Act is best to regulate them.

We also suggest that consideration be given to the need to modify the Building Act and building code to address the effects of climate change and improving environmental outcomes.

In addition, the Panel generally supports approaches and incentives to encourage building standards above the minimums set in the building code; such as a rating from the New Zealand Green Building Council or similar. The building code has been slow to change and could also be reviewed more frequently to respond to new issues such as increased density and commensurate requirements for more noise insulation to protect mental health and wellbeing.

We consider that the relationship between the Building Act and the Natural and Built Environments Act is generally appropriate but recommend that the Building Act should be reviewed to improve its alignment and minimise conflicts with the new legislation we propose. We also suggest that consideration be given to the need to modify the Building Act and building code to address the effects of climate change and improving environmental outcomes and, in such response, to consider a code that incentivises buildings that go beyond minimum standards.

Proposals of national significance

The Panel supports the continued provision for proposals of national significance because it is an important way to address proposals that might not otherwise be handled with the level of expertise, timeliness and attention needed to decide them.

The provisions for proposals of national significance (currently in Part 6AA) are an important way to ensure nationally significant proposals are heard and decided within one clear, independent process. Like direct referral, the assumption is the proposal is likely under normal circumstances to be appealed to the Environment Court and it would be better to begin at that level rather than start with a local process. But in contrast to direct referral, the Minister has the power to authorise the use of the process

The EPA reports 16 completed proposals of national significance processes since 2010. Examples include the New Zealand Transport Agency (NZTA) Waterview connection and Transmission Gully, expansion of Queenstown Airport and most recently the East West Link in Auckland. All of these applications were lodged between 2010 and 2016. We note that those submitters who offered an opinion on the direct referral and proposals of national significance processes expressed support for retaining them.

The Panel supports the continued provision for proposals of national significance because it is an important way to address proposals that might not otherwise be handled with the level of expertise, timeliness and attention needed to decide them. However, we consider the approach is overly complex and that provisions could be simplified.

141. The first issue is the criteria for identifying a proposal of national significance. The Panel recommends revisions to these as follows.

142. The Panel considered whether ‘urgency’ should be included in the criteria but decided against it. While the process would be more streamlined than the standard process, the emphasis for a proposal of national significance is its national context, not whether it is urgent. Direct referral exists for any urgent proposals that are not otherwise of national significance.
143. The second matter relates to the methods for accepting and hearing the proposal. Current provisions require referrals for proposals to go through a consent authority or the EPA. Proposals are heard by an independent board of inquiry usually chaired by a retired Environment Judge, with secretarial and administrative support provided by the EPA. Because of the episodic nature of the proposals of national significance process, the EPA does not routinely have staff assigned permanently to supporting it, but commissions staff and consultants to address applications as they arise.
144. In a 2015 review of the effectiveness of the EPA, the Ministry for the Environment evaluated the involvement of the organisation in supporting proposals of national significance. While considering EPA support was responsive overall, the review identified issues with the board of inquiry process and EPA’s role in supporting it. Among these issues were:
     • lack of process consistency, as noted by board of inquiry members who heard multiple proposals of national significance^[327]
     • variable quality and expertise among board of inquiry members
     • variable quality of internal reports
     • the need to work efficiently to minimise costs (which are passed along to the applicant)
     • challenges working within the nine-month timeframe.^[328]
145. The Panel questioned whether the role of the EPA to receive requests and administer the hearing is a good use of the EPA’s institutional capabilities, given the issues cited above and opportunities to expand the EPA’s role elsewhere in the system. Furthermore, there does not seem to be benefit in having a choice between a board of inquiry process and the Environment Court. We are satisfied the Court has capacity to hear proposals of national significance cases and would provide an approach that is independent, consistent and accessible to submitters. We discuss the potential roles of the EPA and the Environment Court in chapter 14.

There does not seem to be benefit in having a choice between a board of inquiry process and the Environment Court. We are satisfied the Court has capacity to hear proposals of national significance cases.

The Panel recommends simplifying the process for accepting and hearing proposals of national significance in the following ways:

• a proposal of national significance could be called-in by the Minister on his or her initiative, or it could be referred to the Minister by a relevant local government agency or directly by the applicant
• the Ministry for the Environment would provide support to the Minister in assessing and recommending whether a proposal should be accepted
• the Environment Court would hear the proposal
• the relevant local authority would provide secretariat services on a cost-recoverable basis.^[329] This would ensure the administration had an understanding of local processes and values
• as with the current provisions, all of the costs would be recovered from the applicant.

Timeframes and appeals

We are satisfied the nine-month time limit currently applying to the proposals of national significance process is much too short.

We are satisfied the nine-month time limit currently applying to the proposals of national significance process is much too short and places intolerable and unjustified pressure on all participants. We also consider it constitutionally inappropriate to impose time limits of this kind on the judiciary who can be relied on to give the case appropriate priority. Undue speed is not conducive to sound decision-making. Appeal rights on a proposal of national significance decision would be the same as under any other decision by the Environment Court.

Expected outcomes

148. We consider our proposals for reform of resource consent provisions address the key issues in our terms of reference and align with the objectives and principles we adopted for our review. Overall, the proposals will ensure environmental objectives are met while increasing certainty and reducing costs for applicants. Fewer consents will be required, notification will be addressed in a more systematic manner, and processes will be better tailored to the circumstances.

Key recommendations

Chapter 10 Designations, heritage and water conservation orders

1. This chapter addresses designations, heritage and water conservation orders, currently provided for in Part 8 of the RMA.

Designations and infrastructure

The reformed resource management system should ensure infrastructure is adequately planned for in advance, well integrated with land use, and delivered and operated efficiently so it can support improving wellbeing outcomes.

Infrastructure is a critical feature of our built environment and delivers a range of essential services to all New Zealanders including electricity and telecommunication services, freshwater and wastewater, schools and prisons, roads, cycleways and airports.

When they have access to the right level of public transport, space at local schools, and other necessities relative to their density, communities can achieve positive social, economic, cultural and environmental outcomes. The reformed resource management system should ensure infrastructure is adequately planned for in advance, well integrated with land use, and delivered and operated efficiently so it can support improving wellbeing outcomes. This is particularly provided for through the development of spatial strategies (see chapter 4).

The reformed system should recognise the need to enable route protection and the construction and operation of public-good infrastructure. This chapter makes recommended changes to designation provisions in our proposed Natural and Built Environments Act.

Current provisions

5. The RMA enables delivery of infrastructure primarily through designations instigated by requiring authorities (the Crown, local authorities and network utility operators). The designation provisions in the RMA were largely taken from the Town and Country Planning Act 1977.

Designation powers

6. A designation is a form of district plan zoning that applies to a particular site, such as a current or future prison location, or route, such as a transport corridor. Under the RMA, designations can only apply to land. The designation zoning replaces the district plan zoning meaning district plan resource consents are not required, although regional consents, such as discharges to water, are.
7. Significant powers which impinge on private property rights are available under the Public Works Act 1981. In particular, powers of compulsory acquisition and compensation are available for land in a designated area.
8. Owners of land subject to a designation can still use their land until the infrastructure needs to be built or while the infrastructure is operating. However, that use must not impact on the purpose of the designation without express permission from the requiring authority.

Who is eligible to obtain designation powers?

9. Designation powers may be used by Ministers of the Crown and local authorities with financial responsibility for the infrastructure, and network utility operators approved by the Minister for the Environment as requiring authorities.
10. Historically, almost all public-good infrastructure was delivered by public agencies but this has changed over time with regulatory and institutional reform. Some infrastructure is now delivered by publicly owned commercial operators or private companies (eg, telecommunications companies).

What is the designation process?

11. The designation process generally involves two stages: obtaining a designation; and then preparing to carry out works on the designated land.
12. The first step is for a requiring authority to serve a notice of requirement. The notice protects land for the designated purpose until the designation is confirmed or withdrawn. Unless public notification is sought by the requiring authority, decisions on whether to publicly notify notices of requirement are made by territorial authorities in the same way as for resource consents.
13. Generally, notices of requirement are heard by the relevant territorial authority which then makes a recommendation to the requiring authority (or approves it if the council itself issued the notice). Under this process, the requiring authority is the ‘decision-maker’ on the designation. A requiring authority can ask for the notice to be directly referred to the Environment Court for a decision. Or, if the Minister considers the designation to be of national importance, then it may follow a board of inquiry process where a specific board is established to hear and decide on the designation, and appeal rights are limited.
14. Once a designation is in place, subsequent processes enable the requiring authority to undertake the proposed works without further land use consent approvals. Unless such a requirement is waived by the territorial authority, the requiring authority submits an outline plan which describes the works to be carried out. This contains information on the form and nature of the project. Specific conditions of a designation may require management plans to be prepared for defined aspects of a project. Outline plans are not publicly notified. Management plans required by conditions of a designation can stipulate specific consultation requirements to be met during their preparation. As with the notice of requirement, the outline plan is decided by the requiring authority after referral to the territorial authority.
15. Both notices of requirement and the subsequent outline plans can be appealed to the Environment Court. In the case of an outline plan, such an appeal can only be filed by the territorial authority.

Issues identified

16. Over 40 submissions on the issues and options paper made comments on designations. Feedback overwhelmingly supported the use of designations and considered that the designations system works reasonably well. Substantial feedback was also received on how to improve the system, which has helped to identify a number of issues:
    • eligibility criteria, the types of projects that can use designations, and who can be requiring authorities
    • the inability to use designations in the coastal marine area
    • inadequate 5-year default timeframes for lapse of designations
    • inefficiencies and problems with the 2-stage designation process (notice of requirement and outline plan of work)
    • opportunities are missing to jointly plan for infrastructure, integrate it with land use, and co-locate where practicable
    • difficulty aligning with other standards and processes.

Options considered

Eligibility for designation powers and process

17. As noted, designation powers are used by the Crown and territorial authorities for ‘public works’ defined in the Public Works Act 1981 and by requiring authorities approved as network utility operators.
18. Network utility operators are defined in section 166 of the RMA which includes a list of projects, works and networks eligible for this status. There are inconsistencies in these provisions, both as to who is eligible to become a requiring authority and for what works or projects. For example, some parts of networks are not eligible (eg, electricity generators and some connections to the national grid), some commercially operated sites are eligible (eg, airports and irrigation) while others are not (eg, ports), and some publicly-funded infrastructure is not eligible (eg, fire stations). For works other than ‘project works’ the application of the criteria is also unclear (eg, environmental service infrastructure such as coastal dune systems managed to reduce coastal erosion).
19. In general, infrastructure providers who made submissions wanted to see the eligibility criteria for designations widened, including the types of infrastructure eligible for designations (eg, ports, electricity generation, petroleum refining) and corresponding bodies eligible to become requiring authorities. Some suggested using designations to address other issues such as climate change adaptation and mitigation, and large developments.

Eligibility for designation powers should be limited to, and centred on, public-good infrastructure.

We have considered how designation eligibility criteria can help achieve the outcomes we are seeking through the new system, in particular ‘strategic integration of infrastructure with land use’ and ‘enhancement of features and characteristics that contribute to quality built environments’. We concluded eligibility for designation powers should be limited to, and centred on, public-good infrastructure. We consider the current approach of including a list of qualifying requiring authorities should be continued and the Minister should also have the power to approve other requiring authorities subject to considering criteria centred on public-good outcomes.

A list of qualifying requiring authorities included in the legislation should include:

• Ministers of the Crown
• local authorities
• the network utility operators listed in section 166 of the RMA which, after review, are found to meet the suggested criteria for approving additional requiring authorities as set out below.

We have concluded that designations, with their accompanying Public Works Act acquisition powers and compensation provisions, should be one method available to address the effects of climate change or to reduce the risks of natural hazards.

Suggested criteria for the Minister to consider in approving other requiring authorities should include whether the activity, projects or works of the applicant are intended for a public purpose and not predominantly for private benefit.

The need to plan for and manage the effects of climate change may mean there is a public-good interest in some projects and works that has not, to date, been provided for. We have concluded that designations, with their accompanying Public Works Act acquisition powers and compensation provisions, should be one method available to address the effects of climate change or to reduce the risks of natural hazards. We consider this could be achieved through broadening the definition of ‘work’ for designations to include reducing risks from natural hazards and adapting to climate change.

The Panel also considers the current RMA definition of infrastructure should be broadened (see appendix 1). However, the infrastructure that may be delivered by designation is a more confined subset of this broader definition.

Designations and the coastal marine area

25. Submitters sought expansion of designation provisions to include the coastal marine area. There have been instances where major infrastructure providers have been unable to secure consent under the RMA for an infrastructure work, such as electricity transmission, due to existing rights to coastal space. Unlike on land, there is currently no way to extinguish coastal permits or to override permitted activity provisions in a regional coastal plan in order to provide for a public work, even if it is for a wider ‘public good’.

The Panel recommends that consideration be given to extending the designation process to the coastal marine area.

In chapter 4 we propose that regional spatial strategies extend into the coastal marine area to promote integration between land use, the coastal environment and water quality. The coastal marine area is largely managed as a public resource, and designations for public works and infrastructure are one way to deliver such works for the public good.

The Panel recommends that consideration be given to extending the designation process to the coastal marine area, acknowledging there are some complexities that would need to be worked through. In particular, there are implications for the Marine and Coastal Area (Takutai Moana) Act 2011 and protected customary rights as well as Tiriti settlements including for aquaculture and fisheries (although it is noted that some of these issues are common for public works affecting Māori land or land subject to Tiriti settlement).

Designation default timeframes

28. Considerable input was received on the default five-year lapse period for designations. Infrastructure takes considerable time to plan and fund with large and complex infrastructure often taking decades. Infrastructure providers have consistently found the five-year default lapse period for designations inappropriate for planning and funding cycles.
29. The New Zealand Infrastructure Commission − Te Waihanga submitted:

The RMA currently provides designations for five years, extendable to ten years in certain circumstances (section 184). However, this timeframe does not always allow for the fact that some infrastructure requires decades of planning in advance. The time limit on designations was set to prevent land being blighted for development if not used by the requiring agency within the time period. However, section 185 (Environment Court may order taking of land), which enables the Court to order a requiring authority to pay a lease or to acquire designated land, provides adequate disincentive to agencies to hold land unnecessarily. We recommend that the Panel consider options that allows for long infrastructure lead times, such as extending designations to a minimum of ten years.

30. In 2010, the Infrastructure Technical Advisory Group^[330] found in most cases initial extensions to the timeframe were accepted, but there was reluctance to extend this timeframe beyond 10 years for longer-term projects. It also found the Environment Court had generally accepted a 10-year period even though longer periods were often sought. For existing designations, where extensions to lapse periods were sought, the Group suggested that the test of substantial progress or effort was not arduous and extensions were usually granted.
31. While the five-year default timeframe is often extended, we consider there is unnecessary cost and increased uncertainty created by the short timeframe and in the process of repeatedly seeking extensions. These have little benefit to land owners or to planning outcomes.

We propose a new default lapse period of 10 years for all designations, with extensions available of up to another 10 years subject to defined criteria or principles. Twenty years would be the maximum timeframe available. These longer timeframes provide for what some submitters described as ‘concept designations’ for matters such as route protection.

We propose a new default lapse period of 10 years for all designations, with extensions available of up to another 10 years subject to defined criteria or principles. Twenty years would be the maximum timeframe available. These longer timeframes provide for what some submitters described as ‘concept designations’ for matters such as route protection.

33. Principles for consideration in the extension of a designation beyond the default 10-year period would include:
    • a regional and national significance test
    • an expectation that the infrastructure is identified in a regional spatial strategy
    • that the designation facilitates co-location of infrastructure (which may necessitate longer delivery timeframes)
    • consideration of uncertainty or risk management responses.
34. The full Public Works Act powers would be available from the lodgement of a notice of requirement, as is the current situation. Current appeals to the Environment Court would also be retained.

Two-stage process: notice of requirement and outline plan

35. Submitters consider designations are becoming like consents due to the detail that local authorities require at the notice of requirement stage, and because often the requiring authorities do not seek notices of requirement until close to construction. Significant detail is usually not appropriate or available at early stages of infrastructure planning.

The Panel considers it appropriate to maintain flexibility in the implementation of designated works to suit the different types of projects and practical situations that arise.

In other cases, submitters seek a process that allows them to design and build infrastructure with less time needed to plan. These submitters see the two separate stages as unnecessary within their shorter timeframes.

As a result submitters considered designations are restricting design options and potentially losing innovation, hindering the uptake of new technology and foregoing better environmental and community outcomes. The outline plan is also less meaningful due to the detail already considered and for some it is seen as a chance to re-litigate issues.

Submitters have suggested considerable improvements to the two-stage process, particularly to clarify requirements at each stage and ensure they are appropriate for infrastructure project timeframes. Some submitters proposed different types of designations for different types of protections or projects, including ‘concept designations’ (noting there were differing views on what ‘concept designations’ were).

39. When looking at this process, we want to ensure a full assessment of environmental effects occurs for designated infrastructure projects before works start. However, the Panel considers it appropriate to maintain flexibility in the implementation of designated works to suit the different types of projects and practical situations that arise.

Notices of requirement

We have concluded that at this first stage of the process the assessment should be kept at a high level.

Our proposal to extend the default timeframe to 10 years will likely have little impact if requiring authorities are compelled to issue notices of requirement with detail that is usually only available close to the start of construction.

The Panel has considered what the appropriate level of information and assessment is for a notice of requirement and when that information is needed.

Section 171(1) of the RMA requires territorial authorities to assess environmental effects and to make a recommendation to the requiring authority. This assessment includes consideration of national direction, regional policy statements and plans, alternative sites, routes or methods, and whether the designation is reasonably necessary for the work. We generally consider the matters for consideration appropriate, given the ability for such processes to compel the taking of land through Public Works Act mechanisms. We also propose the addition of consideration of any relevant regional spatial strategy.

We propose that notices of requirement be publicly notified due to their public-good benefits and impacts on private property.

We have concluded that at this first stage of the process the assessment should be kept at a high level, focused on considering the designation’s impact on the outcomes set out in the Natural and Built Environments Act, and the environmental effects of the designation footprint, rather than on the detail of potential impacts of the works within the footprint. There would be a subsequent process to address the potential effects of works within the footprint through construction and implementation plans discussed below.

44. We propose that notices of requirement be publicly notified due to their public-good benefits and impacts on private property. When making alterations to the geographic extent of a designation, the panel considers there should also be a presumption of full notification, with the ability to reduce notification depending on the significance of the alteration. As an example, if a requiring authority seeks to alter the designation boundary, and owns the affected land, notification requirements could be waived.

Outline plans – construction and implementation plans

45. With the recommended extension of the timeframes for notices of requirement, the second stage for some designations (currently the preparation of an outline plan) will come a considerable time after the notice of requirement is confirmed. Our recommendations seek to focus subsequent processes on managing the construction effects of a designated work and its operational effects, where those effects extend beyond the designation boundaries. Detail on operational effects and their mitigation (eg, vibration effects on a We recommend that the scope of matters set out in section 176A(3) for an outline plan be broadened.

close building) will therefore be in a new ‘outline plan’ type process. For this reason, we recommend renaming outline plans as ‘construction and implementation plans’ to better convey their purpose.

46. We recommend that the scope of matters set out in section 176A(3) for an outline plan be broadened, as much of this detail will not have been considered at the time the designation was confirmed. The process will focus on the detail of what is being constructed, how it will be constructed, and how the specific effects of operating the designated work will be managed. In preparing these plans, it is expected the requiring authority will identify specific controls and conditions for construction and operation to address the potential adverse effects of the works. It is anticipated the territorial authority, if considering these plans, would be able to make recommended changes.
47. With these proposed changes, it is also acknowledged that new information will be provided at the time a construction and implementation plan is prepared. As such, the Panel considers that adequate time and opportunity should be given for public submissions and territorial authority recommendations prior to construction commencing. However, this requirement and process should not be used to relitigate the notice of requirement and should be limited to matters associated with the construction and operational effects.
48. We propose that construction and implementation plans could be submitted in stages, to enable progressive implementation of designated works.

We recommend a one-stage process is provided for so that the ‘why and where’ (notice of requirement) and the ‘how’ (construction and implementation plan) can be undertaken together if appropriate and if sufficient information is available.

Flexibility to have a one-stage process

49. Different infrastructure projects can have a variety of different needs and circumstances affecting them. Submitters wanted approval processes that also suited a ‘design and build’ approach to infrastructure which may eventuate from particular tender, contract and partner financing arrangements.
50. The RMA already provides for outline plan detail to be included in the notice of requirement or for outline plans to be waived (when they are often replaced with management plans). Nationally significant proposal processes also apply to eligible projects.
51. Building on the existing requirements, we recommend a one-stage process is provided for so that the ‘why and where’ (notice of requirement) and the ‘how’ (construction and implementation plan) can be undertaken together if appropriate and if sufficient information is available.

Enable co-location of infrastructure

52. The Panel considers that enabling the appropriate co-location of infrastructure is an important factor in achieving integration of infrastructure and land use, efficient use of land and quality built environments.
53. Regional spatial strategies will help identify opportunities for co-location of infrastructure, particularly for regionally and nationally significant projects.
54. Section 177 of the RMA provides for multiple designations on the same land to enable co‑location, but the process effectively gives primacy (veto rights) to the first designation holder. This does not always enable good integration and efficient use outcomes. It can potentially create perverse outcomes if requiring authorities seek to avoid overlapping designations to simplify matters for themselves.
55. The Panel recommends adding co-location to the considerations relevant to a notice of requirement.

Alignment with other processes

56. Submitters sought to clarify the relationship between national environmental standards and designations, and the effect of district plan rules. Some infrastructure providers consider the operation of their infrastructure is not sufficiently protected and claim they are needing to participate in plan reviews throughout the country just to maintain the status quo.
57. We consider the balance of our reforms will help to address this issue, including the ability to include infrastructure in regional spatial strategies and combined plans, the longer default timeframes for designations, and clarification throughout the entire suite of national direction. In a reformed system, infrastructure providers will need to engage with fewer plans and will have clarity on where their designations sit within the overall system.
58. Some submitters also suggested there is a duplication of the designation process with some other legislation. For example, Transpower stated the

Public Works Act process largely repeats aspects of the designation process, so similar issues arise and need to be reconsidered. Streamlining the application processes for these complementary statutory approvals, aligning the legal tests, and providing for concurrent joint hearings would minimise the cost and delay caused by this duplication. This approach is consistent with overseas jurisdictions, which generally provide for all relevant approvals to be obtained through the same process.

59. The Panel recognises the efficiencies that can be gained by aligning processes and legal tests (if appropriate), and notes the Urban Development Bill’s independent hearing panel processes that cover multiple pieces of legislation for urban development projects. However, the scope of this review limits recommendations on other pieces of legislation.
60. We consider there is merit in looking at the better alignment of processes and legal tests further but there are a number of considerations that would need to be worked through.

Heritage protection

61. Historic heritage is valued by the public. It makes an important contribution to quality urban environments, our sense of place and nationhood, and wellbeing. Historic heritage values, once destroyed, cannot be replaced. They are a non-renewable resource.
62. Statutory heritage protection mechanisms have been part of New Zealand’s resource management system for some time. Prior to the RMA, the Historic Places Act 1980 empowered the New Zealand Historic Places Trust to classify buildings, having regard to their heritage values. Once classified, the Trust could issue protection notices in accordance with the Town and Country Planning Act 1977.
63. The current RMA plays an important role in the identification, protection, and ongoing management of historic heritage. This chapter focuses on the wider system of heritage management and the potential for using heritage orders in a reformed system. The Panel notes that the Ministry of Culture and Heritage is currently undertaking a review of the heritage protection system – Strengthening Heritage Protection. We recommend that this process should continue and offer some suggestions to be considered as part of that process.

Current provisions

Heritage scheduling under the RMA

64. Under the RMA, historic heritage is defined as “those natural and physical resources that contribute to an understanding and appreciation of New Zealand’s history and cultures” deriving from archaeological, architectural, cultural, historic, scientific and technological qualities. It includes historic sites, structures, places and areas; archaeological sites; sites of significance to Māori including wāhi tapu; and surroundings associated with the natural and physical resources.
65. The matters of national importance within Part 2 include the protection of historic heritage from inappropriate subdivision, use and development; and the relationship of Māori and their culture and traditions with their ancestral lands, water, sites, wāhi tapu, and other taonga.
66. Local authorities usually give effect to these obligations by identifying historic heritage in district and regional plans, often through listing in schedules, and including associated rules to provide for its management and protection.

Heritage orders

67. Legal protection for heritage places is also available through the heritage order mechanism under Part 8. Heritage orders provide immediate protection for specific places and may be sought by a heritage protection authority (HPA). Heritage orders are seen as a last-resort option to protect historic heritage that has not been listed in relevant planning documents. They have been infrequently used.
68. Under the RMA, Ministers of the Crown, local authorities and Heritage New Zealand Pouhere Taonga (HNZPT) have HPA status.^[331] A ‘body corporate’ having an interest in protecting a place may also apply to the Minister for the Environment to become an HPA. This encompasses a wide range of entities including a company, incorporated society, state owned enterprise, charitable trust, incorporations and trusts set up under the Te Ture Whenua Māori Act 1993 and Māori Trust Boards.
69. Before approving a body corporate as a HPA, the Minister must be satisfied that:
    • such approval is appropriate for protecting the place that is subject to the application
    • the applicant is likely to satisfactorily carry out all the responsibilities (including financial responsibilities) of a HPA under the RMA.
70. Any body corporate seeking status as a HPA must demonstrate that it is fully aware of the responsibilities and potential costs involved including ongoing maintenance costs and the possibility of defending appeals.
71. To date, only four body corporates have been recognised as HPAs under the RMA. None of them is mana whenua.
72. The process for obtaining a heritage order is similar to the process for designations, and in broad terms involves:
    • the HPA issuing a notice of requirement which has immediate effect
    • the territorial authority (which could also be the HPA) determining whether to notify the requirement and to hold hearings
    • the territorial authority making recommendations to the HPA
    • the HPA confirming the heritage order and the territorial authority including it in a plan
    • provisions for appeal to the Environment Court and, where the heritage order renders the land incapable of reasonable use, powers of the Court to direct the HPA to either withdraw the order or compensate the owner for their interest in the land.
73. Once a heritage order is in place, activities that would wholly or partially nullify the effect of the heritage order can only be undertaken with the written consent of the HPA.
74. Where a heritage order is placed on a site that has an existing resource consent, certificate of compliance or notice of requirement, it has the potential to constrain the authorised activities. The holder of those existing use rights must seek written agreement from the HPA for any activity that would nullify the heritage order. This empowers the HPA to immediately halt potentially harmful activities and require the redesign of projects to avoid or minimise harm to an important heritage place. It therefore provides a strong protective mechanism.

Wider legislative landscape

75. While the RMA provides for the protection of historic heritage, other legislation also provides for heritage protection.
76. Under the Heritage New Zealand Pouhere Taonga Act 2014, HNZPT is the government’s technical advisor on historic heritage and has several statutory roles. It administers the New Zealand Heritage List / Rārangi Kōrero which provides statutory recognition for heritage places and is a source of information for councils identifying heritage sites under the RMA. However, the inclusion of a place on the New Zealand Heritage List / Rārangi Kōrero does not provide protection unless it is given effect to through relevant RMA planning documents.
77. The Heritage New Zealand Pouhere Taonga Act also provides a statutory framework for the protection of archaeological sites which include any place in New Zealand that was associated with human activity occurring before 1900, or the site of the wreck of any vessel that was wrecked before 1900; and provides or may provide, through investigation by archaeological methods, evidence relating to the history of New Zealand.
78. Under section 42 of the Act, no person may modify or destroy an archaeological site without an authority if that person knows, or ought reasonably to have suspected, that the site is an archaeological site. HNZPT administers the archaeological authority process which operates in addition to any resource consent requirements under the RMA.
79. Other statutory provisions for heritage protection are located in the Building Act 2004, which includes as a relevant principle the need to facilitate the preservation of buildings of significant cultural, historical, or heritage value, and the Conservation Act 1987, which includes a responsibility to conserve, and advocate for the conservation of, historic resources.

Heritage Issues

80. The issues and options paper did not specifically seek feedback on heritage protection, but some submitters provided input on this topic. The working group on reducing complexity also provided suggestions on how heritage order provisions could be improved.
81. Submissions from the International Council on Monuments and Sites New Zealand (ICOMOS), HNZPT, the New Zealand Archaeological Association, Christchurch City Council, Historic Places Aotearoa, Historic Places Wellington and Historic Places Canterbury all raised heritage as an issue needing to be addressed through the review. All of these bodies submitted in favour of strengthening (or at least not weakening) and clarifying existing provisions for heritage – particularly the matters of national importance in Part 2 of the RMA.
82. Christchurch City Council wanted to ensure the Panel maintained a broad definition of heritage, stating:

A review of the definition of Historic Heritage should be considered in order to fully provide for the broad aspects of heritage of New Zealand, including the multiple cultures and communities who have contributed to our heritage over time. It needs to recognise that Historic Heritage includes the built and natural environment, urban and rural landscapes, tangible and intangible heritage, stories, memories and traditions, and movable heritage. Further, that multiple values are associated with individual places, and that the heritage of cultures and values is often intertwined and interconnected.

83. Many of these submissions note the importance of heritage – ICOMOS New Zealand linked protection of heritage to a range of important areas of wellbeing:

Historic heritage in both the built and natural environment is a finite resource that brings wellbeing benefits to present and future generations. Heritage places contribute to the resilience of our communities in the face of significant change by providing a focus for community sentiment and sense of place; they also provide opportunities for emissions reduction through adaptive reuse and sustainable development.

All submitters on this topic raised concerns about the effectiveness of heritage protection under the current system.

All submitters on this topic raised concerns about the effectiveness of heritage protection under the current system. ICOMOS suggested that the heritage protection system had gone backwards in recent years.

Most submissions supported the use of spatial planning and suggested it would support heritage protection by enabling strategic consideration of what should be protected and how this should be achieved.

86. Submissions and advice from the working group on reducing complexity noted significant issues in the following key areas:
    • roles and functions in heritage protection and variable historic heritage provisions in plans
    • lack of protection for Māori heritage
    • jurisdiction over heritage in the coastal marine area
    • demolition by neglect
    • operation of heritage order provisions.
87. The Strengthening Heritage Protection project began in 2018 with an extensive stakeholder outreach to identify problems with the system for protecting heritage. This led to an agreed work plan covering the regulatory system, funding and incentives, and the government’s role as custodian of heritage assets. The scope of the regulatory work includes investigating national direction for heritage, reviewing heritage order provisions and exploring options for dealing with ‘demolition by neglect’. We make some recommendations for this ongoing project later in this chapter.

Discussion

88. There is a range of ways to improve New Zealand’s approach to heritage protection. Our broader proposals for reform are intended to strengthen and clarify the protection of built and natural environments, including significant historic heritage.
89. The suggestions we discuss below are designed to assist the Strengthening Heritage Protection project in its ongoing work.

Roles and functions in heritage protection and variable historic heritage provisions in planning and consents

90. Local authorities have varied approaches to heritage in their plans. Several district plans have no separate criteria for evaluating significant historic heritage. A number of local authorities only schedule historic heritage already entered on the New Zealand Heritage List/ Rārangi Kōrero, meaning sites that are of local and regional significance can go unprotected. Not all HNZPT-listed sites are scheduled, including 25% of all listed archaeological sites. Rules for heritage vary between plans, with some plans offering far less protection than recommended standards. ^[332]
91. HNZPT underscored the importance of both archaeological authorities and scheduling in plans to protect significant archaeological sites. Other submitters raised concerns about the duplication between the two processes, where a site is managed through a resource consent and also requires an archaeological authority. In their view this creates unnecessary delay, uncertainty, and complexity.

We agree there needs to be better coordination in the implementation of heritage approvals.

While archaeological authorities are successful at managing the retrieval of information through archaeological investigation, they do not usually result in the protection of archaeological sites and in fact are issued for the purpose of modification or destruction of such sites. ^[333] Authorities are valuable as a precaution because the location, extent, and relative significance of archaeological sites is often not known, and can therefore be difficult to identify when scheduling in plans. However, systematic protection of significant archaeological sites is more effective through rules in plans, provided the values and extent of the site are well understood.

We agree there needs to be better coordination in the implementation of heritage approvals. We see a potential role here for the ‘open portal’ for resource consents described in chapter 9. There is a need to minimise regulatory overlap between resource consents and archaeological authorities for scheduled historic heritage, while ensuring significant historic heritage is protected.

Lack of protection for Māori heritage

94. Several submitters noted that Māori heritage is poorly protected under the current system. ICOMOS noted that archaeological sites and sites of significance to Māori are particularly vulnerable to the effects of projected sea level rise.

Methods for identification and recognition of Māori heritage could be advanced in national direction as both a heritage matter and part of giving effect to Te Tiriti.

Many plans do not adequately recognise and protect Māori heritage. HNZPT noted in a recent audit that while 72 per cent of plans met the Heritage New Zealand Pouhere Taonga standard for rules controlling the demolition of built heritage, only 23 per cent of plans had rules for Māori heritage that met the standard, and seven plans (11 per cent) had no rule protecting Māori heritage.^[334]

We see a number of avenues for improvement here. Methods for identification and recognition of Māori heritage could be advanced in national direction as both a heritage matter and part of giving effect to Te Tiriti. Mana whenua will be partners in the creation of spatial strategies and combined plans, and can also agree specific tikanga for places through the integrated partnership process discussed in chapter 3. As well, our inclusion of cultural landscapes in the recommended new purpose and principles better recognises the breadth and scale of Māori heritage.

Jurisdiction over heritage in the coastal marine area

97. Protection of historic heritage in the coastal marine area is split between regional councils and territorial authorities, with the line of the mean high-water springs providing the jurisdictional boundary. Many historic heritage sites – such as jetties, wharves, archaeological sites and sites of significance to Māori – span the land-sea divide and lack of coordination can mean inconsistent management and gaps in protection for such heritage places.
98. We see regional spatial strategies, regional combined plans and the ‘open portal’ for consents described in chapters 8 and 9 as improving the integrated management of these places.
99. The damaging of heritage sites through coastal erosion is a significant issue and a concern for the Panel. Our recommended reform places a much greater emphasis on planning for a changing climate and mitigating the effects of sea-level rise, which will in turn provide greater opportunities to proactively protect heritage threatened by coastal erosion.

Demolition by neglect

We agree there is a gap in the regulatory system for protection of heritage and the issues of demolition by neglect.

Submitters raised concerns about ‘demolition by neglect’. Neither the RMA nor the Building Act 2004 support local authorities to deal proactively with demolition or degradation of historic heritage places through neglect. RMA plans manage heritage through controlling activities initiated by the owner of a site. But they have no way to manage inactivity that could result in irreversible decay or damage through a failure to secure the site. While many of these issues come from an owner’s lack of capacity to address the complex and sometimes expensive requirements of a heritage site, there are also cases of intentional neglect where the ambitions of the land owner for the site conflict with stewardship of the heritage place they possess.

101. We agree there is a gap in the regulatory system for protection of heritage and the issues of demolition by neglect. There are opportunities for this to be addressed as part of resource management reform, especially with our proposed shift to achieving outcomes rather than the less proactive approach of managing effects.

Operation of heritage orders

102. Submitters generally supported the concept of heritage orders but have found the mechanism hard to use. ICOMOS New Zealand stated that it sees value in having the ability to provide interim protection for a heritage site given how long a plan change can take. Feedback received by the Strengthening Heritage Protection project indicates that the provisions of section 198 of the RMA create a degree of financial and/or reputational risk that is deterring HPAs from considering the use of heritage orders. The lack of guidance or criteria to assist potential HPAs in using the provisions in the RMA is another limiting factor.
103. The working group on reducing complexity noted that the heritage order process is particularly convoluted, mostly because it is based on the designations process and the drafting in the RMA is heavily cross referenced. The working group suggested that the process for obtaining heritage orders is too complex for the likely scale of the impacts, which is generally restricted to one or several land parcels. Designations are likely to have much greater effects and a wider range of interested parties, so the use of the same process for both processes was not considered appropriate.
104. In 2017, changes to the RMA removed the ability of body corporates operating as HPAs to place a heritage order on private land, and to allow the Minister to transfer heritage orders to another HPA. This change has limited the use of heritage orders for mana whenua and the Waitangi Tribunal has advocated for their expanded use.^[335]

As part of the Strengthening Heritage Protection project, consideration could be given to the use of heritage orders to provide interim protection.

As noted above, heritage orders have been used infrequently. Their function is to provide case-by-case protection for places that are at risk because they have not been sufficiently protected through planning documents. If heritage orders are retained, they could have a role in protecting significant heritage places that have not been assessed or have otherwise slipped through the system. There are several situations where this might occur:

• where the heritage values of a place have been recognised (either under the Heritage New Zealand Pouhere Taonga Act or similar) but there has not yet been an opportunity to consider the place for protection in a plan
• where a site or place is protected in a plan, but this has not delivered protection for the full range of the heritage values of the place or the full extent of the heritage site
• where immediate intervention could result in the avoidance or minimisation of harm to a heritage place, and thus achieve the purpose of the Act.

106. As part of the Strengthening Heritage Protection project, consideration could be given to the use of heritage orders to provide interim protection. The period of interim protection could apply:
     • until the heritage place is appropriately protected in the district plan’s heritage schedule
     • for a period fixed by the HPA to enable another form of permanent protection (such as a covenant) to be put in place
     • for a period needed to address an immediate risk to the integrity of the place (such as remedial works or changes to a project).
107. If a heritage order is used as an interim measure, to allow adequate time to consider protection and possibly negotiate a solution with the property owner, the basis for providing compensation to the owner of the heritage place changes. We consider this is relevant to addressing the other impediment to the use of heritage orders - the potential financial liability for HPAs.

Water conservation orders

108. Water conservation orders are provided for in Part 9 of the RMA. They were introduced by an amendment to the former Water and Soil Conservation Act 1967 in 1981. The conservation order approach was developed in response to New Zealand’s ‘think big’ hydroelectric power projects undertaken during the 1970s. Water conservation orders were intended to provide a counterbalance to major development proposals affecting waterways, and particularly to protect wild and scenic waterways from being dammed. Water conservation orders were carried over when the RMA was introduced in 1991. The provisions have remained largely unchanged since their introduction into the RMA.

Current provisions

109. The purpose of a water conservation order is to recognise the outstanding amenity or intrinsic values of water bodies. It does this by restricting the grant of resource consents that would affect the outstanding values identified in the order and by requiring regional plans to be not inconsistent with their provisions. Case law has established that, in order to warrant protection by a water conservation order, the water body must be outstanding on a national basis.
110. Water conservation orders may be made over rivers, lakes, streams, ponds, wetlands or aquifers and over freshwater or geothermal water. A conservation order may provide for any of the following:
     • the preservation as far as possible of the water body’s natural state
     • the protection of characteristics which the water body has or contributes, to:
       • − as a habitat for terrestrial or aquatic organisms
       • − as a fishery
       • − for its wild, scenic, or other natural characteristics
       • − for scientific and ecological values
       • − for recreational, historical, spiritual, or cultural purposes
     • the protection of characteristics which any water body has or contributes to and which are considered to be of outstanding significance in accordance with tikanga Māori.
111. Anyone may apply to the Minister for the Environment for a water conservation order. The applicant must pay a nominal application fee. If the Minister accepts the application he or she will appoint a special tribunal to consider it. More recent applications have included significant specialist evidence to demonstrate that the water body meets the criteria for protection – the expectation of this standard of application means that applications are expensive to prepare and defend.
112. The special tribunal is responsible for publicly notifying the application, calling for and hearing submissions, considering the evidence presented and providing a report with recommendations on whether the application should be accepted or declined. Anyone may submit on the application. If the application is accepted the special tribunal report will include a draft water conservation order.
113. Anyone who made a submission has a further right of submission to the Environment Court on the special tribunal's report. The Environment Court must hold an inquiry if it receives one or more submissions. Once it has completed its inquiry, the Environment Court makes a report to the Minister recommending that the special tribunal's report be accepted or rejected with or without modifications. Thus far, Environment Court inquiries have almost always been held for water conservation order applications.
114. The Minister then decides whether or not to make a recommendation to the Governor-General. If the Minister decides to make a recommendation, it must be in accordance with the report of the special tribunal or, if the Environment Court has held an inquiry, the report of the Environment Court. If the Minister decides not to recommend making the order he or she must provide a written statement to Parliament setting out the reasons for the decision and also serve it on parties to the proceedings. If an order is recommended, it is then created by order in council.
115. A water conservation order can prohibit or restrict a regional council from issuing new water and discharge permits but it cannot affect existing permits. Regional policy statements, regional plans and district plans cannot be inconsistent with the provisions of a water conservation order.
116. Water conservation orders can be revoked or varied. The process is the same as for making an application, except where the effect would be no more than minor or of a technical nature, in which case the Minister can directly recommend the change.
117. There are currently 15 water conservation orders in place around New Zealand and 2 active applications. The following water bodies are protected by a water conservation order:
     • Motu River (1984)
     • Rakaia River (1988 – amended 2013)
     • Lake Wairarapa (1989)
     • Manganuioteao River (1989)
     • Lake Ellesmere (1990)
     • Ahuriri River (1990)
     • Grey River (1991)
     • Rangitikei River (1993)
     • Kawarau River (1997– amended 2013)
     • Mataura River (1997)
     • Buller River (2001)
     • Motueka River (2004)
     • Mohaka River (2004)
     • Rangitata River (2006)
     • Oreti River (2008)
118. Applications are currently being heard for Te Waikoropupū Springs in Golden Bay and the Ngaruroro and Clive Rivers in Hawke’s Bay. Both applications have been heard by a (separate) special tribunal and submitters on both processes have challenged the tribunal’s report in the Environment Court. The Environment Court will now conduct public inquiries for both applications.

Issues identified

119. The Next Steps for Fresh Water (2016) discussion document contained proposals to amend Part 9 of the RMA. The proposals fell into two tranches: those aimed at improving the involvement of Māori; and proposals aimed at integrating water conservation orders into the contemporary resource management framework. The integration proposals received largely negative feedback – submitters perceived that the changes would potentially weaken the mechanism. It was decided that additional policy work and further consultation was required and the proposed amendments did not form part of the Resource Legislation Amendment Act 2017. This reform process provides an opportunity to complete this work.
120. The following issues have been identified.
     • Many outstanding areas have not been the subject of water conservation order applications, or otherwise suitably recognised (eg, none of the six wetlands recognised under the Ramsar Convention on Wetlands is protected).
     • The cost and the lengthy, complex process for obtaining an order have been cited as barriers to application.
     • Mana whenua engagement is not required in the application or decision-making processes.
     • Applications take too long to decide. The time taken reflects the extensive considerations involved in each application, the significance of the resource management issues at stake and the two-stage process involved. Because the water body lacks conservation order-level protection during the process, it may degrade to the point where outstanding values may be lost while waiting for an order to be made.
     • Water conservation orders are not well integrated with regional plans. In some areas land use rules do not appear to provide for those outstanding features recognised in water conservation orders and councils do not recognise the role orders play in catchment management.
121. Some commentators have questioned the need for water conservation orders given there are now opportunities provided to protect significant water bodies through objectives A2(a) and B4 of the National Policy Statement for Freshwater Management.

Comments received

122. The Panel received only two submissions touching on water conservation orders, but they were comprehensive and came from differing viewpoints, so help to illustrate the breadth of issues relating to water conservation orders. We have also received advice on the topic from the working group on reducing complexity.
123. Key themes of the submissions and advice were:
     • effectiveness of water conservation orders
     • their role in the system
     • the process
     • integration with planning and consents.

Effectiveness of water conservation orders

124. The New Zealand Fish & Game Council observed that few waterbodies that would fit the purpose of water conservation orders are protected by them, and noted that “decisions have been made in respect of several of the supposedly protected water bodies, that have degraded and undermined the outstanding values the WCOs are meant to protect”. Water bodies do not receive protection under the water conservation order until the order is made, meaning a wait of years between application and protection, during which time the water body may be degraded. Fish & Game stated:

Clarification of the interim status of proposed WCOs would also assist in improving the effectiveness of WCOs. This needs to be done, for example, by ... requiring that once notified or in a draft state, no person may do anything to contravene the draft order or requirement except by express provision.

125. Fish & Game also noted the need for positive engagement and support on both the application for and implementation of water conservation orders, as well as the lack of ownership over the process and the orders once gazetted.
126. Fish & Game suggested adopting a model similar to that of heritage protection authorities, to ensure that areas protected by water conservation orders have a body to monitor and advocate for them.

Role of water conservation orders in the system

127. Federated Farmers provided comprehensive comment on water conservation orders, primarily focusing on their role in a planning system which has changed considerably since the process was originally developed:

...the RMA’s provisions for WCOs have largely remained static over the 30 years since the Act was first enacted, whereas other local planning has progressed considerably in understanding and requirements over that time. Much has been learned about how to fine-tune environmental resource management within NZ’s multi- level governance system.

128. Federated Farmers suggested that the water conservation order is inappropriately strong compared with instruments such as regional policy statements, regional and district plans and national environmental standards which are developed strategically and involve broader community engagement:

This situation carries an in-built assumption that top-down planning instruments should trump more integrated planning instruments. This is outdated thinking in an age where water resource use may involve many interrelated factors and many resource users, in complex ways.

129. The submission raised concerns that water restrictions can be more easily imposed in water conservation orders than in regional plans:

Under the current RMA statutory framework, a WCO (that is defined by a narrow scope of applicant interest) can be used to simply ‘wade in’ and intervene in regional plan water management processes in a catchment.

130. The National Policy Statement for Freshwater Management has introduced other opportunities to identify and protect significant water bodies. Fish & Game supports consideration of the role of the water conservation order in the policy framework, given the potential duplication with the national policy statement and the regional plan provisions for both water quality and quantity. However, it does not agree with Federated Farmers that water conservation orders are no longer fit for purpose in the context of contemporary resource management planning.

Process

131. The reducing complexity working group supported bringing the water conservation order process into the reformed system, but suggested the special tribunal and Environment Court process is unnecessarily time-consuming and complex. The working group suggested a single level of decision-making, potentially a special tribunal chaired by a sitting Environment Judge or retired judge, a board of inquiry or the Environment Court. The group also noted there can be some confusion over who should be notified of an application.
132. Fish & Game did not support substantially changing the process:

Fish and Game would not support a material alteration to the current process by which a WCO is processed and recommended. The ability to have WCO applications determined by an independent body, separate from local political influence is critically important.

133. Fish & Game stated that the costs and process for water conservation orders are similar to that of a private plan change or a substantial application for resource consent: “fundamentally the process is no more expensive and complex than comparative processes under the RMA”. It did not see this aspect as a priority for reform.
134. Federated Farmers raised concerns about the ability of communities to engage in the development process and the difficulty of revoking orders once they have been made.

Integration with planning and consenting

135. The reducing complexity working group suggested greater clarity is needed on how water conservation orders are reflected in other planning documents.
136. Fish & Game submitted that better integration between water conservation orders and plans is required to provide the intended protection. It suggested that regional and district councils should actively incorporate the status and recognition that a conservation order imparts to a water body in regional policy statements and plans. It considers regional policy statements and plans should be required to give effect to orders (rather than not be inconsistent with them). In its submission it said:

A requirement to ‘give effect to’ WCOs would be entirely consistent with the fact that WCOs recognise and protect water bodies that have been found to be outstanding. Subordinate plans have to ‘give effect to’ NPS and RPS according to section 67 (3) and 75 (3). It is logical that WCOs, which sit high in the hierarchy, should be given at least the same treatment, and have similar effect on Plans as NPS and RPS.

137. Fish & Game noted there is currently nothing in section 104 of the RMA to trigger consideration of water conservation orders in consent decisions. While section 217 makes it explicit that water permits cannot be granted in a way that would be contrary to the explicit restrictions and prohibitions in a water conservation order, the relevance and effect of an order to other consents is not clear. This makes it hard to know how much weight should be given to the consideration of the order, if an activity is likely to impact a recognised outstanding value, but is not in direct contravention of the restrictions and prohibitions in the water conservation order.
138. Fish & Game suggested that:

amendments to Part 9 to enable WCOs to provide for restrictions on land use resource consents and territorial functions under section 31, which have an effect on the outstanding values and water bodies identified in the order, are definitely required to improve the effectiveness of WCOs.

Options considered

Effectiveness of water conservation orders

139. The Panel sees water conservation orders as a valuable mechanism in the resource management system which should be carried through to the new system. We see the difficulty in revoking a water conservation order as its strength, and suggest that the tool should be made more effective rather than weaker.

The Panel sees water conservation orders as a valuable mechanism in the resource management system which should be carried through to the new system. We see the difficulty in revoking a water conservation order as its strength, and suggest that the tool should be made more effective rather than weaker.

The water conservation order approach differs from almost all other mechanisms under the RMA because it has a conservation purpose. One option would be to move it into the Conservation Act 1987 which is more focused on conservation matters. However, the Panel sees value in keeping water conservation orders within a reformed RMA because to be effective, water conservation orders should have a close interface with planning and consenting.

The Panel acknowledges the historical context for the development of water conservation orders and this review provides an opportunity to reconfigure the mechanism so it is fit for the future. The water conservation order was developed at a time when protecting the natural flow of water was of paramount importance. New Zealand’s freshwater bodies now face more pervasive and increasing challenges, not only from potential development for renewable energy but also from more intensive land use and climate change. Water conservation orders should take a more holistic approach to protection.

We acknowledge that there are differing views on what constitutes an outstanding water body, and that many people would like to see greater protection for water bodies that are significant to them. Early water conservation order applications were introduced or supported by the Minister of Conservation, but more recent ones have been made by Fish & Game, iwi and non-government organisations. There have been prior attempts to identify water bodies of outstanding significance but these have not been successful.^[336]

Role of water conservation orders in the system

143. Objectives A2(a) and B4 of the National Policy Statement for Freshwater Management protect outstanding freshwater values. As these provisions share the same intent as water conservation orders, promoting the work programme to implement the national policy statement could be an alternative way to support the management of outstanding freshwater bodies.
144. However, while they have a similar aim, the national policy statement provisions differ from water conservation orders:
     • they protect values as defined by communities, rather than specific characteristics of water bodies outlined in water conservation orders
     • outstanding values in the national policy statement are determined based on regional significance rather than national significance
     • they do not offer the permanent protection provided by a water conservation order
     • decisions under the national policy statement are made within the context of the general purpose of the RMA (as contained in Part 2 of the Act), whereas the orders have their own unique conservation purpose, which overrides Part 2.
145. These differences mean that promoting the National Policy Statement for Freshwater Management as a means to protect outstanding freshwater bodies is not as strong as the protection provided by water conservation orders.

The National Policy Statement for Freshwater Management as a means to protect outstanding freshwater bodies is not as strong as the protection provided by water conservation orders.

Our recommendations for reform strongly support providing opportunities for mana whenua to participate in resource management processes. The water conservation order was developed at a time when there was scant attention paid to the importance of recognising the significance of water to Māori. This aspect needs to be addressed.

Submitters on other topics in our issues and options paper expressed support for a process that would establish legal entity status for water bodies. Thus far this type of protection has only been provided through Tiriti settlements. A water conservation order could be amended to provide this status. The practical implementation of legal entity status requires establishing individuals or groups to speak on behalf of the water body. This arrangement is somewhat analogous to the suggestion that a body be established to monitor and advocate for the order once made.

Process

The process for considering and determining a water conservation order needs to be simplified. Moving to a one-stage decision-making process will reduce the time and cost to reach a final decision.

We agree that the process for considering and determining a water conservation order needs to be simplified. Moving to a one-stage decision-making process will reduce the time and cost to reach a final decision and is in line with our other recommendations. Applications should be heard by the Environment Court which has the advantage of independence not available to a politically appointed body. The Environment Court should largely follow the current process for hearing an application for a water conservation order – specifically the Environment Court should follow a public hearing process and provide a report with recommendations on whether the application should be accepted or declined to the Minister for the Environment. If the application is accepted the report will include a draft water conservation order.

Hearings on water conservation order applications are currently held close to the water body in question. We see value in this approach because it enables interested parties to attend hearings and gives the decision-makers a sense of place. This is particularly important for mana whenua who wish to be involved in the process.

Applicants bear a significant evidential burden to establish that the water body they seek to protect meets the water conservation order criteria. At the moment only well-resourced groups can provide the level of evidence and expert advice required. This indicates that additional support and resources are needed to enable applications to protect important water bodies to be progressed effectively.

The integration of water conservation orders with planning documents could be improved in two ways.

Integration with planning and consenting

151. The integration of water conservation orders with planning documents could be improved in two ways. The first would be to require regional policy statements and regional plans to ‘give effect to’ water conservation orders. The second would be to develop required changes to regional documents as part of the application, and for these to be considered by the decision-making body as part of the process. If, after hearing an application, the Environment Court recommends an application is accepted its report should include changes to the relevant planning documents which would be required to give effect to the order. These changes should be made consequential upon the application being granted. This would enable the changes to have immediate effect without going through a further plan change process and would reduce cost and complexity.
152. The current provisions are unclear as to how water conservation orders are to be considered and provided for in broader land use and water consenting decisions beyond the explicit restrictions and prohibitions in the RMA. This should be addressed through legislative change. Once an order is made it should be a matter to be considered in any future consent applications that may impact on the water body.

Further matters to investigate

We recommend further work should be carried out to develop policy on the effectiveness of water conservation orders.

In its submission, Fish & Game provides examples of water bodies protected by water conservation orders that have degraded despite this protection. It recommends investigation of these cases with a view to working out why the order has not been effective and what changes are needed to remedy this. Agencies have advised they do not have the information to know whether water conservation orders are working effectively and if not, why not.

We recommend further work should be carried out to develop policy on the effectiveness of water conservation orders. This should include:

• the Ministry for the Environment and Department of Conservation working together to gather information on whether the values being protected under existing water conservation orders are degrading or improving, and whether local authorities are in fact implementing the requirements set out in the orders
• considering whether the water conservation orders should be able to provide legal entity status for water bodies
• considering the role of spatial strategies in identifying water bodies that merit protection through water conservation orders
• considering whether central government should initiate or support applications for water conservation orders over specific water bodies, including those representative of currently unprotected ecosystems (eg, wetlands) or recognised sites (eg, Ramsar sites)
• considering whether resourcing or support should be provided to reduce the burden on applicants seeking a water conservation order
• investigating other ways to encourage increased use of water conservation orders. This could include providing national direction on how orders should be implemented and/or fostering awareness of the opportunity to apply for a water conservation order.

Key recommendations

Chapter 11 Allocation of resources and economic instruments

1. This chapter discusses our proposals for improving the allocation of resources within the Natural and Built Environments Act, including through the use of a broader range of economic instruments. Our terms of reference identified the following key issues to be addressed:
   • considering principles, systems, roles and processes for resource allocation
   • considering how to allocate marine space
   • improving the range and use of funding mechanisms and economic instruments.
2. We are aware the Government is separately considering Māori rights and interests in freshwater, including the findings of the Waitangi Tribunal in Wai 2358. Consideration of those issues is outside the scope of this review, but we understand the freshwater allocation work programme will proceed in tandem with the RMA reform process. The intention is that this will inform Government about how any generic approach to resource allocation might function within a reformed resource management system, as well as issues relating to Māori rights and interests.

In a world in which we are increasingly challenged to manage resources within environmental limits, allocation of the right to use those resources will need to be more systematically approached to ensure it contributes to the overall wellbeing of people and communities.

In a world in which we are increasingly challenged to manage resources within environmental limits, allocation of the right to use those resources will need to be more systematically approached to ensure it contributes to the overall wellbeing of people and communities. In our view, any future allocation system should be consistent with the purpose, outcomes, targets and limits of the Natural and Built Environments Act as discussed in chapter 2. It should also ensure resources are allocated in ways that are both efficient and equitable.

Existing resource management processes such as national direction, plans, rules and consents affect how resources are allocated. Improving allocation will require a future system to more explicitly acknowledge and manage those impacts to ensure the best tools are used for the circumstances. In some cases, greater use of economic instruments using price signals and willingness to pay to determine the highest value use of a resource may be preferred. The Panel has concluded overall that a combination of regulation and the use of economic instruments is best suited to achieving the identified outcomes of the resource management system.

Current provisions

5. The RMA plays an important role in allocating rights to develop and use some resources. Significant examples in which this occurs are allocation of permissions to take, and discharge to, fresh water and to occupy coastal marine space, and allocation of new capacity for development of urban land. Other resources allocated by the RMA include the assimilative capacity of the environment more generally; navigation rights on the surface of rivers, lakes and in the sea; and river and coastal marine area materials (for example, gravel and sand).
6. In the broadest sense, all plans and regulations developed under the RMA play a role in allocation to the extent they place constraints on the development and use of resources. These constraints establish a boundary between matters of interest to the public and the private use of resources. This can be thought of as allocating the benefits of some resource use to the public and future generations.
7. That said, allocation issues under the RMA are most often thought of in the context of determining competing private uses of resources within established environmental limits. The RMA provides a mechanism for this through the issue of permits to take and use resources. In some cases, resources are not allocated under the RMA, but under separate legislative frameworks, including minerals, fisheries, and rights to discharge greenhouse gas emissions.
8. The key provisions that guide decision-making about allocation and economic instruments in the RMA are set out below.

Purpose and principles

9. The RMA does not contain specific principles to guide decision-making about resource allocation among competing private interests. As discussed in chapter 2, once environmental limits were established, it was anticipated this type of allocation would largely be determined by market forces. The RMA was also developed at a time in which there was a relative abundance of the resources it allocates. It is therefore perhaps not unreasonable that the original RMA did not include more specific allocation pr[337]iples.³³⁷
10. Despite a lack of specific principles on allocation, the general purpose and principles in Part 2 provide some guidance. An important aspect of the RMA’s purpose is enabling “people and communities to provide for their social, economic, and cultural well‑being and for their health and safety while sustaining the potential of natural and physical resources (excluding minerals) to meet the reasonably foreseeable needs of future generations”. Within the umbrella provided by section 5, section 7 (b) also specifies that “efficient resource use and development” is a matter that should be taken into account in decision-making.
11. Perhaps of more significance is the principle of ‘first-in, first-served’ or what has commonly been referred to as the ‘priority rule’. This principle is not explicitly stated in the RMA but rather has been developed through case law in response to a lack of more substantive guidance. In Fleetwing Farms Ltd v Marlborough District Council, the Court of Appeal held that the scheme of the RMA requires decision-makers to hear appeals in the order in which they are lodged. Following this decision, the priority rule has come to mean that when two resource consent applications are processed for the same resource, the first application received by the local authority must be heard and decided first. Although the first-in, first-served approach determines the order in which decisions are made, it does not provide a basis for comparison of competing or contemporaneous applications. Each application must be assessed at that point in time in isolation from other potential users.^[338]

National direction

12. National direction has also begun to develop a policy framework for allocation of different types of resources. Examples include:
    • National Policy Statement for Freshwater Management: this requires that regional councils both set environmental limits and ensure plans state criteria by which applications for approval of transfers of water take permits are to be decided, including to improve and maximise the efficient allocation of water
    • New Zealand Coastal Policy Statement (NZCPS): the emphasis on strategic planning in the NZCPS is intended to ensure councils provide direction on allocation of coastal space in policies and plans to help manage adverse cumulative effects and the incremental loss of important coastal values
    • National Policy Statement on Urban Development Capacity: this directs local authorities to provide sufficient development capacity in their resource management plans, supported by infrastructure, to meet demand for housing and business space. Development capacity refers to the amount of development allowed by zoning and rules in plans that is supported by infrastructure. This development can be ‘outwards’ (on greenfield sites) and/or ‘upwards’ (by intensifying existing urban environments). Sufficient development capacity is necessary for urban land and development markets to function efficiently to meet community needs. The National Policy Statement on Urban Development will soon replace this policy statement to provide more direction on how development capacity can meet demand and create well-functioning urban environments.

Plans and consents

13. Since 2005, regional council functions have explicitly included allocation of the taking or use of freshwater, heat or energy from water, the assimilative capacity of air and water, and space in the coastal marine area.^[339]
14. Rights to use natural resources are granted through plans (permitted activities) or permits (consents, certificates of compliance and mining permits). As discussed in chapter 8, permits can be granted for up to 35 years, or for five years if no period is s[340]ified.³⁴⁰ They may be cancelled by a regional council if not exercised for a continuous period of two or mo[341]years.³⁴¹ Permits may lapse if not given effect to within five years of the grant, unless the consent specifies a different period or an extension is[342]anted.³⁴²
15. While there is no explicit guarantee of renewal, common practice has been for this to occur, although conditions to address environmental effects or efficiency requirements may be modified or added. The most recent annual data from the National Monitoring System shows that out of 2145 resource consent renewals (most are discretionary), only three were declined. A further 126 were returned incomplete or withdrawn. Some of these may be effectively declined, but it is too early to tell if this is the case.
16. Subject to various qualifications,^[343] when applying for a resource consent, existing consent holders have priority over new applications (over the same resource) on expiry of a consent, although the consent authority must consider:
    • the efficiency of the existing consent holder’s use of the resource
    • the use of industry good practice by the existing consent holder
    • if the existing consent holder has been served with an enforcement order or convicted of an offence under the RMA.^[344]
17. The consent authority must also have regard to the value of the investment of the existing consent holder.^[345]
18. The RMA provides for the transfer of consents. These can be transferred to a new owner or occupier of the site on application by the consent holder. They can also be transferred to another site in either of the following circumstances:
    • where the transfer is expressly allowed by a regional plan
    • where the regional council specifically authorises the transfer following a joint application by the parties involved, having considered the environmental effects of the transfer and the other matters set out in section 104 of the RMA.^[346]
19. The review of consent conditions is provided for in section 128. A consent authority cannot change the duration of a consent as part of a review process. Under section 131, when reviewing conditions, a consent authority:
    • must have regard to the matters considered when determining a resource consent application
    • must have regard to whether the activity will continue to be viable after the change
    • may have regard to the manner in which the consent has been used
    • if the review was ordered by the Court, must have regard to the reasons for the order.
20. Cancellation of a consent is only possible if the activity has significant adverse effects on the environment and either there were material inaccuracies in the original consent application or the consent holder is convicted of an offence that contravenes the consent.