Executive Summary Introduction Summary NSWMC positions... 6

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2 Table of Contents Executive Summary... 3 Introduction... 4 Summary NSWMC positions Objectives Investor and community confidence Sustainable development Enabling development of our natural resources Community and Stakeholder Engagement Setting appropriate expectations Encouraging quality engagement that is representative of the wider community Leading practice in consultation and engagement The position of special interest groups Strategic Planning State Significant Development and strategic planning NSW Planning Policies Metropolitan/ Regional Plans Subregional Delivery Plans Local Land Use Plans Development Assessment and Compliance Environmental impact assessments and statements Determination of SSD Activities that should not be subject to the planning system Merit appeal Infrastructure Planning and Co-ordination Mining contributions and regional funding by government Voluntary Planning Agreements and the NSW minerals industry Delivering a New Planning System Timeframes Resourcing Transitional arrangements ANNEXURE A - Summary of NSWMC submissions from November 2011 and March APPENDIX B Experts involved in the assessment of the Metropolitan Coal Project References NSWMC Submission Planning System Review Green Paper 2

3 Executive Summary The Planning System Review Green Paper proposes a transformation of the planning system of NSW. The proposals are ambitious and the Government has articulated a vision of a planning system which enables growth and development and places communities at the centre of strategic planning for NSW. The cornerstone of the Green Paper is greater engagement with communities, industry, local government and other stakeholders in the development process. This is strongly supported by the report of the Planning System Review Panel and the review of international best practice. The Green Paper seeks to find a balance between local decision making, with local and regional considerations acknowledged and the need to facilitate the economic growth of NSW. The NSW minerals industry supports the Government s aim to better involve the wider community in planning how to deliver the growth of industry, infrastructure and housing that is vital to the future of NSW. An essential part of this process will also be strong leadership from the NSW government in setting the direction for growth. The Government s NSW 2021 plan sets out ambitious targets for economic growth in NSW including a 30% increase in mineral production. Facilitating this growth particularly in the resources sector will require not only engagement with communities, but also strong leadership from government to guide difficult decisions, which will have considerable local, regional and NSW wide benefits. Ensuring the assessment of projects of state significance is undertaken in a streamlined, whole of government manner is essential to renewing investor confidence in NSW. The Green Paper proposes a process similar to the current state significant development assessment process. The NSW minerals industry is currently working within this framework and we have identified improvements that can be made, including giving greater prominence to independent expert review to provide confidence in the assessments underpinning approvals; returning decision making to the Minister for Planning and Infrastructure to ensure decisions are made in the interests of all the people of NSW; and ensuring streamlining and timeliness of assessment. The Green Paper clearly states the Government s intention for the new system to be an enabling system, and importantly acknowledges that changing the culture of the planning system is integral to delivering and implementing an improved system. To implement these changes will require considerable funding and resources and a pragmatic approach to rolling out reform, including how projects will transition. Setting appropriate expectations in the community about the reform process, and then delivering on those expectations will be vital to regaining confidence in the system. The Government has set an ambitious time table to deliver the new planning system. The Green Paper is necessarily high level. The White Paper should clarify the proposed planning system and provide details. Following the release of the White Paper there should be an appropriate period of consultation before the Government commences drafting the new planning legislation. The outcomes of this reform process will have long term ramifications for the future of our State s economic growth. Getting the details of the new planning system right is vital for our economy, the environment and the future prosperity of the people of NSW and we look forward to seeing these details in the White Paper. NSWMC Submission Planning System Review Green Paper 3

4 Introduction The NSW Mining Industry NSW is a mining state producing around 40% of Australia s black coal, as well as gold, copper and other minerals. In coal was NSW s largest merchandise export in terms of value, worth $11 billion. The Australian mining equipment, technology and services sector also provides significant value, with the sector s export revenue estimated at around $3.5 billion per year. In the mining industry contributed directly to the NSW Budget by paying $1.48 billion in royalties (3% of total government revenue), up from $1.24 billion in Over the next four years it is estimated that NSW Government revenue from royalties will be approximately $8.9 billion. The sector is responsible for 17% of private investment in NSW the highest of any industry in the State. Mining and minerals processing employ around 93,000 people directly, mainly in rural and regional NSW. In addition, the industry generates indirect employment estimated to be in the order of 326,000 people across the State. These jobs range across a large number of industry sectors, including construction, heavy engineering and equipment manufacturing, the provision of mine supplies and consumable items and specialised advisory, design and management services. Mining also brings significant private investment in infrastructure such as ports, which benefit other industries and leads to the creation of further employment. Policies affecting the mining sector will have significant economy-wide impacts that will affect the people of NSW, not just those in mining regions. The NSW Minerals Council (NSWMC) is a not for profit, peak industry association representing the State s $20 billion mining industry. NSWMC provides a single, united voice on behalf of its 100 member companies: 40 full members (producers and explorers), 25 associate members (junior explorers) and 35 associate members (service providers) and works closely with government, industry groups, key stakeholders and the community to foster a dynamic, efficient and sustainable mining industry in NSW. Unique aspects of the mining industry Mining has a number of characteristics that make it unique from other types of development. Most other jurisdictions assess mining projects under separate legislation, recognising its unique nature. Because mining in NSW is assessed under the general planning legislation, the unique aspects of mining must be accounted for within the planning framework. Exploration is different from mining Exploration and mining are two completely different activities that require different approaches to impact assessment and management. Exploration is the process of identifying the mineral resources on behalf of the State of NSW. It is the process used to identify the location, quality and extent of mineral resources as well as local geological and environmental conditions. The level of assessment for coal and mineral exploration activity is commensurate with the level of risk associated with the activity. The Mining Act 1992 regulates exploration activities. Many routine exploration activities have minimal impact particularly compared to existing land uses such as farming - that can be mitigated and remediated by using standard controls. These activities can be regulated by the use of standard measures such as codes of practice and guidelines. Activities with a higher level of risk require approval by the government after a review of the environmental impacts. Mining involves the recovery of a State owned resource that is fixed in location Mining, unlike most development, involves the recovery of a resource owned by the people of NSW. Direct financial benefits in the form of royalties flow from mining projects to the NSW Government. The location of mineral resources is fixed, and there must be reasonable and transparent processes in place that allow these resources to be accessed on behalf of the people of NSW. Mineral resources are not equally distributed throughout the state, and therefore it is not possible to simply move mining to areas without population or competing industries. Mining is a temporary land use Most forms of development have a level of permanence. For example development for an urban subdivision, may change over time, but the land will be permanently changed. Mining, however, is a NSWMC Submission Planning System Review Green Paper 4

5 temporary land use. It has a defined life and following mining it can be rehabilitated to other land uses, such as agriculture, urban development, biodiversity conservation, carbon sequestration or alternative energy projects. The temporary nature of mining should be considered in longer term land use planning, where mining can be a short to medium term land use, followed by other productive land uses. Mining is a dynamic form of development Unlike other forms of development, mining developments are frequently modified. This is because mining is a complex, dynamic activity that can extend over decades, and not all potential variations over the life of mine can be predicted at the time of the planning approval. Factors such as new geological information, minor changes to mine plans, improvements in technology, and new environmental information can all lead to changes being required throughout the life of mine. The planning framework must have the flexibility to account for these changes, using assessment processes commensurate with the level of risk. Structure of this submission This submission is structured to reflect the structure of the Green Paper. This is NSWMC s third submission on the NSW Planning System Review. Appendix A of this submission provides a summary of our key positions from the earlier submissions. Our two earlier submissions can also be viewed by following the links below: Pre-consultation Submission November 2011 Post Issues Paper Submission March 2012 NSWMC Submission Planning System Review Green Paper 5

6 Summary NSWMC positions Objectives 1. The NSW minerals industry supports the objectives for the planning system outlined in the Green Paper, in particular the importance placed on promoting economic development and competitiveness 2. The objects of the new Planning Act should have equal weight 3. The objects of the new Planning Act should be consistent with the Mining Act and should encourage the discovery and development of the mineral resources of NSW Community and Stakeholder Engagement 4. The goal of a Public Participation Charter should be to encourage broader public participation in planning decisions. It should set out the principles of good engagement, and should not be constraining or prescriptive 5. The Government should consult on the detail of a Public Participation Charter, and explain how it will contribute to participation by the wider community in the planning process, at the plan making and project assessment stages 6. The new Planning Act should make it clear that any non-compliance with the Public Participation Charter (apart from the general requirement to publicly exhibit and accept submissions) cannot be used to invalidate a policy, plan or project approval 7. Consultation and engagement standards should not be legislated. There should be flexibility to undertake this process in the way that will best engage communities, provide for sharing of project information and local knowledge and respond and adapt to relevant concerns 8. Environmental groups and should be engaged; however it is not necessary or appropriate to elevate these groups above other groups in the community Strategic Planning 9. NSW Planning Policies need to be statutory plans 10. The composition of the Regional Planning Panels should be changed to remove special interest stakeholders and add a community representative 11. The system of plans must provide for strategic assessments and plans, such as the SRLUPs, and Biodiversity Plans to be developed and take effect. The category of sectoral strategy does not appear to provide for these types of plans 12. The Government should consider whether the Local Land Use Plans are the most appropriate level of plan to contain the development controls currently in the Mining SEPP 13. The key provisions of the current Mining SEPP must be contained as standard conditions of the Local Land Use Plans Development Assessment and Compliance 14. Accreditation of experts would be a costly, resource intensive process, and would be unlikely to provide a level of confidence is assessments that would make the costs worthwhile and should not be part of the new planning system NSWMC Submission Planning System Review Green Paper 6

7 15. The Government should include in the SSD assessment process the capacity for the State Government agencies to identify at the DGR stage, areas of assessment that will require independent review and engage and pay for an independent expert to review the assessment 16. Transparent criteria should be developed to determine when the PAC should be required to undertake a review of a project, or conduct a public hearing 17. The Minister for Planning and Infrastructure should determine SSD applications. In the event that SSD applications are determined by an independent panel, this should be by way of delegation of the Ministers powers 18. In the event that SSD determinations are to be made independently, a new independent, fit for purpose decision making body should be formed whose members should be chosen on the basis of experience in making balanced planning decisions 19. The Minister for Planning and Infrastructure should provide any independent decision making panel with guidelines for decision making and procedures under which the panel should operate 20. Delegation of decisions to an independent decision making panel should be made by the Minister on the basis of criteria to identify projects that are contentious or complex, not simply by the number of submissions received 21. Delegation of decision making should occur after the proponent has responded to submissions and any public meeting also held at this stage 22. The independent decision making panel should refer any issues of concern, both of its members, and expressed by the public at the meeting to DP&I to be investigated with the relevant agencies and addressed in the Director General s Assessment Report 23. The new planning system should retain a mechanism for determining that activities do not require assessment, including low and minimal impact activities, and activities that are appropriately assessed and approved through other legislation, including most mineral exploration. Similarly the definition of development should be narrowed to ensure activities that should not require approval are excluded from the definition 24. The Government should investigate the role of third party appeals. In particular the Government should: Identify ways to ensure that third party merit appeals are not pursued for vexatious reasons such as delaying development, including making better use of costs orders, and requiring a threshold case Extinguish third party merit appeals where the decision maker is an independent body Infrastructure Planning and Co-ordination 25. Treasury should undertake a review of developer contributions in the context of other mechanisms for funding local government and the regions, and the White Paper should address the reform of the VPA process relevant to industries other than residential development NSWMC Submission Planning System Review Green Paper 7

8 Delivering a New Planning system 26. The Government should allow time for consultation on the White Paper before drafting legislation 27. Appropriate resources, funding and people must be available to put the plans in place within a reasonable timeframe. The Government should have a clear strategy for undertaking the whole planning process in high priority regions before moving into other regions 28. Consideration of transitional arrangements should be a priority in developing the new system to ensure that the community and investors have the certainty about how development will be dealt with during the roll out of the new system. The transitional arrangements should ensure that the new legislation is not retrospective, but give proponents the option of opting in to the new system NSWMC Submission Planning System Review Green Paper 8

9 1. Objectives The planning system is the gateway to investment in NSW. A new planning system must provide a fair, efficient, consistent process to return confidence in the system for both the community and investors. The Green Paper states that the objectives of the new Planning Act will emphasise in particular the role of planning in facilitating and managing growth and economic development and that the overarching purpose of the new planning system will be to: Promote economic development and competitiveness Connect people and places Protect the environment Improve people s quality of life Resolve land use trade offs based on social, economic and environmental factors Effectively manage growth and change Investor and community confidence Investor confidence in the NSW regulatory environment is currently poor. This can be seen in the results of the latest Fraser Institute Survey, an annual survey of mining and exploration executives perceptions of mining jurisdictions worldwide. NSW is ranked 32 out of 93 jurisdictions behind all other Australian jurisdictions except Victoria at The NSW Mining industry supports the stated objectives of the new planning system, and believes that if these objectives are met they will improve both community and investor confidence in the system. In particular we acknowledge the focus of the new system on enabling economic development. 1.2 Sustainable development It is not clear whether sustainable development or ecologically sustainable development (ESD) will be included in the objects of the new Planning Act. ESD is one of the objects of that current Environmental Planning and Assessment Act 1979 (EP&A Act), and has equal standing with the other objects. The objects of the Act should continue to carry equal weight. Elevating one object over all others removes the ability to balance all competing benefits and impacts of a plan or project and make the best decision for NSW. 1.3 Enabling development of our natural resources Mining provides significant direct and indirect benefits to the community of NSW. Minerals are the property of the Crown. The objects of the EP&A Act should consistent with the Mining Act 1992 encourage the discovery and development of mineral resources in NSW for the purpose of promoting the significant social and economic benefits to NSW that result from the efficient development of mineral resources. Recommendations 1. The NSW minerals industry supports the objectives for the planning system outlined in the Green Paper, in particular the importance placed on promoting economic development and competitiveness 2. The objects of the new Planning Act should have equal weight 3. The objects of the new Planning Act should be consistent with the Mining Act and should encourage the discovery and development of the mineral resources of NSW NSWMC Submission Planning System Review Green Paper 9

10 2. Community and Stakeholder Engagement 2.1 Setting appropriate expectations Developing better informed communities, where the wider community is engaged and participates in planning making and informing development is an appropriate goal for the new planning system. However, better engagement is not a panacea and there will still be difficult planning decisions to be made by the Government. It is important that the distinction between engagement and consultation, and decision making is made and appropriate expectations are set. This is particularly the case for mining projects where resources are fixed, and not distributed throughout the state. The Government needs to be cognisant of the fact that it is more difficult to make simple compromises to avoid the impacts of a mining project than a residential development. 2.2 Encouraging quality engagement that is representative of the wider community The NSW mining industry believes that community consultation and engagement is an integral part of the planning process and acknowledges that engaging early and frequently has considerable benefits for both the proponent and the community. It allows for the early identification of important environmental and socio-economic issues that should be assessed, allowing these to be included in the environmental impact statement (EIS). Most importantly it allows communities and developers to meet face to face and work through issues in a constructive manner. Securing quality community engagement, which is representative of the views of the wider community, not just of special interest groups, is a challenge for mining, other industries and government. Despite the challenging nature of genuine engagement it is important that government develop strategies to ensure that engagement is much more reflective of the views and expectations of the wider community, by involving people who can be equipped to provide balanced and considered input. The Green Paper proposes a Public Participation Charter, but gives very little detail on what this would contain. The concept of the Charter and how it would help engage the community more broadly needs to be explained in greater detail. Any charter should set the principles for community engagement, but needs to avoid setting out detailed requirements for consultation, should not be statutory or not lead to a risk of litigation. 2.3 Leading practice in consultation and engagement Many of NSWMC s members undertake leading practice consultation and engagement and create innovative programs designed to meet the needs of particular projects. Project design, environmental assessment and monitoring, begin long before the mining projects enter the formal development application and assessment process. It is important to begin consultation and engagement with the community and stakeholders concurrently with the early design and assessment process. Case Study 1 details the engagement undertaken in the development of Newcrest s Cadia East mine near Orange. This case study illustrates the importance of beginning engagement with local communities well before entering the formal planning system. The Green Paper states that under a new system...all players will have to supply information in plain English, meet standards of consultation that are underpinned in law and engage in a richer dialogue with the community. 3 The NSW minerals industry has reservations about attempting to legislate standards of consultation. There is a danger that this could lead to bland uninformative documents and processes designed to avoid any risk of litigation, with the unintended consequence of stymieing innovative consultation. It is important that the resources of developers are focused on the type of engagement and information that best suits the needs of their particular community and project. Case Study 2 illustrates how Xstrata s Beltana mine project used leading practice when engaging with landholders about possible impacts on their properties. NSWMC Submission Planning System Review Green Paper 10

11 CASE STUDY 1 Early engagement influences design and assessment Newcrest s Cadia East project Newcrest Mining owns and operates Cadia Valley Operations (Cadia), a gold and copper mining operation located in central west NSW, 25km south of the city of Orange. Cadia is surrounded by agricultural land, with about 180 neighbouring landholders. In 2006 Newcrest Mining commenced a concept study to develop another gold and copper deposit in the Cadia Valley Cadia East. Before the assessment began it was clear the new operation would cause significant community concerns. Cadia began engagement with the community prior to the approvals process beginning, seeking guidance on the key issues to feed into the Director-General s requirements for environmental assessment. This high level of engagement continued through the project s key milestones: Scope of environmental assessment Briefed stakeholders on the Director-General s requirements and negotiated stakeholder involvement in environmental studies Pre-feasibility (First Major Revision and Second Major Revisions to Project Description) Outlined new project details and sought guidance on key community issues and involvement in revising environmental studies Environmental assessment studies Each draft assessment was presented to stakeholders by the experts who conducted the studies, giving an opportunity to ask questions about the study and be confident of the expert s independence Public exhibition All stakeholders were provided with a digital copy of the environmental assessment and a briefing on the process for making submissions Project approval All stakeholders were provided with a copy of the project approval conditions, briefed on the conditions and the appeal process Project implementation Stakeholders were consulted on the scope and design of environmental monitoring and management systems. The extensive engagement before and during the development of the environmental assessment allowed many issues to be identified and dealt with to the satisfaction of stakeholders before the finalisation of the EIS including: The community identified that the draft EIS had dealt with impact on groundwater bores but not on groundwater springs, and on blast emissions but not on seismic events. All of these impacts were able to be included in final EIS before it went on public exhibition The Panuara community were not able to support the plans for the site of a new tailings dam. Alternative locations were identified by the community and a compromise was reached well before any engineering decisions had been made and the EIS was finalised. The project application was lodged in September 2008 and received approval on 6 January The project was not required to be reviewed by the Planning Assessment Commission and was not subject to any legal challenge. 2.4 The position of special interest groups The participation of environmental groups is given an elevated status by the Green Paper. Environmental groups, like any other stakeholder in a planning process, should be engaged and able to participate in planning processes. The benefits of elevating the status of this group are not well explained in the Green Paper. The NSW minerals industry has strong concerns about the NSWMC Submission Planning System Review Green Paper 11

12 accountability, governance and motives of groups that could be given legitimacy and status within the planning system by this proposal. A confidential funding document for authored by Greenpeace, Coalswarm and the Graeme Wood Foundation, Stopping The Australian Coal Export Boom: Funding proposal for the Australian anticoal movement, was leaked earlier this year. 4 Other groups who are acknowledged as participating in the preparation of this document are the Environmental Defenders Office NSW, Beyond Zero Emissions and Lock the Gate. The sentiment of the document illustrates that many mainstream environmental groups are significantly out of step with the vision for the future of NSW articulated by the Government in its NSW 2021 plan. Elevation of these groups over other stakeholder groups, who may have equally valid concerns about development going ahead/not going ahead, is unfair and may promote the concerns of national or international groups above those of the people who live and work in the area. It is not clear why environmental groups would have elevated status. It cannot be to ensure protection of the environment given that the NSW Government has its own environmental agencies, the Office of Environment and Heritage (OEH), the Catchment Management Authorities (CMAs), the NSW Office of Water (NoW) and the Environmental Protection Agency (EPA). It is the role of these agencies to provide robust, balanced advice to the Government at both the strategic planning stage and with regard to individual development proposals. CASE STUDY 2 Flexibility in approaches to consultation and information Xstrata s Beltana mine Xstrata s Beltana underground mine in the Upper Hunter Valley runs beneath privately owned vineyards. During the environmental assessment process Xstrata recognised the importance of giving individual landholders targeted plain English information about the project. Xstrata prepared individual property impact assessment booklets that addressed property owners concerns, including how the development would affect particular areas of land and infrastructure such as trellises and irrigation, and the steps that would be taken to mitigate any impacts. This approach was complemented by fact sheets, meetings and open days. When the Beltana environmental assessment was placed on exhibition, there were very few submission objecting to the project. This collaborative approach continued after the project was approved with local landholders participating in the development of the monitoring program and the analysis of the results of the program. Early targeted engagement through various forums designed to deliver the right information to the right stakeholders has been key to the success of the Beltana project for both the proponents and their neighbours. Xstrata has successfully undermined seven vintages since 2005 with only minor short term impacts that were able to be compensated for or remediated. Recommendations 4. The goal of a Public Participation Charter should be to encourage broader public participation in planning decisions. It should set out the principles of good engagement, and should not be constraining or prescriptive NSWMC Submission Planning System Review Green Paper 12

13 5. The Government should consult on the detail of a Public Participation Charter, and explain how it will contribute to participation by the wider community in the planning process at the plan making and project assessment stages 6. The new Planning Act should make it clear that any non-compliance with the Public Participation Charter (apart from the general requirement to publicly exhibit and accept submissions) cannot be used to invalidate a policy, plan or project approval 7. Consultation and engagement standards should not be statutory. There should be flexibility to undertake this process in the way that will best engage communities, provide for sharing of project information and local knowledge and respond and adapt to relevant concerns 8. Environmental groups should be engaged; however it is not necessary or appropriate to elevate these groups above other groups in the community NSWMC Submission Planning System Review Green Paper 13

14 3. Strategic Planning The Green Paper proposes a hierarchy of plans to replace the current Local Environmental Plans (LEPs) and the State Environmental Planning Policies (SEPPs). The hierarchy contains four plans, however it is only the final level of hierarchy - the Local Land Use Plans that are proposed to be statutory plans. The NSW minerals industry supports greater engagement at the strategic planning level, with the benefit of more streamlined individual assessment of projects. However engagement and consultation cannot replace leadership by the Government on important issues related to the growth of NSW, and how and where that growth will be accommodated within the State. The Green Paper clearly shows the Government is taking leadership by identifying that significant new residential development will be needed for the state and the strategic planning process will need to facilitate this growth. Likewise the Government needs to communicate clear policies on how and where the growth of industry will occur. This is particularly important to the mining industry where the resources are fixed. Concepts such as the allowing of local councils to trade their allocated growth requirements will not be feasible in regions where growth depends on the development of fixed resources. The Government s NSW 2021 plan includes as its first goal, Improve the NSW Economy. One of the targets to achieve this goal is to Increase the value of primary industries and mining production by 30% by Delivering this growth by the mining industry will depend on the new planning system, and this will need to include a strategic planning framework that enables responsible mining development. 3.1 State Significant Development and strategic planning The Green Paper does not explicitly address State Significant Development (SSD) within the strategic planning process. SSD is vital to the economic growth and prosperity of NSW, and has benefits for all of the people of NSW. The process needs to ensure that this type of development is undertaken sympathetically with regional and local planning priorities. The NSW Planning Policies need to provide a framework for the permissibility of state significant development, including mining. 3.2 NSW Planning Policies It is proposed that the State Environmental Planning Policies (SEPPs) will be replaced by NSW Planning Policies that will provide practical high level planning direction and guide the development of the more detailed plans below. It is proposed that the NSW Planning Policies will not be statutory plans. This aspect of the new Planning Act has the potential to create uncertainty and result in litigation. The NSW minerals industry understands the desire of the Government to reduce state based intervention in planning. However there are numerous provisions within the current SEPPs that will need to be retained in order to ensure economic growth of the State is not compromised. It is important that state significant development such as mining, is provided with a level of protection from planning decisions that might be made at a local level without the capacity to consider all of the ramifications of the growth and prosperity of NSW. In particular the new strategic plans must retain the following protections for mining that are in the Mining SEPP: There should not be any no go areas Exploration remains permitted without development consent Underground mining and open cut mining remain permissible as currently provided in the Mining SEPP. 3.3 Metropolitan/ Regional Plans Both the Green Paper and the International Review of Best Practice in Planning Law appear to have considered strategic planning from a largely metropolitan/ urban point of view. The strategic planning process and hierarchy of plans proposed are reflective of the metropolitan government structures given as examples of best practice in the Review. NSWMC Submission Planning System Review Green Paper 14

15 NSWMC does not believe that bringing together a number of metropolitan areas, and bringing together a number of different areas within a region are analogous. Regional areas contain not just different local government areas, but different towns and rural areas. The characters of these areas, as well as their economic drivers can be different. The challenges of identifying together as a region or even a subregion will be much more complex and difficult to resolve than in metropolitan areas. The Government needs to carefully consider whether the Metropolitan/ Regional Plans as proposed adequately provide for strategic planning in both metropolitan and regional areas. 3.4 Subregional Delivery Plans Composition of the Regional Planning Boards It is proposed that the Regional Planning Board be made up of an independent chair, key stakeholders, the General Manager or director of planning of each local government area in the sub region, and senior representatives of the Department of Planning and Infrastructure (DP&I); NSW Trade and Investment (DTIRIS), Department of Transport (Transport), OEH and Infrastructure NSW. It is stated explicitly that environmental groups will be invited to participate on the boards, along with industry and other relevant stakeholders. It is important that the Regional Planning Boards are functional. For this reason it is appropriate that stakeholders with special interests such as industry and environmental groups should be part of a group that advise the Board, rather than participants on the Board. This approach would be consistent with the comments in the International Review of Best Practice in Planning Law. The Review notes that in the development of these types of regional planning bodies representation needs to be able to produce effective advocacy for state and regional interests 6. It is important to ensure that the community of the region is represented on the Board, however this is better done by appointing a community representative to the Board, rather than a series of stakeholders with strongly held but narrow interests. The community representative should be a person who is not aligned with any particular interest group and has experience in decision making. The NSW Minerals industry proposes an alternative structure for the Regional Planning Boards as set out in Figure 1. Regional Planning Board members: Independent Chair Community representative General Manager or Director of Planning from each local government area State Government DP&I, DTIRIS, Transport, OEH and INSW Advisory Group members: Industry Environmental groups Other special interest stakeholders Figure 1 Alternative composition of Regional Planning Board and Advisory Group NSWMC Submission Planning System Review Green Paper 15

16 Local councils and subregional planning The Government should also recognise in the White Paper that local councils may not be motivated to look outside their own local government area to consider the broader regional context. It will be necessary to address this level of local self interest if the subregional planning process and the Regional Planning Panels are to be functional Sectoral strategies The Green Paper notes that the Strategic Regional Land Use Plans (SRLUPs) will become sectoral strategies. The SRLUPs do not fit easily within this category. Two of these plans have already been finalised by Cabinet and will establish a method for dealing with land use decisions where mining and agriculture are present in a region. A very lengthy and detailed consultation process has been undertaken to develop the criteria for the identification of Strategic Agricultural Land and the Gateway process which will be set out in the SRLUPs. It is not clear how the status of a sectoral strategy will give these elements of the SRLUPs the weight that is required. It is currently proposed to formalise the Gateway process through the SEPP. There are other elements of the SRLUP, such as the Upper Hunter Strategic Assessment of Biodiversity, and its proposed outcome, the Upper Hunter Biodiversity Plan that need to be accorded a status in the planning system that will allow the benefits of a strategic approach to be realised at the development application stage. The sectoral strategy approach does not appear to provide the status that the Biodiversity Plan would require. The Green Paper states that the subregional delivery plans will be prepared for areas within Metropolitan Sydney and growth areas within the Hunter and Illawarra. Additional subregions will also be identified in areas of change. 7 The Green Paper does not explain how the SRLUPs will be activated in the other areas of NSW, which might not have a subregional delivery plan: the New England North West; Central West; Southern Highlands; Murrumbidgee; Alpine; and Western regions. 3.5 Local Land Use Plans The Green Paper states that the where existing State Environmental Planning Policies include important development control provisions those controls will be collapsed into Local Land Use Plans and associated guidelines. 8 It is difficult to see how local land use plans are the most efficient way of retaining the important development controls contained in the Mining SEPP, when in practice most mining development is SSD. The following areas of the current Mining SEPP would need to be included by the NSW Government in the standard local land use plan, and not subject to change: The permissibility of mining Exempt and complying mining development Permissibility of exploration without development consent Evaluation and consideration of incompatible development in areas of where there is currently mining, or possible future extraction of mineral resources. Recommendations 9. NSW Planning Policies need to be statutory plans 10. The composition of the Regional Planning Panels should be changed to remove special interest stakeholders 11. The system of plans must provide for strategic assessments and plans, such as the SRLUPs, and Biodiversity Plans to be developed and take effect. The category of sectoral strategy does not appear to provide for these types of plans 12. The Government should consider whether the Local Land Use Plans are the most appropriate level of plan to contain the development controls currently in the Mining SEPP 13. The key provisions of the current Mining SEPP must be contained as standard conditions of the Local Land Use Plans NSWMC Submission Planning System Review Green Paper 16

17 4. Development Assessment and Compliance 4.1 Environmental impact assessments and statements The Green Paper indicates that the process of assessing development that is state significant will be similar to the SSD process introduced by this Government in The Green Paper notes that SSD regime will be amended to deliver major projects sooner to drive economic growth. Amendments that should be made to the process to meet the Government s stated aim of delivery of projects are: Including tighter mandatory timeframes for assessment by DP&I The integration of all NSW government assessment requirements into the one assessment process and removing the current extent of duplication Ensuring that the conditioning power for SSD is at least as wide as that contained in Part 3A Removing the substantially the same development test for modifications in favour of a wider power to modify such as that contained in Part 3A Increasing community trust in environmental impacts statements The concerns about the integrity of environmental impact statements (EISs) are not well founded. The integrity of these statements in NSW is already provided with robust statutory protection (see Figure 2 below). As a consequence, the general quality of EISs in NSW is of a good standard. The planning system (not proponents) drives highly technical studies on complex and interrelated issues. This means that much of the content in an EIS is not directly comprehended by nontechnical members of the community, which has lead to a perceived lack of integrity. This is why many proponents prepare non-technical executive summaries or project overviews and conduct comprehensive consultation. The PAC and DP&I also play a role in communicating to the broader community. If EISs were generally flawed judicial review proceedings in the Land and Environment Court should frequently result in declarations that EISs were not proper EISs for the purposes of the EP&A Act. Notwithstanding the existence of a very active public interest advocacy group, the NSW Environmental Defender's Office (NSW EDO), it has been rare in judicial review proceedings for EISs to be declared inadequate. Integrity of EIS provisions in the Environmental Planning and Assessment Act 1979 Clause 6, Schedule 2 of the EP&A Regulation An EIS be must be accompanied by a declaration by the person by whom the EIS is prepared, that the EIS has been prepared in accordance with Schedule 2, that the EIS contains all available information that is relevant to the environmental assessment of the development to which the statement relates and that the information contained in the EIS is neither false no misleading Clause 283 of the EP&A Regulation A person is guilty of an offence if the person makes any statement, knowing it to be false or misleading in an important respect, in or in connection with any document lodged with the Director-General or a consent authority or certifying authority for the purposes of the Act or this Regulation. Section 123 of the EP&A Act Confers standing on any person by to bring legal proceedings in the Land and Environment Court challenging the adequacy of an EIS or its compliance with the requirements under the Act. Figure 2 Statutory provisions with regard to the integrity of environmental assessments NSWMC Submission Planning System Review Green Paper 17

18 The NSW minerals industry does not support the Green Paper proposal that experts who conduct environmental impact assessments for SSD would be chosen from an accredited panel. This proposal is not feasible for the following reasons: A general accreditation would not provide a greater guarantee of the integrity of the assessor than already exists through their professional standing, and the declaration they are required to provide Although not explicit in the Green Paper there is an expectation from some stakeholders that it would be the government that would appoint an expert from the panel. This ignores the reality of how complex developments like mining are developed and assessed. It is important to understand that the process of developing an environmental impact statement begins long before an application for development approval is made. Proponents engage experts to provide advice at the earliest stages of design and consideration of the feasibility of a project. If regulators select specialists it reduces the potential for iterative development between the proponent and expert, therefore there is reduced environmental outcomes through mine design In addition the Green Paper does not address the multiple layers of expert assessment that are part of a complex development. Experts with particular specialities are routinely engaged during the process as the understanding of the project grows and it becomes clear that additional assessment is required. Appendix B shows the multiple consultants who were involved in the assessment of the Metropolitan Coal mine in the Southern Highlands of NSW An accreditation system would be costly for government to implement and run and would not deliver a benefit commensurate to that cost Experts who undertake these assessments are highly qualified and are frequently members of a professional association. In some instances they already have specialist accreditation, such as accreditation as an assessor under the BioBanking Scheme The proposal would make it difficult for smaller expert consultants to establish a practice, as accreditation would be an additional burden on new practices. Many of the niche areas of assessment, such as archaeological assessments, are undertaken by these small specialist firms. A system of independent review of selective areas for assessment initiated and paid for by government proposed in Section below would be a much better use of resources Independent review of State Significant Development projects The minerals industry believes that the experts we engage are generally leaders within their area of expertise and people of sufficient reputation and experience that they are unlikely to risk their professional reputation by providing anything other than their professional opinion. However we accept that the perception of the EIS is extremely important and the community are entitled to have confidence in these documents. The NSW minerals industry believes a system of independent review of selective areas of the assessment that are likely to be contentious would give the community greater confidence in the expert reports that make up the EIS. Figure 3 sets out the proposed selective independent review process. While ideally the need for independent review would be identified at the DGR stage, it is acknowledged that it may become evident during the assessment that an independent review is necessary. Accordingly there should be further consideration of whether an independent review is necessary when the EIS is lodged. The independent review should review the EIS after consideration of all of the submissions and the proponent s response. The integrity of this process will be enhanced by: Appointment and payment of the independent reviewer by DP&I. The fees paid by mining proponents are significant and would more than account for the costs of such a review. For instance, Xstrata paid in excess of $1.1 million in fees to DP&I for when lodging the application for its Ravensworth North project. On a cost recovery basis this would more than account for the costs of both DP&I s assessment and that of an independent expert Communication about the process to the community and relevant stakeholders by DP&I as the agency engaging the independent reviewer. NSWMC Submission Planning System Review Green Paper 18

19 Director Generals Requirements Government agencies identify any key issues that require independent review Environmental Impact Assessment Undertaken by proponent Response by Proponent Response, including any changes to the proposed development Exhibition Environmental Impact Statement Independent expert undertakes review Submissions and Response Public and agency submissions, and proponents response Independent review Figure 3 Proposed process for selective independent review Review by the Planning Assessment Commission The Green Paper does not mention the Planning Assessment Commission (PAC) in its review role. We assume that the PAC will maintain this role under the proposed new planning system, and that the Minister will continue to have the power to require the PAC to undertake a public hearing. Under the EP&A Act there are no criteria to determine which development applications should be reviewed by the PAC, or under what circumstances the PAC should be required to hold a public hearing. PAC reviews add to the time taken to assess a project, and PAC hearings lead to the extinguishment of all merit appeal rights. Given the implications of the appointment of the PAC to undertake either of these functions, the appointment should be made on the basis of transparent criteria. 4.2 Determination of SSD The Green Paper proposes that SSD should be determined by the PAC, with some applications which are less significant being determined by senior officers of DP&I. This is a continuation of the interim arrangement which is currently operating The Minister for Planning and Infrastructure Mineral resources are owned by the State. Decisions on how they are developed need to be made by the NSW Government on behalf of the people of NSW. Decision making authority regarding mining projects must remain with the Minister for Planning and Infrastructure, as an elected representative of the community. In addition, the Minister, on behalf of the government of the day, is NSWMC Submission Planning System Review Green Paper 19

20 able to consider all of the impacts of mining projects and make decisions about individual projects that are consistent with the broader strategy for the development of NSW. The Minister should be required to seek a review of the assessment from an independent panel in circumstances where a conflict exists, and in other circumstances at the Minister s discretion. However, removing decision making power from the Minister removes the power from the electorate to hold decision makers accountable Independent decision making panel If an independent panel is to determine SSD, this should be on the same basis that it currently occurs; by the Minister delegating his/ her powers to that independent body. The current review is an opportunity to ensure that any independent decision making panel is fit for purpose. Currently the PAC has been delegated the Minister s decision making powers for SSD applications. Until recently the main occupation of the PAC has been reviewing, rather than determining applications. Members are largely technical experts, as is appropriate for a review body. While the Green Paper makes it clear that the PAC should not stray into the assessment of projects when functioning as a decision maker, the experience of the mining industry is that it is very difficult for the PAC to separate the two roles. A decision making panel should have a different skill set. Members of an independent decision making panel should not be technical experts, but instead should have experience in making balanced planning decisions. Decision making requires the ability to weigh all of the competing adverse and positive benefits of the project and make a recommendation that is in the best interests of NSW Guidelines and procedure for independent decision making In the event that determination of SSD projects is to be made by independently (by the PAC or a new panel) the guidelines for decision making and the procedures under which any independent decision making panel operates, should be set by the Minister for Planning and Infrastructure. Any independent decision making panel should: Make decisions not undertake assessment - An independent decision making panel should evaluate the evidence based on the merit assessment carried out by DP&I, rather than reassess the proposal Make decisions in accordance with the strategic plans, government endorsed policies and technical standards An independent decision making body should not be a policy making body. Any issue that arises which does not appear to be adequately covered by existing plans, policy, or technical standards should be referred to the Minister or DP&I and considered in the state-wide policy context Provide notice of a decision to refuse a project or any amended conditions for the proponent s response Under the current system the PAC can reject a project, or approve the project with additional or amended conditions, without giving the proponent an opportunity to respond to the decision or any amendments to the draft conditions. This could lead to conditions that are not fit for purpose, and could constitute a lack of natural justice. Where an independent decision making panel proposes to refuse a project, or amend conditions of approval, it should advise the proponent and allow the proponent time to consider and respond. Any comments provided by the proponent should then be considered in the final decision. This is consistent with the Commonwealth approach provided by the EPBC Act 1999 and with the principles of procedural fairness Any independent decision making panel should be subject to statutory time frames - Experience indicates that involvement of the PAC in Part 3A and SSD applications considerably delays the final determination. Statutory timeframes, a robust terms of reference and clear processes should be implemented to ensure that any independent decisions are made within an appropriate timeframe and there is certainty for the proponent and the community. NSWMC Submission Planning System Review Green Paper 20

21 Delegation to the independent decision making panel Delegation of the Minister s powers as the consent authority to the PAC is currently made after DP&I have completed the Director General s Assessment Report (assessment report). Projects that are considered contentious or complicated are delegated to the PAC while other applications are delegated to senior officers of DP&I. Basis for delegation An application is automatically delegated to the PAC where 25 or more public submissions are made. This is regardless of the type of submission. For example this could be 25 form letters. This is not a satisfactory way of defining projects as complex or contentious. There should be better defined criteria and a decision should be made against those criteria by the Minister when making the delegation. Current process The current process of delegating to the PAC after the assessment report is completed has been unsatisfactory. The PAC has sought additional information from other agencies, which has caused issues of procedural fairness, required additional reporting by DP&I and additional submissions by the proponent on issues that were dealt with to the satisfaction of DP&I. In addition holding a public meeting after the assessment report has been completed, and asking the public to restrict themselves to raising issues with the report, or the draft consent conditions, has not been satisfactory. The expectation of the community is that all concerns should be heard by the PAC at the public meeting. Proposed process Delegating decision after the proponent has lodged its response to submissions, with a public meeting to be held at that stage would provide a number of benefits: The public would be able to raise all of their concerns at the public meeting The independent panel would be able to refer their concerns and those of the public expressed at the meeting to DP&I to be addressed in the assessment report. If further input was required by other government agencies or the proponent that could be sought by DP&I and included in the assessment report. This would ensure a whole of government approach and protect the independent decision maker from becoming involved in the assessment process and attracting allegations of a lack of procedural fairness. A flow chart of the proposed process is set out in Figure 4. This approach would give greater confidence for both the independent panel and the community that their concerns had been assessed fully by DP&I and any relevant agency. NSWMC Submission Planning System Review Green Paper 21

22 End of EIS exhibtion Response to submissions Minister considers whether to delegate to an independent panel in accordance with critieria Delegation to independent panel Public meeting Independent panel refers issues of concern of panel and public to DP&I DP&I Director General's report is finalised Minister/ independent panel makes decision Figure 4 - Proposed independent decision making process 4.3 Activities that should not be subject to the planning system An important element of the Green Paper is ensuring that the process of assessment and approval matches the level of risk of the activity proposed. There are activities that should not require planning approval and the White Paper should set out explicitly how these are to be dealt with Part 5 of the Environmental Planning and Assessment Act 1979 The Green Paper does not discuss Part 5 of the EP&A Act, which provides for activities which do not require development consent. This part of the Act should be duplicated in the new Planning Act. Retaining the ability to undertake activities that have low or minimal impact on the environment, without incurring the cost and delay involved in assessment is integral to investment in NSW. The Mining Act 1992 regulates exploration activities. Many routine exploration activities have minimal impact particularly compared to existing land uses such as farming - that can be mitigated and remediated by using standard controls. These activities can be regulated by the use of standard measures such as codes of practice and guidelines. Activities with a higher level of risk require approval by the government after a review of the environmental impacts Definitions of development and subdivision The current definition of development should be narrowed to exclude activities which are not development, including the any activities carried out for the purpose of: Assessing the impacts of a project Enabling the preparation of detailed designs. NSWMC Submission Planning System Review Green Paper 22

23 Such an amendment would ensure that explorers and miners do not unintentionally carry out development without assessment or approval by, for example, drilling water monitoring bores for the purpose of assessing water impacts. Similarly the definition of the subdivision of land should be drafted so as to exclude a lease of part of the land (or at least exclude leases for a term of less than 5 years). This amendment would remove the need for subdivision approvals to be obtained for leases for mining infrastructure, such as coal conveyers. 4.4 Merit appeal The Green Paper does not provide any discussion of the merit appeal process, stating only that It is proposed that existing appeal rights under the Act be retained. Given the focus of the Green Paper on developing a system with greater consultation and de-politicised decision making, there should be a discussion of how these measures can reduce the need for third party merit appeal. Third party merit appeal is a costly process, which delays development, but does not generally prevent it. While developers are driven by commercial imperatives, which require them to have good prospects of success when litigating, the same constraints do not apply to many third party applicants. In fact a coalition of environmental groups including the Environmental Defenders Office in NSW have explicitly stated that litigating to delay projects is part of their overall strategy to prevent growth of infrastructure and mining projects. In a document Funding Proposal for the Australian Anti-coal Movement, these groups state Legal challenges can stop projects outright, or can delay them in order to buy time to build a much stronger movement and powerful public campaigns. 9 The document goes on to say that the group will lodge legal challenges to the approval of all of the major new coal ports, as well as key rail links (where possible), the mega-mines and several other mines chosen for strategic campaign purposes. Using the third party merit appeal provisions of the EP&A Act as a tactic to delay development is simple and low risk as there is a high likelihood that the court will not award costs against the third party applicant; and there is no requirement to be represented by a legally qualified person. All of these conditions make it very easy for litigants who will not ultimately be successful to delay and add very significantly to the costs of a development. Those costs include legal costs, and the much more significant opportunity costs. Merit appeal should not be considered to be as of right for third parties, rather it should only be available where there is a high risk that the decision does not have merit and the decision should be made afresh by the Land and Environment Court. Where an independent decision making panel (such as the PAC or an independent panel as proposed herein) makes a decision, it should be considered to be at low risk, and third party merit appeal should not be available. This is an issue that requires further consideration and discussion, given the very significant disincentive that third party merit appeals create to investing in development in NSW. Recommendations 14. Accreditation of experts would be a costly, resource intensive process, and would be unlikely to provide a level of confidence is assessments that would make the costs worthwhile and should not be part of the new planning system 15. The Government should include in the SSD assessment process the capacity for the State Government agencies to identify at the DGR stage, areas of assessment that will require independent review and engage and pay for an independent expert to review the assessment 16. Transparent criteria should be developed to determine when the PAC should be required to undertake a review of a project, or conduct a public hearing 17. The Minister for Planning and Infrastructure should determine SSD applications. In the event that SSD applications are determined by an independent panel, this should be by way of delegation of the Minister s powers NSWMC Submission Planning System Review Green Paper 23

24 18. In the event that SSD determinations are to be made independently, a new independent, fit for purpose decision making body should be formed whose members should be chosen on the basis of experience in making balanced planning decisions 19. The Minister for Planning and Infrastructure should provide any independent decision making panel with guidelines for decision making and procedures under which the panel should operate 20. Delegation of decisions to an independent decision making panel should be made by the Minister on the basis of criteria to identify projects that are contentious or complex, not simply by the number of submissions received 21. Delegation of decision making should occur after the proponent has responded to submissions and any public meeting also held at this stage 22. The independent decision making panel should refer any issues of concern, both of its members, and expressed by the public at the meeting to DP&I to be investigated with the relevant agencies and addressed in the Director General s Assessment Report 23. The new planning system should retain a mechanism for determining that activities do not require assessment, including low and minimal impact activities, and activities that are appropriately assessed and approved through other legislation, including most mineral exploration. Similarly the definition of development should be narrowed to ensure activities that should not require approval are excluded from the definition 24. The Government should investigate the availability of third party merit appeals. In particular the Government should: Identify ways to ensure that third party merit appeals are not pursued for vexatious reasons such as delaying development, including making better use of costs orders, and requiring thresholds Extinguish third party merit appeals where the decision maker is an independent body NSWMC Submission Planning System Review Green Paper 24

25 5. Infrastructure Planning and Co-ordination Through voluntary planning agreements (VPAs) the NSW minerals industry makes a considerable contribution to local infrastructure in the local government areas where mining occurs. These payments have escalated in recent years. Requests for funding have continued to broaden in recent years, with mines being asked not only to pay for infrastructure, but increasingly to contribute to community funds designed to deliver public services and facilities. 5.1 Mining contributions and regional funding by government The NSW minerals industry makes a considerable contribution to the public funds, through royalties, mining rates, company tax, as well as the new carbon tax and Mineral Resources Rent Tax. The industry does not see this contribution returning to the regions where mining operates in NSW. An economic assessment of mining affected regions undertaken by the DTIRIS in 2011, found that while the local government areas (LGAs) of Singleton and Muswellbook were by far the greatest contributors of NSW royalties (see Figure 5), government spending in these two LGAs was below that of other LGAs affected by mining, below non-mining LGAs and below the average for NSW (see Figure 6). 10 Ensuring that there is a coordinated, whole of government approach to the funding of infrastructure and services in the mining affected regions, will reduce the need for councils in these regions to rely on ad hoc voluntary planning agreements to meet their funding needs. Figure Gross royalties per LGA (>$900,000) Figure 6 - Average selected government expenditure indicators by LGA category ( ) NSWMC Submission Planning System Review Green Paper 25