How a 45-year-old act is holding Sydney hostage on housing reform

The news

NSW Opposition Leader Mark Speakman wants the state Labor government to hold a bipartisan roundtable to fix the “broken planning system”, which he says has not undergone wholesale change for 45 years.

NSW Premier Chris Minns has responded by saying he agrees that the Environment Planning and Assessment Act, the unruly 327-page tract that governs planning law in NSW, is “nowhere near fit for purpose”.

But he cautiously warned there would be “different interpretations about what that change would mean”.

NSW Opposition Leader Mark Speakman (left) and NSW Premier Chris Minns.Credit: James Brickwood, Edwina Pickles

“You have got some mayors who say, ‘We need to reform it [the act] so that we can have a bigger say to stop development’,” Minns said this week.

“There are others, more sensible people, who look at the system and say, ‘We need vastly more housing in one of the most expensive cities on earth’.”

Speakman started the new year insisting “bipartisan collaboration” would ensure the best opportunity to deliver meaningful reform on a planning system that has consistently failed to deliver building approvals at a fast enough rate for NSW to meet its targets under the National Housing Accord.

“This planning act has been on the books now for 45 years, and the housing crisis in Sydney and across NSW is getting worse,” Speakman told 2GB radio on Thursday.

Calls for reform to NSW planning laws have grown stronger over the holiday break.Credit: Louie Douvis

“It’s an economic issue that [sees] essential workers moving out of Sydney, it’s an intergenerational equity issue [because] we are seeing young people completely priced out of the housing markets.”

Speakman said there was a “lack of feasibility to build” because of soaring construction costs and land prices, but the “planning system is also broken”.

While the Liberals and Nationals “had a go in 2013″, the upper house blocked reforms that the then Coalition government proposed.

The complexity of the planning act has long been a bugbear of developers. Urban Taskforce chief executive Tom Forrest said the legislation remained a stumbling block to tackling the housing crisis.

“Politicians from all sides have, to date, been poorly advised by conservative planning bureaucrats and councils with a steadfast determination to maintain the status quo. One step forwards, one step backwards,” Forrest said.

“Meanwhile, the housing supply crisis has become what many fear is a permanent feature.”

Forrest said Speakman’s willingness to discuss changes was a welcome change, after the Coalition opposed a range of housing measures introduced by Labor. The opposition leader seemed “ready to shed [his] quasi green pathway to NIMBY oblivion and help redesign the planning act”. Forrest said. “If this happens, we have hope.

“Provided the bureaucrats are prepared to drive housing supply, this is a very welcome sign for home buyers and renters. But we need to be wary. The forces of NIMBY self-interest are great and will require a concerted effort to break.”

How we got here

In 2013, Labor, then in opposition, compared NSW planning minister Brad Hazzard to Donald Trump for his attempt to overhaul the planning system. A decade on, what has changed?

Namely, the housing crisis. In the decade-and-a-bit since, house prices in metropolitan and regional NSW have more than doubled (though they had been rising at a considerable pace before then, too).

Despite a small drop in prices at the back-end of 2024, Sydney’s median house price is still well over $1 million, making it the second most expensive city in the world. The problem has become so pronounced that the NSW Productivity Commissioner, Peter Achterstraat, last year warned that Sydney risked becoming “a city with no grandchildren”.

The crisis has dramatically reshaped the politics of housing. In 2013, campaigning against overdevelopment was a reliable tool for opposition politicians.

It’s partly why, since Hazzard’s bill was killed, there have been no serious attempts at reform.

Despite the difficulty in achieving consensus on change, most agree it has become unwieldy. The legislation has grown from 137 pages to 327 pages since it was passed, and has undergone so many tweaks that even the amendments need amending.

Late last year, the government passed a change reintroducing specialist building certification at ski resorts, a requirement that had been removed during another amendment in 2018 in an “oversight”.

But the public’s growing anxiety about the cost of housing has changed the calculation. Labor under Minns was notable in opposition because it did not make overdevelopment an issue. Since coming to government, the premier has made housing his signature issue.

The government has so far avoided meddling with planning laws, instead searching for ways to circumvent them by changing zoning regulations and handing more power to state assessors to approve large developments.

But if bipartisan support can be achieved, it might be back to the future. Hazzard’s long-abandoned reforms – which included rules forcing councils to greenlight developments in high-growth areas that met agreed requirements, such as building heights, within 25 days, without community input – might be appealing to a government desperate to get approvals on track.

Key players

Minns has staked a lot of political capital on addressing the housing supply shortage.

In the roughly two years since Labor was elected, his government has introduced a string of changes to speed up housing approvals. But it had been slow-going. Zoning regulations that make it easier to build apartments close to public transport have yet to take off, and Minns’ frustration at the lack of turnaround in new housing approvals was key in setting up the Housing Delivery Authority, which will bypass councils on major developments.

With so much riding on making headway on the housing supply crisis, Minns is motivated to take on significant reform. To achieve it, though, he may need the co-operation of the Coalition.

Speakman has been critical of the government’s housing policies and sought to overturn Labor’s signature Transport Oriented Development scheme. But Speakman has signalled he is willing to negotiate on changes to planning laws.

The problem is getting everyone to agree on what the new laws should look like.

While some developers complain about different zoning regulations across individual councils, for example, MPs and the local government sector are unlikely to support changes curtailing local planning instruments.

Inner West Mayor Darcy Byrne said there were areas of common interest.

“Something that would unite everyone is that it’s too complicated, and too slow,” Byrne said.

“The whole act is not predicated on good outcomes. It’s about ticking every box. It’s loaded up with impenetrable jargon, which is good for town planners and architects because they make a lot of money out of it, but it doesn’t lead to housing.”

What they said

“I’m the first to admit that the planning act as it currently is constituted is nowhere near fit for purpose.” – NSW Premier Chris Minns.

“We suggest that a bipartisan approach to planning system reform offers the best chance that reform will actually occur.” – Opposition Leader Mark Speakman.