The Productivity Commission has completed its inquiry into allocation of land use in cities with release of the Better Urban Planning Report which recommends replacing the Resource Management Act 1991 (RMA).

The inquiry which has produced the final 516-page report asked the Commission to identify the most appropriate system for allocating land use in cities - including the processes that are currently undertaken through the RMA, the Local Government Act 2002 and the Land Transport Management Act 2003.

“The Government asked the Commission to take a blue-skies approach to what a future urban planning system could look like. Well-functioning successful cities matter a great deal to the wellbeing of New Zealanders. This is about easing the stresses of growth – such as escalating housing costs and inadequate infrastructure," Commission Chair Murray Sherwin says in a statement.

One of the 64 recommendations is that a future planning system should make a distinction, within a single statute, between the built and natural environments with clear objectives and principles for each.

The report says the current statutes and practice blur the two environments, and provide inadequater security about proteciton of the natural environment and insufficient certainty about the ability to develop within urban areas.

It says the difficulty can be traced back to ambiguity around the purpose of the RMA, an expansive definition of the environment combined with a focus on avoiding, remedying or mitigating adverse effects on the broadly defined environment, and a lack of clarity around objectives for the built and natual environments.

"Future planning legislation should set out a clear purpose or purposes for the built and natural environments. The purpose statement should be developed through a process of wide consultation and reflect contemporary perspectives," it says.

"The purposes should reflect the positive benefits from land uses that meet the social, cultural and economic needs of New Zealanders, while safeguarding the integrity of the natural environment. The Commission recommends that new planning and resource management legislation should provide additional guidance through the use of high-level objectives and principles for both the built and natural environment.

"The precise wording of objectives and principles, and whether they are best placed in primary or secondary legislation, are matters that should be decided on the basis of extensive consultation and expertise in legislative drafting. Generally, objectives that are likely to change in the medium term, as a result of improving scientific knowledge or better information on environmental outcomes, are best placed in secondary legislation, such as National Policy Statements and National Environmental Standards. These instruments are easier to adjust and more responsive than primary legislation."

Finance Minister Steven Joyce says the Government will respond formally on the report "in due course".

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