The NSW Government is committed to supporting a productive economy by enabling business and jobs in the locations where they are needed and delivering on the communities’ strategic vision for their state.
The Department of Planning, Industry and Environment is currently undertaking a suite of reforms which includes the delivery of a simplified employment zones framework that suits the future of work, is fit for purpose, supports productivity and jobs growth while facilitating delivery of strategic plans and planning priorities.
The reform of employment zones aims to support long-term economic recovery through job creation and encourage increased productivity in NSW.
A key outcome of the project will be to ensure employment zones provide clear strategic intent, include clarity around their application and increase flexibility around land uses.
The department is exhibiting a proposal to replace the existing Business (B) and Industrial (IN) zones with five new employment zones and three supporting zones under Standard Instrument Principal Local Environmental Plan (2006) (SI LEP).
We have developed the proposed employment zones framework based on quantitative and qualitative evidence to:
The department has undertaken research through a quantitative and qualitative evidence base that has informed the proposed employment zones framework and implementation approach.
A critical component of the department’s research was the stakeholder engagement program which involved working with other state agencies, all councils in NSW as well as key peak, industry and stakeholder groups to understand the current barriers within the existing zoning framework.
We have heard from councils, industry and government agencies that there is lack of clarity surrounding the purpose of several of the existing zones, that land use tables are inflexible, definitions reflect outdated business models and create land use conflicts, and that there is inconsistent application of the zones across the State.
Feedback received in local government workshops is that councils want a zoning framework that supports good planning outcomes that includes: a centres hierarchy, manages contemporary land use conflicts, sustains employment lands and creates a nexus between the zones and strategic planning.
We will continue to work closely with local government and have detailed discussions with our key stakeholders throughout the reform process.
Benefits of the proposed changes include:
To support the ongoing stakeholder engagement program, the department has prepared a Proposed Employment Zones Position Paper on the proposed changes to employment zones which outlines the draft framework and implementation approach.
Council surveys and workshops, online stakeholder webinar and consultation with industry and government agencies have informed the proposed employment zones framework outlined in the Position Paper.
Other supporting documents on exhibition include a Draft Standard Instrument Principal LEP Amendment Order, Employment Zones Implementation Plan and Proposed Land Use Matrix.
The proposed employment zones framework is on public exhibition until 30 June 2021.
The employment zones reform will deliver a simplified framework that:
This reform aims to support the long-term economic recovery from the impacts of the COVID-19 pandemic through job creation and encourage increased productivity in NSW.
A key outcome of the project is that employment zones provide clarity around their application, increase flexibility around land uses and support the delivery of strategic plans.
The reform does not seek to up zone land as it remains the prerogative of councils to set development standards and controls for height and density.
The way our cities and regions function and businesses operate has changed considerably since the Standard Instrument Local Environmental Plan was prepared over 15 years ago.
The continued rise of online retailing, the emergence of advanced and small-scale manufacturing and the growth of dense, mixed use centres have fundamentally reshaped how we plan for centres and industrial precincts.
It is timely to update the current business and industrial zone framework to better support the community and businesses, and ensure the zones are better able to adapt as circumstances change to ensure continued productivity, investment and community benefit.
The new framework will provide greater certainty for the community, local government and the development industry. It will better support the delivery of long-term strategic objectives and facilitate innovation and changes in business processes now and into the future.
One of the key outcomes is reducing the number of employment zones. This will provide greater consistency and certainty, increase the number of land uses allowed in each zone and provide more flexibility for new businesses to establish and existing businesses to expand or change depending on the circumstances.
One of the key problems with the current framework is that the zones are applied differently throughout the State creating confusion about what development can be anticipated to occur in any given area. The new framework seeks to improve consistency clearly outlining what development can be anticipated based on how an area is zoned.
Councils can still plan for their centres using development standards and controls that manage the height and scale of development rather than unnecessarily restricting specific business types and land uses. This ensures the different scale and character of neighbourhood and local centres can be maintained, delivering on community objectives.
The department will support councils through implementation in planning for their centres.
The department will provide an overview of implementation following public exhibition which will explain the approach, key milestones and next steps.
The department recognises that a significant amount of reform is occurring which councils are having to engage with and implement with finite resources. We will support councils through a number of measures designed to reduce the burden on their resources and provide for the best possible outcome. More information is provided here (link to the position paper).
The department will consider all feedback received during exhibition and finalise the proposed employment zones framework. The new framework will be introduced into the Standard Instrument Principal Local Environmental Plan in September 2021. The department in collaboration with councils, will then introduce these changes into Local Environmental Plans by mid-2022.
The NSW Government is undertaking a significant reform program to improve efficiency, support productivity and jobs growth as well as to facilitate good planning outcomes. More information on the broader reforms can be found under Planning Reforms.
The employment zones reform will not delay or defer development applications or planning proposals that are currently underway.
The department will work with proponents and local government to facilitate translation into the new framework, building on the strategic work that has already been undertaken.
Individual landowners and proponents with applications underway should in the first instance seek help from their consultant planners, council staff or DPIE.
The NSW Government is undertaking a significant reform program across the planning system to improve assessment time frames, reduce red tape, eliminate double-handling and fast-track projects that deliver great public benefits to the people of NSW. A number of these reforms are directly related to the employment zones reform, these include expanding complying development and the Greater Sydney Commission’s review of the ‘retain and manage’ industrial lands policy. More information can be found in the position paper at the Planning Portal.
Having regard to the proposals included in Building Business Back Better Explanation of Intended Effect (EIE) for expanded complying development, that work will be looking at mechanisms to support employment lands. One such mechanism could be a calling up of Cl. 5.4 Controls relating to miscellaneous permissible uses. As part of the final harmonisation of these two reform programs Cl. 5.4 could capture ‘shops’ where they are added by councils as permissible with consent in the proposed E3 Productivity Support zone. This mechanism would support the viability and vibrancy of centres and protect the value of employment lands by encouraging shops to locate in existing centres. Accordingly, councils in any submission to the department are encouraged to nominate in instances where shops are permitted with consent in existing B5, B6 and B7 zones a potential maximum floor area.
Build-to-rent (BTR) housing is large-scale, purpose-built rental housing that is held in single ownership and professionally managed. BTR is allowed anywhere where residential flat buildings are permitted, as well as in the current zones of B3 Commercial Core, B4 Mixed Use zones and B8 Metropolitan Centre zones. The provisions for BTR will also apply under the employment zones. More information about BTR is available at the Built-to-rent housing page.
The employment zones reform will not delay or defer planning proposals that are currently underway. Comprehensive Local Environmental Plan amendments or a site-specific rezoning will proceed unimpeded by the changes. The department will work with proponents and local government to facilitate translation into the new framework when it is introduced, building on the strategic work that has already been undertaken.
The department is working through savings and transitional arrangements for planning proposals that are currently underway.
For councils who are yet to undertake their comprehensive LEP review, or are in the preliminary stages of the review, consideration should be given to how that work could progress under the proposed employment zones framework.
Savings and transitional arrangements will extend to undetermined development applications. Further information on these arrangements will be provided as the reforms progress.
The department has been working closely with councils to determine the timing of the reform to facilitate briefing of councillors and provide a formal council submission on the position paper prior to the commencement of the caretaker period for Local Government Elections in September.
After the elections, the department will work with local government to brief incoming councillors on the reforms to ensure they are brought up to speed quickly and the benefits of the reforms are not delayed.
The department recognises the impact the new employment zones framework will have on councils who have been actively participating in the development and implementation of other reform programs, and dealing with the impacts of natural disasters and the global pandemic.
The department will provide support to councils through measures designed to reduce the burden on council resources and provide for the best possible productivity and planning outcomes. These include:
The department has heard that councils would appreciate more technical planning support in the zone translation process. The department is investigating options to provide meaningful planning support.
The team has considered all feedback provided by stakeholders and councils through the online survey, meetings, workshops and correspondence. This reform seeks to balance the interests of all stakeholders, generate productivity gains and deliver good planning outcomes.
The department has engaged extensively with local government and stakeholders on the policy and substance of these reforms. The position paper outlines the intent of the zoning framework as well as the detailed changes required to the Standard Instrument - Principal LEP. Now is the opportunity to review the detail of the reforms and provide comment.
The department is coordinating implementation so that councils will not be required to prepare individual planning proposals. Please contact the Employment zones reform team to discuss timing and any preferred approach for implementation.
All Local Environmental Plans are intended to be brought across to the new employment zones framework by mid-2022. This is to avoid uncertainty for businesses and communities created by having a dual zoning system.
Non-standard LEPs will not be impacted by the amending order. If, however the instrument calls up the Standard Instrument Dictionary or land use zones, any required changes will be managed through consequential amendments in consultation with councils.
We recognise that in certain locations, where permitted, retail land uses may form the highest and best use and out-compete other businesses for land.
Councils will maintain the ability to control the permissibility, size and scale of specific retail uses in accordance with their strategic plans. In some instances, additional local provisions may be developed.
The employment zones framework is informed by a qualitative and quantitative evidence base including upfront stakeholder and local government engagement. The potential land use term consolidation was not the discussed as part of upfront engagement therefore it is not as well developed as other aspects of the framework. Accordingly, it has not been included in Draft Standard Instrument (Local Environmental Plans) Amendment (Land Use Zones) Order 2021.
We are continuing to receive comments from stakeholders which will inform the draft framework. Where the policy intent has been developed, it has been included in the exhibited position paper for public comment. If supported these changes will be included in the Amendment Order.
If you would like additional information on the employment zone reform please email the Employment Zones project team.
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Page last updated: 20/05/2021