The Government has asked the Productivity Commission to undertake an inquiry into the system of urban planning in New Zealand. The main purpose of the inquiry is to “review New Zealand’s urban planning system and to identify, from first principles, the most appropriate system for allocating land use through this system to support desirable social, economic, environmental and cultural outcomes”. The inquiry will look beyond the current resource management and planning system to consider fundamentally different ways of delivering urban planning. The aim of the inquiry is to set out what a high-performing urban planning system would look like. In doing so, the Commission was asked to consider the background, objectives, outcomes and lessons from the current urban planning system in New Zealand as well as international best practice.

This draft report aims to assist individuals and organisations to participate in the inquiry. It outlines the background to the inquiry, the Commission’s intended approach, and the matters about which the Commission is seeking comment and information. This draft report contains the Commission’s draft findings and recommendations. It also contains a limited number of questions to which responses are invited but not required. The Commission welcomes information and comment on any part of this report and on any issues that participants consider relevant to the inquiry’s terms of reference, by 3 October 2016.

The Commission recommends a future planning system should:

• Make a distinction between the built & natural environment with clear objectives for each (Chapter 13);
• Favour development in urban areas, subject to clear limits (Chapter 7);
• Develop a Government Policy Statement on Environmental Sustainability to provide the boundaries within which urban development can occur (Chapter 8);
• Provide narrower access to appeals and tighter notification requirements (Chapter 7);
• Make spatial plans a mandatory component of the planning hierarchy (Chapter 9);
• Establish a permanent Independent Hearings Panel to consider and review new Plans, Plan variations and private Plan changes across the country (Chapter 7);
• Include more responsive rezoning through the use of predetermined price triggers to signal when land markets are out of balance and rezoning is needed (Chapter 7); and
• Make greater use of targeted rates and volumetric charges to fund infrastructure investment and maintenance (Chapter 10).