Media advisory 2 July 2004

Core industries request RMA changes

Improvements to the Resource Management Act have been requested by a group of significant New Zealand industries.

Manufacturing, processing, transport and energy companies and others have sent a joint letter to the Government asking for changes to streamline and focus RMA processes while still giving protection from negative impacts.

LETTER FOLLOWS

1 July 2004
Hon David Benson-Pope MP
Associate Minister for the Environment
Parliament
Wellington
Dear Minister

Review of Resource Management Act – Submission from “Core industries” group

The organisations that have signed this letter come from a diverse range of sectors.

Collectively, we employ many thousands of New Zealanders. We are also major contributors to the nation’s well-being, through the goods, services and wealth we produce and/or the investments we make in the country’s infrastructure.

We welcome the Government’s decision to review the Resource Management Act (RMA). We believe the Act is not achieving its intended purpose in a number of important areas, and we consider the review to be very timely.

While many of the signatories below have made separate submissions, there are important areas of common ground. This letter is intended to set out those areas in a succinct manner. We believe the review must address these matters to yield meaningful benefits.

Consent processes

The RMA currently does not work well for unusual, large, or complex projects. Under present arrangements, applications to build a major infrastructure project or a small but unusual / complex project1 are treated within the same overall framework as applications to undertake relatively minor works. This “one size fits all” approach is not conducive to effective decision-making.

In particular, the RMA does not cope well with projects whose local effects may be generally adverse, but which produce significant benefits from a regional or national perspective. To remedy this situation we believe there is a need for a “special” process to be developed for such projects. This process would facilitate timely and high quality decisions, whilst still allowing local interested parties to have appropriate input.

A number of possible improvements are set out in more detail in the Appendix to this letter.

Scope of RMA is not clear

Secondly, we believe that the scope of the RMA as set out in Part 2 of the Act requires greater clarity, particularly the statutory definition of key terms such as “environment”. The 1998 Reference Group proposed a number of useful revisions.

These could be complemented by increased guidance to regional councils from central government. We are not advocating that the potential social or economic impacts of projects on other individuals should be discounted, but that the criteria for decisions be more clearly defined.

In addition, Part 2 should be clarified to ensure that the broader benefits of projects (including both national and local economic benefits) can be appropriately weighed against any environmental costs. However, we would caution that consideration of benefits and costs should be measured against the status quo rather than any notional ”ideal”. The latter approach is inherently subjective and is likely to lead to a central planning-type approach to determining the “best” uses of resources.

Mechanisms for allocating natural resources

The final core area of concern relates to possible modifications of mechanisms for allocating the resources that are allocated via the RMA among competing users2. At present the RMA operates on a “first come, first served” basis. Whilst this has some drawbacks, it does help to underpin investment because it provides consent holders with a reasonable degree of security over their usage rights.

Significant amounts of investment have been committed over many years based on a legitimate expectation that usage rights would be sustained under the RMA framework and its predecessors. Any proposal that does not recognise this runs the risk of seriously chilling future investment intentions. This would run directly counter to the Government’s stated objectives.

We also note with some concern the precedents that seem to be emerging through the aquaculture reform process and the Waitaki Bill, which appear to place little weight on the position of existing resource consent holders.

In summary, we believe that policy can be improved in this area, particularly through the potential use of market mechanisms to help allocate scarce resources. However, any such review needs to recognise that different allocation mechanisms (market and non-market) may be appropriate for different resources (water, air, marine space etc.), and that the respect of existing rights is essential to ensure that investment is not retarded.

Because these issues are complex and require thorough and careful consideration, we believe the Government should proceed with caution if unintended, adverse consequences are to be avoided.

Conclusion

Too often in the past, debates about the RMA have been seen as “business versus the environment”. We believe that such characterisations are not only wrong, but are dangerous. Business and the environment are not mutually incompatible. Indeed, we believe – and clear international evidence suggests – that a healthy environment can only be afforded by a prosperous society.

That being so, we submit that it is New Zealand’s best interests to create a legislative framework that facilitates and favours the creation of that prosperity. To do so is, in our view, the best path to being able to afford the healthy environment that today’s New Zealanders, and their future generations, deserve.

We would welcome an opportunity to discuss the issues raised in this letter with you.

1 The Trio holdings application to develop a sponge farm for cancer drug purposes is often cited as an example of a small but nationally important project in this respect.

2 We note that a large proportion of resources (land, minerals, petroleum, radio spectrum, fish etc.) are allocated via other mechanisms that generally work very well. A common aspect of these mechanisms is the recognition of long-term usage rights.

Yours sincerely,

Don Huse,
Chief Executive, Auckland International Airport

Peter Griffiths
Managing Director, BP

Simon Carlaw
Chief Executive, Business New Zealand Stephen

P Barrett
Chief Executive, Contact Energy

Alan Jenkins
Chief Executive, Electricity Networks
Association

Ralph Waters
Chief Executive, Fletcher Building

Tony Carter
Managing Director, Foodstuffs Auckland

Terrence Currie
Chairman, Major Electricity Users Group

Caryll Shailer
Chief Executive, Meat Industry Association

Harvey Weake
Managing Director, Methanex

Doug Heffernan
Chief Executive, Mighty River Power

Roger Kerr
Executive Director, New Zealand Business Roundtable

Thomas Zengerly
Chief Executive, New Zealand Refining
Company

Bill Jacob
President, New Zealand Steel

Spence McClintock
Manufacturing Inputs Manager, Norske Skog Tasman

Murray Sturgeon
Managing Director, Nelson Pine Industries

Ken Ross
Technical Director, Pan Pac

Mike Patrick
Executive Officer, PEANZ

James Everett
Managing Director, Rayonier Asia Pacific

Owen Symmans
Chief Executive, The New Zealand Seafood
Industry Council

Don Elder
Chief Executive, Solid Energy

Keith Tempest
Chief Executive, TrustPower

Mark Franklin
Chief Executive, Vector

CC : Rt Hon Helen Clark
Prime Minister
Hon Dr Michael Cullen
Deputy Prime Minister
Hon Jim Anderton
Minister of Economic Development
Hon Pete Hodgson
Minister of Energy
Hon Jim Sutton
Minister of Agriculture
Hon Parekura Horomia
Minister of Maori Affairs
Hon Marian Hobbs
Minister of Environment
Hon Chris Carter
Minister of Conservation

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