Posted on November 22, 2022 by Lindsay Taylor

ALERT: NSW Reconstruction Authority Bill Passed by Parliament

On 17 November 2022, the NSW Parliament passed the NSW Reconstruction Authority Bill 2022 (‘Bill‘). The Bill is awaiting assent. Regulations will need to be made to enable certain provisions of the Bill to operate.

The Bill establishes the NSW Reconstruction Authority (‘Authority‘) and vests in it the responsibility and power to facilitate disaster preparedness, recovery and reconstruction of affected communities from natural disasters. The establishment of the Authority was a key recommendation of the ‘2022 Flood Inquiry’ into the preparation for, causes of, response to and recovery from the catastrophic flood events across the state during 2021-2022.

In this blog, we focus on the functions and powers given to the Authority under the Bill that empower it in defined circumstances to carry out development in disaster affected areas, to direct local councils and government agencies in New South Wales to take certain actions in exercising their functions, and to step in for a decision-maker in relation to certain prescribed decisions or processes.

Meaning of ‘Disaster’

Central to the Bill is the definition of ‘disaster‘, which covers:

  • natural disasters, and hazards caused by them,
  • other emergencies‘ in relation to which the Minister has requested assistance,
  • other emergencies‘ to which a public authority, including a Minister other than the Minister administering the Act, has requested assistance from the Authority and agreement to assist has been provided, and
  • events, incidents or matters‘ to be prescribed by the regulations (see cl. 6).

The functions and powers of the Authority 

Powers to carry out development

The Bill grants the Authority, under Part 2, Division 2, the power to carry out development on specific land, if the Authority is satisfied, among other things, that the land is

  • in a part of the State that has been, or is likely to be, directly or indirectly affected by a disaster (see cl. 12(1)(a)(i)), or
  • not in such a part of the State that has been, or is likely to be, directly affected by a disaster, but the development is a direct response to the disaster or likely disaster (see cl. 12(1)(b)(i)) – an example given by the Bill is ‘development for the purposes of residential accommodation to house residents who have been displaced by a disaster‘.

Notably, a proposed development under clause 12(1)(a)(i) on specific land that is likely to be affected by a disaster, or a proposed development under clause 12(1)(b)(i) that is a direct response to a likely disaster, will require a ‘proposed development declaration‘ by the Premier, authorising the proposed development and specifying the period during which the development may be carried out under the declaration (see cl. 12).

Development approval powers

Under Part 7, Division 2, the Minister may also make a ‘ministerial authorisation‘ to authorise the undertaking of development without the need for an approval or assessment under the Environmental Planning and Assessment Act 1979 (‘EPA Act‘), or consent from any person (see cl. 68(1)).

Such an authorisation may only be given if:

  • the Authority’s Chief Executive Officer has asked for the authorisation to be given during a declared state of emergency or in relation to a declared project, reconstruction area or disaster prevention area, and has advised to the Minister’s satisfaction of the reasons specified in clause 68(3)(c) for the authorisation, or
  • the Minister is satisfied that exceptional circumstances exist, and immediate action is required to protect the safety and welfare of the public, and no other available mechanism provided under the Act would be appropriate in the circumstances (see cl. 68(4)) – for the purposes of clause 68, ‘exceptional circumstances‘ mean circumstances to be prescribed by the regulations (see cl. 68(7)).

Powers in relation to declared projects and ‘relevant land’

The Bill further provides that if the Minister makes a declaration of declared projects, reconstruction areas or disaster prevention areas under Part 5, then the Authority is given certain functions and powers in relation to the declared projects and the relevant land under Part 6, despite any other Act or law. ‘Relevant land’ is defined by the Bill to mean ‘land within a reconstruction areas or disaster prevention areas‘.

For example, the Authority will have the power to acquire land for the declared project, or relevant land, by agreement or by compulsory acquisition under the Land Acquisition (Just Terms Compensation) Act 1991 (see cl 45). The Authority will also have the discretion to carry our certain functions, such as to:

  • demolish, or arrange to be demolished, any building within or adjoining or in the vicinity of land vested in the Authority or relevant land,
  • subdivide and re-subdivide land, and consolidate subdivided or re-subdivided land, vested in the Authority,
  • set out and construct roads, or temporarily or permanently close roads, on land vested in the Authority or relevant land,
  • erect, alter, repair and renovate buildings on, or to carry out work on or in relation to, land vested in the Authority or other land with the consent of the person in whom the land is vested, or on relevant land, and
  • sell, lease, exchange or otherwise deal with or dispose of, or to grant easements or right-of-way over land vested in the Authority with the approval of, and subject to the terms and conditions decided by, the Minister (see cl. 46).

Power to direct

The Authority will also have the power to direct a government agency, a State owned corporation, a local council or any other person prescribed by the regulations (a ‘relevant entity‘) to take particular actions in certain circumstances (a ‘relevant action’), if the Authority is satisfied of the specified prerequisites to give such a direction (see cl. 13).

For example, the Authority may direct a local council to take certain action in the exercise of the council’s functions under the EPA Act (see cl. 13(1)(b)), or another planning authority, other than a local council, to take certain action in the exercise of that planning authority’s functions as prescribed by the regulations (see cl. 13(1)(c)).

Power to step in

One of the key features of the Authority’s powers under the Bill is that the Authority may, with the Minister’s approval, give a written ‘step-in notice‘ to a decision-maker and applicant for a prescribed decision or a prescribed process in certain circumstances, advising that the Authority will make an assessment and a decision about a prescribed decision or process the subject of the step-in notice (see cl. 52(1)).

The Bill defines the following terms for the purposes of :

  • a ‘decision-maker’ means the entity that may make the prescribed decision under the relevant law for that decision, or the entity responsible for undertaking the prescribed process under the relevant law for that process,
  • a ‘prescribed decision‘ means ‘a decision, in relation to a declared project or development in a reconstruction area or disaster prevention area, required to be made under a law of the State, including, for example, a decision about constructing, undertaking, carrying out, establishing, maintaining or operating a declared project or development in a reconstruction area or disaster prevention area‘,
  • a ‘prescribed process means ‘a process, in relation to a declared project or development in a reconstruction area or disaster prevention area, required to be undertaken under a law of the State, including, for example, a process under the Environmental Planning and Assessment Act 1979‘, and
  • relevant law‘ for a prescribed decision or prescribed process, means ‘the law, other than this Act, under which the decision may be made or the process undertaken‘ (see cl. 42).

The Bill enables the Authority with the approval of the Minister, to issue a step-in notice if the Minister is satisfied the giving of the notice is necessary (see cl. 52(2)):

  • for the protection, rebuilding or recovery of a community, or
  • to mitigate against potential disasters for a community, or
  • to improve the resilience of a community for potential disasters, including, for example, through the betterment of the community.

The step-in notice must (see cl. 52(3)):

  • identify the prescribed decision or prescribed process, and
  • state the Authority is the decision-maker for the prescribed decision or prescribed process from the time the notice is given until the Authority makes a decision, under section 56, about the prescribed decision or prescribed process.

The effect of the Authority giving a step-in notice, is that the Authority becomes the decision-maker, and has all the powers of the decision-maker relevant to the making of the decision, under the relevant law for the prescribed decision or process until the Authority makes a relevant decision (see cl. 55). The Authority in stepping in must consider the criteria, if any, for making the prescribed decision or undertaking the prescribed process under the relevant law, and the primary object proposed by the Bill.

If the Authority makes a prescribed decision the subject of a step-in notice, that decision is taken to be a decision of the original decision-maker under the relevant law, however, a person may not appeal against the Authority’s decision (see cl. 57(1)(a)).

Additional step-in functions

The Bill further provides under Part 7 that the Minister may make a ‘project authorisation order‘ to:

  • authorise the Authority to carry out a project specified in the order (see cl. 64),
  • authorise the Authority to take over a project that is being carried out by or that involves another state government agency (see cl. 65), or
  • transfer to the Authority certain assets, rights and liabilities of, or agreements or undertaking by, another state government agency, which are relevant to the project being taken over (see cl. 66).

Implications of the Bill

The Bill grants the Authority and the Minister some far-reaching powers in the name of disaster relief and prevention to carry out development or projects, direct or step in for public authorities in exercising their legislative functions and powers, acquire and deal with land, take over projects and authorise development irrespective of planning laws.

In this regard, the Bill provides that ‘a decision made by the Minister or Authority under this Act is not an administratively reviewable decision for the Administrative Decisions Review Act 1997‘ (see cl. 92). However, a ‘joint select committee‘ is proposed to be established, consisting of 10 members from both houses of the Parliament, to be responsible for reviewing the Authority’s operations regarding any disaster in relation to which the Authority exercises its functions.

A copy of the Bill that was passed by the Parliament can be accessed via this link.

For more information on the implications of the Bill, please contact Dr Lindsay Taylor, Jennifer Chenhall or Ming Gu.