Australia: The New Urban Growth Zones - Do They Deliver?

Last Updated: 8 September 2008
Article by Karina Shpigel

Amendment VC48 came into force on 10 June 2008. The Amendment introduces the new Urban Growth Zone (UGZ) to some greenfield sites formerly zoned Farming Zone within Melbourne's five growth areas.

The Amendment also introduced some minor changes to clauses 12 and 14 of the State Planning Policy Framework (SPPF), and makes the Growth Areas Authority a referral authority for some applications where there is no Precinct Structure Plan (PSP) in place.


The UGZ is split into two parts:

  • Part A, which applies if there is no PSP in place.
  • Part B, which applies if there is a PSP in place.

Part A of the UGZ introduces controls which are similar to the Farming Zone. However some of the more intensive agricultural uses (intensive animal husbandry and saleyards) are now prohibited.

Importantly, Part A of the UGZ prohibits subdivision into lots of less than 40 hectares, unless the subdivision is a resubdivision of existing lots, for an existing dwelling, or to create a lot for a utility installation.

So, if a landowner wishes to develop land within the UGZ, the landowner must have a PSP in place, so that Part B of the UGZ applies. To do so, a landowner will have to amend the relevant planning scheme to list the PSP in the schedule to the UGZ.

Part B of the UGZ anticipates that the PSP will need to specify:

  • That the provisions of a zone apply to the development of land or the provisions of the zone apply to land in circumstances specified in the schedule.
  • That certain provisions may apply to land in the circumstances described in the schedule.
  • That a permit is required to construct a building or construct or carry out works and if so, the permit granted must:
  • Be generally in accordance with the PSP.
  • Include any conditions or requirements specified in the schedule to the zone.

Once the PSP is approved then:

  • An application for a use subdivision or buildings or works permit generally in accordance with the PSP is exempt from the notice and review provisions of the scheme.
  • A subdivision permit must be generally in accordance with the PSP and include any conditions or requirements specified in the schedule to the UGZ.
  • The specific provisions of the schedule to the UGZ prevail over the provisions of a zone applied by schedule to the UGZ.

From this, it is clear that PSPs must be carefully drafted, and clearly outline the planning controls, any exceptions and special rules, and any further notice requirements and appeal rights that may apply.

Clarity On PSPs Needed

Clause 14 of the SPPF requires the PSP to be prepared in accordance with precinct structure guidelines issued by the Minister for Planning (the Minister). While the Minister has stated that he will release new PSP Guidelines, (the New Guidelines), these have not yet been issued. We have been advised by the Growth Areas Authority that in the meantime, the PSP Guidelines Operational Draft (1 September 2006) (the Draft Guidelines) will continue to apply.

However the Draft Guidelines were not prepared with the provisions of the UGZ in mind, and fail to address a number of issues that arise with the preparation of PSPs for the new UGZ. In particular, they do not specify how to apply other zones, when exclusions and exceptions to the other zones should apply, and the nature of any further notice requirements and appeal rights that should apply.

We are also concerned that PSPs could subvert one of the main purposes for introducing the Victoria Planning Provisions, that is consistency of planning controls throughout Victoria. It appears the UGZ provides considerable scope for site specific provisions to apply through PSPs, with different controls from PSP area to PSP area.

There are also difficulties associated with amending PSPs. Unless the landowner obtains the benefit of an exemption under section 20 of the Planning and Environment Act 1987 (Vic) (the P&E Act), landowners will have to undertake the usual planning scheme amendment process to amend the PSP, with the associated advertising and Panel hearing processes.

The meaning of the term 'generally in accordance with' will receive greater attention due to:

  • The requirement that subdivision be generally in accordance with PSPs.
  • The difficulties associated with amending PSPs.
  • The fact that applications which are generally in accordance with PSPs are exempt from the notice and review provisions of the P&E Act.

The more detailed the PSP, the less deviation from the PSP is permitted. On the other hand, if the PSP is less detailed then there is scope for greater deviation.

This leads to a tension between Councils and landowners. In most cases, Councils will seek greater specificity in PSPs, so there is less scope for changes, and so that they can retain greater control over the form of development. On the other hand, landowners will seek less specificity to enable some flexibility to respond to market and other changes, and avoid delays associated with amending PSPs.

Other Concerns With The UGZ

Other concerns include:

  • It is likely that landowners will incur more upfront cost, having to prepare detailed PSPs as part of an amendment, rather than a general concept plan with further details to be supplied under an overlay control such as the development plan overlay.
  • Panel hearing times may be lengthened, as Panels will have to consider PSPs as well as other amendment documentation. Further it is likely that more parties will participate in Panel hearings, as third party appeal rights are potentially reduced significantly once a PSP is in place.
  • Control over the PSP approval process rests with the Minister. However, there is no provision in the P&E Act to apply to VCAT for a review of the failure of the Minister to make a decision within a reasonable time. Therefore there may be delays between the time a PSP (or an amendment to a PSP) is sent to the Minister for approval and the date of the approval. If delays do occur, no avenue exists for landowners to speed up the process.
  • The new UGZ does not address difficulties associated with preparing development contributions plans (DCPs). If Councils do seek to recover development contributions under DCPs, then they will have to insist on DCPs being prepared simultaneously with PSPs. This may lead to delays in the PSP approval process while DCPs are being prepared.


It does not appear that the introduction of the UGZ will streamline the planning process. It is likely to lengthen Panel hearing times, and there is no process to ensure the Minister approves PSPs (and amendments to PSPs) within a reasonable time. Further, PSPs will have to be carefully drafted to ensure there is an appropriate balance between certainty and flexibility. They should also be drafted so that they are reasonably consistent across Victoria. However the Draft Guidelines do not address these issues. It remains to be seen whether the New Guidelines will do so. Meanwhile, uncertainty remains while the New Guidelines are being prepared.

Phillips Fox has changed its name to DLA Phillips Fox because the firm entered into an exclusive alliance with DLA Piper, one of the largest legal services organisations in the world. We will retain our offices in every major commercial centre in Australia and New Zealand, with no operational change to your relationship with the firm. DLA Phillips Fox can now take your business one step further − by connecting you to a global network of legal experience, talent and knowledge.

This publication is intended as a first point of reference and should not be relied on as a substitute for professional advice. Specialist legal advice should always be sought in relation to any particular circumstances and no liability will be accepted for any losses incurred by those relying solely on this publication.

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