Clause 4.6 requests to vary a development standard in NSW – What's new?

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Bartier Perry

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It is understood that written guidance will be provided by DPE with an updated 4.6 request template.
Australia Real Estate and Construction

In September 2023, the NSW Government published amendments to clause 4.6 of the Standard Instrument which changes the operation of the clause across all local environmental plans.

The changes came into force on 1 November 2023.

Three legislative amendments have been made to deliver the changes:

  1. Standard Instrument (Local Environmental Plans) Amendment (Exceptions to Development Standards) Order 2023
  2. State Environmental Planning Policy Amendment (Exceptions to Development Standards) 2023 (SEPP Amendment)
  3. Environmental Planning and Assessment Amendment (Exceptions to Development Standards) Regulation 2023 (Regulation Amendment)

The often-maligned clause 4.6 has been the subject of considerable judicial consideration and with good reason. Demonstrating that compliance with a development standard is unreasonable or unnecessary is never simple.

We often see clause 4.6 requests that are deficient in that they do not address the tests as established through the well-known decisions of the Court. This leads to uncertainty for both developers seeking to vary the standard, and for any consent authority in determining whether the request is well founded.

It raises the question; will the current reforms change the status quo? Time will tell, but let's first look into the key changes.

Previous clause 4.6

The principal change is the omission of clause 4.6(3) – (5) and (7) in the Standard Instrument – Principal Local Environmental Plan.

The revised clause

The following subclauses will be inserted instead:

(3) Development consent must not be granted to development that contravenes a development standard unless the consent authority is satisfied the applicant has demonstrated that—

(a) compliance with the development standard is unreasonable or unnecessary in the circumstances, and
(b) there are sufficient environmental planning grounds to justify the contravention of the development standard.

Note — The Environmental Planning and Assessment Regulation 2021 requires a development application for development that proposes to contravene a development standard to be accompanied by a document setting out the grounds on which the applicant seeks to demonstrate the matters in paragraphs (a) and (b).

(4) The consent authority must keep a record of its assessment carried out under subclause (3).

Transitional provisions

The SEPP Amendment and Regulation Amendment include savings provisions that will allow development applications made on or before 1 November 2023 to be determined as if the changes had not commenced.

So, what has changed?

The Public Interest

The former clause 4.6 included a requirement that the consent authority be satisfied that the proposed development is in the public interest because it is consistent with the objectives of the development standard within the zone in which the development is proposed to be carried out.

This test has been removed.

There remains the requirement to consider the public interest under clause 4.15(1)(e) of the Environmental Planning and Assessment Act 1979 (EPA Act).

The Department of Planning and Environment (DPE) are of the view that the omission of this subclause is merely to simplify drafting of clause 4.6 requests.

It had been previously held in various leading decisions that if the proposed development is inconsistent with either the objectives of the development standard or the objectives of the zone or both, the consent authority, or the Court on appeal, cannot be satisfied that the development will be in the public interest. That test is no longer applicable.

To consider or to be satisfied

Clause 4.6(3) has been amended. Previously, a consent authority need only consider, pursuant to this clause, a written request that seeks to justify contravention of a development standard by demonstrating that compliance is unreasonable or unnecessary.

The requirement to 'consider' a written request has been changed with an express requirement that the consent authority 'be satisfied that the applicant has demonstrated' that compliance with development standard is unreasonable or unnecessary.

On face value, you might think the change is minor. It is however consistent with the intention of clause 4.6 which does require forming a level of satisfaction, and not merely giving consideration.

Planning Secretary's Concurrence

The revised clause 4.6 removes the requirement for concurrence from the Planning Secretary. DPE intends for this to reduce red tape and enable more timely assessment of development applications in line with the Department's Planning Reform Action Plan which seeks to reduce concurrence and referral request across the NSW planning system by 25%.

The amendments now only require the Planning Secretary be notified of the development after it has been determined. Given that most developments are currently dealt with assumed concurrence, it is not expected this change will have a large impact in practice.

Requirement of Written Requests

The revised clause 4.6 no longer refers to a written request being made by the applicant. The requirement for a written statement has been moved to the Environmental Planning and Assessment Regulation 2021 (EPA Regulation). The Regulation Amendment introduced the new clause 35B which states:

(2) The development application must be accompanied by a document that sets out the grounds on which the applicant seeks to demonstrate that—

(a) compliance with the development standard is unreasonable or unnecessary in the circumstances, and
(b) there are sufficient environmental planning grounds to justify the contravention of the development standard.

Record of assessment

The newly inserted clause 4.6(4) requires the consent authority to keep a record of its assessment carried out under clause 4.6(3).

SEPP Amendment

The following SEPP's will be amended to ensure consistency across all planning instruments that provide for clause 4.6 exceptions:

  1. Precinct State Environmental Planning Policies
  2. State Environmental Planning Policy (Industry and Employment) 2021
  3. State Environmental Planning Policy (Transport and Infrastructure) 2021

The changes also apply to non-standard Local Environmental Plans which have not been repealed since the commencement of the Standard Instrument.

So where to from here?

The changes above are on one view subtle changes.

They do not include some more drastic amendments previously foreshadowed including a requirement that the contravention result in an improved planning outcome, however that may be assessed.

The most forceful change arguably is the removal of the public interest test. This may lead to other ways of satisfying the unreasonable or unnecessary test. Arguably, it is possible that a clause 4.6 request won't need to demonstrate consistency with the objectives of the development standard.

We could see clause 4.6 requests upheld by satisfying one of the alternate tests in Wehbe v Pittwater Council [2007] NSWLEC 827. For example, an Applicant might be able to demonstrate that compliance with a development standard is unreasonable or unnecessary even if it is not consistent with the objectives of the development standard.

As noted above, there remains the need to satisfy the public interest consideration under section 4.15(1)(e) of the EPA Act.

So in summary, clause 4.6 requests are here to stay. The tests that previously applied to such requests, largely remain unchanged.

For applicants and consent authorities alike, the age old issues in respect of whether a clause 4.6 request should be upheld remain. It is understood that written guidance will be provided by DPE together with an updated 4.6 request template.

We will report on further developments.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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