Natural Hazards Commission says RMA reforms not just about improving processes, but also whether NZ's planning framework 'recognises and manages natural hazard risk at its least costly intervention point'

As part of its submission on reforms to the Resource Management Act (RMA), the Natural Hazards Commission Toka Tū Ake (NHC) is calling for a clear definition of "risk-based planning” and for existing land use rights to be overridden in exceptional circumstances.

"Clear and consistent treatment of hazard risk enables development. Uncertainty around thresholds or information standards increases cost, delays, and litigation, and shifts risk into future recovery, insurance, and public expenditure,” the NHC said in its submission on the Planning Bill and Natural Environment Bill.

“As primary legislation for planning decisions, the Bill should clearly articulate what a risk-based approach means, how it is applied, and how it relates to ‘effects’ under the Act," the NHC said.

Last Monday, the NHC's chief resilience officer Jo Horrocks, head of risk reduction Sarah-Jayne McCurrach and champion of land-use planning Wendy Saunders appeared before Parliament’s Environment Committee to elaborate more on its submission.

Horrocks told the Committee people often asked the NHC what was the single biggest thing that could reduce the impact of disasters.

“I think most of us agree that it’s not better emergency response capability. It’s not better hazard models. It’s not even better engineering."

It was about making sure the country’s planning system consistently steered development away from the very high risk places in the first place, she said.

“Most of the losses New Zealand experiences from natural hazards are not caused by the hazard itself. They’re caused by the exposure we create over time through the decisions we make on where we build and how we build, how our land is used, how intensively we build and whether risk is recognised early enough to shape good decisions.”

Horrocks said: “Those decisions accumulate over decades. When they recognise natural hazard risk, the impacts of events can be manageable. When they don’t, the costs are measured in lives lost, houses damaged, disrupted communities, and very large recovery bills.”

The NHC saw the consequences of those decisions through the claims they received under the Natural Hazards Insurance Scheme, she said.

Many of the losses the NHC deals with came from development that had occurred in places where risk was already known, Horrocks said, and that was why land-use planning was one of the most powerful risk reduction tools available in New Zealand.

“Natural hazard losses are not just insurance losses. They fall across the system on households, on local government, on infrastructure providers and on the Crown.”

And when insurance cover narrows or declines, more of those costs would shift to households and government, Horrocks said. “And we’re seeing that quite recently.”

“Planning decisions therefore shape not only the physical risk but long-term fiscal exposure as well."

“For that reason, these Bills are important. They’re not just about improving planning processes. They’re about whether New Zealand’s planning framework consistently recognises and manages natural hazard risk at its least costly intervention point.”

“Once development is in place, the choices available to us are much narrower and far more costly. In our view, the draft legislation represents a significant step forward," Horrocks said.

“In particular, we strongly support the move towards risk-based planning and the clearer expectation that natural hazard risk must be considered in decision making. The test will be in how it’s implemented and operationalised.”

There are significant opportunities but we need to guard against inconsistent practice, Horrocks added.

A clause in the Planning Bill protects existing use rights but Horrocks said the NHC recommended; “ensuring the framework can respond where natural hazard risk becomes significant, including situations where existing land use rights may otherwise prevent risk reduction”.

Its submission said: “The framework should allow existing land use rights to be overridden in exceptional circumstances where it is necessary to avoid, mitigate or adapt to any existing or future natural hazard risk to people, property or infrastructure.”

The NHC also called for natural hazard risks to be added to clause 48 in the Natural Environment Bill, which discussed human health limits.

The NHC's submission said adding natural hazard risk meets the purpose of protecting human health, “given the 233 deaths from natural hazard events in the last 15 years.”

Several councils already use life safety thresholds in plans, the submission said.

Examples of this include the Christchurch District Plan and its life safety limits for cliff collapse, rockfall, boulder roll and mass movement, and the District Plan for Whakatāne prohibits development on the Awatarariki Fanhead Matatā, the submission said.

“Intolerable levels of risk to life were identified in areas with existing development because of debris flow risk,” the submission said.

“This recommendation seeks a nationally consistent mechanism to address significant risk to life from natural hazards.”

Horrocks said the Bills provided a really strong foundation and the NHC's proposed changes were "modest but important".

"They're intended to improve clarity, consistency and practical operability so that the planning system can more effectively manage natural hazard risk, support safer development over time and reduce avoidable social and fiscal costs in the future."