The Residential Zones: The Non-Hysterical Case for Concern

the great aussie nightmare

This article was written for (and as far as I know will be appearing in) the May 2014 Planning News. As it says, it is a response Liz Johnstone’s article “Stop Panning Planning” in the April 2014 issue.

Readers of Planning News will have read Liz Johnstone’s Executive Officer Report in last month’s magazine, endorsed by Brett Davis’ President’s column, which suggested that scaremongering was occurring by opponents of the new residential zones, and that the potential negative impacts of the rollout were greatly exaggerated.

There is no doubt that there is inaccurate reporting going on: the complexity of planning challenges the media’s ability to carry a coherent debate. I also agree with Liz that many of those who are suddenly vocal are, as she put it, the “beneficiaries of ambiguity.” (My own personal version of this frustration is that many of those most agitated about the new zones were silent throughout the assault on activity centre policy though amendment VC88 and the new commercial and industrial zones – I wish they would find a voice on that even more egregious example of #badplanning). It is also true that the areas in which problems occur may be outweighed, in sheer numbers, by areas in which we see a largely neutral rollover to the General Residential Zone.

Nevertheless, I am troubled on a number of fronts with the process surrounding the implementation of the new zones. I believe that there are many planners expressing legitimate concerns, and that these don’t amount to hysterical “Henny Penny” style alarmism. I am concerned that Liz and Brett’s pieces may have created the impression that PIA does not hear or speak for these views.

Certainly there are a range of views on the committee, of which my own is just one. However I think it is important that the industry understand that this perspective is represented on the PIA committee, and that in fact PIA’s submissions to various reviews (such as our comments on Plan Melbourne) have already outlined much of this perspective.

I therefore thought it was important to outline the contrary case for why, scaremongering aside, I believe a reasonable planner should in fact be concerned about the residential zones rollout.

It’s Never Been About the Tools

Let’s start by acknowledging the common ground that the basic principle of the zones is sound. The three-speed zones emerged from Making Local Policy Stronger and went through an arduous six-year process for what were, in essence, relatively minor operational tweaks. In that time the three-speed zone model actually went through an Advisory Committee process twice.

The tools are not the problem; they never were. A low-growth model very close to that created by the Neighbourhood Residential Zone could be achieved using combinations of the Residential 3 Zone, ResCode schedule tweaks, and various overlays (such as the NCO, DDO, and HO). The key issue, then, was underutilisation of the tools that existed, rather than the tools themselves.

Rollout is the Whole Job

This is not to say that the new zones don’t have merit. The NRZ is a more streamlined model than a combination of controls as suggested above, and should send a clearer signal to the market than arcane methods such as zone schedules. And if we accept that the existing tools had been underused, then the very act of introducing the new zones provides an important “circuit breaker” moment to hopefully shock the system into utilising the full suite of growth-directing tools.

Yet choosing where these go is the meaningful part of the planning exercise. To spend six relaxed years on a few tweaks to the zones’ design and then rush the rollout is to mistake tool-building for the core business of planning. Actually deciding where they were to be applied was always going to involved detailed street-by-street assessments and discussion with the community, and this is a far bigger job than designing the zones.

It is also a mistake to assume that this exercise is the same as simply translating existing housing policy. Having identified preferred areas for growth is not the same as having tested and debugged the application of a particular tool, especially where that involves mandatory controls. I support mandatory controls in appropriate circumstances, but we should recognise that their application requires extra care to avoid unjust outcomes that can’t be remedied without corrective scheme amendments.

Implementation Before Strategy

One of the chief concerns about the rollout is the lack of a coordinated strategy that gives confidence that the NRZ will not be overused.

This is not an issue of overall housing supply. As Liz notes, there is a lot of supply still on the fringe and in the expanded CBD. If you want a city apartment or a detached house in the outer suburbs, your needs should be well met for the foreseeable future. However it is possible that overuse of the NRZ threatens the supply of a particular model of housing, at least in some areas: classic infill medium density units, with about three to five on a block and a driveway up the side.

These are an important section of the housing market, especially for first homebuyers and downsizing retirees, for whom they often provide the only feasible point of entry to established suburbs. There is, of course, a large section of the development industry that concentrates on this model and can’t easily repurpose to multi-storey apartment construction.

We know a lot of housing capacity and population projection work has been done over recent years, and the current draft of Plan Melbourne promises (on page 59) that more will appear in the finalised strategy. (This latter point is treating the core business of strategy as an afterthought, and is especially unforgivable given the implementation of the zones is so progressed even as the strategy is still being finalised.)

Arguably the single highest priority of Plan Melbourne should have been to collate and tie together that work so that the metropolitan strategy included transparent and spatially resolved projections of where housing change does and does not need to occur. As part of this work the assumptions of the zone Practice Note – such as the 80% detached housing guideline for the application of the NRZ – needed to be modelled, and the result of that modelling released, to give confidence that the Practice Note’s direction was consistent with those projected outcomes.

The irony of criticising those concerned about the zone rollout for “simplistic analysis” is that the critics’ concern arises precisely from a lack of such detailed analysis. Doubtless the work being touted that attempts to judge the effect of the zones has some flaws. Yet the need for ad hoc work of this type would not arise if the detailed work were done (or publicly released) ahead of the rollout. It is the initial strategic justification that has created this void.

“But it can be Reviewed Later!”

Liz expresses confidence that “[w]hen Plan Melbourne is finalised and released, and the SPPF reviewed, Councils’ regular review of their Planning Schemes will take this into account.” Such a view seems based on two assumptions: firstly, that the final Plan Melbourne will include significantly enhanced spatial resolution to guide zone application; and secondly, that once this work appears, the political will to wind back existing inappropriate NRZ will be readily obtained.

Only time will tell, of course, but both these propositions seem doubtful to me.

Plan Melbourne Broke the Residential Growth Zone

Another problem created by Plan Melbourne is the doubt it has created about the Residential Growth Zone. As the first of the zone Advisory Committees made clear, the key problem that had hampered the widespread use of the Residential 2 Zone was its exemptions from notice of review. The reintroduction of notice rights was therefore the key change between the R2Z and RGZ. Yet Plan Melbourne has clouded that outcome by flagging (on page 67) that the RGZ will be subject to a code assessment model, which is by definition notice exempt. This has crucially undercut the whole point of the new growth zone.

This seems to be a mistake: certainly the relevant passages read as if written by someone with only a vague sense of what code assessment and VicSmart actually are (let alone an understanding that the two are different things). Yet it has been allowed to remain uncorrected throughout the crucial period of zone rollout. Combined with a lack of clear framework to prevent under-utilisation, this seems destined to leave the RGZ underused just as its predecessor was.

“But it’s only a Few Councils!”

Yes, many Councils will be staying with the GRZ for now and pursuing more measured implementation, and those will dilute the impact of any NRZ overuse or problems in implementation. Yet any statutory planner will know that such a macro-level view always forgets the very real coal-face impact upon the people who happen to find themselves subject to a poorly applied or designed control. The first run of councils adopting the new zones will be quite enough to lead to many bad outcomes if the problems are not properly resolved. Those who find themselves unable to reasonably develop their land may find the knowledge that others in the neighbouring municipality can do so to be of limited solace.

In addition, if this exercise is to have any point, we surely wish to pursue more tailored zones across the majority of municipalities. That needs to be done equitably; whatever approach we pursue across the early-adopting municipalities should be able to be reproduced city-wide over time. It is important, then, to get it right.

“But the Advisory Committees Will Pick Up Mistakes!”

Advisory Committees have a valuable role to play, but they are limited by timeframes and resources made available to them. They can scrutinise material, but they cannot reinvent it or cover large gaps in the overriding strategic framework. We should not assume the committee process can remedy fundamental flaws, or find all the problems in rushed work.


I accept that there is some extremist and self-interested commentary occurring at present about the zones. Yet, as I have argued, I believe there are legitimate reasons to be concerned about the current process. There is genuine risk of poor outcomes and undermining of a reform that had real merit.

We need to return planning in this state to a situation where our guidance as to where development occurs is empirically based, strategically co-ordinated, spatially resolved, and clearly communicated. The new residential zones have the potential to be an important tool in achieving this. They will not do so, however, if those principles of empiricism, coordination, resolution and clarity do not inform the process of their application.

Image by Jes. Click for details.

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