Guidelines on the withdrawal of development applications

Mark Evans • December 18, 2023

The NSW Department of Planning and Environment ( Department ) has called out the unofficial practice of local councils encouraging proponents to withdraw development applications.

This is a positive step by the Department. The only thing left now is to stamp out the practice of refusing to accept development applications in the first place.


In October 2023 the Department released the “Guideline on the withdrawal of Development Applications”. The guideline can be accessed on the Department’s website here:


https://www.planning.nsw.gov.au/sites/default/files/2023-10/23a-guidelines-withdrawal-development-applications.pdf


The guideline specifically addresses “the practice of encouraging applicants to withdraw development applications rather than assessing them.”. 


This practice achieves two main objectives. First, the application appears in the system as being “withdrawn” and the (often lengthy) assessment timeframe doesn’t count, particularly in that council’s performance data provided to the Department. 


Second, because the application is not “refused”, the applicant loses their appeal rights to the NSW Land and Environment Court. Section 8.7 of the Environmental Planning and Assessment Act 1979 (EPA Act) grants appeal rights to an applicant who is “dissatisfied with the determination of its application”. The application is withdrawn, not determined by the council.


The guideline is the latest attempt by the Department (including the introduction of the online NSW planning portal) to encourage local councils to improve processing times for development applications. Whether it will make any difference is doubtful.


Guidelines for the Withdrawal of Development Applications


Under the Guidelines for the Withdrawal of Development Applications, councils must be satisfied that the request to withdraw a DA is consistent with the following principles: 

  1. Councils in NSW can contribute to the challenge of addressing the State’s housing shortage through their responsibilities as local planning authorities.
  2. The expeditious assessment and determination of DAs creates a pipeline of development proposals with housing opportunities.
  3. Councils in NSW are required to devote appropriate resources to their planning and assessment teams to ensure development applications are assessed and determined within reasonable timeframes, consistent with the Environmental Planning and Assessment (Statement of Expectations) Order 2021 as issued under section 9.6(9) of the EP&A Act. 
  4. Councils are not to engage in practices of delay in assessing applications, including unnecessarily asking applicants to provide information not necessary for the assessment of the proposal or seeking the applicant to withdraw the proposal.
  5. The request to withdraw a DA is consistent with the Best Practice Guide and the request is not intended to enhance council’s performance data outcomes.


Many experienced town planners and developers will take particular note of (4) and (5) above.


Enforcement of the Guideline

So, what can the Department do about it? In practice, not much. 


The Guidelines issued under section 23A of the Local Government Act 1993 (LG Act) require councils to consider the Guidelines in exercising its function. Section 23A of the LG Act simply provides that the Department may “from time to time prepare, adopt or vary guidelines relating to the exercise by a council of any of its functions.”: s 23A(1). Further s 23A(3) provides that a “council must take any relevant guidelines…into consideration before exercising any of its functions.”.


The Minister for Planning and Public Spaces retains the power to review how a council exercises its planning powers when considering the issue of Directions under Division 9.1 of the EPA Act to a council or the exercise of intervention powers, including the removal of planning powers. 


We have yet to see either the Department, or the Office of Local Government strip local councils of their planning powers.


Perhaps, similar to replacing a council in financial trouble, the Department could consider replacing a local council’s planning department with a specialist taskforce to clear the backlog if that planning department is clearly in crisis and not performing. 


Alternatively, the Department will, in our view, continue to increasingly take responsibility (and workload) out of the hands of local councils through the expansion of development that is encompassed within the complying development code and other state environmental planning policies (SEPPs).


Takeaway for developers and proponents

If you have a development application that has been under assessment for a long time, and you are invited to withdraw the application you should think carefully before doing so and speak to a competent planning and environment lawyer regarding your appeal rights.


You should also ask the local council to describe in detail the reasons they may be considering refusing your development application. 


Require further assistance? please do not hesitate to call us on (02) 9145 0900 or make an enquiry below.

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