National Policy Statement on Highly Productive Land

During the last 20 years, New Zealand has lost approximately 35,000 hectares of highly productive land to urban or rural residential development.  Highly productive land is crucial not only to our primary industries and exports, but also to the economic viability of rural communities, whether they be dairy farms in Gore, or kumara farms in Dargaville.

To address these issues, the Central Government released the National Policy Statement on Highly Productive Land (NPS-HPL) on 18 September 2022.  The NPS-HPL, which commenced on 17 October 2022, aims to ensure that highly productive land is protected for use in land based primary production, both now and for future generations.

What is highly productive land?

Highly productive land is land mapped by local authorities that is in a general rural zone or rural production zone, is predominantly Land Use Capability (LUC) 1, 2 or 3 land, and forms a large and geographically cohesive area.  Land identified for future urban development at the commencement date is excluded from highly productive land.

Within three years of the commencement date, regional councils are required to map all highly productive land in their region in a regional policy statement.  In mapping highly productive land, regional councils must follow the New Zealand Land Resource Inventory’s LUC classification (which can be found here: map), unless they accept more detailed mapping under the LUC system.

Regional councils have some flexibility to classify land not marked as highly productive land in the LUC maps, where land may be highly productive land, having regard to its soil type, physical characteristics of the land and soil, and the local climate.

Territorial authorities are required to map the highly productive land in their district in line with the regional policy statements within six months of the relevant regional policy statement becoming operative.

Until the mapping process is complete, territorial authorities must still implement the NPS-HPL by reference to the aforementioned criteria for highly productive land.

What restrictions does the NPS-HPL introduce?

The NPS-HPL prevents some territorial authorities from the urban rezoning of highly productive land, unless required to provide sufficient development capacity, there is a lack of other reasonable options, and the environmental, social, cultural and economic benefits of rezoning outweigh the corresponding costs of losing highly productive land.

All territorial authorities must avoid the rezoning of highly productive land as rural lifestyle, unless the land is subject to permanent or long-term constraints.

Territorial authorities must also avoid the subdivision of highly productive land, unless applicants can demonstrate that proposed lots will retain overall productive capacity, subdivision is on specified Maori land or it is for specified defence infrastructure.  Even where subdivision of highly productive land meets this criteria, territorial authorities must still avoid if possible, or otherwise mitigate, any potential cumulative loss of highly productive land and any reverse sensitivity effects.

Territorial authorities must avoid the inappropriate use or development of highly productive land that is not land-based primary production, using set criteria to determine what is ‘inappropriate.’

What exemptions are in place?

The NPS-HPL contains a number of exemptions for the new restrictions, the most significant of which is for highly productive land subject to permanent or long-term constraints.  Territorial authorities may only allow highly productive land to be subdivided, used or developed that is not otherwise enabled if satisfied there are permanent or long-term constraints that means land-based primary production will not be economically viable for the next 30 years.

What does it mean for local authorities?

Local authorities will need to come up to speed with the NPS-HPL very quickly, and must give effect to it when assessing applications for land that will potentially be classified as highly productive.  A key risk for local authorities will be ensuring that they give effect to the NPS-HPL while the mapping process takes place.  Local authorities may mitigate this risk by becoming familiar with land classified as LUC 1, 2 or 3 by the New Zealand Land Resource Inventory within their jurisdiction and ensuring that any applications for activities on this land are handled with additional care.

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