• John Luxton

The Minister of Commerce, Hon John Luxton, and Minister for the Environment, Hon Simon Upton, today said that there was good news and bad news in the results from a study on the impact of the Resource Management Act on business, recently completed by Ernst & Young for the Ministry of Commerce.

The study looked at seventy-three businesses in the energy, mining, telecommunications, retail, commercial/industrial, manufacturing and tourism sectors.

The Ministers said today, "The results of the work to date demonstrate that the impact of the Resource Management Act on business varies markedly depending on the nature of the activity, business's own processes and the operation of particular local government processes."

The study is essentially a series of case studies and is not a statistically valid survey. This means that the results cannot be directly translated to the whole business sector, however they do demonstrate that there are a number of significant issues arising out of the implementation of the RMA which warrant consideration.

The report confirms the need for closer scrutiny of the way in which the RMA is being implemented by local authorities. The Ministry for the Environment is already conducting more detailed examination of key problem areas.

"While it has not been possible to precisely measure the costs and benefits of compliance with the Act, respondents in the Ernst & Young study estimated that meeting environmental requirements typically reached up to 5 percent of business costs. Therefore compliance with the Act is a significant component of business costs and deserves ongoing attention by regulatory agencies to improve efficiency and reduce costs. Businesses could also improve their understanding of the Act.

"A major feature of the Act is the need for businesses to obtain resource consents for their activities. While half of the businesses considered that the resource consent process went well, there was considerable uncertainty about what information needed to be provided and the costs of providing information was of concern. More... "A significant number of firms interviewed reported that competitors had been involved in making submissions on their resource consents. We have seen a further example of this in the oil industry, very recently. The cost of delays and timeliness of processing consents was a significant issue for participants.

"There was a wide variation in performance across local councils.

"Particular issues included a perceived lack of sensitivity to commercial requirements, the need for council staff to adhere to agreed time frames and provide greater assistance with minimising compliance costs and facilitating consultation and the charges levied by Councils for processing and monitoring resource consents.

"The study has identified particular areas where improvements can be made that would significantly reduce compliance costs. In general, these relate to improving regulatory methods rather than fundamentally reviewing the legislation itself. This report is useful as we work towards reviewing practice under the Act and making any amendments that may be necessary to improve perf ormance", the Ministers concluded.