Ministerial inquiry into land use may have far-reaching implications on forestry sector

  • Legal update

    31 May 2023

Ministerial inquiry into land use may have far-reaching implications on forestry sector Desktop Image Ministerial inquiry into land use may have far-reaching implications on forestry sector Mobile Image

A new Ministerial report into destructive woody debris across Gisborne/Tairawhiti and Wairoa as a result of Cyclone Gabrielle has a long list of recommendations, but one clear message - act now or face environmental disaster. 

If implemented, the recommendations in the report have far-reaching implications for the forestry sector. For now, while the Government considers the report, forestry operators face an uncertain future. 

We explore five of the key recommendations and their potential impact on the forestry sector in more detail below.

To read the full report, click here

Boughing under pressure – the Ministerial report 

The impact of Cyclone Gabrielle prompted an urgent Ministerial Inquiry into land uses associated with the mobilisation of woody debris (including forestry slash) and sediment in the Gisborne/Tairawhiti and Wairoa districts. The Inquiry was led by an independent panel (Panel), led by former government minister Hekia Parata with the other two members being forestry engineer Matthew McCloy and former National Recovery Manager for the Department of Prime Minister and Cabinet, Dave Brash.   

The Panel’s report (Report) reflects a concern that:

  • the regulations governing the environmental effects of forestry are too permissive and out of date;
  • resource consents have been ineffective; and
  • compliance monitoring is under-resourced.  

The Report is extensive; the Panel made almost 50 recommendations focused on tightening and consolidating regulations applicable to forestry activities and incentivising slower-growing exotics and the planting of permanent indigenous forests. The recommendations aren’t government policy yet, but if they are implemented, they will have potentially significant implications for the forestry sector.  

The Panel’s key recommendations 
Staging a coup(e) on clear-felling 

The Panel considers the current regulation on forestry is too permissive because it allows large catchments to be felled at once. It recommends an urgent halt on large scale clear-felling in the Tairawhiti and Wairoa Districts in favour of staged coupe harvesting of no more than 40 hectares per coupe. There would be a minimum 5-year “green up” period between stages. 

A ban on clear-felling in these districts is designed to prevent further build up of large volumes of slash and minimise the risk of large scale erosion events. Those in the industry say that if this is implemented, the longer harvesting periods will have broader implications for profitability and employment in the area, as operators will employ smaller crews and potentially move them around regions. 

A taskforce on debris 

The Panel recommends the commission of a Woody Debris Taskforce (Taskforce) to immediately clean up the woody debris across the Tairawhiti and Wairoa area. The Panel recommends splitting the clean up costs between forest owners (who would provide the lion’s share of the funding) councils and central government. The Panel also suggests that forest owners could contribute through the Forest Owners Association levy on log sales in Tairawhiti and Wairoa.  

Putting aside the difficulty in imposing this on an industry group, this could raise operational costs for the forestry sector. Given woody debris comes from a variety of sources, it may place a disproportionate burden on productive forestry operators.  

We may see fast movement on this recommendation, as Forestry Minister Peeni Henare has commented that forestry clean up in the Tairawhiti region is a priority.

Reviewing resource consents 

The Panel recommends:

  • allowing the Tairawhiti and Wairoa District Councils to review existing resource consent conditions and lodged (but unimplemented) harvest plans without having to go through the usual review process under the RMA; and 
  • a regional council review over the next six months of conditions of existing and prospective forestry-related resource consents issued by Gisborne District Council, to ensure the conditions are appropriate to manage actual and potential adverse effects of forestry activities.

We understand that the purpose of these reviews would be to vary existing consent conditions to require coupe harvesting on land with a high risk of erosion. If this recommendation is accepted, existing consent holders will face uncertainty about the way in which they undertake forestry activities in the future while they wait to see if, and how, the conditions of their resource consents may be varied. 

Changing national direction for plantation forestry 

The Panel criticises the Natural Environmental Standards for Plantation Forestry (NES-PF) as too permissive. The Panel seeks a review of the NES-PF and makes two specific recommendations, being that:

  • a central government regulator would approve forest harvest plans before forestry activities are undertaken as permitted activities under the NES-PF. This may add time, cost and uncertainty for forestry operators, though the Report offers no practical guidance on the parameters of the regulator’s approval rights; and
  • a new ‘purple-zone’ be incorporated into the Erosion Susceptibility Classification tool as part of the NES-PF. A purple zone would identify land with extreme erosion susceptibility. The planting of exotic trees for harvesting would be prohibited because the soil is vulnerable. The Panel also suggests that this land should be returned to permanent forest (preferably native) but does not detail how that would be achieved.  

The Panel also recommends that an Order in Council be made under the Severe Weather Act providing that plantation forestry (afforestation), in areas covered by the Tairawhiti Resource Management Plan, is a restricted discretionary activity in red or orange zones (as defined in the NES-PF) and would therefore require resource consent. Again, this brings further uncertainty for forestry operators with red or orange zones in their existing landholdings. 

The root of the issue from an OIO perspective

The Panel criticises the role that overseas investors have in contributing to poor land use, but it considers the overseas investment regime to be at the root of these grievances. The Panel contends that the regime does not place enough weight on the costs of forestry investment on the soil and natural environment and are approving applications for forestry for land that should be kept as pastoral land. 

As a result, the Panel suggests: 

  • a review of Part 2 of the Overseas Investment Act 2005. This Part contains the criteria for the Overseas Investment Office (OIO) to grant consent to applications from overseas investors. The review would emphasise both costs and benefits of forestry investments to balance the “cost” of exotic trees on the natural environment. The review would likely involve raising the threshold of the benefits test, making it harder for foreigners to invest in forestry in New Zealand; and
  • prioritisation of applications with longer proposed rotations. The Panel recommends prioritising applications with proposed rotations of 30 years or more, so long as they engage in preferred forestry practices (such as staged coupe harvesting and cleaning up debris). The Panel contents that prioritisation of long rotations, being a minimum of thirty years, would mean there is less speculative investing.

If implemented, these recommendations would see the third round of fundamental change to the overseas investment regime within 10 years. This will do nothing to help the current perception that New Zealand’s overseas investment regime can present an uncertain, if not unwelcoming, hurdle for much-needed foreign investment into the New Zealand economy.

Even now, overseas investors would be well advised to address their proposed methods of harvesting and slash disposal in OIO applications. 

Future thinking – implementation of the recommendations?

The wide reaching recommendations in the Report have been made at a time when the political landscape is uncertain. Five months out from a general election, the current Government may be reluctant to undertake a review of the relevant legislation.  

Though we may not see any consolidated action arising out of the Report until late 2023 or 2024, the Government might address some of the more urgent recommendations (such as the cessation on clear-felling) quickly. We could also see these principles applied more broadly to other regions in New Zealand. 

If you are intending on purchasing forest land, making an OIO application, applying for forestry related resource consents or developing a harvest plan in the Gisborne and Wairoa regions, we encourage you to speak to one of our experts. 


This article was co-authored by Holly-Marie Noone (senior solicitor) and Georgie Hughes (solicitor) in our Environment and Property teams.