It is commonplace for businesses to complain that the Resource Management Act has become a costly bureaucratic nightmare hindering economic development. Ironically, such complaints are often dismissed as evidence of the Act working, with consents being declined or heavily qualified to adequately protect the environment.

But the Act has never been solely about environmental protection. In fact, its mandate concerns the use, management and protection of the environment. This misunderstanding lies at the heart of the problems with the Act and how it has been implemented.

The very reason for the Act – to determine where public and private interests lie in the natural and built environment – has become mired in a complex and often opaque tangle of managing all effects, both public and private. Everything – from the colour of letterboxes and fence heights to the construction of power stations – is now potentially covered by the Act.

In essence, it has become a tool to extend government regulation further into private arrangements in the name of public interest.

The Act’s implementation has disconnected from its legislative origins – that is, to help regulators navigate between the protection and the use of natural and physical resources deemed to be in the public interest.

The progressive blurring of the boundary between the public and private interest is key to the business community’s dissatisfaction with the Act. Its application undermines business confidence and dampens the desire to invest.

With a review underway, now is the time for the Government to take stock and re-establish what should and should not be legitimately regulated in the public interest in the sustainable management of the environment. Central to this must be respect for private property rights.

Two key questions must be asked. What is the problem with private arrangements for managing environmental effects? At what point is a regulatory solution welfare-enhancing, rather than one whose cure is worse than the illness?

Faster processing of consent applications is important but is not the only solution.

Of course, effects-based resource management legislation will diminish property rights to some extent. But any such diminution needs to be undertaken within a coherent and robust framework.

A focus on good public policy with welfare enhancing decisions based on respect for private property rights is crucial – as is policy supported by economic cost-benefit analysis. This will help remove us from the arid debate about the economy versus the environment.

John Carnegie is the Manager of Energy, Environment, and Infrastructure at BusinessNZ.