The O’Farrell Government has announced reforms designed to streamline the perpetual lease conversion process in NSW.

The reforms will encourage incentive-based arrangements, such as conservation agreements, rather than enforcement of covenants, primary industries minister Katrina Hodgkinson said.

Since 2004 the former Labor Government had converted almost 9000 perpetual leases to freehold and many had land management covenants attached to title, she said.

“In future, covenants to protect native vegetation will not be generally placed on leases converted to freehold unless the land has been assessed as having high conservation values,” Ms Hodgkinson said.

Department of Primary Industries data demonstrates there are around 1030 remaining leases where covenants will now not generally be required on conversion.

NSW Environment minister Robyn Parker said as leases are converted to freehold the environmental safeguards will be provided by the Native Vegetation Act and the Threatened Species Conservation Act.

“There are some 342 leases that are on particularly sensitive land, typically land adjacent  to national park or wilderness areas,” Ms Parker said.

“In these cases, conversion to freehold will be considered on a case by case basis with covenants still likely to be applied.”

Ms Hodgkinson said holders of perpetual leases are encouraged to continue applying to convert to freehold and all new applications will be considered against the new agreement.

“The perpetual lease conversion program was introduced by the previous government in recognition that leaseholders owned the majority equity in the land while the Crown retained minimal equity,” Ms Hodgkinson said.

Ms Parker said the Government had made $2 million funding available through the NSW Environmental Trust to support landholders committed to conservation on private land. 

“While our national parks system is vital, the NSW Government believes it’s just as important to work with landholders and the community to protect and improve habitat on private land,” Ms Parker said.

“These funds do just that, and will help fund more landholders to improve and conserve the environment on their own land.

NSW Farmers welcomed the NSW Government’s announcement that it would not require covenants on 1030 remaining perpetual leases in the state.

NSW Farmers president, Fiona Simson, described the move as “a step in the right direction.”

“We have always opposed the use of covenants as an unnecessary duplication of other existing legal instruments,” Ms Simson said.

“But, we still have concerns about those leases that have already been converted with covenants as well as those 342 that will still have covenants applied.”

Covenants are permanent restrictions placed on land titles that limit farmers from undertaking certain activities on their land for example – no cultivation, no earthworks and no dead timber removal.

The NSW Government’s decision means that there will be no covenants connected to the properties of 1030 farmers who had applied to convert from perpetual leases to freehold.

Ms Simson said NSW Farmers wants all covenants on perpetual leases to be removed and will continue to work with government on this issue. 

She said that all farming properties fall under the requirements of the Native Vegetation Act and the Threatened Species Conservation Act and that there is no need to impose these point-in-time requirements on individual land titles in perpetuity.