Deal reached on NSW koala management rules

The NSW government has agreed to new environmental planning regulations for koala habitats, ending a disagreement which threatened to rip apart the coalition between the Liberal and National parties.

In September 2020, NSW Nationals leader and Deputy Premier John Barilaro threatened to blow up the coalition if concessions weren't made to rural property owners for protection measures over koala habitat.

The government on Monday announced that rural NSW land zoned for farming or forestry, labelled "core rural zones", will not be subject to the new Koala State Environmental Planning Policy (SEPP) 2021.

The government argued the new SEPP would enhance koala protection in areas such as Sydney, the Blue Mountains and the Central Coast, where more than 95 per cent of development takes place.

Stronger protections would also be created in the Tweed and Byron shires.

Mr Barilaro said the shift meant NSW farmers would not be "strangled by red tape" and labelled the change a win for regional interests.

"The intention has always been to find a solution to protect both farmers and koalas," Mr Barilaro said in a statement on Monday.

Environment Minister Matt Kean said the new SEPP would facilitate the government's push to double the NSW koala population by 2050.

He also said the government's "Koala Strategy 2.0" would soon be issued.

But NSW Greens MP Cate Faehrmann pilloried the regulatory change, labelling it a victory for the logging industry that "sets koalas up for extinction".

She also criticised the government's plan to strip councils' ability to rezone land used for primary production in an attempt to protect koalas.

"Two thirds of koalas live on private land yet this government has weakened land clearing laws so almost none of it is protected," Ms Faehrmann said.

The Koala SEPP 2020 came into effect in March 2020. It sought to simplify the process by which koala habitats are recognised and protected and extended the number of protected tree species from 10 to up to 65.

But the Nationals were concerned the policy would limit land use on farms and the ability to rezone areas for development, as more trees would be classed as koala habitat. This would restrict the clearing of land.

Operations ultimately reverted to the former SEPP.

A NSW parliamentary inquiry found in July 2020 that koalas would lose their habitat and become extinct in NSW before 2050 without urgent intervention.

The government in January committed to only 11 of the 42 recommendations made by the inquiry, and supported 17 of the recommendations in principle.