The 1991 Resource Management Act (RMA) is the main piece of legislation that governs how we manage our environment.
Activities such as building a house, removing native vegetation, moving earth, taking water from a stream, setting up a business or burning rubbish are all controlled by the RMA.
The RMA requires people to seek permission from their local council before carrying out any of these activities.
It is then the council's job to decide whether to allow an activity to go ahead, taking into account how it might affect neighbours, the community and the natural environment.
The act provides an opportunity for people that may be affected by a change, such as neighbours, to object to it.
For example, a person has the right to oppose an application made by their neighbour to remove a tree if they feel it would negatively affect them.
The act has been in place for more than 23 years but has been described as ineffective. Local Government New Zealand president Lawrence Yule said the act was "very expensive and it is very time consuming", and he is not alone in this thinking.
Time for change?
Nick Smith says a reform is "crucial" for New Zealand's housing market and economy.
In a speech in Nelson last week, Smith proposed 10 changes to the Resource Management Act which, he says, will boost housing supply, make homes more affordable and encourage economic growth.
His speech was timed with the release of a working paper, commissioned by Treasury and the Ministry of Business, Innovation and Employment (MBIE).
The paper by Motu Economic and Public Policy Research showed a number of housing projects had been abandoned because of the delays and uncertainties in the RMA.
For projects which did proceed, meeting council regulations on section size requirements and urban design considerations added an estimated $15,000 to the cost of building a house.
For apartments, height restrictions added $30,000 in extra costs to each new apartment.
Armed with this information, Mr Smith is pushing reform of the RMA which, he says, will help to resolve New Zealand's housing crisis. The minister says the changes are "critical" because, under the current act, creating low cost housing was near impossible. The changes also propose to speed up plan-making processes, making it easier for activities to be approved by local councils, and will reduce the number of RMA plans, creating a handful of plans for all councils to adhere to.
Changes will also be made to section six and seven of the act which provide protection of coastlines, landscapes, historic heritage, lakes, rivers and vegetation.
Mr Smith wants to see provisions for economic growth, urban development and management of natural hazards added to these sections.
So will it speed up and reduce the cost of building homes?
Whangarei land developer and Homeworld owner, Barry Trass, said cutting the amount of the red tape would help builders and homeowners immensely.
"Any changes that reduce red tape bureaucracy and unnecessary compliance costs would be fantastic. Government has realised [there are] a lot of unnecessary regulations and costs associated with property development," he said.
Head of research at the New Zealand Initiative, Dr Eric Crampton, said the reforms would almost certainly help speed up building processes - but only in the short-term as councils were too motivated to keep costs up.
"If councils want to implement rules that restrict housing supply and inflate the cost of housing, it might take them a while to come up with new ways of achieving that goal after RMA reform, but they are likely to find a way to do it," he said.
"We need to couple effective RMA reform with reconsideration of how councils are funded so that they have stronger interest in fostering rather than blocking development."
Dr Crampton said RMA restrictions had contributed to rising house costs but housing affordability was also the fault of local councils whose goal was to keep prices high in order to maintain low rates.
And he said the impacts on neighbours or affected parties' right to object wouldn't be known until Mr Smith outlined more detail.
"While I hope that objection rights are maintained for those neighbours actually and really affected by a new development, I also hope that objection standing is limited to those experiencing that kind of direct effect," Dr Crampton said. "Whether this kind of change will happen, though, will not be known until we see the detail of the legislation."
Support from local councils
Mr Smith has backing, at least from Local Government boss and Hastings District Mayor Lawrence Yule.
Mr Yule said ratepayers would be pleased.
"Undoubtedly the Resource Management Act is a very complicated piece of law. It is very expensive to use and it is very time consuming," he said.
"I think most ratepayers generally have that view so having a decent look at it after 25 years in action is a reasonable thing for the Government to do."
When asked about the effect on people's rights to object, Mr Yule said he expected a considered approach.
"The minister has been quite clear he is going to be reasonably moderate. I like to think the Resource Management Act has a way of moderating private property rights, the environmental things and growth really.
"He [Mr Smith] has indicated he wished to strengthen private property rights, we don't actually know what he means by that yet. "What the minister is trying to get to is normal everyday stuff like house planning."
Mr Yule said the proposed changes wouldn't fix but would help to alleviate current problems with a lack of housing supply.
"Fixing the housing crisis is a complicated thing, this will help in a sense but there are a whole lot of things needed to fix the issue. What he has suggested won't fix the housing crisis but it is part of the solution."
Not so positive
Not surprisingly, the Green Party isn't a big fan of the reforms.
Green Party RMA spokesperson Julie Anne Genter says National's real goal is to undermine hard-fought environmental protections which ensure a high quality of life in our neighbourhoods and communities.
"Environment Minister Nick Smith is misusing the evidence in the Motu report to justify stripping the power of communities to protect the quality of their homes and neighbourhoods," she said.
Meanwhile, Save Manapouri activist Alan Mark said he was very concerned about the proposals.
That campaign laid the groundwork for the Resource Management Act. After the case was won, it united New Zealanders in the country's first mass environmental movement.
"What I am very concerned about is Smith's plans to expand city and town boundaries to make room for growth," Mr Mark said. "It is an issue because we will be building on valuable and high producing soils.
"We must protect high producing soils for New Zealand's future generations."
Mr Mark said more detail of the proposed changes was needed before the true potential effects of the reform would be known.
Mr Smith plans to pass his reform into legislation by the end of this year.