Planning Minister Matthew Guy announced new rules in March giving power to local councils to plan how and where new housing is built in their area. So far so good. Everyone agrees that while new housing is needed as Melbourne continues to grow, development must respond to the character of local communities.

The new rules set out three zones into which each local council must divide their area. ''Residential growth'' zones enable the highest levels of new housing growth near train lines, shopping strips and the like. ''General residential'' zones should be used in most residential areas to preserve urban character while enabling moderate housing growth. Finally, ''neighbourhood residential'' zones tightly restrict housing growth.

'Building new housing ever-further from Melbourne's employment and economic centres will stifle Melbourne's economy.' Credit:Reuters

This seems pretty sensible. But what the Planning Minister has failed to do is share responsibility for accommodating more people, so that all areas of the city play their part in meeting Melbourne's growth needs. Glen Eira and Boroondara councils have got in early, exploiting this weakness to declare that they want growth to happen somewhere else.

Glen Eira council has zoned about 80 per cent of residential land to restrict growth in housing. Similarly, Boroondara is seeking approval to restrict growth in about 80 per cent of residential land. Only 1 per cent of residential land in Boroondara is proposed for the residential growth zone, and just 19 per cent for the general residential zone, despite state government guidance that this should be used in most residential areas.