"This reconstruction order allows the authority to use its powers to subdivide land, demolish buildings, repair or renovate buildings,” he said on Tuesday.

"It will also allow the authority to set out and construct roads as well as use its powers to consider new homes and supporting infrastructure outside of traditional residential areas helping address housing shortages and affordability in the region."

The minister's declaration allows the authority to push decision-makers to make a call on significant reconstruction decisions or expedite the completion of a reconstruction process.

With the minister's permission, the authority can also step in and make its own decisions about planning.

It comes as the government scraps a controversial planning panel for Lismore, which was the epicentre of the biggest flood in modern Australian history.

Local MP Janelle Saffin says dissolving the panel and granting the reconstruction authority more powers were steps in the right direction.

"We have watched in despair as thousands of properties were damaged or destroyed last year and we are still in the middle of a tough recovery, and we know we will face floods again," she said in a statement.

The NSW Reconstruction Authority, which reports to the planning and emergency services ministers, was established after last year's catastrophic floods.

It absorbed another disaster agency, Resilience NSW, which came under fire for its bureaucratic response to flood victims.

Resilience NSW was established after the Black Summer bushfires, with respected former fire chief Shane Fitzsimmons at its helm.

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