The new rules retain the 10/50-metre permit-free zones - contrary to the change first reported by this website - allowing the felling of trees up to 10 metres from homes and other vegetation out to 50 metres. The 10/50 rules came into effect on August 1.

However, the area in which the clearing without permission applies will be reduced.

Homes deemed to be near vegetation deemed to be category-one bushland will only be allowed to apply the 10/50 rules if they are within 100 metres of that bushland, rather than 350 metres previously, the government said in a statement.

Category-one bushland includes areas in the Blue Mountains but also regions closer to Sydney such as Lane Cove, Pam Palmer, a councillor for Lane Cove, said.

Residents near category-two bushland will be able to clear trees and vegetation under the 10/50 rules only if they live within 30 metres of the bush, compared with 150 metres under the previous setting.

Ms Palmer said the confusion of rules and how they applied would likely continue, making it more reasonable to halt the permit-free clearing until the review of the policy by the Rural Fire Service and the Department of Planning and Environment had been completed.

"It is clear from some submissions and feedback that while the scheme is designed to reduce bush fire risk, there has been some abuse of the fuel reduction provisions for other purposes," according to a statement from Police Emergency Services Minister Stuart Ayres.

Environment groups earlier welcomed the changes but said a moratorium should have been put in place instead given the extent of the abuse of the rules.

"Obviously it's going to save a lot of trees", said Corinne Fisher, from the Lane Cove Bushland and Conservation Society. "But a lot of damage has already been done."

'Deeply flawed'

Ms Fisher said a survey by Lane Cove Council had found that only four of the 216 trees cleared in the area had been done so "for the purpose of perceived bushfire protection".

Mosman Council reported a similar result. Of 101 trees felled, 36 per cent of the removals were development-related, 29 per cent for nuisance reasons, and 10 per cent for views.

"It should be noted of the remaining 25 per cent removed for other reasons (or unknown), none have been for bush fire risk," the council said in a submission.

Kate Smolski, chief executive of the Nature Conservation Council, also welcomed the amended rules but said abuses of the "deeply flawed policy" would only be slowed by reduction in the buffer.

"Hundreds of landmark trees have already been cut down because of this rule without any meaningful improvement in bushfire risk," Ms Smolski said.

"There was a very good system in place that allowed people to have their bushfire risk comprehensively assessed by professionals from the [RFS]. We need to return to the system," Ms Smolski said.

Remnant vegetation

A moratorium was also needed because the same rules applied to areas next to remnant vegetation contained threatened species as to those living near bushland, Ms Fisher said.

"The vegetation types are very rigid," said Ms Fisher. "Remnants in Lane Cove are very small and very narrow but are treated in the same category as vast expanses of forest in the Blue Mountains."

The government had received 1800 submissions which were "deserving of careful consideration before a final position is adopted", the government said in the statement, adding that the review is expected to be completed in the first half of 2015.