A parcel of land bought by the federal government next to the proposed Western Sydney International Airport for just under $30 million in 2018 is now valued at $3 million, an audit has found.
The auditor-general said the infrastructure department had not shown appropriate due diligence in its purchase of the 12.26ha Leppington Triangle.
“In the course of this audit it became clear that aspects of the operations of the department, both during and after the acquisition, fell short of ethical standards,” the auditor-general found in the report released on Monday.
The department’s approach was focused on “incentivising an unwilling seller to dispose of their land some 32 years in advance of when it was anticipated to be needed”.
As well, the auditor found the department’s underlying analysis “overstated the identified benefits, did not quantify costs and did not address risks, and the acquisition approach eventually employed departed from the approved strategy”.
The government expected it would require the land when a second runway was needed around 2050.
The problem began when the property owner suggested to the government the name of a valuer which was agreed to by the department.
“It was not made evident (in key briefings with decision makers) that the department intended to pay a per hectare rate some 20 times higher than that proposed by the NSW government for its portion of the Leppington Triangle.”
The department agreed to the audit’s recommendations to improve the way it gets valuations, prepare more detailed cost-benefit analyses and run proper meetings with landholders.