09-22-2020, 03:48 PM
(This post was last modified: 09-22-2020, 03:52 PM by thorn bird.)
Taxpayers spent $30m on land worth only $3m for Western Sydney Airport's second runway
Sydney Morning Herald
By Matt O'Sullivan
September 21, 2020 — 6.45pm
The federal government has been castigated for paying a dairy farm operator 22 times more per hectare for a parcel of land abutting Western Sydney Airport than what its state counterpart did for its own slice of what has been dubbed the "Leppington triangle".
The 12.26 hectares in question at Bringelly were bought by the Commonwealth for almost $30 million in July 2018 with the aim of eventually using it as part of the airports second runway.
Less than a year later, the federal Department of Infrastructure's accounts revealed it valued the land at $3.065 million – just a tenth of the price it paid Leppington Pastoral Company.
It led to an audit by federal Auditor-General Grant Hehir who has found that the department failed to exercise proper due diligence in its purchase of the dairy farming land, and that aspects of the agency's operations "fell short of ethical standards".
His report, released on Monday, also determined that the department's valuation approach inflated the value of the land, which lead to the Commonwealth paying "more than was proper".
In fact, the Commonwealth ended up paying 22 times more per hectare than what the NSW government paid for a 1.36-hectare slice of the Leppington triangle needed for a realignment of the Northern Road, which is a key north-south link between Narellan and the M4 motorway.
The Auditor-General also found the department's acquisition strategy was focused on "incentivising an unwilling seller" to dispose of its land some 32 years before it was expected to be used for a second runway. The farming land next to the 1780-hectare airport site became known as the Leppington triangle because of its shape.
Upon buying the land, the Commonwealth leased it back to the dairy operator for a decade with options to renew the lease for a further 10 years. The land was valued at $920,000 for lease back.
A consequence of the decision to lease the land back was that a road underpass needed to be constructed to allow farm vehicles and animals to pass between the Leppington Pastoral Company's main farm and the Leppington triangle land.
Years earlier, the federal government had agreed that, if the Northern Road was re-routed, it would construct a tunnel or other carriageway under the road.
In mid 2017, the federal department instructed NSW's Roads and Maritime Services to include an underpass in the design of the Northern Road for the farm owner's use.
According to departmental records from early 2016, the underpass was expected to cost about $10 million. The Audit Office sought details of the cost but the Department of Infrastructure advised in June that it did not have separate figures for the underpass.
The Auditor-General also highlighted in his report that ministers and other decision-makers were not properly advised on the land acquisition as formal briefings omitted key information, such as the purchase price and that it exceeded all known market valuations.
In its response, the Department of Infrastructure said it was concerned by the report's findings and was taking action to fix any shortcomings in the processes and decision-making arrangements.
The department has agreed to all three of the Auditor-General's recommendations, including that it prepare balanced analysis on the benefits, costs and risks of proposals to spend public money.
The Auditor-General also highlighted in his report that ministers and other decision-makers were not properly advised on the land acquisition as formal briefings omitted key information, such as the purchase price and that it exceeded all known market valuations.
All passing strange? Department of infrastructure paying a very rich landholder way way way over the odds for a small piece of his land to build an airport, but gift our secondary airports to development sharks to turn into industrial sites, paying peanuts to make billions.
Wonder which Murky Mandarin set that up?
The machinations of the big end of town never cease to amaze me.
Sydney Morning Herald
By Matt O'Sullivan
September 21, 2020 — 6.45pm
The federal government has been castigated for paying a dairy farm operator 22 times more per hectare for a parcel of land abutting Western Sydney Airport than what its state counterpart did for its own slice of what has been dubbed the "Leppington triangle".
The 12.26 hectares in question at Bringelly were bought by the Commonwealth for almost $30 million in July 2018 with the aim of eventually using it as part of the airports second runway.
Less than a year later, the federal Department of Infrastructure's accounts revealed it valued the land at $3.065 million – just a tenth of the price it paid Leppington Pastoral Company.
It led to an audit by federal Auditor-General Grant Hehir who has found that the department failed to exercise proper due diligence in its purchase of the dairy farming land, and that aspects of the agency's operations "fell short of ethical standards".
His report, released on Monday, also determined that the department's valuation approach inflated the value of the land, which lead to the Commonwealth paying "more than was proper".
In fact, the Commonwealth ended up paying 22 times more per hectare than what the NSW government paid for a 1.36-hectare slice of the Leppington triangle needed for a realignment of the Northern Road, which is a key north-south link between Narellan and the M4 motorway.
The Auditor-General also found the department's acquisition strategy was focused on "incentivising an unwilling seller" to dispose of its land some 32 years before it was expected to be used for a second runway. The farming land next to the 1780-hectare airport site became known as the Leppington triangle because of its shape.
Upon buying the land, the Commonwealth leased it back to the dairy operator for a decade with options to renew the lease for a further 10 years. The land was valued at $920,000 for lease back.
A consequence of the decision to lease the land back was that a road underpass needed to be constructed to allow farm vehicles and animals to pass between the Leppington Pastoral Company's main farm and the Leppington triangle land.
Years earlier, the federal government had agreed that, if the Northern Road was re-routed, it would construct a tunnel or other carriageway under the road.
In mid 2017, the federal department instructed NSW's Roads and Maritime Services to include an underpass in the design of the Northern Road for the farm owner's use.
According to departmental records from early 2016, the underpass was expected to cost about $10 million. The Audit Office sought details of the cost but the Department of Infrastructure advised in June that it did not have separate figures for the underpass.
The Auditor-General also highlighted in his report that ministers and other decision-makers were not properly advised on the land acquisition as formal briefings omitted key information, such as the purchase price and that it exceeded all known market valuations.
In its response, the Department of Infrastructure said it was concerned by the report's findings and was taking action to fix any shortcomings in the processes and decision-making arrangements.
The department has agreed to all three of the Auditor-General's recommendations, including that it prepare balanced analysis on the benefits, costs and risks of proposals to spend public money.
The Auditor-General also highlighted in his report that ministers and other decision-makers were not properly advised on the land acquisition as formal briefings omitted key information, such as the purchase price and that it exceeded all known market valuations.
All passing strange? Department of infrastructure paying a very rich landholder way way way over the odds for a small piece of his land to build an airport, but gift our secondary airports to development sharks to turn into industrial sites, paying peanuts to make billions.
Wonder which Murky Mandarin set that up?
The machinations of the big end of town never cease to amaze me.