Federal officials were overly focused on maintaining a “positive relationship” with wealthy landowners when they purchased land for the Western Sydney Airport for 10 times its market value, an independent review has found.
The sale of the land was first made public last year after a damning Auditor-General’s report that found officials had paid $30 million, despite it being valued at only $3 million.
An independent review commissioned by the Department of Infrastructure – which managed the deal – was tabled on Monday and it found a litany of failures within the department.
The 12.26-hectare parcel of land – known as the Leppington Triangle – at Bringelly was purchased in July 2018 and was intended to be used as part of a second runway for the Western Sydney Airport after 2050.
The land was bought from the Leppington Pastoral Company, which is owned by billionaires Tony and Ron Perich, who are high-profile donors to political parties, in particular the Liberal National Party.
There is no suggestion in the report of wrongdoing from any official, minister, MP or landowner involved.
The report, by Sententia Consulting, found the infrastructure officials had “no experience in acquisition of land for public purposes”.
While officials had followed the requirements of the Land Acquisitions Act, the review found officials also disregarded factors that brought “unnecessary risk” in not “achieving value for money”.
“While an understandable strategy for the handling of relevant LPC properties was developed, it was heavily focused on maintaining a positive relationship with LPC,” the review said.
“In undertaking the acquisition, relevant officers made, or failed to make, a number of decisions which exposed the acquisition to unnecessary risk.
“It is clear that the department did not undertake all reasonable steps to determine what a suitable cost would be for the government to acquire the property, to demonstrate that the price paid for the property represented an efficient, effective, economical and ethical use of public funds.”
The review noted the complexity of the purchase, highlighting the original $3 million price tag was solely based on its value as agricultural land and that LPC likely wouldn’t have accepted a $3 million offer.
It said the Commonwealth could’ve sought to acquire the land through the compulsory acquisition process, but conceded the potential legal costs from the landowners challenging the acquisition would’ve been significant.
In the end, the review found officers “paid a price per square metre that is not inconsistent with numerous recent transactions in the region”.
The review also found no evidence to “suggest poor integrity, criminal activity or personal benefit for officers involved in the transaction”.
“While there is no question that the likely future benefit from the acquisition is significant, it has come at a high reputational cost to the department,” the report said.
In a statement tabled to parliament, the Department of Infrastructure said the agency accepted the recommendation of the independent review.
The ABC contacted the department for comment.