An ACT Legislative Assembly inquiry will investigate who decided to subdivide the Fairvale rural property, and why, as it continues examining an audit into rural land purchases made by the former Land Development Agency.
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The inquiry, by the Assembly's Public Accounts Committee, is one of three currently on foot into the dealings of the now-defunct agency, the others examining audits of the agency's Dickson land swap and its dealings involving land and businesses at Glebe Park and by Lake Burley-Griffin.
The rural land inquiry will also investigate the process behind the purchases, after Auditor-General Dr Maxine Cooper and her office's staff confirmed seven of the purchases they examined came about after the former owners of the properties approached the agency, not the other way around.
The only exception to the unsolicited approaches by former owners to the former agency was in the Fairvale deal, where the agency was the first to voice its interest in buying the land, through its agent, Colliers International ACT.
The audit found some of the nine purchases of farm land along Canberra's western fringe, and the management of some agency contractors, lacked probity - or accountability and transparency - and documentation of agency decisions lacking.
During a hearing on the audit on Wednesday, Opposition leader Alistair Coe asked how the transactions came about, with land owners seemingly aware the agency was seeking to buy farms in the area, despite the public not necessarily being aware at the time.
Auditor-General Dr Maxine Cooper told the committee that she was unsure if that question was examined during the audit office's investigation, but the audit office's Jonathan Brown confirmed none of the purchases were actually initiated by the former government agency.
Dr Cooper said the audit was a large and complex one that took about a year, and securing documentary evidence was a challenge to examine the purchases made between June 2014 and June 2017, the period the former agency's land acquisition policy framework was in place.
She also said while the properties were purchased as a potential urban development front, there was no certainty they would become part of an urban development area as at present they were subject of a further investigation, which had still not commenced.
"Regardless of how they are viewed, there is a need now for clarity regarding their long-term land use," she said.
Dr Cooper also said that while at the time the former agency had not included the eight properties it had bought at the time of the audit in bushfire operational plans, importantly for the citizens of Canberra, the new Suburban land Agency had done so since.
But she said there still needed to be analysis done on why land management agreements for the properties were still not completed three years on from when the purchases began.
Mr Brown also said that out of the eight tests in the former agency's land acquisitions policy framework at the time - which has since been improved - none of the purchases met four of the tests, except the Wintergarden purchase.
He also said four of the eight properties also did not follow test five, which related to ensuring the purchase was in line with an independent market valuation of the property, though each for different reasons.
The inquiry is also seeking to illuminate the circumstances of the decision to subdivide the Fairvale property, and who signed the paperwork for the subdivision.
While the former agency was originally planning to buy the entire property, at some point during the second half of 2017, the seller's valuer, Knight Frank's Steve Flannery, approached former agency chief executive David Dawes with the proposal to subdivide the land, so he could purchase part of the property.
The audit found the part of the block [Block 517 Stromlo] Mr Flannery and his spouse Cia ultimately bought was potentially more 'developable' than the dog-legged part the former agency bought, though neither individual was named in the audit or during the hearing.
The audit also found the former agency's decision not to pursue purchasing the entire Fairvale property was irregular and represented a probity risk.
Mr Flannery has previously declined to comment on the matter when asked by The Canberra Times.
Asked whether the audit looked at probity issues for the valuer for the seller, Dr Maxine Cooper said it did not, and because that information was declared to the agency, and having been declared, the accountability rested with the former agency.
She said was also unsure whether the audit office asked who signed on the dotted line to approve the subdivision, but took that question on notice, saying she would contact Chief Planner Ben Ponton about the committee's inquiry.
But Dr Cooper said some of the audit's key findings were that there was no evidence the former agency identified the risks related to not pursuing the entire purchase of the property, the former agency had knowledge of Mr Flannery's position and yet the agency directly supported the subdivision.
She said that just because somebody asks [the government for something] doesn't mean you give it, and that "in public office, such decision-makers needed a good reason for doing something or not doing something, and had to have documentation" [to support the decision].
Audit staff also said while the audit assessed the purchases of eight of the nine properties, the Wagtail Park purchase was not examined, as it resulted only from a 2014 Cabinet decision, and as such did not need to be assessed under the former agency's land aquisition policy framework.
The inquiry continues.
Clarification: The report initially incorrectly reported that all the purchases examined came about after unsolicited approaches from former owners to the agency. It has been edited after clarification from the audit office, to show that one purchase, of Fairvale, was instead initiated by the former agency.
