The ACT government has launched an internal review of the Land Development Agency's governance framework, after a series of controversial Canberra deals including the agency's purchase of property at Glebe Park in Civic.
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LDA chief executive David Dawes awarded former Commonwealth Auditor-General Ian McPhee the $55,000 contract in mid-July, after talks between Chief Minister Andrew Barr and Head of Service Kathy Leigh, for a report in September.
Mr McPhee's review is the second such investigation under way into the agency's recent dealings and internal policies, with ACT Auditor-General Dr Maxine Cooper also examining its "acquisition of land and businesses" under the government's multimillion-dollar City to the Lake project.
The Auditor-General's investigation is understood to be examining the LDA's land and business acquisitions for the project, including separate boat and bike hire businesses in the West Basin.
The review contract was issued after media reports in June highlighting the LDA's 2015 decision to buy land at Glebe Park from developers Barry Morris and Graham Potts for $4.2 million – a purchase price more than four times the agency's initial valuation of the block.
But Mr McPhee's review will not investigate any individual transactions, instead focusing on the overarching "governance framework" for ACT land sales across both the LDA and Procurement and Capital Works divisions in the Chief Minister's portfolio.
Mr Dawes said the review was commissioned "following the ACT government's recent land acquisitions" and it aimed to "ensure appropriate processes for sound governance in this area".
But he would not answer questions regarding the extent of Mr Barr's involvement in the decision to order the review, nor specify which of the agency's recent land sales had prompted it.
"This is an internal review initiated at directorate level to examine governance processes and is not a review of individual purchases," Mr Dawes said.
Mr Dawes' approval of the contract as the agency's chief executive also meant it was exempted from the ACT's usual "quotation and tender threshold requirements" under the ACT's Government Procurement (Principles) Guidelines 2002, exemptions that could be given if only limited suppliers were available or the contract was issued with a strict delivery timeframe, among other criteria.
The exemptions give the chief executive of an ACT government entity control over how many quotes or tenders are sought, the powers to choose which suppliers would be approached to tender and decide whether or not a public tender would be issued.
Both Mr McPhee's review and Ms Cooper's audit were expected to be handed to government in September, just weeks from the ACT's October election.
Although the official Auditor-General's report will be made public, Mr Dawes would not answer questions as to whether Mr McPhee's report would be released publicly, before or after polling day.
Liberals deputy leader Alistair Coe has previously questioned whether Mr Dawes had the authority to buy the Glebe Park land without going to the board, citing the ACT's 2014 Land Acquisition Policy Framework.
That policy outlines that LDA purchases below $5 million need the agreement of the agency board, with advice also to the minister, and once the annual total of land purchases reaches $20 million, government agreement is needed.
But in August 2015, just before the finalisation of the Glebe Park purchase, the land agency's board discussed how to interpret the policy.
In order to give the agency the "necessary flexibility to pursue opportunities as they arise", the "preferred" interpretation was that the policy applied only to land outside the agency's "core business" of delivering the land release program, according to board minutes.
The board endorsed that interpretation, leading Mr Coe to accuse the agency of "establishing a way to determine when this direction from the minister does not apply".
The agency has previously said the Glebe Park purchase did not need board clearance as an individual purchase as it formed part of the larger City to the Lake project.
Mr Barr's spokesman said Mr McPhee was appointed by the directorate because of his high-level experience in the evaluation of public sector organisational governance, including 10 years as national Auditor-General.
"Mr McPhee has experience working with both public service and government agencies working in commercial fields and will bring a strong understanding of the governance requirements to satisfy accountability and transparency in decision-making in such agencies," he said.
