Parliament finds conflicts of interest, due diligence failures in Central Barangaroo saga
An inquiry has called on the state government to ditch the latest plans for the project citing conflicts of interest, a bungled process and a former premier who ‘did not exercise due diligence’.
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An inquiry has called on the NSW government to scrap the latest plans for Central Barangaroo, finding the state bungled decision making around the precinct and exposed itself to conflicts of interest.
A NSW parliament inquiry tabled its report into Central Barangaroo on Friday, finding developer Aqualand was facilitated to take over the project at the expense of Grocon.
The Select Committee on Barangaroo sight lines made ten findings, noting former NSW premier Mike Baird “did not exercise due diligence” when negotiating the initial deal over Central Barangaroo, exposing the state to legal action.
Legislative Council Labor MP Anthony D’Adam said Mr Baird created the problematic conditions around Central Barangaroo.
“The root cause of this problem with Central Barangaroo was Mike Baird and his office not doing the job they needed to do and agreeing to a deal that was very costly for the taxpayer,” he said.
The report found Infrastructure NSW “failed to anticipate the significant ramifications of undertaking a reconceptualisation of Central Barangaroo in 2015, including the decision to locate a Sydney Metro station in the precinct”.
This saw Crown and Lendlease launch legal action against the NSW state government, claiming the changes to Central Barangaroo would see views of the Sydney Harbour Bridge and Opera House blocked by proposed buildings in the area.
The NSW government settled with Crown and Lendlease, in a secret deal that granted them major concessions to their developments in Central Barangaroo.
The report found this deal exposed the NSW government to “a potential conflict of interest” and INSW “did not adequately consider nor appropriately address the significant impact of the sight lines dispute with Lendlease and Crown on the Central Barangaroo development”.
The inquiry criticised this deal, recommending the NSW government engage in a resolution process “for development disputes that seek to arrive at a transparent package of financial compensation rather than development bonuses‘”.
Select committee chair Mark Latham said the Barangaroo development was “another lesson…on the folly of picking winners and pursuing excessive intervention and manipulation of commercial decisions”.
“The huge, hoarded-off hole in the ground at Central Barangaroo has broken the continuity of the southern (commercial) and northern (parklands) parts of the development. It looks terrible and is terrible for the people of Sydney,” he said.
Melbourne developer Grocon led a consortium that won the initial bid to develop Central Barangaroo.
However, after several years of delays in securing planning permission over its project Grocon withdrew from Central Barangaroo, selling its stake to Chinese-Australian developer Aqualand.
The committee found the NSW state government allowed Aqualand to take over Central Barangaroo at the expense of Grocon.
Grocon is now suing the NSW government over Central Barangaroo, with the case set down for trial in February next year.
The report recommends the NSW government dump Aqualand’s latest modification to the Central Barangaroo project and “ensure that the redevelopment of Central Barangaroo remains small in scope”.
The report also notes the state government should draw up new rules governing public servants going into jobs with companies they deal with.
The committee heard senior public servant Tim Robertson went on to consult for Aqualand over Central Barangaroo after dealing with the developer.
“The committee expresses serious concerns over evidence that a consulting business established by former Infrastructure NSW executive, Mr Tim Robertson, after he left Infrastructure NSW,” the report notes.
“This conduct raises potential probity concerns regarding senior public servants going on to have a commercial relationship with entities they dealt with when working for the NSW Government.”
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Originally published as Parliament finds conflicts of interest, due diligence failures in Central Barangaroo saga
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