The Auditor General reported to Parliament yesterday that great improvements are needed to ensure that the interests of Government and the rights of land owners are adequately safeguarded when property is expropriated for public purposes.   

Government Departments requiring immovable property for public projects were not fully exploring opportunities to minimise expenditure.  Liaison with the Government Property Division, the Government’s estate agent, within the portfolio of the Ministry of Justice and Home Affairs, was weak.  Government Departments took possession of property before the legal process was initiated by the Division, thereby exposing Government to avoidable risks.   

Lengthy delays, attributed mainly to a lack of human and financial resources, characterised the various stages of the land acquisition process.  When the value of land had not been determined serious financial implications were bound to follow since the value of land tend to rise.  An analysis of nine cases in the sample revealed that savings could have been made had price determination not been delayed.  

The land acquisition process was not supported by adequate management information.  Cases which had not reached conclusive settlement were not readily identifiable, and the estimated figure owed to owners could not be reliably ascertained.  At the end of 2002, accumulated debts in respect of past land acquisitions had been estimated by the Division at Lm26 million.  The total excluded any damages/interest payable to owners, and potential increase in the value of land.  With the average budgetary allocation of recent years of Lm 2.6 million, it would take many years to settle outstanding commitments.   

Although various factors were taken into account, the Government Property Division’s valuation practices and methodology were not documented.  Architects were not recording the relevant considerations on which their valuations were based.  The NAO study indicated a trend where the GPD’s valuations appeared to be conservative.  

The smaller debts were settled as a priority from the Division’s limited capital vote to pay for pre-1994 acquisitions.  Although there was no policy directive, the practice was considered to be inequitable since it discriminated against larger creditors.  

When current initiatives to computerise records are in place, the GPD is expected to be in a position to manage the land acquisition process much more efficiently.  Moreover, recent legislative amendments, stipulating that prices should be determined at the outset of the acquisition process, should slow down the rate of increase of funds owed to land owners.  However, unless a comprehensive and effective debt management programme is in place, the problems associated with past acquisitions for which prices have not yet been determined will prevail.