“Inconsistent” and “undermined” NSW Office of Valuer-General must go says damning parliamentary report

A damning parliamentary report has called for the abolition of the NSW Office of the Valuer General in favour of a Valuation Commission along with 29 recommendations for fixing the current non-transparent system of land valuations.

The Office of the Valuer General, currently led by Philip Western, provides  around 2.6 million land valuations in NSW each year, which are used to levy land taxes, rates and duties.

The joint standing committee report of the Office of the Valuer General, chaired by Matt Kean is highly critical of the current way the office operates.

Based on submissions made since January into its 'Inquiry into the land valuation system in NSW', the committee identified a long-list of concerns around the volatility of land values, transparency and “procedural fairness currently afforded to landholders and the governance framework of the valuation system”.

It reports on a “systemic failure to afford landholders a fair hearing, to provide transparency surrounding the valuation methodologies and to treat landholders with the respect, dignity and fairness, to which they are entitled, has significantly and detrimentally impacted landholders”.

Its assessment of the current framework of valuations, finds that the independence of the valuation function from executive government has been “undermined” through the Land and Property Information (LPI) government agency “performing functions that should be performed by the valuer general”.

Submissions received also show “material inconsistency between property valuations” with some property valuations doubling over the space of 12 months and large variations in the value of similar properties located on the same street.

At a hearing in Sydney in March, the committee heard an instance where a valuation of a mine near Broken Hill was reduced from $20.9 million to $4.9 million.

The recommendations include “a new governance framework that replaces the Valuer General with a Valuation Commission”.

The Commission model would involve the appointment of two valuation commissioners and a chief valuation commissioner, all independent statutory appointments.

The chief valuation commissioner would issue public guidelines for the valuation of land in NSW that would clearly state the methodologies; and the circumstances in which they are applied.

Under this framework there would also be Ombudsman oversight, including a “macro review every two years to provide accountability”.

The Committee also recommends a “three year averaging of council rate valuations to dampen the material and significant volatility in the valuation system”.

Other recommendations include improved procedures for landowners to review valuations; the establishment of a dispute resolution system; the annual publication of a separate and detailed annual performance report as well as the creation of a central database of key information of “non-mass” land valuations.

The full report and recommendations can be downloaded here.