The Napthine government paid elite private school Scotch College $5.4 million for a thin strip of land, taken for a road-widening project, that was previously valued at just over $1 million by the state's Valuer-General.
The payment was made by VicRoads in October last year.
The government's road authority in 2008 used its compulsory acquisition powers to take a 2.8-metre-wide and 400-metre-long sliver of land from the Hawthorn boys' school.
The land was taken in order to add a lane to CityLink, which runs alongside the school.
The strip of land taken for the road widening adjoins three of Scotch's sporting ovals.
In 2008 the Brumby government offered the school $1.06 million for the land, after a valuation by then valuer-general Jack Dunham.
It also offered Scotch $86,400 a year as a fee for occupation of other school land it needed during construction.
The school refused the offer, and took the government to the Supreme Court.
Nothing was heard of the case's resolution, until the school this year lodged its 2013 financial return.
It shows, among the school's revenue for the year of $70.9 million, a payment for $5.4 million as "reimbursement following a Supreme Court action".
The payment helped Scotch record a net surplus of $11.5 million.
Scotch old boy and state Liberal Party elder David Kemp headed a taskforce to ensure the school got what it considered fair compensation for the land.
Dr Kemp, the party's state president between 2007 and 2011, said on Sunday there had been "normal legal negotiations" between the school and the government over the land's worth.
And he said the negotiations were entirely undertaken by lawyers. "I had no personal role," said Dr Kemp, who is a Scotch College director.
A spokesman for Roads Minister Terry Mulder confirmed Dr Kemp had not been personally involved in the negotiations.
A spokeswoman for Scotch said the value of the land acquired for the freeway expansion "was the subject of negotiation during the Supreme Court action".
She said the final amount received from the government included payment for disruptions to school operations, ground repairs, reimbursement of other costs, and rent for the use of property by construction companies during the project, which was finished in 2010.
The Australian Education Union, though, said the payment indicated there were different rules for private and public schools.
"It is a sad indication of the Napthine government's priorities that they are willing to make a secret $5 million payout to one of Victoria's wealthiest schools for a thin sliver of land, but not willing to be open with other schools about ... extra funding under the Gonski reforms," the union's Victorian president, Meredith Peace, said.
theage.com.au 16 Nov 2014
Another corrupt money for mates deal at the expense of the public's purse.
The 'brotherhood' looking after their own.