Audit office flags governance flaws in Townsville council's rail-yard venture

The Queensland Audit Office’s review of Northern Rail Yard Development Pty Ltd uncovered serious shortcomings in how Townsville City Council managed the council-owned firm that was tasked with redeveloping a derelict Queensland Rail depot. The company was established in the 2023-24 financial year without the required sign-off from the Queensland treasurer, violating legislative rules. Over two financial years the council provided $624,000 in operating funds, while the Queensland government allocated $35 million for the broader redevelopment into a mixed-use hub.

The audit found delayed resolution of the issues, preventing an audit opinion for the 2023-24 year, and the entity was wound up in May 2026. The audit office now requires the council to prepare financial statements for the 2024-25 and 2025-26 periods. Mayor Nick Dametto affirmed that the project will continue under a direct partnership with developer Brad Webb’s Flinders St Rail and that additional disclosures will appear in the council’s upcoming financial statements.