Photo/IllutrationMoritomo Gakuen had planned to open a private elementary school on this site in Toyonaka, Osaka Prefecture. (Mari Endo)

The government overestimated the volume of waste buried on state-owned land it sold to school operator Moritomo Gakuen at a drastic discount, according to the Board of Audit.

The audit, requested by the Diet in March in light of a growing political scandal about the appropriateness of the transaction and suspected favoritism, found that the estimated volume of waste buried underground on the plot in Toyonaka, Osaka Prefecture, was up to 70 percent smaller than the government's calculations.

The government based its 820-million-yen ($7.3 million) discount on waste-removal costs so Moritomo Gakuen could proceed with its plans to build an elementary school there.

However, the Board of Audit found there was no justification for such generosity, casting further doubts on the appropriateness of the 134 million yen sales price against its appraised value of 956 million yen.

The board submitted its audit report to the Diet on Nov. 22.

The Board of Audit also pointed out that it was not able to confirm details of the process leading to the sales price because the government had destroyed records that led to the contract with Moritomo Gakuen.

Because of this, there is no way to check whether the land sale was carried out appropriately.

The government has repeatedly stated that it was, but its position on the issue will still face strict questioning.

The huge discount raised suspicions of favoritism because the former director of Moritomo Gakuen had ties to first lady Akie Abe, who was once named honorary principal of the planned school.

The government sold the 8,770-square-meter plot to Moritomo Gakuen in June 2016. The school operator told the government that waste was buried deep underground in many areas.

This led to the deduction of 820 million yen for removal and associated costs.

Suspicions of questionable dealing also arose after it emerged that the government did not disclose the sales price even though it is obliged to do so in principle.

The Board of Audit investigated the Finance Ministry’s Kinki Local Finance Bureau, which oversaw the sale, and the transport ministry’s West Japan Civil Aviation Bureau, which formerly owned the land.

The government estimated that 19,520 tons of waste was buried on the site, using photos taken by the contractor for the school project and records of past surveys.

The estimate was based on the depth the garbage was buried and the ratio of waste in the ground.

Unable to find a sufficient basis for the depth and garbage ratio figures given by the government, the Board of Audit made its own calculations using a different method.

It concluded that the volume of waste could be as low as 6,196 tons or as high as 13,927 tons. The figures suggest that the government's calculations had an error margin of 70 to 30 percent.

The government had calculated that removing the waste would require 22,500 yen per ton, which the Board of Audit took issue with but could not say with certainty whether the figure was realistic.

The investigation was also hampered by the fact that the Finance Ministry destroyed some of the records on its negotiations with Moritomo Gakuen.

(This article was written by Takeshi Suezaki and Taichi Kobayashi.)