The NSW government will refer allegations of corruption by a senior planning official to the ICAC following claims made under parliamentary privilege by an opposition MP.

Liberal MP Alister Henskens told parliament on February 8 that the official used confidential information given to them as a public official for personal gain in relation to a multibillion-dollar property policy.

Mr Henskens claimed he has evidence showing the official also passed on confidential information to neighbours in an attempt to make them become part of his “property syndicate”.

The government’s Transport Orientated Development Program (TOD) will allow low-rise properties within 400m of 31 nominated railway stations around Mr Henskens Sydney North Shore electorate to be converted to seven-storey apartment blocks.

Mr Henskens told parliament the policy has been rushed and implemented in a way that has enabled corruption.

“Proper probity checks have not occurred, which has already led to corrupt conduct by at least one public official,” he’s recorded as saying on the Hansard record.

Proper probity checks have not occurred, which has already led to corrupt conduct by at least one public official.

Alister Henskens

Mr Henskens said he was alerted to the matter by a whistleblower and that he has obtained corroborating documents.

He told parliament the senior official had purchased a property within one of the proposed TODs.

“The official paid well about the median suburb price …A strong circumstantial case that the property’s acquisition was motivated by information as to the planned TOD policy can be made out,” he said.

After living in the neighbourhood, the official then communicated with neighbours about “banding together” to sell their properties to a developer, Mr Henskens said.

The official “sought to draw their neighbours into their web of corruption to become part of a criminal conspiracy to trade on inside information”, he alleged.

“I am told that this person’s conduct has had the tendency to coerce neighbours by using the person’s senior position in the department as well as the implied threat of being dominated by an overdevelopment of the neighbourhood if they did not join the syndicate,” Mr Henskens said.

“A public official should never use confidential information given to them as a public official for their own personal gain. (Disgraced former Labor minister) Eddie Obeid and others did that …and cannot believe … that it is happening again.”

He said a public inquiry was the only way to restore confidence in the TOD process.

In a statement on Friday planning minister Paul Scully said the NSW Government did not tolerate corruption of any kind.

“There is absolutely no place for the kind of actions being alleged by the Member for Wahroonga,” Mr Scully said.

“The NSW Government will refer the Member’s statement to the ICAC, and will cooperate fully with any investigation.

“We urge the Member to make a similar referral, and provide ICAC with whatever information he has to allow for a comprehensive investigation.”