I agree in general that govt sits on way too much land that amounts to dead capital, but the problem is how to realize value from it, or at least break even on it, rather than generate new long-term liabilities from it. A stretch of unused land can either sit on the books generating no return, or it can be serviced for a new township, none of whose residents can be expected to pay rates or utilities bills for perhaps decades. 

It may be though that these liabilities exist whether or not the govt does anything - that's where it starts getting interesting. Govt should perhaps bite the bullet and stop fighting a rear-guard action against the inevitable.