On 3 July 2020 a NSW Legislative Council committeee, the Public Accountability Committee (PAC), began an Inquiry into the Integrity, efficacy and value for money of NSW Government grant programs.
Thus far public hearings have been held on 21 September, 16 October and 23 October 2020 with further hearing dates scheduled for 27 November and 9 December 2020.
Six of the seven local government councils in the NSW Northern Rivers region – Tweed Shire, Richmond Valley, Ballina, Kyogle, Lismore and Clarence Valley - made submissions to the Inquiry outlining both satisfaction and frustration with the current grants system. These submission can be found here.
The Inquiry’s public hearings to date have generated media interest given these followed on the heels of the NSW Independent Commission Against Corruption (ICAC) Operation Keppel public hearings which revealed the six year intimate relationship between NSW Premier Gladys Berejiklian and Daryl Maquire both when he was a member of her government and after his forced resignation from state parliament in 2018.
The Sydney Morning Herald, 21 October 2020:
Senior advisers from Gladys Berejiklian's office have been called before a parliamentary inquiry to explain why the NSW Premier handed out $250 million in council grants without any signed paperwork.
The grants scheme is emerging as a major issue for Ms Berejiklian on the back of her appearance before the corruption watchdog, which is investigating her ex-lover Daryl Maguire.
Ms Berejiklian will know the direction of findings from the Independent Commission Against Corruption on December 7, when submissions from counsel assisting are sent to "relevant parties".
In an unusual move, Ms Berejiklian's former chief of staff Sarah Cruickshank and present senior policy officer Sarah Lau will give evidence to the public accountability committee on Friday.
Ms Cruickshank also gave evidence at the ICAC hearing into Mr Maguire, which is investigating whether he used his position as an MP for financial gain, including brokering property deals.
Finance Minister Damien Tudehope has confirmed that no signed approvals exist for 249 grants rubber-stamped between June 27, 2018 and March 1, 2019 from the Stronger Communities Fund, established after council amalgamations.
Ms Lau was the author of emails such as one sent on June 28, 2018 which said: "The Premier has signed off further funding for metro councils. Outlined below is what is been approved."
Ms Berejiklian directly approved more than $100 million in grants, but the only records of her approvals are in the form of emails from advisers.
Staff in Deputy Premier John Barilaro's office also emailed approvals, including one dated August 24, 2018 which said: "The DP has approved funding of $600,000 to Edward River Council."
But Mr Barilaro, who returned from four weeks' mental health leave on Wednesday, distanced himself from the fund, and said "everything was correct" in a similar fund for regional councils.
"The Stronger Communities fund is not a fund that I administer. The Stronger Country Communities fund is something that I administer under my department in regional NSW," Mr Barilaro said.
"There's an allocation made to every single local government area so it's not the beauty contest that we normally get, everybody gets a slice of the fund."…...
The government was dealt a humiliating blow late on Tuesday when its most senior minister of the upper house was suspended from Parliament in a rare move last used more than 20 years ago.
Leader of the government Don Harwin was removed from the chamber by the Usher of the Black Rod over a failure to produce documents showing signed paperwork relating to the grants.
Labor's leader in the upper house Adam Searle told Parliament the government's failure to produce signed approvals could amount to "maladministration, corruption or illegality"…...
The grants, which Labor's MP John Graham told the house were worth "two-and-a-half times the federal sports rorts" scandal, were distributed almost exclusively to councils in Coalition-held seats…...
The head of ICAC Peter Hall QC has said the methods used by the government in its administration of the council grants fund could open the door for corrupt conduct.
The Sydney Morning Herald, 20 October 2020:
An inquiry wants answers as to whether Premier Gladys Berejiklian declared a conflict of interest in her position on a committee that signed off on $30 million for a Wagga Wagga conservatorium following lobbying by former MP Daryl Maguire.
The NSW upper house inquiry into allegations of grant rorting on Friday heard the the Regional Cultural Fund awarded $10 million and $20 million to the Riverina Conservatorium of Music, for the construction of a new recital hall, in 2017 and 2018.
Chris Hanger from the Department of Regional NSW said the latter portion was a pre-byelection commitment from the government following the exit of Wagga MP Mr Maguire, who resigned in disgrace after a corruption inquiry heard he sought commissions from a developer.
After Mr Hanger testified that the funding was signed off by the Expenditure Review Committee, of which Ms Berejiklian is a part, Greens MLC David Shoebridge asked, "are you aware whether or not a conflict of interest was ever placed on the record by the Premier, given she was in a close personal relationship with Mr Maguire?…..
Jonathan Wheaton, executive director of regional programs at the department, told the parliamentary inquiry that, given the ERC was a subcommittee of the cabinet, he was unsure whether that level of information could be shared publicly.
The Sydney Morning Herald has sought comment from the Premier's office about whether or not she was obliged to declare a conflict of interest, and whether or not she had…..
The Sydney Morning Herald, 23 October 2020:
Gladys Berejiklian gave her lover Daryl Maguire's Wagga Wagga electorate six grants totalling $40,000 from her discretionary fund, while an inquiry heard one of her advisers shredded documents showing the Premier's approval of projects under another scheme.
In a parliamentary speech made before resigning from the Liberal Party in disgrace in 2018, Mr Maguire thanked Ms Berejiklian for providing $5134 from the special fund to the Ladysmith Tourist Railway, near the regional city, to cover the cost of replacing railway sleepers stolen by "scoundrels".
"It was a cowardly act to steal the sleepers, but I thank the Premier for helping to replace them," Mr Maguire said in June, also announcing the receipt of $5000 for the erection of a memorial to World War I Victoria Cross recipient Jack Ryan in Tumut. That money had also come from the fund.
Other grants included $10,400 for the Wagga branch of the Sporting Shooters Association of Australia for a firearm cleaning safety enclosure, which Mr Maguire announced to local media in October 2017, and $5000 towards the Talbingo Men's Shed……
ABC News, 23 October 2020:
Documents which Premier Gladys Berejiklian used to approve millions of dollars in grants to local councils were later shredded, a NSW parliamentary inquiry has heard.
One of the Premier's senior policy advisers, Sarah Lau, told the inquiry she also deleted electronic copies of the notes.....
Nearly all the grants were awarded to local councils in Coalition-held seats.
The inquiry heard that $141.8 million of the grant funding was allocated by the Premier, with $61.3million allocated by the Deputy Premier John Barilaro and $48.9 million by the Minister for Local Government.
In addition to the ICAC and PAC inquiries, the NSW Auditor General has announced an intention to review a selections of grant programs and, the Commonwealth Fraud Prevention Centre has also announced a new project regarding grant programs, highlighting the need to better understand key fraud risks and learn about effective fraud prevention methods particularly given there are elevated integrity risks for government grants in times of crisis or emergency.
