The initial report from the NSW parliamentary inquiry into state grant schemes distributed under the Berejiklian government doesn’t mince words in its assessment of how the Coalition has allocated public money in an attempt to consolidate its power and appease its supporter base.
The inquiry delved into the Stronger Communities Fund (SCF), which NSW Public Accountability Committee chair David Shoebridge described as a fund established to assist councils created as a result of forced amalgamations that went on to morph into “a brazen pork barrel scheme”.
In his forward to the report, the NSW Greens MLC further outlines that SCF saw $252 million in taxpayer money handed over to council’s “on a purely political basis” in the run up to the 2019 state election to reward Coalition-held seats and to punish councils that objected to the mergers.
The SCF was established in 2016 to ensure ratepayers didn’t foot the bill for council mergers. However, its guidelines were revised in mid-2018 to permit Coalition heads to simply hand out the money without the constraints of any transparent criteria, an application process or assessment.
Under the scheme, the projects funded were approved by NSW premier Gladys Berejikilian, deputy premier John Barilaro and then local government minister Gabrielle Upton.
And, as Shoebridge further notes, if any of the funded projects did prove beneficial, it was “by accident not by design”.
The report makes thirteen key findings. These include that 95 percent of the $252 million – or $241 million – was allocated to Coalition-held or marginal seats, in what was a “clear abuse of the grants process”.
NSW Office of Local Government (OLG) deputy secretary Tim Hurst indicated at an inquiry hearing that of the $252 million, Berejiklian allocated $141.8 million, Barilaro signed off on $61.3 million, while Upton oversaw $48.9 million.
And of the three, only Barilaro appeared at the inquiry when requested to.
The committee found that the mid-2018 revised guidelines didn’t detail how projects would be identified or assessed but were rather designed to facilitate certain legal disputes being resolved, to curry favour in Coalition seats and to punish those councils who opposed the amalgamations.
In place of official funding briefs, the premier used working advice notes to approve project funding and then her office destroyed these records, while the deputy premier didn’t even bother to keep records in regard to which projects he allocated funds to.
A case in point
Two instances were identified where funds were allocated to deal with legal disputes. One of these involved the provision of the largest grant: $90 million to Hornsby Shire Council. This was distributed without “any due process or merit assessment” for purposes outside of the original SCF scope.
Having not undergone an amalgamation, Hornsby council wasn’t eligible for the SCF scheme prior to its revision. But following this, funds were handed over at great speed with $50 million allocated to rehabilitate a former quarry at Hornsby Park and $40 million for the Westleigh recreation area.
On 27 June 2018, the revised guidelines were approved. OLG deputy secretary Hurst contacted Hornsby council that day to advise that it had become eligible for funding under the scheme and requested it make an application.
On the following day, the council received the relevant paperwork. The application form included pre-populated sections that detailed the name of the projects to be funded and the amounts. The OLG approved the payment that same day, and two days later, the council received it.
The Public Accountability Committee found that this money had been granted to Hornsby Shire Council to compensate it over the loss of a substantial part of its ratepayer base, when land was handed over to Parramatta City Council during the amalgamations.
A similar payment of $16 million was made to Parramatta council, which appears to have resulted in its plan to sue Hornsby council being dropped. Parramatta had sought to take its neighbour to court over funds it refused to hand over as a result of the mergers.
Further investigation recommended
Chief among the recommendations made by the report authors is that the NSW Legislative Council “refer its concerns regarding the inappropriate design and maladministration of the Stronger Communities Fund” to both the ICAC and the NSW auditor general for further investigation.
The report suggests that NSW State Archives and Records reconsiders pursuing legal action against the state premier and her office after it found they had illegally destroyed records detailing the allocation of the SCF funds, as the oversight body had previously asserted it wouldn’t be doing so.
The committee also recommends the Good Practice Guide to Grants Administration be reviewed and updated with its requirements being enforceable, as well as the auditor general having increased investigation powers, and that a central website be established to detail funding schemes.
The Public Accountability Committee also wants to see the government overhaul the way that grants are provided to local councils so that a funding formula applies, which links to existing council documentation and considers the needs of regional and remote communities.
Something’s got to stick
A senior policy officer in the premier’s office told the committee in October last year that the SCF grant allocation documentation that Berejiklian had signed off on had been destroyed by her office. And via a forensic recovery process, copies of the documents were obtained on 26 November.
On that same day, the premier appeared before the press and admitted that her government had engaged in pork barrelling, however she asserted that it was “not illegal” and it’s a common political practice.
“Governments in all positions make commitments to the community in order to curry favour. I think that is part of the political process whether we like it or not,” Berejiklian assured the constituency. She added that she’s aware that the public is not particularly comfortable with the pork barrelling.
The public, however, is getting increasingly uncomfortable with the premier’s participation in the practice, as since last November, she’s been caught up in further currying favour scandals in regard to NSW arts funding, as well as the distribution of bushfire relief.
The report’s recommendation that ICAC investigate Berejiklian’s SCF dealings is the second time last month that it was suggested the watchdog look into her dealings.
And with the committee set to release its next report on the bushfire and arts grant allocations, it’s likely it won’t be the last.
So, while the moniker Teflon Gladys might suit the NSW premier for the time being, it seems that one day soon, she’ll be emerging from an ICAC hearing with a bit of egg stuck to her face.