Gladys Berejiklian slammed in damning report on $252m Stronger Communities Fund grants scheme

Former NSW premier Gladys Berejiklian oversaw a $252m fund and gave almost all the money to loyal voters, a damning report says.

The NSW Auditor-General has slammed the NSW government’s handling of a $252m grants program that gave 96 per cent of funds to Coalition-held seats.

The then-premier Gladys Berejiklian and her deputy John Barilaro, who approved most of the funds, “likely” sought to gain political advantage by directing the funds to loyal areas, the the Auditor-General wrote in a new report.

A briefing note included in the report, prepared for Ms Berejiklian’s by her staff, said: “We have continued to work on how we allocate this funding to get the cash out the door in the most politically advantageous way.”

The grants scheme was launched in 2017 to benefit NSW councils that had been forcibly merged.

The following year Ms Berejiklian’s office decided money should only go to the councils that had supported the merger process, freezing out “unfriendly” councils.

Former NSW premier Gladys Berejiklian oversaw the approvals of many of the grants. Picture: NCA Newswire / Gaye Gerard

“We propose not to compensate councils that were subject to a merger proposal, and then sued us,” staff wrote in a briefing note to Ms Berejiklian.

“This also avoids us having to justify why we are not going to provide funds to unfriendly merged councils.”

This meant that out of 55 eligible councils, only 24 received funds.

Some of the projects were identified by government MPs, even before the guidelines had been approved, the report said.

Hornsby Shire Council received by far the biggest pile of money, $90 million, or 36 per cent of the total funds.

Ms Berejiklian and Mr Barilaro approved payouts to 22 councils, although no formal briefing notes were prepared.

“We cannot rule out that the lack of information about accountabilities in the program guidelines, coupled with a lack of formal documented approval from the former Premier and Deputy Premier, was a purposeful attempt to avoid transparency and accountability over the involvement of the former Premier and Deputy Premier in approving grant allocations,“ the Auditor-General wrote.

“The assessment and approval processes … lacked integrity,” Auditor-General Margaret Crawford wrote.

“The exclusion of key information from the program guidelines and the lack of formality in approving 22 of the 24 funding allocations prevent accountability and transparency over the government's approach to selecting councils for funding.”

Former premier Gladys Berejiklian and ex-deputy premier John Barilaro selected most of the projects to be funded, the report said. Picture: NCA NewsWire / Dylan Coker

Ms Crawford said the funding guidelines developed by the then-Office of Local Government were “deficient in a number of aspects” and largely ignored by the top ministers who decided where the money should go.

“For the 22 councils where funding allocations were determined by the former premier and deputy premier, the only record of their approval is a series of emails from their staff,” the report said.

The other two councils were selected by the then-Local Government Minister Gabrielle Upton.

The government agreed that mistakes were made.

“The department acknowledges, as found by your audit, that the design of the grant guidelines for the fund was not best practice and could have been improved in a number of respects,” Department of Planning and Environment secretary Mick Cassel wrote in a response to the Auditor-General.

“Including by clearly identifying the decision-maker and setting out the process for the selection and assessment of projects against specified criteria.”

NSW Premier Dominic Perrottet has vowed to clean up the grants process. Picture Gaye Gerard / NCA NewsWire

The letter also said the DPE would implement a new grants management process by July 1.

NSW Premier Dominic Perrottet ordered a review of grants funding in the state shortly after he assumed the top job late last year.

He said on Tuesday he had zero tolerance for pork barrelling.

“I’ve made it abundantly clear to every single one of my ministers - they are the ones responsible for the decision-making in relation to those grants programs and the outcomes,” he said.

The report vindicates findings by a NSW parliamentary inquiry that Ms Berejiklian and Mr Barilaro were responsible for allocating funds without adequately documenting the decision-making process.

“Today’s scathing Auditor-General’s report into the scheme has agreed with all of the public accountability committee’s key findings about the Coalition’s $252m pork barrel,” committee chair and Greens MP David Shoebridge said.

Originally published as Gladys Berejiklian slammed in damning report on $252m Stronger Communities Fund grants scheme