No external audit for Premier's staffer who scored $267k taxpayer grant

Queensland's opposition has raised concerns over the independence of an investigation into a $267,000 government grant awarded to a company part-owned by Premier Annastacia Palaszczuk's chief of staff.

The state's independent auditor-general has been asked to step in and investigate the Palaszczuk government's Advance Queensland business development investment in Fortress Capstone Pty Ltd in 2017-18 for the development of an app called CruiseTraka.

The Premier's chief of staff David Barbagallo has been a director of the company since 2007.

Premier Annastacia Palaszczuk speaks with Chief of staff David Barbagallo during estimate hearings last week. Credit: Jono Searle/AAP

Ms Palaszczuk has engaged her department's internal auditor Ernst and Young to cast an eye over the taxpayer-funded grant, and her department insists Mr Barbagallo "removed himself from the application process as soon as he was employed by the Premier".

Deputy LNP leader Tim Mander wrote to the auditor-general, Brendan Worrall, on Monday asking him to conduct a separate investigation.

"The Queensland government has insisted that all decisions relating to the fund are taken by an ‘independent panel’ that is not answerable to members of Parliament or the Queensland public," Mr Mander wrote to the auditor-general.

"I am seriously concerned by both the evident conflicts of interest that have emerged and the lack of accountability and transparency surrounding the Business Development Fund."

On Tuesday, Mr Mander aired concerns over the independence of an investigator that, he said, relied on government contracts.

“Often these companies are beholden to governments because they are relying on ongoing government work," he said.

“The best person or the best department that is in a position to do this independent investigation is the auditor-general.

“The auditor-general has a great track record in revealing inadequacies in government processes and I wonder whether that is the reason Annastacia Palaszczuk doesn’t want the auditor-general looking at this particular situation."

The Department of the Premier and Cabinet has appointed professional services firm Ernst and Young to undertake an independent review of the awarding of an Advance Queensland Business Development Fund co-investment to Fortress Capstone Pty Ltd, on behalf of the Acting Director-General Rachel Hunter.

A department spokesman said the terms of reference into the audit would be "jointly developed" by Ms Palaszczuk's department and Ernst and Young.

"We expect the review to be completed expeditiously," he said.

"Costs will be made available at the conclusion of the review."

The revelations came after controversy over Deputy Premier Jackie Trad's purchase of a Woolloongabba property.

Ms Palaszczuk insisted her government did not have an "integrity problem".

"We're really tough when it comes to rules around transparency and integrity," she said.

 -with Felicity Caldwell