Mike Baird ‘incredulous’ that Gladys Berejiklian didn’t reveal affair

Former NSW premier Mike Baird has delivered a devastating assessment of Gladys Berejiklian’s conduct, telling a corruption hearing he was ‘incredulous’ to learn she had been in a relationship with Liberal MP Daryl ­Maguire.

Then premier Mike Baird and his treasurer Gladys Berejiklian in 2016. Picture: Adam Yip

Former NSW premier Mike Baird has delivered a devastating assessment of Gladys Berejiklian’s conduct while treasurer in his government, telling a corruption hearing he was “incredulous” to learn she had been in a relationship with Liberal MP Daryl ­Maguire and it should have been disclosed as a matter of policy.

Mr Baird, who described himself as a close friend of Ms Berejiklian, told the Independent Commission Against Corruption on Wednesday that he learned of the relationship a year ago when Ms Berejiklian sensationally gave evidence during earlier hearings.

The former premier and his chief strategy adviser, Nigel Blunden, were questioned over the handling of a $5.5m funding grant awarded to the Australian Clay Target Association located in Mr Maguire’s electorate of Wagga Wagga, raising questions over whether Ms Berejiklian, as treasurer, should have declared any conflict.

Mr Blunden flatly opposed the proposal – after then sports minister Stuart Ayres made an urgent request for it to be put before the government’s Expenditure Review Committee – in a stark memorandum written to his boss on December 12, 2016.

In a nod to Tom Cruise’s character in the 1983 film Risky Business, Mr Blunden wrote: “As Joel Goodsen [sic] famously said, sometimes you gotta say WTF.”

“The business case has not been subject to any independent review; there’s no feasibility study; the capital costs haven’t been market-tested,” Mr Blunden wrote in the memo, tendered at the hearing.

He said the ACTA should “go away, test the assumptions, verify the business case and then come back when it’s solid.”

 

He also indicated that he had had the funding application withdrawn from the ERC agenda but Ms Berejiklian had had it ­reinstated.

“Daryl fired up and Gladys put it back on,” Mr Blunden wrote.

The memo further said: ­“Gladys (Berejiklian) and (Stuart) Ayres want it. No doubt they’re (sic) done a sweetheart deal with Daryl (Maguire), but this goes against all of the principles of solid economic management.”

Mr Baird told ICAC had he known about the relationship between Ms Berejiklian and Mr ­Maguire, he would have taken ­action to mitigate potential conflicts of interest.

“Was that something that came as some surprise or perhaps shock to you, finding out that ­information?” asked counsel ­assistant the commission, Scott Robertson, of the secret relationship.

“I think incredulous,” Mr Baird replied.

Mike Baird leaves his Sydney home for the ICAC hearings on Wednesday. Picture: John Grainger

“If you had known about that relationship at the time you were premier and she was treasurer, would that have affected anything you did as premier?”

“Look, I think … certainly I think it should have been ­disclosed.”

Asked why this was necessary, Mr Baird said the information went to the heart of public function and, in the context of private interests, it would have been “good practice” to do so. He said he would have expected that information to have been passed on to him directly “as the premier”.

Mr Baird’s appearance at ICAC capped off a third day of hearings into the conduct of Ms Berejiklian during her time as treasurer and premier of NSW.

She was earlier this month named as an investigative target of the corruption body, triggering her resignation as premier.

Mr Baird revealed Mr Maguire had acquired a reputation within the Liberal caucus as someone who was aggressive and abusive.

He strongly fought for local projects but was also a person who was “relentlessly in the pursuit of his own agenda”.

Asked whether Mr Maguire was respected by his colleagues, Mr Baird said: “At times he was aggressive and I think, at times, abusive to members of staff, to public servants and MPs. It certainly wasn’t conduct that I would support.”

Outside the hearing on Wednesday, Mr Baird told reporters he had answered the commission’s questions about Ms Berejiklian “clearly with a heavy heart”, although he said he believed she had generally maintained “the highest levels of integrity”.

“In simple terms, I thought it (the relationship) should have been (disclosed), but I also think it could have been managed.” Mr Baird said.

“She’s a very close friend. I wish she had (disclosed the relationship).

“Obviously I’m disappointed but that doesn’t change the way I feel (about Ms Berejiklian).”

Mr Baird told the hearing that solutions may have been available if he had known about the relationship; he said Ms Berejiklian could have potentially recused herself from meetings about government spending that concerned projects relevant to Mr Maguire, or to his electorate of Wagga Wagga.

The commission’s investigation - codenamed Operation Keppel - initially began with an inquiry focused solely on Mr Maguire’s activities, which was made public in 2020.

It later developed into an extra three-pronged inquiry concerned chiefly with Ms Berejiklian’s conduct, largely because of their secret relationship.

In the aftermath of those initial public hearings, Ms Berejiklian maintained she had always upheld the highest levels of integrity.

Mike Baird appearing before ICAC on Wednesday.

Specifically, ICAC is seeking to establish whether Ms Berejiklian withheld knowledge of Mr Maguire’s corrupt conduct, and whether she potentially encouraged that conduct by failing to act within her duties.

The third tranche of the inquiry is examining potential breaches of public trust committed by Ms Berejiklian; ICAC is pursuing this through two funding grants either promised or awarded to entities located in Mr Maguire’s former electorate of Wagga Wagga -- the Australian Clay Target Association and the Riverina Conservatorium of Music.

It is seeking to establish whether Ms Berejiklian breached her obligations by advancing projects or approving funds as treasurer to the Wagga Wagga electorate while in a secret relationship with Mr Maguire.

Mr Baird’s evidence supported remarks made by other public servants, who have lined up since Monday to vent their bemusement and displeasure with the processes that led to the ACTA being awarded the funding grant.

Some described it as a rushed application that circumvented usual government processes, and an application that was deficient of critical economic detail.

“The work hadn’t been completed, in terms of finalised costings,” Mr Baird said on Wednesday.

“There was a business case of sorts, but the advice was clear that this was insufficient and more needed to be done.”

Documents tendered at ICAC suggest that aside from Mr Maguire, Ms Berejiklian and Mr Ayres, the proposal, which would ultimately use the $5.5m to upgrade ACTA facilities in Wagga Wagga, did not have overwhelming government support.