Sport Australia received the final list of projects to be given grants from the former sports minister Bridget McKenzie 17 minutes after the government entered the caretaker period and one day after it was sent to the prime minister’s office.
Sport Australia officials revealed at a Senate inquiry hearing on Thursday that McKenzie chose not to fund 164 projectsthe agency had recommended on 3 April 2019, sending a final list at 8.46am on 11 April, 17 minutes after the governor general prorogued parliament before the 2019 election.
The Australian National Audit Office has told the Senate inquiry, in answers to questions on notice, that McKenzie wrote to the prime minister on 10 April attaching spreadsheets of projects she intended to fund, summarised by state, political party and electorate, then provided the signed approval brief dated 4 April to Sport Australia on 11 April.
On Thursday, Labor continued to pursue the government on Scott Morrison’s involvement in the administration of the $100m community sports infrastructure grant program, attempting to show that representations from Morrison’s office influenced outcomes or to tie him to an ineligible project funded in his electorate.
The ANAO has suggested that although Morrison’s office made both direct and indirect representations about which project to fund, there was not sufficient correlation with final decisions to conclude that anyone other than McKenzie decided on grants.
Luke McCann, Sport Australia’s chief operating officer, told the hearing he was “not aware” that the final list of projects came through 17 minutes after the government entered caretaker period.
He said Sport Australia recommended 225 projects and McKenzie decided to fund 228, with only 61 projects in common – explaining why the ANAO found that 73% of the projects funded by the minister had not been recommended by Sport Australia.
McCann revealed that in the first round Sport Australia gave McKenzie raw scores for every project as well as a recommended list which already accommodated projects it knew McKenzie was supportive of. But before the third round – awarded weeks before the 2019 poll – Sport Australia issued its own independent set of recommendations.
“In our view, as we worked through the iterative process, we decided we needed to be better at providing our advice … to be consistent with better practice,” McCann said.
Officials rejected Labor shadow sports minister Don Farrell’s characterisation that Sport Australia had decided to “cover its arse” after it realised the program was a “rort”.
The Sport Australia chair, John Wylie, said it had demonstrated “due stewardship” of the $100m program by raising risks with McKenzie’s office, but it was her prerogative to fund different projects as she was the ultimate decision-maker.
McCann cited two instances when Robin O’Neill, the head of the infrastructure branch, warned McKenzie about the approval process on 5 December 2018 and again on 5 March 2019 when the minister’s office asked for blank application forms after the application process had closed.
Wylie batted back queries about how clubs judged meritorious by Sport Australia that missed out on funding might feel, noting that McKenzie had a “wide discretion” and “that was public knowledge, at the time guidelines were published”.
“The rules weren’t changed on the way through here,” he said.
Wylie revealed that two other programs give the minister a decision-making role, including the Move it Aus–Better Ageing program.
This may leave them at risk of legal challenge, due to the ANAO finding that it was “not evident” what McKenzie’s authority was to give grants under the community sport infrastructure grant program and constitutional concerns.
Wylie said Sport Australia had received legal advice from an eminent QC and was confident its actions were within its power, but did not comment on McKenzie’s legal authority.
In a scathing report, the ANAO found McKenzie’s office had conducted a parallel process to judge projects, skewing grants towards Coalition target and marginal seats.
Asked about five new applications that were funded in round three despite applications having closed, officials explained that they were successful because state governments had supported the projects on the condition of co-funding or because of urgent repair needs, including concrete cancer in light poles at the Yeppoon Swans football club and poor drainage at Westbury bowling club.
McCann revealed the minister’s office had asked for the forms “for the purpose of advocating in the budget process” when Sports Australia had raised concerns.
Officials were quizzed about how the ANAO had concluded 272 projects were ineligible when funding agreements were signed, when all had been eligible when assessed by Sport Australia.
McCann replied that clubs were “confused” about the requirement that work must not have commenced when the agreement was signed, suggesting the ANAO may have taken a “narrow interpretation” of the requirement. All clubs were asked to confirm they were still eligible and had not started work before an agreement was signed, he said.
On Wednesday the ANAO revealed Morrison’s office exchanged 136 emails with McKenzie’s office about the community sport infrastructure grant program.
Documents produced to the Senate also reveal that Morrison’s office was informed before he attended an event at the Sans Souci football club on 11 July that “it is worth noting that the club initially missed out” on funding in the first two rounds, and by the third round the club had “fundraised and the project is almost completed”.
A spokesman for the prime minister said the project was “approved for funding by the then minister for sport based on its assessed eligibility by Sport Australia”.
“It was the responsibility of the applicants and Sport Australia to have ensured all projects met the eligibility criteria,” he said.