Grants scheme used to ‘prop up’ NSW government

The NSW government provided key independents special access to a controversial grants scheme set up by Labor before the last election, prompting accusations the funds were used to “prop up” Chris Minns’s minority government.

Funding for a series of projects in the independent-held seats of Wollondilly, Orange and Murray was all changed after the election despite guidelines for the Local Small Commitment Allocation (LSCA) scheme stipulating the money needed to be locked in before the March 2023 vote.

Held up by Labor as an “anti pork-barrelling” grants program, the LSCA has instead been dogged by controversy since being established. The Herald has previously revealed allegations some grants were promised in exchange for political support, while a number of MPs and candidates also gave money to community organisations with which they had a relationship.

The scheme handed Labor MPs and candidates in all 93 electorates $400,000 to give to community projects of their choosing. The funding would be distributed only if Labor won government, and any unallocated money would be used by councils for parks and playgrounds.

Only Labor MPs had access to the $37.2 million scheme. However, the Herald has previously revealed influential independent Sydney MP Alex Greenwich had been able to lobby for changes to funding in his seat.

In evidence provided to an ongoing parliamentary inquiry into the grant scheme, Cherie Burton, a former Labor MP turned senior adviser to Minns who was tasked with overseeing the scheme, told committee members that “nothing changed from the original commitment and what went out the door”.

She later said the changes in Sydney had been the result of an “error”.

“There was an error made; I’ve been up-front about that, even in my original testimony. I’ve been up-front about that there was a mistake. There’s nothing to hide here,” Burton told the committee during a second appearance in June.

However, new documents reveal funding changes made by the Premier’s office went well beyond the seat of Sydney.

A list of the original pre-election commitments obtained via a parliamentary order reveals three other electorates held by independents — Wollondilly, Orange and Murray — all had their allocations changed after Labor came to government.

The document, which came to be known as the “source of truth”, lists all three seats as having their funds unallocated, meaning all $400,000 would go to parks and playgrounds in that electorate.

However, the allocations were later changed.

In Wollondilly, $256,000 funding was allocated for a men’s shed and $45,000 for Yerrinbool Bargo Soccer Club. Judy Hannan, the MP, confirmed she was “made aware” the $400,000 in LSCA grants was “extra funding for her electorate”.

“I have regular meetings with the premier and his team … as part of those discussions at the time I would have spoken about the timing for the announcements for LSCA as the RFS shed in particular was keen to have an answer for their funding,” she told the Herald.

“I’m aware it was assessed independently from applications by the Local Small Commitments Allocation team.”

Sitting outside of government, independents have little opportunity to allocate taxpayer funding.

Shadow minister of state Chris Rath accused the premier’s office of breaching grant guidelines.

“The fault is not with independent MPs lobbying for grants in their electorates,” Rath said. “Chris Minns must explain whether he doled out taxpayer money to prop up his precarious minority government.”

In a statement, a spokesperson for the premier said the LSCA program “supported communities in every one of the 93 state electorates in NSW regardless of the political stripe of its local member”, saying it was in “stark contrast” to the “pork barrelling” under the former government.

But the government did not deny that the projects had changed. Instead, the premier’s spokesperson said the “final” project list was given to the NSW public service on July 28. That document was “the master list from which the LSCA grant program was administered”, the spokesperson said.

The government did not respond to questions about Burton’s comments to the upper house inquiry examining the grants.

Coalition and Greens MPs were not given the chance to alter the funding allocations made by Labor candidates in their electorate. When Jenny Leong, Greens MP for Newtown, requested that funding for a P&C in her seat be evenly split across all the schools in her electorate, she was turned down.

During a budget estimates hearing on August 20, Nationals frontbencher Sarah Mitchell asked the premier whether Burton “lied to the committee under oath”.

“That’s an outrageous accusation,” Minns responded, saying the allegations about providing funding independents needed for Labor to form government were “just another wild conspiracy theory”.

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