A New South Wales government review into grant funding has recommended a raft of changes but fallen short of saying pork-barrelling should be an offence.
The review was commissioned in November last year as the government was fending off allegations about its grants scheme, in the wake of the Independent Commission Against Corruption (ICAC) hearings involving former premier Gladys Berejiklian.
Completed in April, the final report, along with 19 recommendations on how to improve transparency, accountability and probity, was released by the state government this morning.
"Grants are a significant part of the way the government supports communities and individuals," Premier Dominic Perrottet said.
"All grants are ultimately funded by public money, and so it's critical we also make sure they are administered fairly, effectively and transparently."
Prepared by the Department of Premier and Cabinet and the productivity commissioner, the review is forward looking — suggesting changes to policies rather than analysing previous decisions.
In a section titled "Accountable decision-making is necessary to manage the risk of pork barrelling", the report puts forward a case against creating an offence prohibiting pork-barrelling due to "existing legally enforceable measures".
It also states that updating the ICAC definition to include pork-barrelling is not "appropriate" because the watchdog's act already includes an "extensive definition of what constitutes 'corrupt conduct'".
Instead, the report recommends managing the risks through "accountable decision-making" and better record keeping.
"Robust decision-making frameworks will help to ensure accountability and transparency in grants administration," it says.
"This includes identifying and documenting who makes funding decisions and on what basis.
"This is particularly relevant in the context of concerns raised by stakeholders about perceived pork-barrelling in the administration of grants."
The recommendations are being considered by the government with a response due in coming weeks.
However, Labor leader Chris Minns said the review "confirms the grant process in NSW is broken".
"There's nowhere near enough oversight and scrutiny of taxpayer funds being spent by this Liberal and National government," Mr Minns said.
Labor is proposing legislation that would confer additional powers on the auditor-general to investigate grant funding.
Among the other recommendations is a new grants administration guide, based on Commonwealth standards for integrity, trust, service and accountability.
So too are calls for mandatory compliance for officials, ministers and staff.
Increased transparency, through the use of published guidelines and selection criteria, were also necessary, the report found.
It also suggested the establishment of a publicly available database cataloguing upcoming grant opportunities, grants awarded and a record of ministerial decisions and the reasons for the decision.
The report offered recommendations on the use of closed, non-competitive grants, which come with a high level of ministerial discretion to distribute funding.
It said: "Non-competitive processes should remain an option but, given the substantial benefits of competitive grants, officials should always ask: 'If not competitive, why not?'"
While ministers and MPs can make suggestions for grant funding in their electorates, the review says such input should be recorded "at all stages of the process", as well as how that input is considered in the assessment stage.
It cited a review from the Audit Office of NSW which found some MPs were identifying projects for funding before the program guidelines were approved.
The NSW government usually spends about $4 billion per year on grants but that has blown out to $10 billion due to temporary COVID-19 and natural disaster support programs.
