Relief funds for the victims of the devastating 2019-20 bushfires failed to reach some of the state's hardest-hit areas, a report into the NSW government's grants system has found.
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Urgent reform to the system is needed, the Public Accountability Committee warned in its final report tabled in parliament on Thursday.
There were widespread failures in the way grants were handed out by the NSW government, which used taxpayer money for political gain in a system that is "open to abuse", the report said.
The system had shown a "complete failure" to detect fraud, Greens MP and committee chair David Shoebridge said.
Some $16 million worth of fraudulent grants had been handed out in NSW, while a further $40 million worth were being sought by "bikie gangs", he said.
The revelations were tabled to parliament on the same day the government announced a $400 million grant program for western Sydney.
"The government's fraud control measures are rudimentary at best," Mr Shoebridge said.
"One of their primary fraud control measures continues to be an Excel spreadsheet."
The heavily bushfire-impacted areas of the Central Coast, Blue Mountains and Ballina did not receive any stage-one funding through the Bushfire Local Economic Recovery packages.
The report found the way bushfire funds were allocated was "politically driven" and decisions were made after an inquiry drew attention to systemic pork-barrelling in NSW.
The report also found arts grants were pork-barrelled by the coalition in 2020.
A pool of 222 grant applicants was reduced to just six after the former arts minister Don Harwin reallocated funding to the Sydney Symphony Orchestra, which had not applied for grants.
Labor's spokesman for music John Graham said there was "a story of heartbreak behind every one of these arts grants which is manipulated by a minister".
"For every one of these grants that goes to someone lifted up the list by the minister, there is someone who has missed out on their big break - their chance to succeed on the world stage," he said.
The report made 13 recommendations including an urgent fraud investigation, implementation of anti-fraud systems, and an accountability system when a decision is made to deviate from department advice over funding.
NSW Premier Dominic Perrottet said earlier this month he has "zero tolerance" for pork-barrelling, after a NSW auditor-general's report revealed 95 per cent of the $252 million Stronger Communities Fund grants were awarded to coalition-held electorates, in the same week an analysis found 75 per cent of ClubGRANTS funds were funnelled to coalition seats.
The NSW government's $1.03m Refresh and Renew Grants program was also 70 per cent funnelled to coalition seats.
Mr Perrottet told parliament question time on Thursday new WestInvest grants would "make a real difference" and would ensure "western Sydney is the best place to live, to work to run a business and raise families".
Mark Owen, NSW secretary for Infrastructure detailed the new grants in parliament on Thursday, saying $400 million would be allocated to 15 local government areas in western Sydney.
Opposition leader Chris Minns said he had "real concerns" over the project, which was directed at communities who had faced harsh lockdowns and curfews in the COVID-19 pandemic.
"Even in the opening stages of this massive funding we're seeing the government directing to their political aims, not the aims of the best interests of the people of New South Wales," he said.
Australian Associated Press
