Corrupt Berejiklian’s $5.5m taxpayer waste

ANTHONY KLAN

INVESTIGATION

The $5.5 million gun club project at the heart of Gladys Berejiklian’s serious corruption has been a giant waste for taxpayers with not one of its “forecast” major events materialising in its six years of operations, investigations reveal.

The monster 1000-person “function centre” at the Australian Clay Targets Association in Wagga Wagga, five hours drive west of Sydney, was supposed to bring a boon of interstate and international visitors.

Costing taxpayers $5.5m it was supposed to create “up to 91 full-time equivalent jobs” and deliver over $2m a year to the Wagga Wagga economy.

In fact, last year the privately owned function centre — before all costs of the sprawling, 2,200sqm facility — delivered total revenue of just $153,000.

Of eight specific conferences put forward in its 2017 “business plan” –– including national conference of the Country Women’s Association, the national conference of the APEX Services Club and the national exhibition of the Lamb Industry — not one has occurred.

The revelations come as the NSW Court of Appeal just over a week ago rejected the former premier’s attempts to have the findings of “seriously corrupt conduct” against her overturned — rejecting all 13 grounds put forward by her high-paid legal team.

As Treasurer, and later Premier, Berejiklian approved the $5.5m gun club grant and $20m set aside — but later abandoned — for the Riverina Conservatorium of Music, also in Wagga Wagga.

It later emerged Berejiklian had been in a long-time secret relationship with then long-time Wagga Wagga MP Daryl Maguire.

Berejiklian resigned as NSW Premier over the scandal in October 2021 and last year the NSW Independent Commission Against Corruption (ICAC) found Berejiklian had engaged in “seriously corrupt conduct” over the grants.

The $20m earmarked for the Riverina Conservatorium of Music was scrapped after ICAC’s investigations commenced but the $5.5m to the gun club had already gone ahead.

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The ACTA function centre. Source: ACTA

ICAC heard Berejiklian approved the $5.5m despite serious repeated warnings from senior government officials — including that its business case was “deficient” and “flimsy”, with “imaginary claims of community benefit”.

It failed to meet the government’s central criteria — the grants were for the public “not private assets on private land”.

The Klaxon’s investigations underline the vast waste to taxpayers of the $5.5m corruptly given to the gun club.

According to its business case — which had been “revised” to get it over the line after an alleged intervention by Berejiklian as Premier — ACTA’s Range Function Centre was supposed to host four 400-person and two 800-person conferences every year.

Not one of anything like that size — or of a size that could not be hosted at the numerous existing venues in town — has occurred since it opened its doors in 2018.

Under ACTA’s “business plan” — itself funded by NSW taxpayers —  the function centre was to deliver “up to 91 full-time equivalent jobs”, deliver over $2m a year to the local economy and provide “international promotion of the City of Wagga Wagga, regional Australia and Australia as a whole”.

A massive 97% of the taxpayer “benefits” of the project were to come from increased visitors to the region.

In December 2017 Nigel Blunden, senior advisor to then NSW Premier Mike Baird, wrote to Baird opposing the “suss” grant.

“Increased tourism accounts for 97% of the forecast benefits [so it’s suss],” he wrote to Baird.

“Sometimes you gotta say WTF,” wrote Blunden.

Daryl Maguire at the ACTA gun club. Source: Supplied

Days later Treasurer Berejiklian’s “expenditure review committee” gave “conditional approval” for the $5.5m grant.

It was rejected by the government “Investment Appraisal Unit” four months later. But after an alleged intervention by Berejiklian, who had become NSW Premier, an “updated business case” was prepared and it passed, just.

The project needed to show a “net benefit” to NSW taxpayers –- and attract events that would not otherwise be held in the state, rather than cannibalising other NSW business.

The updated business case said “business events” were required, such as conferences and exhibitions, because they were “high-yielding” — rather than community events such as “weddings, theatre style shows, presentations or other community ceremonies”.

The updated business case stated eight “potential conference events”. They were:

— Country Women’s Association national conference

— APEX Services Club national conference

— Lamb industry national exhibition

— Royal Australian Air Force national functions

— Local Government NSW annual conference

— Australian Local Women’s Association annual conference

— Artlands Festival conferences

— Country Energy conferences

Not one of those events has happened at the ACTA function centre since it opened its doors in 2018.

ACTA did not respond to repeated requests for comment.

Berejiklian has also repeatedly refused to respond to requests for comment.

Analysis shows the $5.5m has not only effectively been a complete waste for NSW taxpayers but the massive centre is almost certainly a financial burden on the club itself.

ACTA’s financial performance before and after conference centre. Source: ACTA. Graphic: The Klaxon

Since 2018 the average total annual revenue of the function centre — which all up cost $6.9m — has been just $101,000 a year.

ACTA ’s annual reports do not break down the full costs of centre, only its revenues.

In 2023 the income of the function centre was $152,862.

For the year a figure of $39,082 is recorded against a subset of costs called “function centre operating costs, catering and maintenance”.

Also listed are “hall of fame expenses” — created as part of the function centre — of $17,699.

What specifically is included in the $39,082 “function centre operating costs, catering and maintenance” is unknown.

“Salaries, wages & other staffing costs” are reported separately.

The 2023 annual report states ACTA employs a “Manager of the Range Function Centre”.

Also reported separately are “electricity, gas & water”; “rates and taxes; “insurance” and “permits, licences and subscriptions”.

In every category the costs surged before and after the function centre.

Daryl Maguire and Gladys Berejiklian. Source: ABC News

As previously reported, between 2016 — immediately before construction began — and 2019, the first full year of the function centre operating, “electricity, gas & water” expenses soared from $25,800 to $58,900.  Last year that figure was $60,522.

Between 2016 and last year, “rates and taxes” grew from $9,200 to $31,645, while “permits, licences, fees and subscriptions” went from $7,000 to $51,192.

The $5.5m function centre grant saw ACTA’s total assets almost double, from $6.1m in 2016 to $11.8m in 2018 (ACTA’s entire land holding is currently valued at $1.67m).

Yet the operating results of the club have plummeted since it opened its doors in early 2018.

The non-existent “conference style events” ACTA was supposed to attract. Source: NSW ICAC

It is continuing to operate at a surplus, but its operating profit has plunged from around $300,000 a year or more before it opened to just $86,158 in 2022. Last year it was half that again, at $42,163.

The “accumulated depreciation” marked against the function centre is now $1.01m — vastly more than its entire revenue since opening.

The ICAC heard the $5.5m ACTA grant was “fast-tracked” and was highly unusual on many fronts.

NSW Office of Sport director Michael Toohey said the business case was “flimsy” with “imaginative” claims of community benefit.

Then NSW Sport executive director told ICAC his department didn’t consider it “stacked up” and was “surprised” to hear it was approved.

In July 2017 Jenny Davis of Infrastructure NSW wrote to colleagues across three departments: “the project is unusual” and had been approved by (Berejiklian’s) expenditure review committee “before we had ever heard of it”.

“We need to ensure that the funding goes to public infrastructure, not to private assets on private land,” she wrote.

In his December 2017 email to Baird, Blunden wrote: Gladys and (MP Stuart) Ayres want it”.

“No doubt they’ve done a sweetheart deal with Daryl, but this goes against all the principles of sound economic management”.

“No doubt they’ve done a sweetheart deal with Daryl” – Nigel Blunden

Ayres was NSW Sports Minister at the time. ICAC made no findings against him.

In August 2022 Ayres resigned from his ministerial positions and as deputy leader of the NSW Liberal Party over a scandal involving the appointment of former MP John Barilaro to a plumb US trade role.

Ayres lost his seat at last year’s state election. He has since been appointed NSW CEO of property developer lobby group the Urban Development Institute of Australia (UDIA).

ICAC made findings of “serious corrupt conduct” against both Berejiklian and Maguire.

Berejiklian, who has repeatedly publicly criticised ICAC, has never apologised for her actions or accepted any wrongdoing, including after the July 26 Court of Appeals finding.

She remains in a senior executive role at telco giant Optus to which she was appointed just months after resigning as NSW Premier in October 2021 and long before ICAC completed its investigations. 

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