Prime Minister's department head Phil Gaetjens has denied any knowledge of the part played by Prime Minister Scott Morrison's office in choosing sports grants ahead of the last election, despite being asked to investigate the affair.
A Senate inquiry into the sports grants has heard there were 136 emails back and forth between Mr Morrison's office and the office of Sports Minister Bridget McKenzie in the weeks before April 11, when the caretaker period began.
Some of the emails were between April 4 and April 11 after Senator McKenzie said she had signed off on the grants but changes were nevertheless made. Senator McKenzie has said those last-minute changes were made without her input or knowledge.
Now Mr Gaetjens has said he wasn't aware of any of the communication between Mr Morrison's and Senator McKenzie's office.
That is despite Mr Morrison asking Mr Gaetjens in January this year to investigate whether Senator McKenzie had breached ministerial standards in her handling of the affair. In his report, Mr Gaetjens cleared Senator McKenzie of awarding grants based on political considerations, saying there was no evidence that the money was skewed towards marginal electorates.
That finding is directly at odds with the finding of the Auditor-General, whose office has said the only rationale it could find for Senator McKenzie's decisions was the priority given to marginal and targeted electorates.
On Wednesday, Mr Gaetjens appeared before a Senate inquiry into the affair.
He said Mr Morrison had tasked him with investigating only whether Senator McKenzie had breached ministerial standards. He didn't think the Prime Minister could or would ask him to investigate the Prime Minister himself, he said.
He had not been asked to re-audit the program and had been interested only in information relating to Senator McKenzie's decisions. Mr Gaetjens appeared angered at the suggestion that his report had been flawed, saying his department had analysed whether a statistically unfair proportion of grants had gone to marginal electorates.
"The remit of my inquiry was to look at the minister and did she apparently breach the standards. That went to fairness. It also went to disclosure of interest. So I will not take it that the analysis was partial or limited or anything like that," he said.
" ... It is arithmetic and mathematics, not process ... I will not stand by here and just be criticised."
Similarly, Mr Gaetjens said the existence of 28 versions of a spreadsheet used to decide grants, colour-coded according to which party held the electorate, only became known after his report was done.
Labor Senator Katy Gallagher suggested he might have been influenced by loyalty to Mr Morrison after spending three years as his chief of staff and 11 years before that as chief of staff to former Liberal Treasurer Peter Costello.
Mr Gaetjens rejected the suggestion. He said when he wrote his report in late January, he had seen no evidence of any emails between Senator McKenzie's office and Mr Morrison's office over the grants.
When that evidence emerged a couple of weeks later, in February, Mr Gaetjens said he had seen no need to go back and look again at the way grants were approved.
Asked whether he now acknowledged the role of Mr Morrison's office, he said he did not. While he had seen "comments" about emails he still had not seen them.
By the time he had seen reports about the emails, his inquiry had been completed, Senator McKenzie had resigned (over her membership of a gun club which was awarded funding), and there had been no role for him in reinvestigating, he said.
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Senator Gallagher pushed him on whether it was appropriate to decide $40 million in grants after the caretaker provisions began. He said that would depend on context.
"Everything is considered in the context of the transaction or decision being made, with respect to scope, scale, importance, sensitivity, so I cant give you a one size fits all answer as to whether a decision should or should not have been made in caretaker, it would relate to the actual circumstances," he said.
"Well, we've got an an actual circumstance here," Senator Gallagher replied. "Does that bother you, that $40 million of taxpayers' funds was being signed off after caretaker kicked in, going for projects in seats that the government was trying to win?"
"I'd have to look in more detail at the actual decisions that were made," Mr Gaetjens said, to which Senator Gallagher replied: "Oh come on, Mr Gaetjens, you're the head of the public service. It doesn't bother you that taxpayers' funds were being spent after caretaker kicks in? That's extraordinary."
Labor's Anthony Chisholm pushed Mr Gaetjens on why he hadn't felt the need to look again at the $40 million of grants in caretaker mode once he became aware of it.
"By that time the minister had resigned. Why does one feel the need to have a look at something when the minister has resigned?" he said.
Asked whether he still judged his report accurate and complete given the information that had emerged since, Mr Gaetjens said he did.
Mr Gaetjens also revealed that he hadn't spoken to Senator McKenzie's former staff who had been involved in the grants funding.
The auditor found that Senator McKenzie's office had run a parallel grants process, making its own decisions about which groups would get funding at odds with and largely independent of the assessments being made by Sport Australia, which was in charge of the program.
Mr Gaetjens insisted that Senator McKenzie had the right to decide funding, despite the auditor-general saying he could find no legal basis on which the minister could make decisions, given Sport Australia is s separate corporate entity.
"The program guidelines for this project, whether people like it or not, said the minister made the final decision, and the minister could take into account other factors," Mr Gaetjens said.