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EXCLUSIVE: Gun club financial report shows mystery grant 'costs'

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Daryl Maguire and Gladys Berejiklian arranged for a $5.5 million grant to a regional gun club (Image by Dan Jensen)

The regional gun club at the centre of investigations by the NSW corruption watchdog incurred “costs” in obtaining its $5.5 million government grant that were so substantial, they dinted its 2016 financial position.

The Australian Clay Target Association’s 2016 annual report says the gun club’s ‘successful application for a $5.5 million dollar grant’ had been associated with unspecified “significant costs”.

Those unspecified “costs” are listed as occurring in the 2016 calendar year and as one of the reasons that the gun club, ACTA, saw its profits drop by over $120,000 in 2016.

Yet documents previously released by ICAC have shown it was the NSW Government - and not the gun club - that paid for the club to prepare its tender for the grant, including a “business case” to be undertaken.

NSW Government records from 2017 state:

'Consultants GHD were engaged by the Department of Industry to complete a business case for the proposal in consultation with the proponent (ACTA).' 

An ACTA official has told ICAC that in mid-2016 the gun club was told by the NSW Office of Sport that it had been allocated a $40,000 grant to:

"have a business case study done to present to the Government."

In January 2016, Daryl Maguire wrote, on ACTA’s behalf, to then Treasurer Gladys Berejiklian (and two other NSW ministers) seeking the multi-million dollar grant.

In December 2016, a NSW Government fund overseen by then Treasurer Berejiklian set aside the $5.5 million, even though the gun club was yet to submit a formal proposal.

In August 2017, the $5.5 million grant was approved after an intervention by Berejiklian, who had by then become NSW Premier.

The grant was for a new clubhouse and 1,000-person convention centre at the gun club’s premises at Wagga Wagga, about 250 kilometres west of Canberra.

Despite their “significant” size, there is no specific detail provided in the 36-page document about the grant “costs”, so it’s not known what they were specifically for, or where the money was directed.

In ICAC hearings last year Maguire admitted that he had secretly operated a company which ICAC heard had facilitated the gun club in purchasing 1,300 chairs for the convention centre from China.

Yet the “significant costs” ACTA reports for the 2016 calendar year appear to have been incurred long before this trip.

As of December 31, 2016, ACTA was still more than seven months away from the $5.5 million grant being officially approved - and even further away from construction of the convention centre beginning, let alone being completed.

ACTA told us it was unable to comment because the matters were subject to a NSW Independent Commission Against Corruption (ICAC) inquiry.

On Monday, The Klaxon revealed the gun club had actually been seeking the grant for several years before it was approved following Maguire’s 2016 approach to the NSW Government.

It was also revealed the gun club said the deal ‘would never have been possible’ without Daryl Maguire, the local NSW Liberal MP at the time.

In October last year, it spectacularly emerged that Berejiklian and Maguire had been in a secret relationship between at least 2015 and August 2020.

After 19 years as MP for Wagga Wagga, Maguire was forced to resign from Parliament in April 2018 after an ICAC investigation, Operation Delta, found he had secretly sought kickbacks from a major Chinese property developer.

Last year, ICAC announced it had launched a second investigation into Maguire’s secret business dealings, this one code-named Operation Keppel.

A four-week round of public hearings in Operation Keppel was held late last year, which is where the Berejiklian-Maguire secret relationship emerged.

Two weeks ago, on 1 October, ICAC announced it had expanded Operation Keppel and that it was now investigating Berejiklian – as well as Maguire – and that it would hold a second round of public hearings.

ICAC said it was investigating circumstances around the $5.5 million gun club grant and another grant to the Conservatorium of Music, also in Wagga Wagga.

Berejiklian immediately announced she would be resigning, voluntarily, both as NSW Premier and from Parliament entirely.

Being investigated is whether Berejiklian engaged in any impropriety, such as by taking actions behind the scenes to financially or politically benefit Maguire, her secret lover.

The second round of Operation Keppel starts on Monday and ICAC today released a witness list for the first week of the three-week hearings.

Among those called to give evidence are Berejiklian’s predecessor as NSW Premier, Mike Baird, current NSW Deputy Premier Stuart Ayres, and Chris Hanger from the Department of Regional NSW.

The witnesses are not accused of any wrongdoing.

Only Berejiklian and Maguire have been announced by ICAC as under investigation.

“Significant costs”

ACTA’s 2016 annual report says the club showed ‘a profit of $250,805 down from $378,937 in 2015’ — a drop of $128,132.

Former ACTA National President Robert Nugent wrote:

The difference is mostly from post-Olympic promotion, legal and restructuring expenses, computer and software updates and costs associated with the successful application for a $5.5 million dollar grant were also significant.

 

It is envisaged that the grant will allow the construction of a first-class clubhouse with catering and convention facilities on the national ground.

 

This development will be used extensively during our main events and be available to the public as a source of income to the Association to help relieve pressure on membership fees ongoing.

Despite those costs being “significant” and a reason why the gun club had seen its profits slump by one-third, they are not specifically disclosed or itemised in the annual report.

The annual report includes ACTA’s 2016 financial statements, which were audited by firm Tudor and Company and which span seven pages.

This includes aggregated financial information, which includes a profit and loss, statement of cash flows, statement of changes in equity and statement of financial position.

The audit statement from Tudor and Company carries a disclaimer, saying that ‘additional financial data’ is presented on page 23.

The auditor says that information is ‘in accordance' with information recorded in ACTA’s books, but that its audit ‘did not cover all details of the additional financial data’.

‘We give no warranty of accuracy or reliability in respect of the data provided,’  the auditor writes.

The ‘additional financial data’ is presented as ‘profit and loss account — unaudited’.

It provides a list of income and expenses for the club but is broken down into more detail than the other, audited, statements.

The report says the drop in profit between 2015 and 2016 was:

‘...mostly from post-Olympic promotion, legal and restructuring expenses, computer and software updates and costs associated with the successful application for a $5.5 million dollar grant...’

The annual report shows computer expenses of $48,271 for 2016 (compared to a gain of $784 the year before).

There are no “legal fees” listed but there is a line-item called ‘consulting and professional fees,’ although these costs are recorded as falling in the year. They were $23,207 in 2016, down from $31,251 in 2015.

There is no category “Olympic promotion” though there is an “advertising” category and a “promotion” category.

In 2016, promotion costs are recorded as $34,657, down from $36,616 the year before.

“Advertising” costs in 2016 are recorded as $43,640, up from $19,245 in 2015.

“Restructuring expense” is listed as $0 in 2016 and $18,877 in 2015.

Anthony Klan is an investigative journalist and editor of The Klaxon. You can follow him on Twitter @Anthony_Klan.

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