Health Minister Mark Butler encouraged City of Charles Sturt council, partially in his South Australian electorate, to apply for funding in an invitation-only grant program before proper costing was completed, documents obtained by the ABC showed.
His office reportedly urged the mayor to submit a proposal for the redevelopment of Jubilee Reserve, valued at around $6 million.
Federal Labor then pledged $5 million for the project in the lead-up to the 2025 election.
The council had originally requested $1.2 million for lighting and development of a master plan for the reserve, but requested more after being approached by Mr Butler's staff, ABC first reported.
The revelation came after a Centre for Public Integrity report found 45 electorates were not invited to apply for a $560 million community and sport infrastructure program and did not receive any funding.
A golf club in the prime minister's electorate, where he was made an honorary member, was also awarded a grant.
It was designed to fulfil election promises made by successful candidates in the 2025 election and to provide a one-off, invite-only grants round the following year.
Labor backbencher and long-time audit committee chair Julian Hill said the grants were well within appropriate bounds.
"The auditor general has said repeatedly in public inquiries that the proper way to deliver election commitments is exactly, precisely, as the government has done," he told News24 on Wednesday.
"This project went through a full value-for-money assessment by the public service and was recommended for funding," he said, suggesting it was entirely proper and even best practice for MPs to contact local councils.
Competitive programs, where guidelines are agreed on and eligible parties apply, and closed grant programs are both legal and legitimate ways of funding election commitments.
Key to the funding revelations is a question of whether the Albanese government has misused a funding system to win favour with constituents, as its coalition counterpart did six years ago.
In 2020, a report found Nationals Senator Bridget McKenzie had breached ministerial standards in not disclosing her membership of a gun club that received funding. She quit the Morrison cabinet as a result.
Mr Hill defended the Charles Sturt grant, saying it was completely different to the actions of Senator McKenzie and the then-coalition government.
But deputy Liberal leader Jane Hume told News24 the grant "stinks" and called into question Labor's integrity.
"The idea that you would have invitation-only grant programs, but then encourage people to ask for more, - you would push a council, push a golf club committee in a particular way when you know that you are responsible for the levers of these grants programs - that stinks," she said.
The Senate on Monday voted to launch an inquiry into the grants program, which was used to fund election promises in marginal Labor seats.
Mr Butler's office has been contacted for comment.
13°C