How the words 'sweetheart deal' raised eyebrows during week one of ICAC inquiry into Gladys Berejiklian – ABC News

How the words 'sweetheart deal' raised eyebrows during week one of ICAC inquiry into Gladys Berejiklian
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As he penned a jest-filled memo quoting a Tom Cruise character to the NSW premier in 2016, a political strategist could never have known it would become evidence at a corruption inquiry.
The blunt language, and his borrowing from a Hollywood script, made Nigel Blunden's document the most colourful exhibit during this week's Independent Commission Against Corruption (ICAC) hearings.
But as the watchdog investigates former premier Gladys Berejiklian's conduct in relation to her secret relationship with Daryl Maguire and funding grants awarded in his electorate, two words have appeared more jarring in the context of hindsight: "sweetheart deal".
Mr Blunden, who insisted during his evidence he implied nothing improper by the term, was advising then-premier Mike Baird to oppose a $5.5 million grant proposal to a Wagga Wagga shooting club.
There was "no doubt", his memo said, Ms Berejiklian had done a "sweetheart deal" with then-sports minister Stuart Ayres and Mr Maguire, but the idea contravened "all of the principles of sound economic management".
The proposal was also questioned by senior public servants, who gave evidence they considered a rush around it "unusual" and remained unconvinced about its merits.
Those in the Office of Sport, such as lifelong bureaucrat Michael Toohey, told the ICAC the business case "didn't stack up" and was "deficient".
Mr Blunden's memo was sent a few days before the proposal was considered by a cabinet committee chaired by then-treasurer Ms Berejiklian in December 2016.
"As Joel Goodson famously said, sometimes you gotta say WTF," he wrote, using the 1983 film Risky Business to sum up his concerns.
He believed the proposal was not ready for the committee and informed Mr Baird it was dropped from the agenda, but "Daryl fired up" and Ms Berejiklian added it back in.
Her secret relationship began around the 2015 election, the ICAC learned last year.
The Australian Clay Target Association (ACTA) proposal is one of two case studies the ICAC is using to consider whether Ms Berejiklian breached public trust or turned a blind eye to alleged corrupt conduct during her relationship.
A key question is whether there was a conflict of interest between her public duties and private life.
Ms Berejiklian denies wrongdoing, insisting when she resigned this month that history would show she always acted with the highest integrity.
The first week of hearings produced more peeks behind the curtains of bureaucratic machinery than bombshell moments.
The shooting club grant was backed by the expenditure review committee but with conditions, including a revised, satisfactory business case.
Mr Baird told the commission he was "happy with the broad principle" if concerns were overcome, in part because of its benefits to the regions.
The former premier recalled being "incredulous" when he found out about Ms Berejiklian's secret relationship during her ICAC appearance a year ago.
He said it should have been declared, but he also believed potential conflicts could have been managed given his view of her integrity and commitment to public service.
Outside the commission's Sydney CBD office, Mr Baird said he was "devastated" to have to give the evidence and reiterated that it had not changed his views about his close friend.
Mr Ayres, now the deputy Liberal leader in NSW, also said a declaration would have been "prudent" but he struggled to see how there was a conflict.
That would require deriving a private benefit from the ACTA project, Mr Ayres told the watchdog, and he could not see any — even in light of their relationship.
But there also existed a responsibility to "manage the perception around conflicts", Mr Ayres said.
For some witnesses from the bureaucracy, things appear to be more black and white.
Mr Toohey said had he known, he would have expressed concerns about why a grant based on "scant" information was being pushed to the treasurer's boyfriend.
"I can't see that's anything but a conflict of interest," he said.
The proposal was championed by Mr Maguire as far back as 2012 but had repeatedly been classified by bureaucrats as a low priority.
Paul Doorn, former Office of Sport executive director, told the commission it would also be a competitor for Sydney's Olympic-standard shooting facility.
Former NSW premier Mike Baird tells the state's corruption watchdog he was "incredulous" after learning of Gladys Berejiklian’s secret relationship with an MP during her evidence to an ICAC hearing last year. 
Like Mr Toohey, he recalled an "urgency" about the proposal and said the secret relationship would have been a "red flag" if he had known.
The project was rejected by Mr Ayres's predecessor and ranked last of 15 projects for the 2013/14 financial year budget.
But Mr Ayres said it "had a lot of merit", in part because of its regional location, benefits to the visitor economy and upcoming world championship event in 2018.
When the contents of Mr Blunden's memo were put to him by Ms Berejiklian's barrister, Mr Ayres rubbished the "sweetheart deal" contention as not just speculation but "fantasy".
Ms Berejiklian took over from Mr Baird as premier in January 2017.
In April that year, there were still problems with the revised business case and external consultants ranked its benefit-to-cost ratio score as being below a benchmark to secure funding.
However, that did not mean it hit a "dead end", the ICAC heard.
Chris Hanger, a Department of Regional NSW deputy secretary, said there was "particular interest" in the project from Ms Berejiklian's office, communicated to him via former deputy John Barilaro's office.
"I was clearly of the impression that the premier's office and the premier wanted that business case revisited," he said.
Mr Hanger said if he had known about the relationship, he would have tipped off senior managers so "ways of identifying and managing potential personal conflicts of interest" could be implemented.
Several witnesses have given evidence they never observed Ms Berejiklian to appear biased towards Mr Maguire.
Mr Blunden also pointed out Mr Maguire, who will be called to give evidence next week, also had "every right" to advocate for projects in his electorate.
Ms Berejiklian is expected to be the last witness during the public hearings on Thursday and Friday.
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