NSW government underspent on PPE and mental health, audit of $7.5bn Covid spending finds | New South Wales politics

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The New South Wales government underspent on personal protective equipment and mental health services and forked out close to $200m on faulty imported masks and ventilators as part of the state’s $7.5bn pandemic expenditure, a review has found.

The auditor general released a detailed report on Friday after examining the state’s spending from the first case detected in January 2020 to the middle of 2021.

It found that while NSW government agencies were provided with $9.7bn to spend on Covid measures, a lower amount of $7.5bn was used over the period, with most going to direct health response measures, PPE, quarantine and cleaning.

The audit found that hits to the bottom line meant the government was “unlikely to meet” some of its fiscal goals.

“The Covid-19 pandemic significantly impacted the financial performance and position of state government agencies,” the report stated.

It found the government paid more than $130m to private operators to make up for the approximate $80m a week in lost revenue from Opal card users when public transport use dropped.

The audit found the government had set aside $433m to buy PPE for healthcare workers but underspent by almost $180m.

It also found only $51m of the state’s $69m mental health package was used.

The government also forked out $159m for masks from overseas that did not meet regulatory standards, and more than $20m on faulty ventilators, also bought from overseas, that were “not performing in accordance with the supplier’s operation manual”.

The report found that Treasury did not issue guidance for Covid-19 expenditure or on how to record and monitor spending.

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“No specific guidance was issued to detail eligible expenditure or how agencies should identify Coivd-19 spending in finance systems,” the report said.

“The mechanisms for reporting and monitoring of expenditure were left for agencies to determine.”

The state opposition treasury spokesperson, Daniel Mookhey, said this was not good enough and the government needed to have better oversight of its money.

“Every dollar the premier spends in the coming budget has to have a clear and identifiable public benefit,” he said.

“The government can’t just flood departments with money for a big announcement, while secretly hoping that they don’t spend it all.

“Money the government promises for critical health and economic support must get out the door.”

The NSW treasurer, Matt Kean, did not respond to specific questions about why all the money allocated for mental health and PPE had not been spent, but said underspends allowed for that money’s use in other Covid measures.

“While NSW Labor played politics during the pandemic, the NSW government was spending $46bn protecting the population,” he said.

“Funds were made available for a range of programs, and unspent funds allowed further spending on the state’s efforts against Covid which continues to this day.”


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