The investigation by former Prime Minister and Cabinet department secretary Phil Gaetjens found there were significant shortcomings by coalition senator Bridget McKenzie in awarding a community sporting grant to a gun club that she was a member of.
Documents released under freedom of information revealed Mr Gaetjens said there was a lack of transparency for other applicants for the sporting grants on how the money would be allocated.
"This lack of transparency coupled with the significant divergences between projects recommended by Sport Australia and those approved by the minister has given rise to concerns about the decision making," the report said.
"Those submitting grant funding applications had, in my view, a right to more fully understand the basis on which the funding decisions were being made."
The Gaetjens investigation was launched following a damning auditor-general's report found former sports minister McKenzie's office overlooked sporting grant applications of merit in favour of those in marginal electorates.
Despite this, Mr Gaetjens said in the investigation there was no evidence of pork barrelling.
"I can find no basis for the suggestion that political considerations were the primary determining factor in the minister's decision to approve the grants," the report said.
The investigation did find Senator McKenzie breached ministerial standards by not declaring she was a member of the Wangaratta Clay Target Club, which received a grant of $36,000.
Senator McKenzie resigned from cabinet in early 2020 after Mr Gaetjens finished the investigation.
While a summary of the Gaetjens investigation into sports rorts was published at the time, the full report was not released due to it being cited as cabinet-in-confidence.
However, the investigation was released under freedom of information, after the FOI commissioner ordered the prime minister's department to hand over the full document.
The investigation was scathing, however, of the large gaps between the large number of grants that were approved and the number that weren't in the list of recommended projects by Sports Australia.
"I cannot reconcile such large variations in the final approval results compared to recommendations based on the published assessment criteria with the minister's view that the published assessment criteria were the "key decision factor", the report said.
"I find that other factors had a material impact on the minister's final approvals being different from Sport Australia's own recommendations."
The investigation also noted there was no evidence to support the grants being applied systematically.
"Where the minister was the final approver and approvals departed materially from official recommendations ... I am concerned there is no evidence of the reasons that supported the minister's final approvals," the report said.
However, Mr Gaetjens said Senator McKenzie did not breach ministerial standards by using discretionary powers as a minister.
However, he said in the report Senator McKenzie had an obligation to disclose her membership of the gun club.
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