A controversial community grant scheme spreading $37.2 million across 93 electorates has been cleared of pork-barrelling claims but conflicts of interest concerns linger.
The NSW auditor-general on Thursday published its verdict after two years of consternation from the coalition over the integrity, efficacy and value of Labor's taxpayer-funded Local Small Commitments Allocation scheme.
The grants program, announced by Labor before it swept to power in the 2023 NSW election, allowed each Labor candidate to nominate projects for $400,000 in funding.
Nominations could be made by candidates with no prosect of winning.
Several coalition MPs described the scheme as a "slush fund" where "taxpayer money is being used to try to buy votes".
But Auditor-General Bola Oyetunji said the government had effectively administered the program and complied with grants administration laws as it divvied the pot between 644 projects.
He identified two concerns around conflicts of interest of 54 panel members recommending the grants and minor administrative errors.
Liberal MP Chris Rath, who was among a group of MPs critical of the grant, argued the report was "scathing."
He called on Premier Chris Minns to order a conflict of interest check on all 93 Labor candidates the party fielded in 2023.
The government office overseeing the grants program only reviewed such checks for 17 candidates, put forward by Special Minister of State John Graham.
Two grants were subsequently not approved.
The office said it had received verbal confirmation that conflict-of-interest processes had been implemented by Labor for all electorates.
But it hadn't asked for documentation supporting those claims, the auditor-general's report said.
More than 50 "moderate risk" conflicts of interest of panel members approving a total of 644 grants also should have been passed onto a probity adviser before ending up on the special minister's desk, the report said.
A spokesman for Mr Graham said it accepted the audit office's recommendations to tighten up its processes.
Labor's grants program followed a report in two damning indictments of coalition-organised grants programs.
A 2023 report from the auditor-general found the former coalition government intervened to effectively exclude Labor electorates from receiving bushfire recovery funding.
Another grants round, the $252 million Stronger Communities Fund, came under a cloud when an upper house inquiry found 95 per cent of the funds went to councils in coalition-held or marginal seats under the Berejiklian government.
