Senior Victorian public servants hid loss of $285m from Covid grants

By the Editorial Team · Friday, October 16, 2026

Senior public servants in Victoria concealed losses totaling up to $285 million from flawed Covid-19 business support grants, deliberately withholding information from management and providing misleading reports to government officials. This investigation highlights serious governance failures during a key pandemic response period and underscores the urgent need for improved transparency and oversight in the state's public sector.

Senior public servants in Victoria concealed the extent of significant financial losses linked to flawed Covid-19 business support grant payments, according to an investigation by the Independent Broad-based Anticorruption Commission (IBAC). The probe revealed that approximately $257 million in grants were disbursed to about 9,000 ineligible businesses during the pandemic, with total suspected losses potentially reaching $285 million.

The investigation focused on conduct within the now-replaced Department of Jobs, Precincts and Regions, examining the response of senior officials after initial concerns were raised about grant eligibility criteria. The department used the Goods and Services Tax (GST) as a key metric for assessing eligibility, a practice that contributed to erroneous payments.

By mid-2021, the department was reportedly aware of significant issues with the grant program’s execution. However, the report found that the associate secretary and deputy secretary deliberately withheld information regarding the full scale of the financial losses from their management. The deputy secretary directed that details about the suspected losses be removed from a draft report intended for then-minister for Industry Support and Recovery Martin Pakula and the Victorian Auditor-General’s Office.

Further, IBAC found that in 2022, following the Auditor-General’s announcement of an official audit of the grants, the deputy secretary prepared a briefing for then-minister Ben Carroll containing false and misleading information. The document claimed Pakula had been fully informed and had approved the department’s approach to assessing grant applications, asserting that no payments had been made in error. IBAC described this assertion as disingenuous. No adverse findings were made against Carroll, who is currently serving as Victoria’s premier.

IBAC Commissioner Victoria Elliott emphasized that the behavior exposed in the investigation fell short of the standards expected of senior public servants. She underscored the importance of transparency and accountability in the public sector and recognized the role of whistleblowers who initiated the investigation by reporting the alleged misconduct.

The department involved was replaced in 2023 by the Department of Jobs, Skills, Industry and Regions. Commissioner Elliott praised the courage of whistleblowers whose actions helped bring the misconduct to light, stating that their bravery is essential to fostering integrity and improving governance in public institutions.

The Operation Harmonia report presents a detailed account of significant administrative failures during a critical period of government support and underscores the need for strengthened oversight mechanisms within Victoria’s public sector.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.