A New South Wales trade commissioner based in San Francisco was forced to work out of the front room of his home after the government closed its office on the west coast of the US in favour of a new base in New York.
Guardian Australia can reveal that until September 2019 the NSW government was paying about $584,000-a-year for its San Fransisco trade operations, before shifting its focus to New York as part of the Global NSW strategy announced while John Barilaro was the minister for trade.
It comes as the NSW opposition has asked for parliament to be recalled from its winter break to produce documents relating to the former deputy premier’s appointment to the lucrative New York trade commissioner position.
Last week, Barilaro’s former senior adviser provided an explosive submission to an inquiry probing the appointment, claiming his then-boss told him he would get the California office moved across the country because he wanted the job “when I get the fuck out of this place”.
In a submission to the upper house inquiry probing the appointment, his former chief of staff Mark Connell said he had a conversation with Barilaro in April 2019 in which the then deputy premier told him he was “off to New York”.
The conversation allegedly occurred after a meeting with Barilaro, then-treasurer Dominic Perrottet and the trade minister Stuart Ayres.
Connell initially believed Barilaro was referring to another trade role based in London, but claims in the submission that the then deputy premier said: “I don’t want to go to London, fuck that, I’m off to New York.”
“I responded and stated, ‘Our current office and staff are in California’,” Connell wrote in the submission.
“Mr Barilaro responded and stated, ‘I’ll get them to put one in New York, that’s where I’m off to.’”
Barilaro denied the conversation ever took place, describing his former chief of staff’s evidence as “fictitious” and “false”.
The evidence “only serves as a reminder as to why we had to part ways”, Barilaro said in a statement.
The office did move, however. In September 2019, while Barilaro was still the minister responsible for trade, Investment NSW told budget estimates it was paying $584,800-a-year for its operations in San Francisco.
NSW employs two San Francisco-based trade officers. They had previously worked out of a WeWork office in the city, part of what a spokesperson for Investment NSW called “a longstanding” working arrangement. The agency said the half-a-million dollar figure included wages for the two staff members and “office costs”.
During the same estimates hearing in 2019, at which Barilaro was present as minister, Mike Pratt, then the secretary of NSW Treasury, said the government was conducting a review of “our global presence”.
Asked if the government was reviewing all of its trade posts, Pratt replied: “Yes, we are.”
In December of that year, the government announced it was establishing the senior trade commissioner role in New York City, one of six in cities around the world.
Barilaro was one of three ministers – along with Gladys Berejiklian and then-treasurer Perrottet – who announced the roles as part of its Global NSW strategy.
The Global NSW strategy stated that New York would be one of six “key hub cities” for senior trade commissioners, while San Francisco would remain as a “spoke” location.
Documents obtained through a parliamentary order show that – in a “milestone report” compiled by Investment NSW – locating a “preferred office space” in New York was one of the first tasks for the agency and was due to take place between April and June of last year.
In her appearance before the upper house inquiry, Investment NSW CEO Amy Brown said the department had spent $905,000 on fit-out costs for the new New York office.
By March this year, Investment NSW confirmed the office in San Francisco had been abandoned, saying the trade commissioner – as well as the second staff member – were now working from home.
Kylie Bell, a senior public servant in the agency, told budget estimates that while the government was keeping the west coast trade role, “we do not use an office there”.
“He works from his front room,” Bell told budget estimates.
In a statement, a spokesperson from Investment NSW told Guardian Australia the office was closed “due to Covid-19 lockdowns around April/May 2020”. But the agency did not answer questions about why the decision had been made to shift its focus from California to New York.
Last week Perrottet told reporters the decision to establish a New York trade office was made following advice from the department.
Speaking from Japan, where he is currently on a trade visit, Perrottet said that “any document (to the inquiry) that should be legally provided needs to be provided as quickly as possible”.
“Dates are set and they should be met,” he said.
“There’s a whole lot of SO-52 [standing orders] that have been issued and my expectation is they should be complied with.”
Earlier, he said the previous set-up in the US had been “incredibly poor” and that having two trade offices in the US “will make a real difference”.
But Labor’s shadow treasurer, Daniel Mookhey, said the government could have saved money by staying in California.
“It’s awfully suspicious that the government closed the California office to open a new one in Manhattan,” he said.
“We could have saved ourselves nearly $1m in disruptions costs by basing the America’s position in California … There’s no reason why a senior trade commissioner couldn’t have serviced the east coast from a base in San Francisco.”
Labor has said it won’t call Barilaro to give evidence – which the former deputy premier has requested – until it can access the relevant documents.
“Our preference is for the government to obey the law and handover the documents,” Mookhey said.
“But without them, the inquiry is stuck having to put together a puzzle without all the pieces.”
