Reports this week raise questions about a NSW budget cover-up.

A former New South Wales auditor-general says the NSW Government has used an “accounting gimmick” to artificially inflate its budgets by tens of billions of dollars in the past six years.

The claims involve the Transport Asset Holding Entity (TAHE), which officially became a statutory state-owned corporation last year.

TAHE used to be known as RailCorp, and ran the state’s metropolitan rail network. RailCorp was scrapped in 2013, when current Premier Gladys Berejiklian was transport minister.

Reports this week claim NSW Treasury used the TAHE to hide a budget deficit in 2018, which former NSW auditor-general Tony Harris has described as an “accounting gimmick” and a “financial mirage”. 

Mr Harris alleges the trick has boosted the state’s operating result by more than $30 billion over the last six years.

“It was designed to avert the prospect of the state losing its AAA credit rating by creating an apparent surplus through an accounting gimmick,” Mr Harris said.

It appears that the state government placed the costs of the rail network onto the TAHE. A KPMG transport review commissioned by Transport for NSW predicted that the TAHE would end up costing the budget $5.3 billion over 10 years, and it is alleged that the state’s Treasury urged KPMG to remove the damning findings from the report.

Labor MP Michael Daley says Premier Gladys Berejiklian, treasurer Dominic Perrottet, and transport minister Andrew Constance are all in on a cover-up.

“This may be the most dishonest budgetary fraud ever concocted by a NSW state government and it goes all the way to the top,” he wrote on Twitter.

“The NSW budget has been based on a massive lie for years.”