Scott Morrison and Josh Frydenberg personally announced sports grants under the controversial $100m program overseen by Bridget McKenzie – with Morrison even boasting the program “isn’t about sport” but rather “community” while unveiling a $200,000 grant in his electorate.

On Wednesday the auditor general released a scathing report on the program, finding it had a distributional bias in favour of marginal seats and suggesting the then sports minister may have lacked legal authority to approve grants.

On Monday Labor stepped up its attack on Morrison’s involvement, with the shadow small business minister, Brendan O’Connor, saying it “beggars belief” that the prime minister, the “campaigner in chief” at the 2019 election, did not know how funding was allocated.

Later, Morrison conceded that his office had been involved, claiming they passed on representations from MPs about projects for consideration by McKenzie.

Three clubs in Morrison’s electorate of Cook received funding under the community sport infrastructure grant program: Lilli Pilli Football Club, which got $200,000; Sans Souci Football Club ($50,000); and St George and Sutherland Shire Giants Baseball Club ($42,500).

A Football NSW video posted to YouTube on 3 September 2019 shows Morrison officially opening the Lilli Pilli oval clubhouse and precinct upgrades funded in part through the program.

Morrison outlines that he met the Lilli Pilli FC club president, Greg Storey, “even before I had become the member for Cook” and the club had raised $500,000 in 20 years.

“So with the council and the local community coming together it was our great thrill as a commonwealth government to back that in with our further $200,000 in support through the sport infrastructure grants program,” Morrison said.

“Because that grants program – which we not only do here but we do all around the country – it actually isn’t about sport. It’s not about football. It’s about community, at the end of the day.”

Scott Morrison in a Football NSW video opening the Lilli Pilli oval clubhouse and precinct upgrades.

Morrison also appeared in a Sports Australia video spruiking the grant to the Sans Souci Football Club.

On 11 July both Morrison and the Sans Souci Football Club posted Facebook photos of his attendance at an event announcing the grant.

Scott Morrison at an event to announce a grant to the Sans Souci Football Club. Photograph: Sans Souci Football Club Facebook page

On Facebook Morrison said that “part of the job of being [prime minister] is also about being a good local MP, supporting our local community”.

“So [it] was great to be back in southern Sydney today backing in our local youth sport clubs (Sans Souci Football Club and Gymea Netball Club) with new facilities under our stronger communities and sports infrastructure grants programs.”

Scott Morrison during his visit to the Sans Souci Football Club. Photograph: Sans Souci Football Club Facebook page

On Monday Morrison was asked if he or his office played any role in the allocation of the grants. He replied: “The decisions were done in accordance with the process the minister set out, that was the minister made those decisions and they were actioned in an endorsing way by Sports Australia, that’s how it worked.”

The Australian National Audit Office said that representations about projects were received “across the three rounds both directly and indirectly, including through the prime minister’s office”.

Later on Monday, Morrison clarified that “the prime minister’s office has always relayed on representations made to it by its members”. “The minister was the one making the decision on those grants programs,” he told reporters in Canberra.

In the treasurer and deputy Liberal leader Josh Frydenberg’s seat of Kooyong, grants were given to Camberwell Hockey Club ($38,000), Camberwell Junior Football Club ($10,520) , East Camberwell Tennis Club ($90,000), Kew Little Athletics ($92,450), Grace Park Hawthorn Club ($25,000) and Hawthorn Malvern Hockey Centre ($500,000).

In Kooyong, only the grant to the Camberwell Junior Football Club was given in the first round of the program, with the rest given in the controversial second and third rounds just weeks or months out from the May 2019 election.

The auditor general’s report found that 70% of projects approved by McKenzie in the second round in March 2019 were not recommended by Sport Australia, rising to 73% in the third round in April 2019 after an extra $40m was tipped into the program.

Frydenberg spruiked the grants in press releases and a Twitter post on 7 May, in which he said it was “fantastic to announce funding to upgrade the facilities at Camberwell Hockey Club”.

Fantastic to announce funding to upgrade the facilities at Camberwell Hockey Club. It was also great to view the new LED lighting that was delivered thanks to Fed Govt funding. @Camberwell_HC pic.twitter.com/rSgeNEQk2Q — Josh Frydenberg (@JoshFrydenberg) May 7, 2019

Morrison and McKenzie both maintain that all projects were eligible for funding and no rules were broken, although Morrison has asked the attorney general to “clarify” and “address” legal issues raised by the auditor general.

The audit report also said it was “not evident to the ANAO what the legal authority was” for McKenzie to approve grants, comments which have led lawyers to warn that clubs which missed out on federal funding could bring court cases to overturn her decisions.

At a doorstop in Melbourne, O’Connor said it “beggars belief that [Morrison] was not aware, at least to some extent, of the way in which those matters were managed by his minister, given he was so much involved in those announcements and references to those announcements when he was campaigning”.