Arts Minister John Graham has revealed Powerhouse Museum's two most senior executives are part of a NSW government misconduct investigation.
Upheaval at Western Sydney's first cultural institution in Parramatta saw its CEO Lisa Havilah step aside last week.
In July, the Powerhouse Museum's chief operating officer (COO), Mark Wilsdon, was also replaced by a government official.
Both of their salaries are ongoing amid the investigation.
Under questioning at budget estimates on Monday, Mr Graham said the government began investigating Powerhouse Parramatta as early as last year.
"In March 2025, I approved and delegated authority to DCITHS [Department of Creative Industries, Tourism, Hospitality and Sport] to progress a fact-finding assessment," he said.
"There was also at the time a referral to ICAC [Independent Commission Against Corruption] and we're quite cautious anything is referred on.
"That fact-finding report was finalised and in late December 2025, I approved the agency conducting a formal misconduct investigation.
The government has not detailed the allegations against the senior executives.
Ms Havilah was suspended from her chief executive role on Thursday, only 10 weeks from the museum's grand opening.
She led the Powerhouse for the last seven years, overseeing the $915 million project.
NSW government architect Abbie Galvin replaced Ms Havilah as interim CEO.
Mr Graham noted that it was a serious investigation.
"The idea that two of the senior executives were working through this process, this detailed processes and could also make sure that went smoothly, was really starting to become unsustainable," he told the budget estimates hearing.
Timeline to Ms Havilah stepping aside
Melanie Hawyes, secretary of the DCITHS, told the hearing about the details leading up to Ms Havilah's suspension.
"Last Thursday Ms Havilah and I had a conversation about further allegations that had come to light and on that basis we agreed that it would be appropriate for her to step and aside," she said.
"I then made arrangements to suspend her from duty and arrange for an interim chief executive to be brought in.
"What I will say is that Ms Havilah's key concerns were the welfare of her team and the success of the launch."
When asked by Shooters, Fishers and Farmers MP Mark Banasiak about the other executives under investigation, Mr Graham confirmed Mr Wilsdon was also involved.
"Certainly, the COO is also providing significant information as part of this process," he said.
Treasury executive, Cassandra Wilkinson, has assumed the role of COO while Mr Wilsdon is on leave.
Ms Hawyes said the decision to bring in Ms Wilkinson had nothing to do with the investigation.
"It's entirely timely to assess what the ongoing operational funding requirements will be for that brand new cultural institution," she said.
"It has absolutely nothing to do with the allegations that are under investigation right now. They are separate matters."
Ms Hawyes said staff movements were not indicative of any conclusions.
"The interim arrangements we've put in place, should not be taken as any sort of sense of a sanction or a finding," she said.
Contractor ties questioned
Mr Graham was also quizzed by Greens MP Cate Faehrmann about president of the board of trustees at Powerhouse, David Borger's relationship with former board member turned Powerhouse contractor Mark Hassell.
"Minister were you aware of David Borger's relationship with Mark Hassell who's one of the people behind the company Ki Community?" Ms Faehrmann asked.
"He was given a tour by David Borger of the Parramatta House in the first half of 2025."
Both Mr Graham and Ms Hawyes said they were unaware of any such tour.
The ABC contacted Ki Community and Mr Hassell for comment.
When asked by Ms Faehrmann if he had full confidence in Mr Borger and the board, the minister defended both.
"Yes I do and I have confidence in the board as well. I do believe they have performed their functions appropriately," he said.
Mr Borger had previously said that the board had raised concerns about Ki Community's contract with the Powerhouse as a conflict of interest.
He also said that the board did not endorse the CEO's decision to approve the contract.
Mr Graham confirmed the project was still on budget and on time, with November 7 set for its opening.
