Scott Morrison has sensationally claimed millions of dollars in government grants were never meant for regional areas.
The Prime Minister swatted away questions about $10 million given to the North Sydney Olympic swimming pool on Sydney Harbour under the regional program.
"This is one of the bits of misinformation that are out there," Mr Morrison told 2GB radio.
"When I announced the program, I didn't say it was for regional areas, it was for areas right across the country.
"That was a piece of information that was provided incorrectly by the department, that it only applied to regional areas."
The $150 million scheme, announced weeks before the federal election last year, was originally designed to build female change rooms and upgrade community swimming pools in rural and regional areas.
The government also continues to face scrutiny over another grants program designed for local sporting clubs.
Opposition Leader Anthony Albanese said the government had spent months hiding information about the $100 million scheme.
"This is like pulling teeth," he told ABC radio on Wednesday.
Mr Albanese said the Prime Minister was "up to his neck" in the sports rorts affair and accused him of misleading parliament.
"I want him to actually treat the Parliament seriously and to tell the truth and to say what the involvement of his office was," he said.