Senior members of the Morrison government are standing by Senator McKenzie, after an audit last week revealed her office had undertaken a "parallel" assessment of applications under the Community Sport Infrastructure Grants program which favoured applications from seats the Coalition wanted to win.
There was also no evidence the minister had the legal authority to be making the final call on grants, the Australian National Audit Office said.
However Coalition MPs are insisting no rules were broken and all successful applicants were eligible for the grants program.
But there are fresh questions about whether Senator McKenzie's actions were a breach of the statement of ministerial standards signed off on by Mr Morrison in August 2018.
According to those standards, ministers must "ensure that they act with integrity - that is, through the lawful and disinterested exercise of the statutory and other powers available to their office".
Ministers must also "observe fairness in making official decisions".
They must "act honestly and reasonably, with consultation as appropriate to the matter at issue, taking proper account of the merits of the matter, and giving due consideration to the rights and interests of the persons involved, and the interests of Australia".
Chair of the Centre for Public Integrity and former Justice of the Supreme Court of NSW Anthony Whealy said it was clear Senator McKenzie had not exercised her power in a "disinterested" or lawful way.
Mr Whealy also said Senator McKenzie had not taken "proper account of the merits of the matter", given how many meritorious applications were thrown out.
"The audit office found what motivate her alternate method was targeting seats for political gain," Mr Whealy said.
"In my way of thinking, that's clearly not a disinterested approach to using her powers."
Mr Whealy said the prime minister needed to enforce the standards he set.
"These ministerial standards were signed off on by Scott Morrison himself in August 2018. Why isn't he insisting they be honoured," Mr Whealy said.
Prime Minister Scott Morrison's office failed to answer questions about whether he would refer Senator McKenzie to his department for investigation.
However past investigations have come to naught.
Former Prime Minister and Cabinet secretary Martin Parkinson cleared ex-ministers Julie Bishop and Christopher Pyne of any impropriety after they took on roles as consultants related to their portfolios. Mr Pyne went to work for EY on defence contracting after being defence minister, and Ms Bishop went to Palladium, an aid contractor that had extensive dealings and contracts with the Foreign Affairs and Trade department.
Mr Whealy said it was problematic there was no independent body to enforce ministerial standards.
"What this demonstrates is an effective national ant-corruption body should have the jurisdiction to investigate breaches of ministerial standards and make findings about those so the public and parliamentarians know what's right and what's wrong," he said.
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The Morrison government's preferred anti-corruption body would not cover politicians or staffers or hold public hearings.
Senator McKenzie failed to respond by deadline.
Treasurer Josh Frydenberg dismissed questions about whether Senator McKenzie had breached the ministerial standards on Tuesday.
"As the Prime Minister made clear yesterday - no rules were broken, all the projects were eligible, the money went into these sporting communities across electorates, across the country, including in many Labor electorates," Mr Frydenberg.
Energy Minister Angus Taylor also said Senator McKenzie had "stayed within the rules".
"She's been very clear on that," Mr Taylor told Sky News.
But Mr Whealy also said the fact all applications were eligible for grants was a red herring.
"If they had been ineligible it's criminal fraud, and it's besides the point. She abused her power by ignoring the process that has been put in place. To say they were all eligible doesn't advice it at all," Mr Whealy said.
Emergency Management Minister David Littleproud also said "every time a dollar is spent in regional Australia" it was unfairly characterised as pork barrelling.
"We deserve something too," Mr Littleproud said.
However Mr Whealy said process mattered.
"How would the community feel if all this money about to be dispersed to help bushfire survivors was allocated to marginal seats or seats targeted for political gain, rather than distributed to those most worthy and needy? The country would explode with indignation if that happened. There's no real difference," Mr Whealy said.
Labor leader Anthony Albanese is set to push for the full merit lists compiled by Sport Australia to be released.
He said Senator McKenzie's conduct had brought the whole system into question.
"When it comes to sport, people expect a level playing field," Mr Albanese said
"This stinks. Everyone who looks at it knows it's the case."
This story first appeared on the Canberra Times.