The State Government has awarded a $560,000 grant to a trust and investment company whose principal executive officer was Premier Wayne Goss's former private secretary David Barbagallo, according to a government report tabled in State Parliament.

The Premier's Department's 1994-95 annual report said the company, Distributed Systems Technology Centre (DSTC Pty Ltd), had also received $190,000 in 1993- 94.

Mr Barbagallo joined the centre in March 1994 as its principal executive officer and as a director, and is understood to be earning around $140,000 per year.

Mr Barbagallo yesterday said the government had allotted the centre around $2.5 million "long before" he had left Mr Goss's employment. He said there was absolutely nothing unusual about the grant which had been applied for some years ago, especially as the Queensland Government participated in the centre's research.

The DSTC performs cooperative research for universities and private organisations. It develops sophisticated computer technology for distributed systems -- for example, the technology that underpins modern computer networks and the Internet.

The organisation participating in the centre include the University of Queensland, QUT, Griffith University, Bond University, the University of Technology Sydney, the Queensland Government, the Australian Defence Science and Technology Organisation, Digital Equipment Corporation, Telstra, the CSIRO, and Fujitsu.

The Federal Government awarded the DSTC $12 million for 1992-99. Its total funding in cash and kind for its seven year program is estimated around $50 million.

Mr Barbagallo said he had been appointed to his current job after a rigorous selection process involving the PA Consulting Group, and after a lengthy interview by the DSTC board then headed by the late Roy Deicke, the former chairman of the Queensland Industry Development Corporation.

Mr Barbagallo, who holds a Bachelor of Surveying and Masters of Technology Management, is also a candidate in an election now being held for the University of Queensland Senate.

Among the centre's former directors is Mr Ashley Goldsworthy, the immediate past federal president of the Liberal Party.