By JOHN PYE -- Associated Press
  SYDNEY, Australia -- The state government of New South Wales has agreed to tell a parliamentary committee why it is spending another $84.8 million on the Sydney Olympics.

  The bailout earlier this week by the state government was the third in four months for Sydney organizers and came on top of a $56.7 million funding increase last month in the state budget to offset escalating costs.

  When the state budget was released, treasurer Michael Egan said the Sept. 15-Oct. 1 games had been paid for completely.

  But he was approached last week by games president Michael Knight, who said the quality of the event would be compromised without more money. Egan then said there was no guarantee that organizers would not require additional funds.

  Treasury estimates show the total cost of staging the games has climbed from $1.42 billion in February to $1.51 billion.

  A governmental investigating committee must report its findings to parliament by Aug. 29.

  A spokesman for Knight, Australia's Olympics minister, said the Sydney organizing committee would cooperate fully with the investigation because, "There is nothing to hide."

  He said investigators will have access to anything they want on the $140 million and anything to do with the overall budget, he said.

  Knight has been defending his dual roles as speculation of financial mismanagement continues to intensify.

  Knight's office rejected criticism from New South Wales attorney general Bob Sendt that the minister had a conflict of interest over the Olympics budget.

  "A minister ideally should be able to stand back and hold an organization under his control accountable," Sendt said. "But when that minister is also on the board of that organization, it does raise issues."

  Organizers also have complained of being stripped of real powers since the government increased its stake in the committee when Knight became president and since key operations were merged with the state-run Olympic Coordination Authority.

  But Knight said his dual function had been praised by the International Olympic Committee and Australian Olympic Committee as being a model for future games.

  IOC vice president Kevan Gosper supported Knight despite admitting the latest cash injection was "disconcerting."

  Knight, he said, manages the committee "very tightly and will be a hero after a successful games."

  Gosper said the Olympics would proceed without any financial panic.

  "The bailout was needed because our existing contingency will be exhausted before the end of the games," organizing committee chief executive Sandy Hollway told the Australian Broadcasting Corp.

  Hollway said organizers still had an operating surplus and were applying strict controls on using taxpayers' money.

  "There needs to be complete transparency in all this," he said. "The public is owed that."