Prime Minister Anthony Albanese has been forced to admit that a $6 million grant he promised to Marrickville Golf Club is not for fixing sewerage issues as he previously asserted to the House of Representatives.

Following the ABC's report revealing Mr Albanese held an undisclosed honorary membership to the club, the prime minister chastised the national broadcaster and told MPs the grant funding was to stop raw sewage flooding into the nearby Cooks River.

"When it floods in Marrickville, raw sewage flows into the Cooks River. That is what the funding is for," he told the House of Representatives last month.

But the Infrastructure Department sunk that claim under questioning at Senate estimates on Monday, confirming the project did not include any sewerage works.

The vast majority of the $6 million grant will go towards a major redevelopment of the Royal Marrickville clubhouse, including a new bar, new furnishings and outdoor dining, a "dog-walking station", and office and meeting spaces, as well as a redesigned pro shop.

$1 million will go towards stormwater harvesting upgrades that will help to water the greens, and $500,000 will be spent on "botanic plantings" and landscaping, according to Inner West Council meeting minutes.

Mr Albanese admitted to the chamber he was wrong to say the grant was to fix sewage issues.

"That was not correct. The state government had moved in and are funding the project," Mr Albanese said.

"The NSW government is funding the sewerage related aspects of the club, which has been an issue for a very long time.

"The funding was going to be for sewerage, the NSW government has stepped in which is appropriate because NSW run water and sewerage."

Earlier, Manager of Opposition Business Dan Tehan attempted to compel Mr Albanese to provide an explanation on whether he had misled the house by repeatedly stating the grant was for sewage fixes.

"This is an opportunity for the prime minister to clear the air. This is an opportunity for the prime minister to be frank with the house," Mr Tehan said.

"Just admit you got it wrong and tell the truth."

PM's claim rejected

Mr Albanese's admission came after officials from the Infrastructure Department on Monday rejected his claim that the grant's purpose was for sewerage fixes.

"It does not include sewerage works," a department official confirmed under questioning.

Mr Albanese has a decades-long association with the club and held an undisclosed honorary membership there, but he has defended the grant as necessary for the community and says he did not give the final approval for it.

Last month when pressed on the grant, Mr Albanese repeatedly said that its purpose was to fix septic issues causing raw sewage to spill into the Cooks River.

"It has existed for a long time, almost 100 years, and they have a septic tank. Because it is on the flood plain, when it floods in Marrickville raw sewage flows into the Cooks River — that is what the funding is for," Mr Albanese told the House of Representatives.

The prime minister also chastised the ABC for its reporting on the grant and Mr Albanese's undisclosed honorary membership to a club which he has a decades-long association with.

"What it's for — because the ABC were told information they chose not to publish appropriately — what it's for, is at the moment because it's on a flood area by the Cooks River, when it rains and there's flooding, raw sewage goes into the Cooks River. That's what it's for, for fixing that," Mr Albanese claimed regarding the grant.

"And the ABC should do better."

Documents released under freedom of information laws show the brief prepared by the department to Transport Minister Catherine King, and shared with the prime minister's office, contained no mention of septic issues or sewerage works as part of the $6 million grant. 

That brief said the clubhouse refurbishment would include furniture, lighting, bar area and alfresco dining upgrades, public toilets, a dog walking station and dedicated space for local environment groups.

The brief was shared with Mr Albanese's office just days before the ABC put questions to the office about the grant and his honorary membership.