The Department of Infrastructure's tweet comes after reports from The Sydney Morning Herald and The Age on Monday night that the government had admitted the Department of Infrastructure had used the wrong data in making up to $1 million available to the Victorian shire and that would trigger a review of the entire selection process. The area has experienced one of its best seasons in years.

It's unclear whether the data rerun performed by the Department is the audit Water Minister David Littleproud requested on Monday.

He asked for an audit of how councils are selected for the programme after local representatives of Moyne expressed their surprise at the local government area being made eligible for drought funding.

In the Hunter, federal MP Joel Fitzgibbon has criticised the government for having "snubbed" Singleton in the latest expansion of its eligibility list, which has included Muswellbrook and Upper Hunter councils since 2018.

Singleton's mayor Sue Moore said she thought the LGA "surely" would have been included in the addition of 13 councils to the list of 123 on Friday, saying the agricultural prospects in Muswellbrook and Singleton were "pretty similar".

"We're not saying there aren't other areas that are in worse need but we definitely think as a council we could support our community better," she said.

One project on the council's wishlist is a multi-million dollar water transfer scheme to Milbrodale and Bulga, communities relying on rainwater and potable water that is trucked in. Cr Moore said subsidies for rainwater tanks, new in-ground dams and dam clearing would also be beneficial to the LGA, after level one water restrictions were introduced in June.

When Hunter cattle farmers Cheryl and Richard Marshall accessed drought relief under the federal government's Drought Communities Programme in May they had to prove their property was in Muswellbrook, despite its Singleton address.

Their Bowmans Creek property is divided in half by the border of the two local government areas, which Cheryl Marshall had previously believed were in a "similar situation" when it came to the drought.

"I was totally unaware that Singleton didn't qualify," Ms Marshall said. "I had to produce a rate notice from the Muswellbrook Shire."

The Drought Communities Programme (DCP) provides eligible council areas with $1 million for drought-related projects and up to $3000 for households in those areas that are drought affected.

Water Minister David Littleproud requested on Monday an audit take place to examine the process and data used to determine local government areas included in the scheme after Moyne, in southern Victoria, was added to the eligibility list on Friday - to the surprise of its local representatives who say the area is not in drought.

Mr Littleproud said selection criteria for councils is predicated on drought mapping by the Bureau of Meteorology and other economic and industry data. He defended the inclusion of Moyne, saying as of June 30, BOM data indicated 62 per cent of the shire was in drought.

The Bureau of Meteorology declined to comment on the statement on Monday evening.

Moyne Shire Mayor Mick Wolfe said last Friday's funding announcement came as a surprise, as neither the council nor local federal MP Dan Tehan had asked for the money.

"We do not believe Moyne Shire is experiencing drought conditions and so we are pleased that the Minister for Agriculture has ordered an audit to be carried out on information used to inform this decision," he said.

"I think they meant to give it to the Moira Shire [in Victoria's north]. When I heard about it I thought it was a joke, but I knew it was wrong. They've stuffed up somewhere," local farmer and councillor Jim Doukas said.

Acting general manager of Dungog Shire Council Shaun Chandler said he was sure drought-affected farmers would welcome access to funding if it was made available to the area. Dungog cattle farmer John Hooke said he would like to know why it had not been so far.

"It's not like out west where kids are going to school without ever seeing proper rain, which is terrible ... but there are still farmers buying feed, and they've been doing it for a long time," he said.

The latest drought mapping from the NSW Department of Primary Industries indicates around half of Singleton and Dungog is in drought, while the majority of Muswellbrook is affected. Dungog has a significant area of intense drought.

Another council included in the eligibility list, Lithgow, has a small portion of land in drought as well as some of the only areas of non-drought affected country in the state.

Leonie Ball, who operates a 3500 acre cattle farm in Singleton and Muswellbrook LGAs with her husband Gregory, said compiling a list of councils was not an adequate way of identifying the need of farmers for funding, which would change over time. The couple has not applied for drought relief.

"I would personally love to see a government agency actually take this up and look at funding on a case by case basis. All properties have an identification number, they should have to log in with that to access any government or charity funding so governments can see who is getting it," she said.

"We can be under a cloud today and not for the next six months, it's really just the luck of where the rain is.

"Some properties are getting triple or quadruple [drought relief], and some, which may be more deserving are getting none."

Ms Bell said that due to her and her husband's strategy of selling cattle in periods of low rainfall, they would actually be in the most financial difficulty when the drought breaks because they would be restocking the herd.

"We won't be selling so that two year period after the drought is when we really have to have that extra support," she said.