Bonded asbestos was discovered in mulch at Liverpool West Public School, in Sydney’s southwest, over the weekend, forcing the school to close for at least two days while the material was removed.

Minns said parents who wanted answers on how the material ended up on school grounds would be understandably frustrated, but the NSW Environmental Protection Agency was investigating.

An area has also been cordoned off at Campbelltown Hospital, in Sydney’s southwest, the latest site potentially affected by the contaminated material since it was discovered near a playground at a new park in the inner city in mid-January.

NSW Premier Chris Minns warned unscrupulous suppliers would be driven from the industry if an ongoing investigation found any evidence of wrongdoing.

“If there are people who are going to breach the rules, there’s no place for them in that industry,” he said on Monday.

Minns said recent discoveries at an inner-city park of the more dangerous friable asbestos, were unacceptable.

“That kind of asbestos being found in a park in Sydney is deeply worrying,” he said on Tuesday.

Previous finds had been limited to the less-dangerous bonded asbestos, which is mixed with concrete or resin.

Friable asbestos can easily crumble into dust and become airborne, creating a potential health risk.

“The Government is currently investigating certain actions that we will take in the weeks ahead, firstly, to raise the fines that are imposed on companies that do the wrong thing,” Minns said.

Current penalties of up to $2 million for corporations were already steep but the Government was prepared to go further, he said.

“I’ve got to make a decision about whether these penalties are being incorporated in the cost of doing business, which sometimes happens,” Minns said.

Friable asbestos was found in mulch at Harmony Park, which would be temporarily closed while the site was cleaned.

Bonded asbestos has been found at 13 sites across Sydney in mulch made up of recycled building material.

Minns said the supply chain for the product was complicated, but stricter rules would be brought in if required.

NSW EPA chief executive Tony Chappel said officers were tracing the mulch in a similar way to health authorities’ tracking of the spread of COVID-19.

He said supplying mulch contaminated with asbestos was a serious criminal offence and the agency has more than 70 staff investigating.

“The supply chain is under intense scrutiny,” he said.

Education Minister Prue Car said Liverpool West Public School will remain closed until at least Wednesday.

“This is obviously something that needed to be dealt with straight away,” she said.

Car said the supplier identified by the EPA had not provided recycled mulch to other public school sites.

“We understand at this stage that it is not in any other schools, but we are double and triple checking everything,” she said.

Education Department secretary Murat Dizdar said it had been made very clear to suppliers they needed to test recycled mulch before it was laid.

Bonded asbestos is considered a lower risk to the public than friable asbestos, but it can weaken and have the potential to turn into powder as it ages and is exposed to the elements.

Australia banned the use, sale or import of asbestos in 2003.