Almost two-thirds of grants given from a $1 billion regional infrastructure program were against department recommendations, a damning audit has revealed.
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The audit office's report into the former Coalition government's Building Better Regions Fund has revealed 65 per cent of 1293 projects awarded funding were not put forward by the Infrastructure Department as the "most meritorious".
The Auditor-General found the overall program's awarding of grants, which was overseen by former Coalition infrastructure minister Michael McCormack, was "partly consistent" with the guidelines.
But the report also noted "an increasing disconnect" between the assessments put forward by the department and the grants issued by the minister as the program progressed through the five rounds.
The use of a ministerial panel, which consisted of Coalition members, was found to have increasingly relied upon "other factors" in the decision-making progress, inconsistent with departmental advice.
The oversight office said record-keeping of those decisions had been "inadequate".
Nationals senator Fiona Nash, who chaired the first round's ministerial panel, argued the Coalition MPs who made final decisions had "on-the-ground understanding" of regional communities unlike departmental decision-makers "located in the cities".
"They do not have the benefit of an on-the-ground understanding of the regional communities, and their circumstances, where projects are proposed to be located, and the potential impact and benefit of those projects," she said in response to the audit office's findings.
Panel membership across the rounds, included Bridget McKenzie, Michaelia Cash, Matt Canavan, David Littleproud and Sussan Ley.
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Mr McCormack responded to the audit's report, last month saying all grants had been awarded in line with the guidelines.
Seats held by the Nationals got $104 million more - 29 per cent - than if the merit processes had been relied upon and rural seats fared between 3 and 16 per cent worse off under the ministerial panel decisions.
Infrastructure Minister Catherine King said the report proved regional Australians had been "dudded" of public money.
"It confirms what we already suspected: that the former government actively ignored grant guidelines and, in the process, dudded hard-working regional Australians," Ms King said in a statement.
"Former Coalition ministers made decisions on the basis of 'choose-your-own-adventure' criteria that weren't fully explained to those applying for grants.
"Regional Australians deserve better. Taxpayers deserve better."
Sarah Basford Canales
I'm a federal politics and public sector reporter with an interest in national security, integrity and regulation. Contact me with general tips and thoughts at sarah.basfordcanales@canberratimes.com.au or confidential tips to sbasfordcanales@protonmail.com.
I'm a federal politics and public sector reporter with an interest in national security, integrity and regulation. Contact me with general tips and thoughts at sarah.basfordcanales@canberratimes.com.au or confidential tips to sbasfordcanales@protonmail.com.
