A scathing audit report has found that the Morrison government awarded a $4 million grant to a faith-based rehab facility, later accused of abuse, under a health program that didn't do proper due diligence or comply with grant guidelines.
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The Esther Foundation, which provided counselling to women and teens affected by domestic violence, bullying, depression and abuse, closed last year amid numerous allegations of abuse, including sexual assault and LGBTQ+ conversion practices.
The Australian National Audit Office found that the facility was a beneficiary of a $2 billion Community Health and Hospitals program that deliberately breached grant rules and finance laws.
"A Health [department] email to the Minister's office on 12 June 2019 described Esther Foundation as one of seven grants the government had identified were 'sensitive and priority' projects," the audit report stated.
The Health Department went ahead with the grant agreement in 2019 without doing a financial viability assessment, getting audited financial statements or confirming a legal authority to support the spending, as required by grant rules and guidelines, the audit found.
The department assessed the foundation's project proposal as "suitable" even though it included plans for vocational training, vehicle fleet expansion and other items not eligible under grant guidelines.
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Fewer than 100 words were written in support of the assessment outcome, copied from the foundation's media profile and an activity plan provided by the foundation at the department's request.
According to the report, the then Health Minister Greg Hunt approved the grant before the Australian Government Solicitor (AGS) provided a legal risk assessment, which later identified the grant as "high risk".
"[The Health Department] also requested that to expedite delivery of funding agreements and manage risk, the Minister provide his approval pending AGS advice about legal risk," the report stated.
In response to the audit findings, Health Minister Mark Butler slammed the grant as a Mr Morrison "captain's pick".
"Subsequently, deeply distressing allegations against Esther House were aired and a West Australian parliamentary inquiry was held into allegations of sexual and psychological abuse at the foundation," he said.
The foundation went into liquidation last year, with the health department later reducing the grant's value to $2 million to reflect the amount spent. The department formally shut down the project last October.
The Western Australian government then announced it would ban LGBTQ+ conversion practices in response to a parliamentary inquiry into the rehabilitation centre, where former residents shared testimonies of abuse.
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Natalie Vikhrov
Natalie Vikhrov reports on federal politics and public service for The Canberra Times. Prior to this, she spent several years covering human rights in Eastern Europe, including Russia's invasion of Ukraine. Get in touch via natalie.vikhrov@austcommunitymedia.com.au.
Natalie Vikhrov reports on federal politics and public service for The Canberra Times. Prior to this, she spent several years covering human rights in Eastern Europe, including Russia's invasion of Ukraine. Get in touch via natalie.vikhrov@austcommunitymedia.com.au.
