The audit office has found that the Morrison Government funnelled Nationals seats an extra $104 million in grant funding, often against departmental advice. 

The Australian National Audit Office (ANAO) has investigated the management of the $1.38 billion Building Better Regions Fund (BBRF).

The fund has spent $1.15 billion on almost 1,300 projects across the country so far. 

However, the former Coalition government, particularly its Nationals component, has been accused of using the fund as a vehicle for pork barrelling. 

The ANAO has now found that departmental advice on the worthiness of projects was routinely ignored by ministers. The full report is accessible here.

“The decisions about the award of grant funding across each of the five funding rounds were not appropriately informed by departmental advice,” the report said.

“As the program has progressed through the first five rounds, there has been an increasing disconnect between the assessment results against the published merit criteria and the applications approved for funding under the infrastructure projects stream (which comprised the majority of approved projects and funding).

“This reflects the extent to which the ministerial panel has increasingly relied upon the 'other factors' outlined in the published program guidelines when making funding decisions.”

The ANAO found electorates held by the Nationals were the big winners.

“Specifically, applications located in electorates held by The Nationals were awarded $104 million (or 29 per cent) more grant funding than would have been the case had funding been awarded to those applications assessed as the most meritorious in each round,” the report says.

“Applications located in electorates held by all other political parties were awarded less grant funding than would have been the case had funding been awarded based on the results of the merit assessment process.

“The most significant reductions were to electorates held by the Liberal Party ($73.5 million less grant funding awarded) and the Australian Labor Party ($26.1 million less grant funding awarded).”

Nationals members chaired the ministerial panel throughout four of its five funding rounds, with Fiona Nash, Michael McCormack and Barnaby Joyce holding the position at various stages.

The ANAO found 179 funding decisions were not properly documented, the ministerial panel decided not to approve applications recommended by the department on 164 occasions, and 65 per cent of infrastructure projects awarded cash were not considered most meritorious.

Former minister Michael McCormack has responded to the auditor-general's report claiming that “all grants were allocated within the Ministerial and Programme guidelines at the time”.

His former Nationals colleague, Fiona Nash, has responded too.

“While the departmental processes for assessing and scoring applications are, in my view, sound, it must be recognised that the departmental decision-makers in that process are located in the cities,” she said.

“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.

“One of the intentions of the Ministerial Panel was to bring local community knowledge to the decision-making process regarding the most appropriate and worthy projects and, on that basis, strengthen the robustness of funding decisions.”

Australia’s current Infrastructure Minister Catherine King said in a statement that the ANAO’s report “confirms what we already suspected: that the former government actively ignored grant guidelines and, in the process, dudded hardworking regional Australians”. 

“Former Coalition ministers made decisions on the basis of ‘choose-your-own-adventure’ criteria that weren't fully explained to those applying for grants,” she said. 

“They did not keep proper records of decisions.”