BY Colin Bettles
ALLEGATIONS that Labor misused taxpayer dollars when administering the Regional Development Australia Fund (RDAF) have reignited smouldering tensions between the Nationals and former federal independent MPs Tony Windsor and Rob Oakeshott.
The RDAF was established by the former Labor government in the $10 billion deal for regional Australia, securing the support of the independent MPs in the minority parliament.
But Labor’s handling of the Fund is now subject to a joint parliamentary inquiry by the Public Accounts and Audit Committee.
Approved projects' merit queried
Infrastructure and Regional Development Minister Warren Truss and his assistant Jamie Briggs recently revealed the results of an inquiry by the Australian National Audit Office (ANAO), alleging Labor misused taxpayers’ money for political gain ahead of last year’s election.
Mr Briggs said the ANAO report showed that over a quarter of all projects – almost 50 per cent of the total funding – approved by the then-Minister for Regional Services Catherine King under rounds three and four had not been recommended for funding by the RDAF’s expert advisory panel.
Public Accounts Committee chair Dr Andrew Southcott MP said the inquiry would reflect the Committee’s important role of holding Commonwealth agencies to account for the efficiency and effectiveness with which they use public monies.
“In the case of the RDAF, the ANAO concluded that there was not a clear trail through the assessment stages to demonstrate that the projects awarded funding were those that had the greatest merit in terms of the published program guidelines.” Dr Southcott said.
Truss lays blames with independents
Mr Truss said the origins of the scandal could be traced back to Mr Windsor and Mr Oakeshott who did a deal with the government to establish the RDAF.
“When they made that announcement they said the money was going to be used for the one third of Australians who live outside the capital cities,” he told Fairfax Agricultural Media.
“Now very shortly after that announcement was made – and while Mr Windsor and Mr Oakeshott were still in the parliament – Labor changed the definition to ‘all of Australia except the major metropolitan areas’.
“Only central city areas were excluded from it and as a result so much of that money, which Mr Windsor and Mr Oakeshott said they got for regional Australia, was actually spent in the cities.
“Minister King obviously used her ‘dexterity’ to spread that liberally in areas that were beneficial to Labor’s election objectives.
“But it goes right back to Oakeshott and Windsor either agreeing or somehow having their backs turned when the definition of regional Australia got changed by Labor.
“That’s why the biggest project Labor funded in regional Australia was the roads around Perth airport that not many people would consider regional.
“And what’s more they funded it out of the proceeds of the mining tax which never earned any money.”
Mr Truss said in contrast, the Coalition’s $1 billion Stronger Regions Fund would provide funding for stimulating economic and social growth in disadvantaged regions and contain a more stringent and robust oversight process.
“The money is intended to be used to help build and strengthen those economies,” he said.
“We’ve got a very robust criteria. Indeed, some applicants have identified to us that maybe we’ll have to look at some of the criteria because they’ve perhaps been too restrictive.
“We’ll see how it works in practice but certainly some issues have been identified and we’ll have to look at that before we get to the next round.
“But they’re not the kinds of things the Auditor-General raised – this is a robust process to ensure the criteria that he talks about are dealt with.”
Mr Windsor was contacted by Fairfax Agricultural Media but did not respond before deadline.
Not 'value for money'
Mr Briggs said the former Minister approved 23 projects worth almost $91 million – or 40pc of the total funding – that the panel specifically recommended not to fund as they did not represent value for money or achieve the objectives of the program.
He said the Audit report also revealed that in round four, of the 42 eligible applications funded “the Minister made 34 decisions that diverged from the recommendations of the panel”.
“Not only were the Minister’s decisions irresponsible, it appears she intentionally deviated from proper process for political purposes only months out from an election,” he said.
“The report identifies that 80pc of the Minister’s decisions to not fund applications recommended by the advisory panel were from Coalition held seats – 93pc in round three and 54pc in round four,” he said.
“Furthermore, 64pc of the Minister’s decisions to fund applications that had not been ‘recommended for funding’ were from ALP held seats, compared to 18pc in Coalition held seats.
“The only conclusion that can be made is the Minister had total disregard for delivering value for taxpayers’ dollars and was more interested in using RDAF rounds three and four as a political vehicle to help prop up a failed government.”
Dr Southcott said a number of issues arising out of the audit report needed further public scrutiny.
“These include the failure of the Department of Regional Australia to implement previous recommendations from the ANAO and the ministerial decisions made in May and June 2013 which saw recommended applications in Coalition-held electorates rejected and projects in Labor-held electorates which were not recommended for funding approved,” he said.
The deadline for making submissions to the Committee’s inquiry is Friday, February 13, 2015.