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Regional generosity needs explaining

By Scott Prasser - posted Friday, 7 December 2007


The loss of Coalition seats in regional Queensland and New South Wales was an important contributor to the Howard government's demise. Not insignificantly, during the election campaign a report from the federal Auditor-General suggested the Howard government had its snout in the public taxpayers' trough in providing grants to regions for some questionable projects through its Regional Partnerships Program.

This seems to have backfired now on the Howard government.

The Regional Partnerships Program replaced earlier regional pork-barrelling programs that had been hastily developed in response to Pauline Hanson's One Nation party that threatened the Coalition in its first and second terms.

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What made the Regional Partnerships Program so effective at selective pork-barrelling was that it was project based, had specific time limits and, most importantly, left the final decision with the Minister for Transport and Regional Services (and later a committee of ministers).

Indeed, one of the Auditor-General's prime criticisms was that ministers could overturn departmental advice on applications without providing clear reasons for their decisions. The temptation to fund projects on partisan considerations was great.

The evidence is there. Coalition seats have been the main beneficiaries of the program. Rural electorates received 77 per cent of the grants and the 10 electorates with the highest funding were held by the Coalition. Moreover, ministerial decisions were more likely to overrule departmental advice if Coalition seats, rather than Labor seats, were involved.

Also, such projects were less likely to reach targeted goals.

The Regional Partnerships Program highlighted all that was right and wrong with the Howard government.

First, it showed the Howard government's political astuteness and skills in developing a targeted and relatively minimally funded scheme to head off One Nation and to show concern about regions. The Howard government's real interests were with corporate Australia, deregulating rural industries and responding to the demands of aspirational voters in urban areas.

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The Regional Partnerships Program was a symbolic sop to regional Australia while allowing local Coalition, and especially National Party politicians to get kudos in handing out taxpayer-funded grants.

The ability of ministers to override departmental advice, though exercised in only about 6 per cent of applications, ensured there was flexibility in the program for the government to respond quickly to regional “needs” and political pressures.

The other problem was that some grants involved sub-optimal spending on questionable projects.

That the department failed to monitor many projects adequately, allowing cost over-runs to occur, also highlights that there were administrative, as well as political, problems with the program. However, these problems and the sub-optimal pork-barrelling expenditure involved in some of the program grants are not corrupt in themselves.

On a small scale, some grants probably provided some helpful assistance to local regions. Nor is it wrong for elected officials to seek political kudos from handing out funds, as long as they are not the direct beneficiaries of the grants. What is questionable is whether incumbent governments gain political advantage by the allocations from taxpayer-funded schemes. Labor, although critical during the election, has been reluctant to condemn the program outright.

The new Rudd Government will need such programs to fund local projects, keep regions and interest groups satisfied, and to assist local federal members.

Simon Crean knows this. He talked about many regional projects before the election. So, we will soon have Regional Partnerships Program Mark 2.

The real issue with Regional Partnership grants, as highlighted by the Auditor-General, was their lack of transparency in how governments decided their allocations.

Too easily the program was seen by those in office as “theirs” to decide how to allocate, rather than ours, the taxpayers, to assess whether they are worthwhile.

The Rudd Government faces a challenge in injecting better accountability into such schemes.

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First published in the The Courier-Mail on November 27, 2007.



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About the Author

Dr Scott Prasser has worked on senior policy and research roles in federal and state governments. His recent publications include:Royal Commissions and Public Inquiries in Australia (2021); The Whitlam Era with David Clune (2022) and the edited New directions in royal commission and public inquiries: Do we need them?. His forthcoming publication is The Art of Opposition reviewing oppositions across Australia and internationally. .


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