Mr Grant Hehir
Auditor-General
Australian National Audit Office
GPO Box 707
CANBERRA ACT 2601

By email only: grant.hehir@anao.gov.au

26 March 2019

Dear Mr Hehir

I refer to your letter dated 21 March 2019 in relation to my request that the Australian National Audit Office undertake an audit into the circumstances surrounding Georgina Downer’s presentation of a cheque to the Yankalilla Bowling Club. That cheque, which bore an image of Ms Downer’s face and Liberal Party branding, related to a grant awarded under the government’s Community Sport Infrastructure Program.

The cheque presentation by Ms Downer, who is the unelected Liberal candidate for Mayo, took place before the elected local Member of Parliament, Ms Rebekha Sharkie, had even been notified that the Club’s grant application had been successful.

I note that you have decided to conduct a performance audit of the award of funding under the Community Sport Infrastructure Program.

At the time of writing that letter, I understood that incident to be an isolated example of the Liberal Party using a taxpayer-funded grant as if it were a campaign contribution to promote an unelected Liberal candidate.

However, since then, I have also learned that the National Water Infrastructure Development Fund ($1.3 billion), which is administered by the Department of Infrastructure, Regional Development and Cities, the Community Sport Infrastructure program ($60 million) and the Building Better Regions Fund ($641.6 million) are being advertised on social media as Nationals Party cash. Collectively, those programs are worth over $2 billion. Enclosed with this letter are the relevant advertisements.

Moreover, numerous other specific examples of taxpayer-funded grants being “announced” by unelected Liberal and National Party candidates, reminiscent of the Georgina Downer episode, have also come to light. For example:

• On 5 March 2019, Ms Cathy McGowan AO MP drew your attention to the fact that the unelected National Party candidate for Indi, Mr Mark Byatt, had “announced” $3.4 million worth of Commonwealth grants from Round 3 of the Building Better Regions Fund alongside Regional Services Minister, Senator Bridget McKenzie – before Ms McGowan had received formal notification that the grants had been awarded. Most egregiously, successful grant applicants to the Building Better Regions Fund were apparently advised by Senator Bridget McKenzie’s office that they should not tell Ms McGowan – their elected representative – that their grant applications had been successful (presumably to enable the unelected local candidate, Mr Byatt, to make the announcement). I understand that the Department of Industry, Innovation and Science bears ultimate responsibility for administering that grant program, while the Department of Infrastructure, Regional Development and Cities is the relevant Commonwealth policy entity. As you would be aware, Ms McGowan has referred this matter to you for consideration.
• It was reported in The Age newspaper on 10 March 2019 (Coalition accused of pork- barrelling grants in marginal seats) that the unelected Liberal candidate for Hindmarsh, Jake Hall-Evans, presented a “letter of notification” to the Semaphore Bowling Club which informed the club that it had been awarded a $65,000 grant. I understand that, as with the grant “announced” by Georgina Downer, that grant was awarded under Round 2 of the Community Sport Infrastructure Grants program.
• In the same story in The Age, it was reported that Kathy Ganley, the unelected Country Liberals candidate for Solomon, had been tasked with advising applicants to the Fostering Integration Grant program that their applications for taxpayer funded grants had been successful. It is not clear why Ms Ganley was told about the successful grant applications before the elected local MP, Luke Gosling – let alone why she was the person who first notified successful applicants. I understand that the Department of Home Affairs bears ultimate responsibility for administering that grant program.

In each of the examples cited above, unelected Liberal and National Party candidates were given an opportunity – and perhaps even encouraged – to “announce” taxpayer funded grants to successful applicants before elected local MPs had even been notified by the relevant department or minister. This is despite the fact that, in a number of cases, elected local MPs had worked closely with grant applicants to support their applications.

The story in The Age cites numerous other examples this happening.

In light of the above, in addition to undertaking the performance audit of the Community Sport Infrastructure Program, which I understand has already commenced, I also request that you conduct a performance audit of:

• Round 3 of the Building Better Regions Fund; and
• the Fostering Integration Grant program.

I also ask that your investigation extend to the conduct of:

• Peter Dutton MP and David Coleman MP (as the Ministers responsible for the Department of Home Affairs, which administers the Fostering Integration Grant program);
• Michael McCormack MP (as the Minister responsible for the Department of Infrastructure, Regional Development and Cities, the policy entity responsible for the Building Better Regions Fund); and
• Senator Matt Canavan and Karen Andrews MP (as the Ministers responsible for the Department of Industry, Innovation and Science, which administers Round 3 of the Building Better Regions Fund).

These grants should not be treated as campaign contributions to, or as gifts from, the Liberal and National Parties. The Australian people should know how it is that unelected Liberal and National Party candidates have been – and apparently continue to be – allowed to “announce” taxpayer funded grants to successful applicants before elected local MPs have even been notified of successful grant applications by relevant departments or ministers.

I have copied this correspondence to the Secretaries of the Department of Home Affairs, the Department of Infrastructure, Regional Development and Cities and the Department of Industry, Innovation and Science. I ask Mr Pezzullo, Dr Kennedy and Dr Smith to treat this correspondence as if it were personally addressed to them.

Thank you for considering this matter.

Yours sincerely

Mark Dreyfus QC MP

cc: Mr Michael Pezzullo, Dr Steven Kennedy and Dr Heather Smith PSM

Attached:

• National Party advertising on Facebook
• Facebook post by Kathy Ganley
• Semaphore Bowling Club Newsletter

Mr Grant Hehir
Auditor-General
Australian National Audit Office
GPO Box 707
CANBERRA ACT 2601

By email only: grant.hehir@anao.gov.au

24 February 2019

Dear Mr Hehir

I refer to the attached photograph published on social media by Ms Georgina Downer, Liberal candidate for Mayo.

As you will see, the photograph shows Ms Downer presenting a cheque to the Yankalilla Bowling Club in the sum of $127,373. The cheque purports to be issued by Ms Downer and the Liberal Party and bears Ms Downer's image and Liberal Party branding.

However, the $127,373 provided to the Yankalilla Bowling Club was not a gift from Ms Downer or the Liberal Party. It was in fact a grant from the Australian Government under the taxpayer-funded Community Sport Infrastructure Program.

Further, I understand Ms Downer “announced” the grant to the Yankalilla Bowling Club before the elected local Member of Parliament, Ms Rebekha Sharkie, had even been advised that the grant application was successful. It is questionable whether this is compliant with Community Sport Infrastructure Program Guidelines, particularly given the Yankalilla Bowling Club's successful application under the Program was sponsored by Ms Sharkie and relied on a letter of support from her.

I query how it is possible for Ms Downer, the unsuccessful candidate for the 2018 Mayo by-election and an unelected candidate for the upcoming Federal election, to misuse a taxpayer-funded grant in this fashion.

It is completely inappropriate and unacceptable for Ms Downer and the Liberal Party to treat taxpayers’ money as if it were their own, and to deceive Australians about the true source of this taxpayer-funded grant.

I ask that you please investigate the conduct of the Liberal Party, Ms Downer, relevant Government Ministers including the Minister for Regional Services, Sport, Local Government and Decentralisation, Senator Bridget McKenzie, and relevant Departments in relation to this concerning matter.

I have copied this correspondence to the Secretary of the Department of Infrastructure Regional Development and Cities, Dr Steven Kennedy. I ask Dr Kennedy to treat this correspondence as if it were personally addressed to him.

Thank you for considering this matter.

Yours sincerely

Mark Dreyfus QC MP

CC: Dr Steven Kennedy steven.kennedy@infrastructure.gov.au

Attached:

1. Grant Application for Yankalilla Bowling Club.pdf
2. JPEG image of Ms Downer