Government must be more transparent about who gets community grants – and why

Australian governments have an unfortunate history with community grants programs. Sports infrastructure programs, car park grants and other schemes have repeatedly raised the same concern: public money intended to serve communities becomes entangled with electoral politics. The Albanese government’s $560.9 million Major and Local Community Infrastructure Program (MLCIP) was established to deliver community infrastructure commitments made at the 2025 election. It was a one-off, invitation-only and non-competitive program. More than 220 organisations were invited to apply — but beyond saying they were election commitments, the government has never publicly explained how it decided which community projects were invited. New analysis released this week by the Centre for Public Integrity raises serious questions about the scheme, with almost three-quarters of the funding going to the government’s own electorates. Even after accounting for Labor holding more seats, Labor-held electorates received substantially more funding than a proportional distribution would predict, while Coalition and other electorates received correspondingly less. The one-off, invitation-only scheme was an election commitment made by Labor during the 2025 federal election. Lukas Coch/AAP A closed, invitation-only program The integrity questions around this program began before we even knew where the money went. Unlike an ordinary competitive grants program, community organisations could only apply if invited by the federal government. The 2022 New South Wales ICAC Report on investigations into pork barrelling described closed, non-competitive, one-off grants as relying on ministerial discretion, and often announced during election campaigns. The report warned: [F]or obvious reasons, this category of grant is at high risk of pork barrelling. The report recommended that if this type of grant is adopted, the government must explain why, and “outlin[e] the risk mitigation strategies”. Yet the Albanese government has never publicly explained how projects were selected for invitation or why a closed, non-competitive process was necessary, let alone provided a risk mitigation strategy. Attempts to get answers from the government through parliament produced little clarity. Independent Senator David Pocock asked in Senate Estimates who within government had determined who could apply. The answer was simply that projects had been “identified by government”. No further information was provided. Why community infrastructure grants programs are vulnerable This is not a problem peculiar to Labor. Australian governments from both sides of politics have repeatedly used discretionary grants programs in ways that blur the line between public benefit and electoral advantage. In relation to the Morrison government’s 2018–19 “sports rorts” affair, the auditor-general found the sports minister’s office ran a parallel assessment process that gave priority to marginal electorates, rather than simply following Sport Australia’s assessment of merit. Nine of the ten electorates receiving the most funding were marginal or Coalition-targeted seats. In the $660 million commuter car parks program, the auditor-general again found project selection was neither open nor transparent, and not demonstrably merit-based. It also reflected the political profile of those given the opportunity to nominate projects. In another instance, Labor’s 2008 Better Regions Program funded 2007 election commitments. The auditor-general found funding was largely concentrated in marginal and fairly safe seats held by the Coalition before the election. These included electorates that Labor was seeking to win. So where did the community infrastructure grants go? Using information from the Commonwealth Department of Infrastructure, Transport, Regional Development, Communications, Sports and the Arts, the Australian Electoral Commission and by examining Labor’s media releases, social media posts and local news articles, the centre found the following: 1. Almost three quarters of funding (73.2%, or $409.1 million) went to notionally Labor-held divisions. This compared to 22.6% of funding to Coalition-held divisions. For every dollar going to a Coalition-held seat, more than $3.20 went to a Labor-held seat.This disparity cannot simply be explained by Labor holding more seats: even after accounting for the number of electorates held by each party, Labor-held seats received about $118 million more than they would have under a proportional distribution. 2. Accounting for the different number of electorates in each category, marginal seats in which Labor was competitive received $66.5 million more than they would have received if funding had been distributed proportionately across categories of electorates. Fairly safe Labor seats received $62.9 million more. By contrast, marginal seats where Labor was not competitive, fairly safe non-Labor seats and safe non-Labor seats collectively received $116.6 million less. 3 Using household income and “community connectedness” as indicators of community need, there appears to be no relationship between the level of funding received by an electorate and its level of need on these measures. If community need explains the distribution of funding, the government should make the basis for that assessment publicly available. The data do not definitively show individual grants were awarded for partisan reasons. But combined with a process in which government decided who could apply, and without publishing how it made that decision, this pattern demands an explanation. The existing framework isn’t enough The Commonwealth Grants Rules and Principles provide a non-binding framework for the government. They say competitive, merit-based selection should be used unless another approach is specifically agreed on. If another method is used, the rationale should be documented in the grant opportunity guidelines. For closed processes, the framework describes it as “better practice” to identify eligible applicants or explain how eligibility was determined. The Centre for Public Integrity has argued reform requires three things. First, the government must be required to set clear, merit-based criteria that govern the allocation of grants. Second, the government must be required to report to parliament how decisions about funding were made against those criteria. Finally, there must be proper accountability for the grants system, including by making the grants framework enforceable and introducing greater parliamentary accountability. Public money should not be treated by governments as money they can use for political advantage. The distribution of the community funds raises concerns this is exactly what happened. Community organisations should not need to be in the right electorate — or receive an invitation from the government of the day — to have the opportunity to make their case for funding. This article was written in collaboration with Zoe Neumayer and Max Douglas from the Centre for Public Integrity.