Regional generosity needs explaining

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.

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.

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.