Since its establishment in the 2018-19 Budget, the Urban Congestion Fund (UCF), and the Commuter Car Park Fund (CCPF) as a program within the UCF, have been administered without any proper administrative framework or oversight, and have been used as vehicles for the selection of projects which serve a political purpose, instead of what they should be used for—addressing congestion in urban areas to help commuters every day.
The misallocation of funds under the CCPF reflects an endemic culture within the Government of using public money for political purposes, given its parallels to the Government’s administration of the Community Sport Infrastructure Grants Program which was mired in political interference and failures of governance. While the committee notes the CCPF was not a grant program, the politically motivated misallocation of infrastructure funding corrodes public trust in government spending decisions.
Governance framework
As detailed by the Australian National Audit Office (ANAO), the UCF is not a grant program, and therefore does not need to adhere to the Commonwealth Grant Rules and Guidelines. Further, the ANAO found that there are no published guidelines, eligibility criteria or merit criteria for the UCF. This has led to the allocation of funding under the UCF through a non‑competitive, non‑application‑based process. Given that the UCF is a $4.8 billion fund, the lack of any proper administrative, feasibility, value for money or merit-based frameworks is astounding.
The significant problems associated with this approach have been exemplified by the administration of the CCPF. What was originally a $500 million fund, has become a $711 million fund, which has been plagued by the misallocation of taxpayer funds.
The committee’s inquiry has supported the findings of the ANAO regarding the role and actions of the Department of Infrastructure, Transport, Regional Development and Communications (the Department). With regard to the Department, the ANAO found that:
its administration of the CCPF was not effective;
it did not develop a program-specific implementation plan, performance indicators or evaluation plan for the UCF;
selection of car park sites as part of the CCPF was not appropriate, nor was it designed to be open, transparent, or to properly engage with stakeholders like state governments and councils;
its underlying assessment work was not appropriate, and it did not satisfy itself that projects were meritorious, value for money or eligible under the relevant legislation; and
the Department did not implement controls to establish clear project delivery timelines and links between payments and milestones for each approved project.
Further, since announcing the CCPF in 2019, several projects have been abandoned and the rollout of the remaining projects has been extremely slow.
Ministerial interference and announcements
There has been much discussion about the fact that 27 commuter car park sites were selected the day prior to the announcement of the 2019 election. The CCPF project site selections and their announcements—despite being agreed to before caretaker—were depicted almost universally as election commitments, which they were not.
The committee notes that there must be a clear distinction between the actions and announcements of a political party, as distinct from the actions of government and decisions made by the executive.
For the most part, the 27 sites were directed to specific, Coalition-held electorates. The CCPF project distribution had a clear geographic and political profile—77 per cent of sites were in Coalition-held seats, the majority of those were located in Victoria, and 83 per cent of those in Victoria were in an electorate held by the Coalition at the time of selection.
The committee is persuaded by the evidence that both the Prime Minister’s Office and Minister Tudge’s Office were central in the coordination of the exclusive canvassing of Coalition MPs and candidates, in marginal Coalition held seats and targeted Opposition held seats, and in the development of the ‘top 20 marginals’ spreadsheet. Further, the evidence strongly points to the Prime Minister being aware of the canvassing process and that either he (or his Office) approved all the car park projects within the scope of the ANAO audit.
The ANAO’s evidence is that it was the same officer in the Prime Minister’s Office involved with both the selection of CCPF projects, and the Community Sport Infrastructure Grants Program. The findings of the ANAO also indicate that not only the CCPF but the entire UCF program is vulnerable to politically motivated misallocations of funding.
The geographic location of the selected CCPF projects, and the development of the ‘top 20 marginals’ spreadsheet confirms the exclusivity of the canvassing process. It has resulted in the areas with the greatest need for reducing congestion (including areas in New South Wales and Queensland) receiving little to no funding under the UCF.
The example of the Department using a Prime Ministerial press release as the only authority for the Mitcham CCPF project, shows a complete disregard for proper executive decision‑making and governance. This is made all the more problematic when an allocation of millions of dollars of taxpayers money is made to a project which had not been properly considered regarding its feasibility and necessity—as proven by the fact that the project is no longer proceeding under the CCPF.
Consultation
The ANAO found that in administering the CCPF, the Department did not engage with the states, did not put in place a process for engaging with states and councils on the identification of candidate projects, nor did it recommend a process to the Minister. The evidence to the inquiry has made clear that the lack of consultation over CCPF project cost and feasibility, and subsequently on the rollout of the projects, has resulted in a lack of industry expertise being utilised in the design of the commuter car parks, and cancelled or underfunded car park projects.
The lack of merit criteria and non‑competitive processes in the CCPF and the UCF more broadly, and the decision not to publicly release the UCF investment principles —principles which the Government agreed in 2018—allowed the Government to make its own governance arrangements and make its own decisions, based on perceived political advantage and with no accountability around those decisions.
The results of the failure of the adopted process are clear, with delivery partners not coming on board, projects being scrapped and cost blowouts. It has also resulted in projects being approved without any clear indication whether the projects will actually deliver the outcomes for commuters and local communities which have been promised.
The committee’s view is that states and local councils should have been afforded the opportunity to put forward suggestions for projects under the UCF framework which would align with their existing infrastructure and transport strategies and would actually go some way to addressing congestion in urban areas.
‘Busting’ congestion
The clear evidence before the committee is that the CCPF, and specifically more car parks around railway stations, would do little to ‘bust’ congestion. This was supported by the findings of the ANAO, which found little evidence that the decisions of the Department in selecting car parks was based on merit against the UCF investment principles or policy objectives.
Commuter car parks may not necessarily be suitable for inner and middle ring urban settings and therefore may not properly address urban congestion as anticipated under the aims of the UCF. Commuter car parks may instead be better suited to outer urban and growth areas, where either walking or bus feeder services aren’t practicable or available.
Because of the way project sites were selected—the canvassing process through Minister’s offices and executive government—there was no proper process through which to assess the feasibility and need for commuter car parks in each area. The process should have included potential delivery partners putting forward projects and potential sites, based on feasibility studies, costings and evidence of value for money, project delivery times and the effectiveness of the project in addressing congestion in urban areas.
Instead, the Minister made the decision to adopt the electorate canvassing process which was ultimately utilised. This was the key governance failure.
Of further concern is that the Department does not appear to have completed any research or analysis regarding congestion and car parks in urban areas. It is therefore hard to see how decisions can be made within the UCF about the efficient and effective allocation of public funds, in order to reduce congestion.
Transparency and accountability
Given that the CCPF is only one part of the UCF program and given the serious findings of the ANAO in relation to the CCPF (but also in relation to the UCF administrative framework), the committee considers it of utmost importance that the ANAO undertake an urgent audit of the UCF and all its subsidiary programs. Ongoing parliamentary oversight in the 47th Parliament will also provide real-time accountability to the Parliament and the public on executive and departmental administration of the UCF.
This inquiry has reinforced that there is no effective enforcement mechanisms in place, for ensuring that public administration is aimed at addressing areas of most need in an impartial, ethical and efficient way. There is clearly a need to better hold the executive to account and ensure that any actions taken, or decisions made are in the best interests of the Australian public.
The evidence before the committee, while damning, still leaves questions unanswered and no one held to account or accepting responsibility for the misallocation of significant amounts of public money, for political purposes.
The misuse of the CCPF program by the current Government, which has followed closely the serious issues with the administration of the Community Sport Infrastructure Grants Program, has strengthened calls for the urgent establishment of a federal integrity commission ‘with teeth’, and which has the powers of a Royal Commission.
Recommendations
The committee has made several recommendations, aimed at accountability, transparency, and the proper use and allocation of taxpayers’ money.
The evidence before the committee has led it to make seven recommendations. Four of these recommendations relate to the government and to the Department, as follows:
the Prime Minister provide a full explanation, within two weeks, about his role, the role of his Office, the role of the then Deputy Prime Minister’s Office and any other Ministerial Offices and staff in the allocation of funding under the CCPF;
the Government conduct a review of the National Land Transport Act 2014, with regard to the adequacy of the provisions for Ministerial approvals for infrastructure projects and programs as part of the UCF;
the Department conduct an evidence-based, consultative analysis into how to best reduce congestion in urban areas, then making this analysis public and using it to inform all future decision‑making within the UCF; and
the Department develop and publicly release—no later than 28 February 2022—the investment principles and policy objectives for both the UCF and the CCPF, including eligibility requirements and the requirements of delivery partners.
The remaining three recommendations relate to transparency and accountability, both to the Parliament and to the Australian public, and include that:
the ANAO, as part of its 2022-23 Audit Program, complete an audit of the UCF and all its associated projects and programs, and that the Australian Government ensures that the ANAO is given adequate funding and resources to complete both the UCF audit, and for ongoing scrutiny of government expenditure and activities; and
within the first 18 months of the 47th Parliament, the Senate refer the ongoing administration of the UCF to the appropriate Senate committee for further inquiry and report.
As a matter of urgency, the committee also recommends that the Australian Government establish a national integrity commission with the standing powers of a Royal Commission. This inquiry and the administration of the UCF highlights just one of the many reasons as to why a national integrity commission is very much needed.