Probe of Labor’s $2bn SRL pledge sparks warning for govt agencies

Federal government agencies have been put on notice after a probe of Labor’s $2bn promise to the contentious Suburban Rail Loop revealed records about the project were hardly documented.

The acting Auditor-General has put federal government agencies on notice over record keeping following a probe of Labor’s $2bn commitment to the contentious Suburban Rail Loop project.

The new Australian National Audit Office report released on Wednesday has called on the Infrastructure Department to outline the process for handling election commitments, with meetings, emails and verbal briefings about the project hardly documented.

It also found “no evidence” of a merit review of all election commitments of more than $5m, after Infrastructure Minister Catherine King declared projects that “don’t stack up” would not proceed.

But Acting Auditor-General Rona Mellor said the department had provided “largely appropriate advice” to the government on the project, noting it had only progressed through the first stage of the approval process.

“The funding is governed by an approval process,” she wrote.

Acting Auditor-General Rona Mellor said the department had provided ‘largely appropriate advice’ to the government on the project. Picture: AAP

A project proposal report from the Victorian government is due to be submitted to the department by the end of 2024 for SRL East to be assessed and approved by Ms King.

An updated SRL business case is also required to be submitted by the state for Infrastructure Australia to evaluate before the funding can be released.

Ahead of the Albanese government’s first federal budget, a departmental spreadsheet of all infrastructure projects left the “justification and benefits” of SRL blank with a note saying “information not necessary for election commitments”.

Departmental records dated October 17, 2022 indicated that staff had verbally briefed the minister through their office on the issues with the business case but did not state when the talks took place.

“A process is in place to support project selection for land transport infrastructure projects, however, this differs for election commitments,” the report states.

“There is an opportunity for the department to document the process by which election commitments should be treated to support consistent and transparent administration and decision-making.”

In July 2022, Ms King said her department would conduct a ‘merit review’ on all election commitments over $5m. Picture: Richard Walker

In July 2022, Ms King said her department would conduct a “merit review” on all election commitments over $5m.

But a month later, the department advised that given the “broad discretion” within the Infrastructure Investment Program, it was “unlikely” it could rule out any election commitments based on the current information.

It stated that it had assessed projects against “legislative eligibility criteria” but there were “multiple future check points” where a project could be cancelled based on merits assessment.

The report found there was “no evidence” of the approach the department planned to undertake for the merit review, that the advice was formalised, or a review of election commitments was provided to the minister.

The department was also unable to provide ANAO with evidence of its decision-making process in 2021 when it did not support funding for SRL East.

Infrastructure Department secretary Jim Betts welcomed the report’s conclusion that the department was “largely effective” in managing the approval and administration of the commitment to SRL East.

Treasury Department secretary Steven Kennedy said he accepted the report’s key message for all Australian government entities, regarding the importance of appropriate records management and providing advice through formal ministerial briefings.