Integrity agency accuses Allan Labor government of underfunding it

A Victorian integrity agency says the Allan Labor government is not providing it with enough money to do its job, with the cash-strapped government last year rejecting its $1.4m funding request.

Victorian Premier Jacinta Allan. Picture: NewsWire/Ian Currie

You can now listen to The Australian's articles. Give us your feedback.

You can now listen to The Australian's articles.

A Victorian integrity agency says it doesn’t have enough money to do its job, revealing that the cash-strapped Allan Labor government last year rejected a $1.4m funding boost.

The Victorian Ombudsman – responsible for overseeing the actions of more than 1000 public authorities – confirmed in a statement to The Australian that it had been forced to cancel and scale back projects because of in­adequate funding.

“The Ombudsman plays a vital role independently resolving complaints and investigating the actions and decisions of the state,” an agency spokesperson said.

“We shine a light on public interest issues and support the bodies we oversee to improve – preventing maladministration and protecting human rights.

“However, our funding is not adequate to do the job entrusted to us by parliament and the community, and in real terms is going backwards.”

The spokesperson said the government had not undertaken a review of the agency’s base budget to account for the significant additional maladministration and education functions it had been handed by the Victorian parliament in 2019.

Since then, it had instead been relying on receiving Treasurer’s Advances – a mechanism traditionally used to meet urgent unforeseen expenses – to top up its budgeted funding, Ombudsman Marlo Baragwanath told a parliamentary committee last year.

However, the agency said it was not granted any Treasurer’s Advances in 2024-25, with a document seen by The Australian showing that in November 2024 then-treasurer Tim Pallas rejected the Ombudsman’s request for $1.389m to increase its legal resources and address risks related to its cyber security posture and risk management system.

The ministerial briefing showed the Department of Treasury and Finance recommended the treasurer decline the request, as well as the agency’s application for a “base review”.

“The VO’s funding in 2024-25 was slightly higher than previous years and will increase further with indexation over the forward estimates, which should cover any funding required for additional staff,” the briefing read.

“DTF does not support a base review given one was conducted a few years ago and VO has not mat­erially changed operations since then, negating any pressing need for one.”

A handwritten note from Mr Pallas read: “Please change the content of the letter to reflect my discussion with the Ombudsman, i.e. no T.A. but O can direct savings to her office’s shortfall.”

The Victorian Ombudsman received funding of $22.7m in the 2025-26 state budget – about 39 per cent of that of the NSW Ombudsman – after the government largely knocked back its bid for what the agency described as a “modest” increase to its budget.

The agency told The Australian it had been forced to revisit its annual plan and remove or scale back projects when it learned of its budget outcome for this financial year.

Opposition Leader Brad Battin accused Labor of failing to properly fund the Ombudsman in an attempt to avoid scrutiny.

“When the Ombudsman isn’t properly funded, governments can’t be fully held to account,” Mr Battin said.

“It raises serious questions: how will misconduct be invest­igated, and why is Labor trying to silence scrutiny of its own ­actions?

“The Ombudsman plays a vital role in protecting Victorians and upholding integrity across government services.”

A Victorian government spokesperson defended its funding of the Ombudsman, which it said had almost doubled since 2014.

“We’ve delivered stronger powers and record funding to support our integrity agencies, including almost doubling funding for the Victorian Ombudsman,” the spokesperson said.

Ms Baragwanath told a parliamentary committee in November last year that the Ombudsman’s reliance on Treasurer’s Advances made it “very difficult to plan going forward and to adequately perform functions such as prevention”.