Labor’s home affairs spokesperson Kristina Keneally is urging the Auditor-General to investigate Peter Dutton's handling of the Safer Communities Fund.
Mr Dutton's home affairs department recommended funding a list of 70 projects using a merit-based assessment under the third round of the Safer Communities program, according to documents obtained by the ABC.
Among the $17.5 million in projects were lighting, security cameras, walkways and drones for local councils.
But the ABC found on January 31, 2019, Mr Dutton reduced funding for 19 of the highest-scoring grant applications, in a handwritten note, by a combined total of $5.59 million.
He then redirected the funding to other projects of his choice, at least one of which was in his Brisbane electorate.
Mr Dutton has strongly denied any wrongdoing and defended his management of the program.
Senator Keneally said Auditor-General Grant Hehir must examine why Mr Dutton had made the funding decisions.
"This is rorting on an industrial scale – this is Scott Morrison and Peter Dutton treating taxpayer money as if it is Liberal party money," Senator Keneally told reporters.
"It seems Peter Dutton was not interested in making communities safer – he instead interested in making government and marginal seats safer for the Liberal party."
Senator Keneally has written to the Auditor-General's office requesting it investigate the matter.
The office is an independent body responsible for conducting audits within the Australian government and reporting to Parliament.
The multi-million dollar Safer Communities fund is drawn from the seized proceeds of crime.
Labor's home affairs spokesperson Kristina Keneally. Source: AAP
Under grant guidelines, the home affairs minister is expected to take into account the assessment of each project but can make a decision to overrule his department based on merit-based assessments.
The documents indicate Mr Dutton reduced funding for 19 of the highest-scoring grant applications by a total of $5.59 million.
That money was then re-deployed by Mr Dutton to fund other projects.
In a written statement, Mr Dutton said: "The suggestion that the government has done anything other than support projects worthy of support is nonsense.
"I am proud of the support the Safer Communities Fund has provided to organisations such as The Scout Association, Salvation Army Trust and St Vincent de Paul who have made Australia a safer place.
"Australians expect the Government to act to make the communities we live in safer. That is exactly what the government has done through the Safer Communities Fund."
The documents also indicate Mr Dutton fast-tracked a grant to the National Retailers Association.
The NRA received a one-off $880,000 grant for a program to assist retailers responding to armed offender incidents - eight days after the group had made a donation to the Liberal National Party of Queensland.
Mr Dutton said the small donation had nothing to do with the funding decision.
"The baseless suggestion that I have or would be influenced by a lawful donation to the LNP is false and highly defamatory," Mr Dutton said in a written statement.
"The suggestion that the government has done anything other than support projects worthy of support is nonsense."
