View from The Hill: Bridget McKenzie falls – but for the lesser of her political sins

Agriculture Minister and Nationals deputy leader Bridget McKenzie has finally fallen on her sword, after intense pressure on her to limit the government’s damage from the sports rorts affair ahead of parliament resuming this week.

But McKenzie has been pushed out not for rorting the sports grants program for political advantage – as shown by the Auditor-General’s investigation - but on the lesser matter of failing to declare her membership of gun organisations.

Scott Morrison announced her resignation from cabinet late on Sunday after receiving a report from his departmental secretary, Phil Gaetjens, on whether she breached ministerial standards. She has also stepped down as Nationals deputy.

Read more: Remembrance of rorts past: why the McKenzie scandal might not count for a hill of beans

Gaetjens’ controversial finding is that she did not unduly favour marginal seats in allocating the sports grants.

This is in stark contrast to the audit report highlighting a “distribution bias” in the decisions of the then sports minister, who did not follow the ranking from the independent assessment process undertaken by Sport Australia.

The audit found funding reflected the approach of the minister’s office “of focusing on ‘marginal’ electorates held by the Coalition as well as those electorates held by other parties or independent members that were to be ‘targeted’ by the Coalition at the 2019 Election”.

Morrison said Gaetjens had found that “applications from marginal or targeted seats were approved by the minister at a statistically similar ratio of 32% compared to the number of applications from other electorates at 36%”.

The prime minister quoted Gaetjens – whose report he will not release - as saying he found no basis for the suggestion that political considerations were the primary determining factor.

But Gaetjens did find McKenzie breached ministerial standards in failing to disclose her membership of the Wangaratta Clay Target Club, which received a grant.

Gaetjens indicated she should have declared a conflict of interest and stood aside for another minister to make the relevant decisions in relation to any organisation of which she was a member.

She also had a problem with her membership of Field and Game Australia, which had not been disclosed until later. A couple of this association’s parts had received grants.

The government has defended from the get-go the distribution of the grants. At the same time, ministers have wanted McKenzie gone, to stem the political damage of the affair. But the opposition will pursue the issue in parliament, and there could be a Senate inquiry.

After receiving the Gaetjens report on Saturday night, Morrison on Sunday took it to the governance committee of cabinet, which was briefed by the secretary. Morrison asked Nationals leader and Deputy Prime Minister Michael McCormack to speak to McKenzie, who was also briefed by Gaetjens.

McCormack was not at the Morrison news conference. Morrison said he was on his way to Canberra.

The Nationals must now elect a new deputy to replace McKenzie, with Water Resources minister David Littleproud the frontrunner. The party will meet on Tuesday. McCormack will then reshuffle his frontbench. Morrison ruled out a wider reshuffle.

McKenzie, who said she will stay in parliament, said in a statement she accepted the Gaetjens report but strongly defended herself.

“I maintain that at no time did my membership of shooting sports clubs influence my decision making, nor did I receive any personal gain.” However she acknowledged “my failure to declare my memberships in a timely manner constituted a breach of the Prime Minister’s Ministerial Standards”.

McKenzie said “elected representatives are responsible for public expenditure and take advice, not direction, from the public service and others. The operation of ministerial discretion is important to our democratic process.

"My support for the sport of shooting is well known and fully disclosed through my public advocacy. I will continue to back our sporting shooters against the ongoing, often misinformed, public debate about a sport that routinely wins Australian medals at the Olympics”.

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Morrison was fulsome in his praise of McKenzie, saying she had done “amazing work” for regional Australia, showing “incredible application”. But “there are standards that must be upheld and she understands that and so do I.”

Looking to the future, Morrison stressed the government was adopting the Audit Office recommendation to bring in a consistent framework for situations where a minister decides upon the award of grants.

The Audit report said the advising, decision-making and reporting requirements applying where ministers approve grant funding should “be extended to apply to corporate Commonwealth entities in situations where a minister, rather than the corporate entity, is the decision- maker”.

The government had already announced it would adopt this recommendation.

Morrison also said Attorney-General Christian Porter had advised, after consulting the Australian Government Solicitor, that McKenzie did have the legal authority to make decisions about the grants. The question of this authority had been raised in the audit report but not answered.

Opposition leader Anthony Albanese said: “How does Angus Taylor remain in cabinet while Bridget McKenzie does not?” Energy Minister Taylor, on Sky on Sunday night, refused to say whether he had been interviewed by the federal police, who are considering the affair of an alleged forged document he used to make false claims about the carbon footprint of City of Sydney councillors.

Meanwhile the latest Newspoll, published in Monday’s Australian, shows a further worsening of the Coalition’s position, in the wake of a torrent of publicity about the sports rorts, as well as continuing debate about the response to the bushfire crisis.

The Coalition now trails Labor on a two-party basis 48-52% compared to 49-51% three weeks ago. The Coalition primary vote has fallen 2 points to 38%; Labor is down a point to 35%.

Albanese leads Morrison as better prime minister 43-38%.