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Axing drug adviser costs taxpayers $1 million

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The Federal Government’s shock decision to axe funding to one of the nation’s oldest advisory bodies on alcohol and drugs policy will end up costing it close to $1 million, it has been revealed.

Fairfax Media has obtained a leaked report from the administrator appointed to wind up the Alcohol and Other Drugs Council of Australia (AODC) showing the Commonwealth has so far paid out more than $949,000 to cover the cost of shutting the organisation down.

The Abbott Government sent shockwaves through the public health sector last November when it abruptly withdrew funding to the Council, which has been operating since 1966 as the peak body for organisations working to minimise the harm caused by drugs and alcohol.

In a letter sent to the Chair of the National Commission of Audit on 26 November last year, Health Minister Peter Dutton said the decision to discontinue funding had been taken because of “the duplication of roles of peak bodies in the drug and alcohol sector”.

 The Council, which received $1.6 million a year from the Health Department, provided professional development, information sharing and advocacy services for drug and alcohol organisations, as well as maintaining one of the world’s foremost research libraries on drug and alcohol policy.

The decision to axe funding to the body was announced by Assistant Health Minister Fiona Nash, who was embroiled in controversy earlier this year over her intervention to have a website for the new Healthy Food Star Rating System taken down just hours after it went live.

Her Chief of Staff Alastair Furnival was subsequently forced to resign after it was revealed he had links to a lobbying firm which had had a major food manufacturer opposed to the rating system as one of its clients.

Former federal Liberal MP Dr Mal Washer, who was President of the AODC Board, told Fairfax Media the decision to axe funding to the organisation was “a bloody tragedy”.

“This wasn’t subject to any review. It was dumb advising dumber, and dumb won,” Dr Washer said.

In his letter to Commission of Audit Chair Tony Shepherd, Mr Dutton said that if the Council was unable to secure funding elsewhere, “it may lead to a wind-up of operations, and the Australian Government will seek to assist with outstanding liabilities”.

The leaked administrator documents obtained by Fairfax Media show the Council reached a settlement with the Health Department for $697,790, while a further $250,000 in administrator fees have been sought or approved, so far.

Adrian Rollins