A federal government department is paying around $70 million to rent an inner city office block in Canberra, prompting ridicule from the Opposition.
Nationals Senate leader Barnaby Joyce said the money to house the Department of Regional Australia, Regional Development and Local Government could be used to buy an entire building or a whole block in a city with cheaper real estate, such as Hobart or Toowoomba.
The department's central office is in Garema Place, in the heart of Civic, Canberra's central business district.
The government took a 12-year lease from last April to make the department the sole office tenant in the building, with 10,883 sq m of floor space.
If a Coalition government went ahead with a proposal to shift public servants to northern Australia, it would have to find the $70 million from savings if it forced the department to break the lease.
After Senator Joyce made his observations during a Senate Estimates hearing, Regional Australia Minister Simon Crean said the Nationals Senate leader was suggesting public servants be sent from Canberra to Hobart, which came just after a leaked Coalition discussion paper proposed sending tens of thousands of public servants to northern Australia.
"Mr Abbott wants to force people north while his shadow minister for regional development [Senator Joyce] wants to send people south," Mr Crean said.
"Senator Joyce has shown that despite having representation all over the country, the Coalition has only one idea – to forcibly move public servants and their families.
"The solutions for northern Australia and Tasmania are in the strategies we've developed, not dividing Australia."
Senator Joyce said departmental officials told the Estimates hearing the cost of ending the lease would be its face value, with a maximum liability of $70 million.
"What about Tasmania? Would it be expensive to move [the department) to Tasmania as well?" he asked.
After the dinner break, Senator Joyce told the hearing he had researched what could be bought for $70 million.
"You can buy, in Tasmania, whole blocks, multi-storey buildings in Queensland ... but why wouldn't you use that $70m and invest it in Tasmania and ... you could buy a whole block in Davenport, you could buy a whole block in Smithton," he said.
Senator Joyce told Fairfax Media on Thursday a smart alec remark at the hearing had produced interesting information.
"When [Tasmanian Labor] Senator Lin Thorp asked the department whether it was possible to move the Department of Regional Development to north Queensland, obviously as a shot against the Coalition and my northern Australian development policy, I took it as banter but I got the answer they had just negotiated a $70 million lease," he said.
"Sometimes the most interesting information falls on your lap in the most peculiar way.
"Her attack gave reason for me to ask a range of questions, seeing as it is the office of regional development, as to what could you get for $70 million because, call me old fashioned, but that seems like an awful lot of money.
"In Toowoomba you could buy a whole multi-story building and you could buy a whole block in towns such as Dalby.
"For half the money, you could buy some of the most substantial commercial real estate in Tasmania.
"And the natural question I asked the department was, did you do a comparative analysis study of these areas when you decided to take out the $70 million lease to house the Department of Regional Development and the answer was no.
"I wouldn't have worried about this issue except it is $70 million and that requires quite a few questions to be asked."
Senator Joyce said he had not suggested relocating the department to Tasmania.
"That is completely and utterly wrong – what I was asking was, had a comparative analysis been done before locking taxpayers into a $70 million lease," he said.
"As far as commercial leases go, this is one of most exceptional ones in Australia."
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