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Close Keating ally resigns in grants scandal

PAUL KEATING, the Australian Prime Minister, suffered a blow yesterday when one of his closest political allies, and the only woman cabinet minister, was forced to resign over a scandal involving grants apparently used to buy votes for the ruling Labor Party.

Ros Kelly, 45, the Minister for the Environment and Sport, and the Minister Assisting the Prime Minister for the Status of Women, handed her resignation to Mr Keating soon after a report was tabled in Parliament that strongly condemned her handling of the grants. Mrs Kelly has come under a crescendo of attack from opposition MPs and the press over her administration of Adollars 30m ( pounds 15m) of public grants to community sporting groups before Australia's last general election a year ago. There were allegations last year that Mrs Kelly had favoured marginal Labor electorates and this was confirmed in a report by the Auditor-General in November.

The report said that the minister's handling of the sports-grant scheme had been weak and criticised her for failing to document it properly. The 'sports rorts affair', as it became known (after an Australian colloquialism, rort, meaning deception or dodge), has dominated politics for weeks as a House of Representatives committee held an inquiry. Mrs Kelly, a former teacher, stunned MPs when she told the inquiry that she made her decisions by writing the short-listed applications on 'a great big whiteboard' in her office, after which her staff rubbed them out.

Although no one accused Mrs Kelly of corruption, she performed unconvincingly in parliament against opposition charges that she had been biased, incompetent and had misled the House.

After first rejecting the charges, she was forced to concede that she had approved sporting grants in at least one marginal Labor seat after advice from her own department that the bodies in question were ineligible. Most leading newspapers called for her resignation last week. The parliamentary report, tabled yesterday, stated: 'Her record- keeping was seriously inadequate and her administration was deficient.'

Mrs Kelly is the third minister to leave the cabinet in two months. She is a close friend of Mr Keating and his family and was one of his strongest supporters when he unseated Bob Hawke from the Labor Party leadership two years ago.