Labor is demanding an inquiry into a regional jobs fund that handed out cash to projects against the advice of department officials.
The auditor-general has identified serious flaws with the federal government's $220 million Regional Jobs and Investment Packages program.
Angry at the coalition's muted response to the scathing report, Labor now wants parliament's Joint Committee of Public Accounts and Audit to investigate the program.
Regional development spokesperson Catherine King wrote to the audit committee calling for the inquiry which she says is needed to expose "the maladministration" by the Morrison government.
Ms King accused the government of burying the audit by releasing it during the running of the Melbourne Cup last week and slammed the lack of response from Nationals leader Michael McCormack.
"Michael McCormack has said critics are cherry picking from the report. No-one is cherry picking, deputy prime minister, the whole report is scathing of your government," Ms King said.
Ms King wants 17 findings from the report examined further, including why 28 per cent of recommended applications were rejected and how 17 per cent were approved without recommendation.
"I have read some pretty scathing audit reports over my time ... but this one is really serious," committee deputy chair Julian Hill said.
"I agree that these issues requires a full, public investigation given the auditor-general's findings."
Agriculture Minister Bridget McKenzie hosed down any wrongdoing from the government during Senate Question Time on Monday.
"The actual conclusion of the report said was there was no bias evident in the assessment and the decision-making process concerning the funding of projects in hardship regions over others," Senator McKenzie said.
"That is what the report found. Now could processes improve? The department is looking at that."
Senator McKenzie said in selecting each of the 10 regions the government considered recent structural changes in the local economy, whether the regions were under pressure from falling commodity prices, and the downturn in the mining and manufacturing sectors.
© AAP 2019