The government will pledge an extra $250 million to the controversial Building Better Regions Fund in next week's budget, Deputy Prime Minister Michael McCormack announced on Wednesday.
"Australia's regions have driven our nation through the worst of the pandemic and we are emerging in great shape," Mr McCormack said.
The extra $250 million for a sixth round of the fund was described as a "vote of confidence in the future of our regions" by the leader of the Nationals.
A billion dollars has already been poured into the fund, with broad guidelines covering infrastructure projects, events, strategic regional plans, leadership and capacity-building projects.
The use of the fund has come under fire in recent months, after documents released under Freedom of Information showed Mr McCormack and a group of ministers had intervened in the decisions made on a third of the projects.
More than $22m will be in the budget for water infrastructure projects in Victoria, New South Wales, Tasmania and South Australia.
There will also be funds to help regional communities rebuild after the pandemic, with $5.7m going to a Rebuilding Regional Communities Program.
"The program will offer grants across two streams to community organisations to help with the COVID recovery," Mr McCormack said.
"The Micro Projects stream will provide small grants of up to $10,000 for communities in regional Australia with fewer than 50,000 people to help sustain local organisations and their work.
"The COVID Recovery stream will provide up to $50,000 for larger projects which enhance the process of recovery of communities affected by the COVID19 pandemic."
The National Farmers' Federation chief executive Tony Mahar said he wanted to see the government commit to regionalisation, which was not a new issue.
He called on the government to pick 20 regional centres across the country to focus on building infrastructure and growing investment opportunity.
"COVID has given us the opportunity to reset," Mr Mahar said.
"The government has to take advantage of what has been a challenging 12 months, and use it to adjust the settings to promote investment in rural Australia."
New statistics from the Australian Bureau of Statistics shows many city dwellers are swapping their apartments for the bush, with internal migration figures showing the highest rate of people moving from cities to the country on record in 2020.
Almost 43,000 more people went from the city to the country last year, more than double that in 2019.
"In the 2020 calendar year, 233,100 people arrived to live in regional areas and 190,200 people departed for the capitals," the bureau's director of demography Phil Browning said.
"This resulted in a net gain of 43,000 people for the regions, up from 18,900 in 2019."
Sydney experienced the greatest net loss of people, with Melbourne coming in second.
The story Money for bush in the budget as Aussies move away from cities first appeared on Farm Online.