Pegrum has resigned on the

day an audit report damned the

management of the

Commonwealth's overseer of the

national capital.

However, Ms Pegrum said last

night that her departure was not

linked to the report and she had

planned to leave months before.

''I take huge umbrage to any

connection between the two,'' she

said.

The Australian National Audit

Office report, tabled yesterday in

Parliament, found the authority had

mismanaged Canberra's national

assets, worth $456 million, overpaid

contractors, risked a major oil spill

from Scrivener Dam and failed to

heed warnings to lift its game.

Home Affairs Minister Bob Debus

expressed deep concern at the report

which he said revealed ''an extraordinary

waste of public money'' and

questioned the authority's abilities to

manage its own affairs.

The authority is already under

pressure from a Debus-

commissioned parliamentary

inquiry into its future and after

budget cuts led to it shedding a third

of its staff.

Outlining the scope of the

problems, Mr Debus said, ''The

National Audit Office has found the

authority paid $1.4 million for a

computer system they don't use,

which will now have to be replaced at

great cost.

''Equally as concerning is the fact

that the NCA will now have to take

legal action to attempt to recover

over $300,000 in uncollected rent

and overpayments to a contractor.

''The NCA has consistently

complained about not having

enough money to carry out its

responsibilities but this report raises

serious doubts about the authority's

ability to manage its budget.''

The audit report and Ms Pegrum's

resignation come only a day after the

joint committee into the future of the

authority wound up its public

hearings.

Mr Debus has referred the audit

report to the parliamentary committee.

The

auditor found the authority

had not funded ''a number of major,

non-routine maintenance tasks'' on

Scrivener Dam, which had been

found not ready to handle a flood,

including:

Twenty-eight projects on the

dam's electrical system. (The work,

identified by a consultant as necessary

in 1998, is scheduled for completion

in 2009.)

Twenty-six projects recommended

by another firm of consultants in

2000 as ''necessary to be done in the

short term (one to two years)'' which

were ''important for dam operation,

safety, surveillance, occupational

health and safety, environment''.