The Federal Government has been branded "corrupt" by Denison MP Andrew Wilkie after announcing it would spend the majority of $16 million, originally offered to the Cadbury factory, in the state's three Liberal-held seats.

The Federal and State governments combined last September to create a $24 million investment fund after Cadbury pulled out of a $16 million pre-election deal made in 2013.

Among the list of projects receiving grants from the Commonwealth under the Tasmanian Jobs and Investment Fund (TJIF), none are in Glenorchy where the Cadbury factory is.

Businesses were able to apply for grants on the basis they must contribute $2 for $1 of taxpayer money put towards their project.

The majority of the money is destined for businesses in the tightly contested Liberal-held seats of Bass, Braddon and Lyons.

Independent MP Andrew Wilkie said the Glenorchy community had been left high and dry.

"It is a corruption of good governance for the Turnbull Liberal government to put its political self-interest ahead of the public interest, and to hang out to dry the city of Glenorchy which, as much or more than any other part of the state, desperately needs economic stimulus," he said.

"I want the $16 million spent in Glenorchy."

Money being used to save Liberal seats: Wilkie

Mr Wilkie said the money was going towards saving the seats of Tasmania's three Liberal MPs — or "three amigos" — Andrew Nikolic, Eric Hutchinson and Brett Whiteley.

The three Liberal-held seats of Lyons, Bass and Braddon are to receive 41 of the 56 grants, or $16.79 million of the total $21.92 listed under the TJIF.

Grants by electorate Electorate Held by Grants Total Lyons Liberal 18 $6.29m Bass Liberal 12 $5.55m Braddon Liberal 11 $4.95m Franklin Labor 9 $2.97m Denison Independent 6 $2.15m

"Explain how, before the 2013 election they can say there was a pressing need for economic stimulus in the south but now, before the 2016 election, it's OK to send all or most of that money through a slush fund to save the so-called three amigos," Mr Wilkie said.

Federal Labor member for Franklin Julie Collins questioned the timing of the grant announcement, given applications closed in February.

"It couldn't possibly have taken that long to assess the applications," she said.

"They've used the federal election to try to prop up their marginal seats ... with this funding in the hope it will get those local members re-elected.

"Tasmanian jobs should be on the basis of need, and the funding should have been on the basis of need."

Tasmanian Liberal senator Richard Colbeck defended the decision, saying Mr Wilkie's electorate would still benefit from the money.

"If the Tasmanian economy benefits, everyone in the state benefits," he said.

"This is not about any individual. It is about making a strategic and sensible decision to assists businesses in this state to employ more people."