A year after Cadbury was promised $16 million, Labor says no business case has been made for the federal grant.
The Opposition has obtained emails under Freedom of Information (FOI) laws that it says shows no proposal has been put forward by the company.
The funding was promised to the confectionary company by the Coalition in the lead up to last year's federal election.
At one stage the grant was believed to be for the company to develop its tourism operations.
Labor's Anthony Albanese said the Assistant Minister for Trade told Parliament in April this year that a strong case had been made.
"At the same time the department was saying 'well, we'd better sort this out before the ABC asks the ministerial office, what information?' Because at that time, as it is still, Cadbury was yet to provide a business case for this proposal," he said.
Mr Albanese said the money was originally pledged to boost tourism, but there was confusion over what the money would actually be used for.
"It appears to be a different thing for different ministers at different times," he said.
"What's consistent is that they all say this grant should be approved in spite of the fact that one year on, there is still no business case," he said.
Tasmanian Senator Eric Abetz has told 936 ABC Hobart Cadbury advised the Federal Government the tourism element of their proposed expansion would not be viable without public funding.
"We accepted that at face value and we are now going through with Cadbury to determine if that's the case," he said.
"And if the case doesn't stack up then we'll have to reconsider because we will, at the end of the day, protect taxpayers' dollars."