On 23 December 2021, Austrade issued an update on the newly restructured Export Market Development Grant (EMDG) program that applies from years ending 30 June 2022.
Given the timing of the notification, we are concerned some claimants may have missed the update as it provided critical information on assessment and grant agreement timings, grant payment schedules and estimated grant amounts.
Unfortunately for claimants, the news is not good. According to the update, Austrade have received the highest number of applications in the history of the program and, as they work within a set allocation of resources and funding allocated each year, estimated payments have been severely reduced and grant assessment times extended.
Estimated grant amounts
The newly structured scheme was designed to provide “upfront funding certainty… so you can plan your promotional activities with confidence”. However, Austrade has indicated the initial ceiling amounts for each tier of funding have been significantly reduced:
Level of funding |
Initial ceiling (per year)$AUD |
Revised actual ceiling$AUD |
|
Tier 1 |
$40,000 |
$15,000 |
|
Tier 2 |
$80,000 |
$23,000 |
|
Tier 3 |
$150,000 |
$35,000 |
Timings
Austrade is aiming to advise application outcomes before 8 February 2022, but have warned this may take longer given the high number of applications. Grant agreements will be issued from mid-February 2022 with no final date given.
Applicants can check the status of their application by logging into the EMDG online portal or contacting their BDO partners.
BDO comment
This will be a major blow to all EMDG applicants. While there has always been a caveat on the relationship between application numbers and the fixed pool of funding, we are disappointed Austrade was not more careful in their forecasts and calculations to ensure businesses had more accurate advice.
With the EMDG programme in transition this year (applications for the 2022 financial year closed five months into the year), some claimants may have been incurring costs since submission of their application, which they may now not be supported for.
There was no additional information provided in relation to the 2021 financial year other than applications are being assessed in the order they are received, and Austrade aims to finalise 98 per cent of applications by 30 June 2022.
If you would like to discuss the impact this announcement may have on your EMDG claim, or discuss other R&D or grant applications, please contact your local BDO adviser.