Article:

Manufacturing Modernisation Fund - Applications open soon

24 November 2020

Simon Wu, Manager, R&D Tax & Government Incentives |

This article has been updated to include the latest guidelines. The article was originally published on 21 October 2020.

The Government announced a new Modern Manufacturing Strategy as part of its JobMaker plan to stimulate the Australian economy. The strategy will see $1.5 billion invested in Australian manufacturing for five years from 2020-21, targeting six National Manufacturing Priorities identified as either areas of competitive strength or strategic national priority. The six National Manufacturing Priorities are:

  • Resources technology and critical minerals processing
  • Food and beverage
  • Medical produts
  • Recycling and clean energy
  • Defence
  • Space.

Manufacturing Modernisation Fund

The guidelines for round two has been released, however, the Government has not yet released an opening date. We expect this to open in the coming weeks.

Round two will support approximately 150 firms that align with the newly introduced Modern Manufacturing Strategy with a specific focus on the six National Manufacturing Priorities, to make capital investments that will increase employment, upskill workers or result in the use of new technology to support the COVID-19 recovery.

It is our understanding applications that do not fall within the six National Manufacturing Priorities are unlikely to be considered.

Funding information

Under round two of the Manufacturing Modernisation Fund, a total pool of $50 million is available from 2020-21 to 2022-23. Grant funding will be up to 25% of eligible project expenditure with a minimum grant amount of $100,000 and a maximum of $1 million.

Eligibility criteria

To be eligible to apply, you must:

  • Have an Australian Business Number
  • Be non-tax exempt
  • Be registered for GST
  • Be an incorporated entity, where your trading activities form a sufficiently significant proportion of the entity’s overall activities, and are substantial and not merely a peripheral activity of the entity.

Before applying, it’s important to ensure you:

  • Are a small or medium-sized manufacturer with up to 199 employees
  • Have a minimum of $400,000 in eligible project expenditure.
  • Clearly identify the level of job creation expected from the project
  • Outline how your project aligns with one or more of the six National Manufacturing Priorities
  • Provide evidence from the board (or CEO or equivalent if there is no board) that the project is supported, including that the project can be completed and meet the costs of the project not covered by funding
  • Provide evidence of how you will provide for the share of the project costs (i.e. accountant declaration)

Supporting Documentation/Attachments

The guidelines for round two have defined the documents that must be provided, including:

  • A detailed project plan, including:
    • Overview and project scope
    • Market analysis
    • Potential benefits
    • Detailed project timeline or Gantt chart
    • Project management team
    • Risk analysis.
  • A detailed project budget, including an explanation of the basis upon which the costs assumptions were made. The budget should include a breakdown of the costs that sit under each head of expenditure and how these have been determined (i.e. quotes)
  • Accountant declaration
  • Evidence of support from the board, CEO or equivalent
  • Trust deed (where applicable).

For further information on the Manufacturing Modernisation Fund or how you can apply, please contact a member of our Government Incentives team.

The Manufacturing Modernisation Fund was first administered in 2019 to provide small and medium-sized manufacturers with funding to modernise their manufacturing processes, adopt new technologies, become more productive and create jobs. The fund was highly successful and has been renewed for a second round.