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With several elections on the horizon, both at the state and federal levels, at minimum we will see grant programs stall in line with caretaker periods. Should there be a change in government, the period of disruption may extend. This is a real possibility in the Queensland grants jurisdiction.
Broader economic volatility and contraction are already impacting, and will continue to impact, the availability of grants and how the government chooses to support industry (think equity and debt investment or production tax rebates over traditional non-dilutive grant funding).
Upcoming elections in key states such as Queensland, scheduled for October 2024, and Western Australia, scheduled for March 2025, will impact the availability of grant funding at the state level. This is especially significant in FY25 as both Queensland and Western Australia are states with healthy budget positions, having generally strong and broad grant regimes.
These elections, coupled with a clear, but highly targeted industry support strategy from the federal government (clean energy transition) will continue to shape the availability and focus of grant programs.
The federal election, expected by May 2025, will pause grant programs at this level. This will impact already highly subscribed, multi-stage programs, like the Industry Growth Program (noting that the grant stream of the Industry Growth Program only opened in May 2024).
The net effect of this will be continued increase in competition in the grant funding space, exacerbated by pent-up demand from industry, likely resulting in longer application assessment times and perhaps temporary program closures as we have seen in Queensland (Industry Partnership Program), and more recently in Western Australia (WA Investment Attraction Fund).
Of course there is also the US election in November, and it remains to be seen what impact a Trump victory could have on the Future Made in Australia plans, part of which hinge on exporting Australian value-added critical mineral to allies such as the United States.
The current economic climate, characterised by an inflationary environment and post-COVID budget deficits, has prompted some state governments, such as Victoria, to scale back legacy industry support programs. While New South Wales has reopened grants following the 2023 change of government, the state no longer has the breadth of programs it once did. Assessment times on its new Net Zero Manufacturing Initiative program were well over those publicised in the guidelines, and those moving from Expression of Interest to Detailed Application stage will agree – things are moving suspiciously slowly.
The impact of reduced state budgets is particularly evident in the “traditional” manufacturing grant space, where funding has been significantly curtailed. The focus on immediate economic relief measures means limited budget allocations to grant funding, again making the landscape more competitive and challenging for businesses seeking funding – particularly SME manufactures operating outside the National Reconstruction Fund priority industry sectors.
Despite these challenges, governments at all levels continue to seek similar benefits from grant supported projects, with funding supporting capital expenditure, high-skilled job creation, skills investment, positive economic outcomes and of course clean energy market development. A notable trend is the increasing emphasis on environmental and ESG impacts – with the ‘S’ of ESG also growing in focus. Take the Federal Government’s new Future Made in Australia Community Investment Principles as an example of this shift.
At Grant Thornton, we support small, mid-sized, and large businesses with comprehensive government grant assistance. We help you identify, plan for, and apply to grant programs that align with your business growth strategy. If you are an innovative business with upcoming investment projects, there are likely grant opportunities available for you, especially if you operate in priority sectors such as agriculture, defence, energy, food & beverage, health, medtech and life sciences, mining, renewables and low emissions technologies, resources and critical minerals, or space. We can design a dedicated grant strategy to help you stay competitive and grow!
Read on for more key government grant programs to watch in FY25.
With a clear focus on the Future Made in Australia mission, grant programs will focus on priority industry sectors, namely:
Other industry sectors identified for the National Reconstruction Fund include: value-add in resources; value-add in agriculture, forestry and fisheries; transport; medical science; renewables and low emission technologies; defence and enabling capabilities.
Key grant and investment programs to look out for:
The R&D Tax Incentive program continues to help companies to innovate and grow, by offsetting their costs of eligible research and development (industry agnostic).
New hydrogen and critical minerals production tax incentive programs were also flagged in the 2024-25 Budget and are undergoing design (public consultation closed in July 2024).
Next election: The next election is due by September 2025, but expected by the end of May. Expect a pause on grant programs for at least 2-3 months on either side of the election period.
For the 2024-2025 year, Victoria has reprioritised budgetary allocations from grant programs to other initiatives. Government funding support for mid-sized businesses will likely be challenging, and businesses may need to consider other non-capex based funding options for their projects.
Key grant and investment programs to look out for:
Next election: November 2026.
With a significant focus on cost of living and other committed funding in the recent 2024-2025 Budget, there are no notable new grant funding programs announced for the coming financial year.
Key grant and investment programs to look out for:
Next election: March 2027.
Queensland has several interesting industry grant programs on offer. However, with the state election upcoming in October 2024, assessment of these programs may be delayed. If there is a change in government, there is uncertainty about timing of new grant programs.
Key grant and investment programs to look out for:
Next election: October 2024. Expect a pause on grant programs for at least 2-3 months on either side of the election period.
With the next election upcoming in March 2025, Western Australia is strategically tightening up its grant funding programs and refocusing to other initiatives.
Key grant and investment programs to look out for:
Next election: March 2025. Expect a pause on grant programs for at least 2-3 months on either side of the election period.
South Australia’s budget is in surplus for 2024-2025, and offers some grant programs that may be of interest, particularly for defence projects.
Key grant programs to look out for:
Next election: March 2026.
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