Grants 101

For anyone new to Commonwealth grants administration, it can sometimes be confusing to work out what to do to ensure grant programs are designed and delivered in compliance with the Grants Framework and Finance Law. This page outlines key steps to guide you.

First, the Grants Framework is set out in the Commonwealth Grants Rules and Guidelines (CGRGs), which is a legislative instrument that is largely principles based, with some specific requirements.

Is it a grant?

It is important to determine the appropriate type of funding arrangement for the spending activity, i.e. grants, procurement or another financial arrangement. New spending activities need policy approval, often the result of the annual budget process or MYEFO [Mid-Year Economic and Fiscal Outlook, refer], which may indicate the type of arrangement. The Department of Finance has developed a simple tool to assist you when determining the type of financial arrangement: Grants decision tree tool.

Tip: if it is not clear what type of financial arrangement it is think about what the substantive purpose of the arrangement is, why is the funding being made available?.

Note: There are some financial arrangements, which would normally be included in the definition of a grant, that are not subject to the CGRGs for policy reasons. Please see the exclusions in clause 2.6 of the CGRGs.

Resource Management Guide 411 provides useful information on a range of financial arrangements, including grants and procurement, and may assist further.

It is a grant

After making the decision that the type of financial arrangement is a grant program, and it falls under the CGRGs, the next step is to develop the grant opportunity. The department of finance have a flow diagram that outlines the grant process

Step one is Design: If your entity is in scope to use a Grants Hub (Hub), your agency should work with the Hub to design the grant opportunity. Design teams in the Hubs have a breadth and depth of experience to draw on, to guide an agency to get the best outcome and most effective administration for each grants program. Other agencies can also use a grants Hub and it is likely to benefit your program if you do. See more information below on the Business and Community Grants hubs and entities in scope to use a Hub.

Tip: When you are thinking about the design of a program, think about the grant applicant and recipient and what is proportional for the amount of grant available. Think about how much red tape or burden you are placing on applicants and recipients and whether this is reasonable. Grants Hubs can help you to work through this.

Robust planning and design is a key principle of the CGRGs ( Chapter 7). Matters to consider include:

  • establishing the rationale for the grant opportunity, in particular what outcomes are required and how these will be measured;
  • defining the operational objectives;
  • consulting with key stakeholders;
  • undertaking risk identification, mitigation and engagement;
  • designing the grant opportunity to achieve value with relevant money, considerations for this include:
    • developing eligibility and assessment criteria that reflect the operational objectives and policy intent and are easily assessable;
    • identifying any considerations which will impact on the decision making;
    • ensuring the application and selection processes are proportional and accountable and meet probity and transparency requirements;
    • establishing performance and evaluation measures;
  • identifying the capabilities required for assessment, who will assess applications and who the decision maker will be;
  • selecting an appropriate funding strategy and grant agreement/s taking into consideration the risks and objectives;
  • considering legal, accounting and policy matters; and
  • developing robust governance arrangements.

Grant Guidelines

Grant opportunity guidelines must be developed for all grant opportunities. Grant opportunity guidelines are the authoritative documents which potential grantees engage with that provides all information required to understand the purpose of a grant opportunity and how to make an application.

The Department of Finance, in consultation with granting agencies, has developed whole of government grant opportunity templates to assist when designing and developing grant opportunities. These templates meet better practice administration requirements under the CGRGs and allow speedier timeframes for approval and publication of the grant opportunity, to open the grant for applications.

This is a decision tree tool to help you decide which template to use: Grants template wizard.

Risk is also a key principle of the Grants Framework. Entities are required to prepare a risk assessment with the grant opportunity guidelines and consult with the Department of Finance and the Department of the Prime Minister and Cabinet (PM&C) on the risk rating (more on this below).


Entities are required to conduct a self-assessment risk analysis of the grant program and related guidelines. Once the entity has assessed a risk rating, they are required to consult with Finance and PM&C on the risk assessment and grant guidelines and seek an agreed risk rating. This risk rating determines the approval process for publishing the grant opportunity guidelines. The key steps are:

  1. Entities prepare risk assessment and grant opportunity guidelines
  2. Finance and PM&C review and agree on a risk rating for the grant opportunity (this determines the approval process for the release of the guidelines)
  3. Grant opportunity guidelines are approved and published on GrantConnect.

Risk includes the program and implementation risk, grantee risk and activity risk. Things to consider include: complexity of the design of the grant opportunity, number of eligible applicants, as well constitutional and legislative risk (is the commonwealth able to make payments for these purposes), etc.

Guidance material on how to prepare a risk assessment is available on here, please contact the grants team for the self-risk assessment template

Streamlined approval process for grant guidelines

The Government has streamlined the process for grant opportunity guidelines to be agreed and published, where a whole of government template is used and the agreed risk is “low”. The streamlined approval process aims to reduce the time spent by entities on administrative processes, enabling guidelines to be released more quickly and to allow the focus to be on achieving the best outcomes for Australians.

Once the grant opportunity guidelines have been approved, they are published on GrantConnect (, a requirement under the CGRGs.

In using the whole of government templates (link), responsible Ministers may approve grant opportunity guidelines where the relevant entity, Finance and the Department of the Prime Minister and Cabinet (PM&C) agree the risk is “low” and the templates have been populated as instructed. This process and the correct use of templates enables entities to engage in better practice grants administration in a consistent and transparent way. The templates also aim to reduce the time spent by grant applicants reviewing guidelines by providing a common format and structure making it easier for grant applicants to navigate and understand the requirement they will need to satisfy to apply for a grant.

The table below outlines the key requirements for each grant opportunity

Quick Reference Guide Competitive and Non-competitive selection processes Eligibility only or Demand Driven selection processes One-off or ad hoc grants
Policy and legal authority required? Yes Yes Yes
Grant opportunity guidelines are required?
The use of these templates is optional, but will enable low risk grants to use the streamline approval process to publicly release the guidelines.
Yes Yes Yes
The risk rating from the self-assessment must be agreed in consultation with Finance and PM&C prior to the release of grant opportunity guidelines? Yes Yes Yes
Grant opportunity guidelines must be published on GrantConnect. Yes Yes Optional
The approver must record the basis of the approval relative to the grant opportunity guidelines and the key principle of achieving value with relevant money. Yes Yes Yes
The entity is required to report grants awarded on GrantConnect. Yes Yes Yes
Where a Minister approves a grant in his/her own electorate, the Minister must write to the Finance Minister. Where the Minister is the approver the Minister must write to the Finance Minister as soon as practicable. Yes Yes Yes
Where a Minister approves a grant that the entity recommended be rejected, the Minister must report these grants annually to the Finance Minister. Yes Yes Yes

Streamlining Government Grants Administration (SGGA) Program

The grants hubs are part of the Streamlining Government Grants Administration Program which aims to reduce duplication of effort and expense by delivering a simpler and more consistent approach to the administration of grants across the Australian government. 

The SGGA program consolidates and standardises grant services into grants administration hubs to create a common ICT and business platform and standardised business processes. This is to improve the user experience (making it easier for grant applicants and recipients to find and apply for grants), enable better policy development that meets the needs of Australians, and create efficiencies and improved service delivery.

If you are administering grants from one of the below listed entities please contact either Hub:

While entities can choose their preferred grants hub, in general:

  1. Community and health sector grants are delivered by the Community Grants Hub, within the Department of Social Services; and
  2. Business and business-like sector grants are delivered by the Business Grants Hub, Department of Industry, Science, Energy and Resources.

Business and Community Grants Hubs

If your entity is listed below, the Business and/or Community Grants Hub must be used to administer grants on your behalf:

  • Attorney-General's Department
  • Department of Agriculture, Water and the Environment
  • Department of Defence
  • Department of Education, Skills and Employment
  • Department of Health
  • Department of Industry, Science, Energy and Resources
  • Department of Infrastructure, Transport, Regional Development and Communications
  • Department of the Prime Minister and Cabinet
  • Department of Social Services
  • Department of Veterans’ Affairs
  • Department of Home Affairs
  • National Indigenous Australians Agency.

Please engage early with the grants hub to ensure that design of the grant opportunity is fit for purpose and seek a quote for grants administration service delivery.

Commonwealth entities consume grant administration services from the grants hubs across the lifecycle of a grant. The grants lifecycle encompasses five stages: design, select, establish, manage and evaluate (CGRGs paragraph 2.8).

For further information contact the Grants team at

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