The Federal Government’s Manufacturing Modernisation Fund offers grants from $50,000 to $1 million for eligible projects for Australian SME manufacturers. Applications are closing soon.

Manufacturing Modernisation Fund

On 5 September 2019, the Federal Government announced a strategic funding package to support and enhance Australian, SME manufacturing businesses. The Manufacturing Modernisation Fund will run over three years from 2019-20 to 2021-22. The program is targeted to stimulate business investment in new technologies, training and processes in the manufacturing sector.

The Manufacturing Modernisation Fund is part pf the Governments broader programs to support Australian manufacturing industries and in particular to implement advanced manufacturing technologies to increase innovation and competitiveness. The Advanced Manufacturing Growth Centre has published a Sector Competitiveness Plan which outlines the following strategic priorities for the sector:

  • Advanced Knowledge: including high R&D investment and STEM skill intensity
  • Advanced Processes: including using state-of-the-art technology and managing energy use
  • Advanced Business Model: including offering high value niche solutions, servitisation models and export competitiveness.

Funding equates to a 25% to 50% discount on your project

The Manufacturing Modernisation Fund has a total pool of $50 million over 3 years, which will be delivered through two streams of funding:

  1. Small Grants ($20 million) – to support technology and efficiency improvements with the value of $50,000 to $100,000 (50% funding ratio)
  2. Large Grants ($30 million) – to support transformative investments in technologies and processes with the value of $100,000 to $1 million (25% funding ratio)

How does this work? Early advice suggests that to receive for example a $50,000 grant, your project would be $100,000 in value, meaning the Manufacturing Modernisation Fund will invest $50,000 and your company must invest the remaining $50,000. For grants over $100,000, your company must provide 75% of the funding capital and the Manufacturing Modernisation Fund will contribute 25% – for example a project with a total cost of $500,000, your company will contribute $375,000 and the Manufacturing Modernisation Fund would contribute $125,000. (Note this advice should be verified with the Department).

Lease options permitted

Don’t have the cash to execute the project? The Grant guidelines even allow you to lease (finance lease or operating lease under certain conditions) to achieve your projects plant and equipment. In claiming the purchase price of capital items, you must take out any costs related to financing, including interest. You can claim related freight and installation costs on capital expenditure.  Eligible costs for plant and equipment will normally need to be on your balance sheet.

If utilising an operating lease, grant applications will only consider costs for plant and equipment not on your balance sheet under certain circumstances. Eligibility includes that:

  • you integrate the plant or equipment into your manufacturing process; and
  • you cannot transfer the plant or equipment and the lease period is at least 4 years.

Eligible Applicants

To be eligible for the Manufacturing Modernisation Fund you must:

  • Company – be an entity incorporated in Australia and a trading corporation (no trusts)
  • Headcount – have up to 199 employees
  • Job Creation – clearly identify the level of job creation expected from your project.
  • Support – provide evidence  of project support from your Board, CEO or Managing Director.
  • Funding – provide evidence that you can meet the costs of the project not covered by the grant funding.

Eligible Projects

To be eligible your project must involve capital investment AND associated skill-based training to modernise your manufacturing process. Eligible activities may include:

  • buying, constructing, installing or commissioning of manufacturing plant, equipment or software
  • relevant training and skills development to assist you to integrate the new technology into your business, including upskilling and accreditation in advanced processes.
  • process design and engineering directly related to your capital investment
  • fit-out, alterations and/or extensions to buildings directly related to your capital investment. We may also approve other activities.


Grants are competitive and will be assessed by the Commonwealth Department of Industry, Innovation and Science. Applications for the first round of grants close on 31 October 2019 and with such tight timing, businesses who already have a project in the planning phase are well placed to apply for this grant funding.

Australis Engineering – smart thinking equals manufacturing modernisation

As a trusted integrator of manufacturing technologies and members of the AMGC, from state of the art conveying and pallet handling, to robotics, industrial automation and Industry 4.0 technologies, Australis are well placed to assist your business to formulate a project to take advantage of the Manufacturing Modernisation Fund.

Some of the project opportunities which might qualify for Grant funding:

  • Robotic palletising system
  • Automated pallet handling and warehousing system
  • Collaborative robot picking and packing system
  • High speed conveyor system
  • Vision inspection system
  • Bespoke, customised processing equipment

We can even assist you to connect with trusted partners to help write the grant application and therefore increase your chance of success in what is sure to be a competitive funding assessment.

Contact us to learn more.