Australian governments—federal and state—have various programs to support manufacturing technology adoption. Some specifically target AI; others are broader but applicable to AI projects.

Navigating this landscape is confusing. Programs change frequently, eligibility criteria are often unclear, and the application process can be daunting. Let me break down what’s currently available and how to approach it.

Federal programs

Industry Growth Program

The Industry Growth Program replaced several earlier programs and provides funding for businesses looking to commercialise innovative products and processes.

Relevance to manufacturing AI: Projects that develop or adopt AI for manufacturing improvement can potentially qualify. The focus is on competitive advantage and commercial outcomes.

Funding: Grants ranging from $50,000 to $5 million depending on the stream.

Eligibility: Australian companies with turnover generally between $1.5 million and $100 million. Must demonstrate innovation and growth potential.

Catch: Competitive process. Application quality matters. Success rate is typically 15-25%.

R&D Tax Incentive

Not a grant, but a tax offset for eligible research and development activities.

Relevance to manufacturing AI: Developing new AI systems, adapting AI for novel applications, and experimenting with AI technologies can qualify as R&D.

Benefit: Refundable tax offset of 43.5% (for companies under $20M turnover) or non-refundable offset of 38.5% (for larger companies) on eligible R&D expenditure.

Eligibility: Australian companies incurring R&D expenditure. Activities must be experimental with uncertain outcomes.

Catch: Strict rules about what qualifies as R&D. Off-the-shelf AI implementation generally doesn’t qualify; developing something new might. Get specialist advice.

Modern Manufacturing Initiative

Focused on designated priority areas of manufacturing. Funding for capital investment and commercialisation.

Relevance to manufacturing AI: AI investments that support manufacturing capability in priority areas may qualify. Priority areas include resources technology, food/beverage, medical products, recycling, defence, and space.

Funding: Varies by stream, but grants of $1-20 million have been awarded.

Eligibility: Manufacturing companies in priority areas with credible plans for growth and investment.

Catch: Very competitive, focused on substantial projects with significant co-investment.

State programs

Each state has its own programs that come and go. Here’s a snapshot, but check current status as these change frequently.

Victoria

Made in Victoria 2030 initiative includes various support programs:

• Manufacturing Excellence Fund (capital investment support)
• Supply Chain Resilience Program
• Digital Skills and Jobs Program

Victoria also has strong innovation ecosystem support through Launch Vic and various industry programs.

New South Wales

Jobs Plus Program: Support for companies creating jobs in NSW, including advanced manufacturing.

Boosting Business Innovation Program: Grants for SMEs to work with research institutions.

Various industry-specific programs through Investment NSW.

Queensland

Made in Queensland Program: Grants for manufacturers to adopt new technologies and processes. AI projects have been funded through this program.

Business Investment Fund: Larger investments supporting business growth.

South Australia

Economic Recovery Fund: Support for businesses investing in capability.

Research Consortium Program: Funding collaborative research projects.

Strong focus on defence manufacturing through the state’s industry development programs.

Western Australia

New Industries Fund: Support for emerging industries and technology adoption.

Investment Attraction Fund: Larger projects creating jobs and economic activity.

How to actually get funding

Understanding that programs exist is one thing. Successfully accessing them is another.

Step 1: Be strategic about which programs to pursue

Don’t spray applications everywhere. Assess:

• Does your project actually fit the program objectives?
• Are you genuinely eligible?
• Can you make a compelling case?
• Do you have capacity to manage the application and reporting if successful?

One strong application beats three weak ones.

Step 2: Engage before applying

Most programs welcome pre-application discussions. Contact the program team, explain your project, and ask for feedback on eligibility and fit. This saves time and improves your eventual application.

For state programs, business development managers at state development agencies can provide guidance.

Step 3: Build a solid business case

Grants are investments, not gifts. Programs want to fund projects that will:

• Create jobs
• Build Australian capability
• Generate economic returns
• Demonstrate innovation

Your application needs a credible business case showing how the AI project delivers these outcomes. Vague claims about “digital transformation” don’t cut it.

Step 4: Document everything

Applications require detailed documentation:

• Project plans and timelines
• Budget breakdowns
• Evidence of technical capability
• Financial statements
• Letters of support

Start gathering documentation early. Missing pieces cause delays or rejection.

Step 5: Consider help

Grant writing is a skill. Many successful applicants use grant consultants or specialised writers. The cost (often 5-10% of grant value) can be worthwhile for significant applications.

Be wary of firms that promise guaranteed success or take payment only on success—these often produce low-quality applications.

Step 6: Plan for the money

If you receive a grant, you’ll have reporting obligations. Be prepared to:

• Track expenditure against budget
• Document progress against milestones
• Provide evidence of outcomes
• Complete acquittal reports

Build this into your project plan from the start.

Common mistakes

Applying for everything: Spreading effort across many applications dilutes quality.

Overpromising: Committing to outcomes you can’t deliver creates problems later.

Underestimating effort: Both applications and subsequent reporting take real time and resources.

Mismatch with program objectives: Trying to fit your project into a program it doesn’t really suit.

Going it alone for large applications: Complex applications often benefit from professional support.

The ROI question

Is it worth the effort?

A $200,000 grant that takes 100 hours of staff time to apply for and 50 hours to report on is probably worth it. A $20,000 grant that takes the same effort might not be.

Consider:

• Grant amount
• Application effort
• Success probability
• Reporting burden
• Opportunity cost of staff time

For large, well-suited projects, grants can significantly improve ROI. For small projects or poor fits, the effort may exceed the benefit.

Beyond grants

Some other support mechanisms:

Export Market Development Grants: If your AI capabilities will help you export, EMDG can offset marketing and development costs.

Approved Research Institutes: Universities and CSIRO can be partners in R&D that qualifies for enhanced tax incentives.

Accelerators and incubators: Various programs support technology commercialisation with mentoring and connections, not just cash.

Regional development programs: Regional areas often have additional support not available in metro areas.

Keeping current

Grant programs change constantly. What’s available today may not exist tomorrow, and new programs emerge.

Resources to stay informed:

• business.gov.au - Federal programs
• State development agency websites
• Industry associations often track relevant programs
• Newsletters from accounting/consulting firms that specialise in grants

Manufacturing AI projects can often access support that reduces the effective cost by 20-40%. That’s significant. But it requires understanding the landscape and investing effort in applications.

Don’t let grant availability drive your project decisions—do what makes business sense. But once you’ve decided on a project, investigate what support might be available. It’s money that’s there for the taking, if you’re willing to do the work.