AUSTRALIAN GOVERNMENT
GRANTS NEWS
April 2014
It has been another busy quarter in grants
administration. We have seen the inaugural
Repeal Day, with the Low-risk Grant
Agreement Template now launched on the
Finance website. The grants.gov.au scoping
study is underway and the Public
Governance, Performance and Accountability
Act 2013 (PGPA Act) Taskforce continues to
move forward, with the new act to take
effect from 1 July 2014.
This edition features our first agency profile
from the Attorney General’s Department, as
well as information from the Australian
National Audit Office about value with
public money.
2014 Australian Government
Repeal Day
On 19 March 2014 (Repeal Day), the
Prime Minister announced a range of
measures that contribute towards the
$1 billion target of reduced regulatory
burden on individuals, businesses and
community organisations.
Finance is
responsible for implementing a number of
initiatives through the grants and
procurement frameworks.
As part of the Autumn Repeal Day, the
Government officially launched the low-risk
grant agreement template. The template
includes a standard set of 20 terms and
conditions (just two-pages) and aims to
reduce the administration and legal costs
associated with grant agreements. Finance
has also developed an accompanying risk
tool and user guide to assist agency staff
using the template.
The template, risk tool and user guide are
now available on the Finance website.
Please contact the Grants Policy Team at
grants@finance.gov.au if you would like to
arrange an information session for your
agency on the low-risk template.
The procurement related initiatives are
focussed on making it easier for small
business to do business with government.
One measure is the Commonwealth
Contracting Suite for low-risk procurements
under $200,000. It comprises standardised
terms and conditions, combined with userfriendly and intuitive online templates.
These should remove the need for legal
advice and other associated costs. Probity
guidance on the Finance website is also
being updated. Government agencies will
be encouraged to talk to potential suppliers
during the tendering process.
A second policy, effective from 1 July 2014,
facilitates prompt payments to small
businesses. Credit and debit cards will
become the Government’s preferred
payment option for purchases under
$20,000. This means businesses will save
on costs relating to financing cash flow
See this link for additional information on
Finance’s
low-risk
grant
agreement
template. Once finalised the Commonwealth
Contracting Suite will be published on the
Finance website, meanwhile updates will be
posted on the Procurement Coordinator’s
blog.
Minister’s Annual Reporting
Requirements: Reminder
The Commonwealth Grant Guidelines
(CGGs) require Ministers and Parliamentary
Secretaries report to the Finance Minister
on all instances where they have approved a
grant which agency staff
have
recommended be rejected. This report is
due by 31 March each year. The Finance
Secretary wrote to all secretaries and chief
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executives on 3 February 2014, reminding
them of this and advising of the revised
reporting period, to accommodate the
change of government.
Finance has
received 51 responses. For agencies yet to
report please do so, including for nil
responses.
The grants.gov.au project
As previously reported, Finance is
undertaking a scoping study to inform the
development of the Australian Government
Grants System (grants.gov.au). As you may
be aware, Finance requested all FMA
agencies to complete a questionnaire, which
sought comprehensive data on agencies
granting activities. Responses to the
questionnaire closed 3 February 2014.
We received responses from 106 FMA Act
agencies, with data relating to either the
2012-13 financial year or the 2012 calendar
year. The preliminary data indicates around
40 FMA Act agencies provided grants in
2012-13. There were approximately
800 grant programmes across these 40
agencies. Agencies received over 62,000
applications and entered into over 26,000
grant agreements.
To help identify any issues Finance is
consulting with potential grant recipients. A
survey was sent to over 100 potential grant
recipients and we have been meeting with
specific stakeholders. The results of this
survey are currently being analysed.
The final scoping study report is due to be
completed by mid 2014, with the system to
be operational by mid 2016.
If you would like to know more please
contact grants@finance.gov.au.
Resource Management
Instructions under the PGPA Act
Commonwealth entities are currently
preparing for the start of the PGPA Act on
1 July 2014. The PGPA Act consolidates into
a single piece of legislation the governance,
performance
and
accountability
requirements for the Commonwealth, and
sets out a regulatory framework for all
Commonwealth entities (regardless of
whether they are currently FMA or CAC Act
entities).
To help entities transition to the PGPA Act
and Rules, the Model Resource Management
Instructions (RMIs) for non-corporate
Commonwealth entities (this covers most
FMA Act agencies under the current
framework) are being developed in
consultation with a cross-agency working
group. These are based on the Model Chief
Executive Instructions (CEIs) that were
developed by Finance and agencies in 2011.
The Model RMIs are essentially a summary
of the key requirements of the resource
management
framework
in
simpler
language. They seek to improve consistency
across entities and help all staff members to
understand and comply with the key
requirements of the resource management
framework. The draft RMIs include topics
on grants and approving and committing
relevant money.
Together these two
instructions will help staff in the
administration of grants and entering into
grant agreements.
A draft version of the Model RMIs has been
distributed to agency CFOs for comment by
mid-April.
For further information on the draft model
resource management instructions refer
http://www.pmra.finance.gov.au/.
Attorney-General’s Department
Profile
The Attorney-General’s Department (AGD)
is currently preparing for the introduction
of the PGPA Act, which is set to replace the
FMA Act and the CAC Act. This involves the
substitution of the CGGs for the
Commonwealth Grant Rules and Guidelines
(CGRGs), which take effect 1 July 2014.
Tasks include making adjustments to
guidance material and internal practices,
particularly as a consequence of the
removal of the FMA Regulations relating to
spending of public money, and providing
awareness training to programme staff
about the impending legislative changes.
Currently, an internal grant reform
taskforce is reviewing and preparing a suite
of standard documents to be made available
to all programmes to coincide with the
introduction of the new act and rules.
Associated with this standardisation
exercise, the department has, along with
other agencies, set up a deregulation unit, to
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monitor the impact of regulation on
stakeholders and focus on the reduction of
red-tape, including red-tape in grant
programmes. AGD has already trialled the
Commonwealth low-risk grant agreement
template across several grant programmes
and welcomes its’ recent formal launch as a
means of streamlining administrative
processes to reduce the regulatory burden
on grantees and to allow for efficiencies
within agencies when developing grant
agreements.
Revising existing programme
guidelines and consulting Finance
Programme guidelines can only be revised
where a change does not constitute a New
Policy Proposal (NPP). Where proposed
changes are considered NPPs, agencies
should comply with the relevant Budget
Process Operational Rules.
Agencies revising grant programmes or
grant guidelines should consult with their
Agency Advice Unit (AAU) within Finance
and the relevant area in Prime Minister &
Cabinet (PMC) when a change is made to:
 the scope of the grant
 the purpose or the intent of the grant
 financial implications of the previously
released granting activity.
Where these types of changes occur,
agencies need to submit a new risk analysis
assessment, along with the revised grant
guidelines, to your Finance AAU. Once a risk
rating is agreed, agencies should write to
the Finance Minister (see Estimates
Memorandum 2014/07).
Administrative changes, resulting from
machinery of government changes, such as
changing agency titles, Minister’s names or
corrections to typos and formatting, are
minor revisions provided there are no other
changes and there is no impact to risk. If
you think your guidelines are in this
category you should contact your AAU to
discuss. Provided your AAU agrees that the
changes are minor and administrative, and
there is no change to the level of risk, you
can vary the guidelines without consulting
the Finance Minister.
Finance and PMC agree a risk rating for the
granting activity. Finance does not ‘approve’
grant guidelines, and nor does the
Finance Minister. In the case of medium to
high risk granting activities the Finance
Minister ‘agrees’ to the release of the
programme guidelines.
The guidelines,
their quality, compliance and administrative
management of the grant, remains the
responsibility of the relevant agency.
Where in doubt, contact your AAU in
Finance for clarification.
Frequently Asked Questions
I have responsibility for updating some
grant guidelines that were published years
ago. I think the changes are minor. Can I
make theses changes without going
through the process outlined in Estimates
Memorandum 2014/07?
Where programme guidelines have been in
place for a long time, and have not been
through a risk assessment process, then you
should conduct an agency risk selfassessment and seek agreement from Finance
and PMC. Given the CGGs have been in place
for over five years, by now agency staff
should have reviewed the content and
structure of most guidelines to ensure that
they are in accordance with current
legislative provisions and the CGGs.
Generally, minor administrative changes to
published guidelines, such as updating
contact details resulting from Machinery of
Government changes, do not need to go
through the risk assessment processes
outlined in EM 2014/07. To determine what
you will need to do, consult your AAU.
Grants management business
process and taxonomy
development
As mentioned in the December 2013 edition
of Grants News, Finance (AGIMO), together
with agencies managing significant grants
programmes, has
been undertaking
business analytical work in relation to
grants processes. The two projects have
involved identifying and mapping the high
level business process involved in grants
administration and compiling a taxonomy
for grants management. This work has
recently been completed and will be
submitted
to
the
Secretaries
ICT
Governance Board for discussion and
agreement in May 2014.
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Finance thanks those agencies who have
been actively involved in this work to date.
ANAO perspective: Value with
public money considerations when
selecting grant recipients
The CGGs state that it is expected that value
with public money will be a core
consideration in determining funding
recipients under a grant programme. This is
in addition to the overall test, required
under the Commonwealth’s financial
framework, as to whether a spending
proposal represents efficient, effective,
economical and ethical use of public money
that is consistent with the policies of the
Commonwealth. Often, this is referred to as
a ‘value for money’ test, noting that the
CGGs use the phrase ‘value with public
money’.
Against
this
background,
ANAO
performance audits consider value with
public money in the selection of grant
recipients at two levels.
The first relates to the detail of the
assessment
and
selection
process.
Specifically, ANAO’s criteria is that value
with public money is promoted by selecting
those applications that:
ANAO also examines whether the grants
assessment and selection processes
demonstrate a focus on outcomes in the
allocation of grants (noting that an
outcomes orientation is one of the key
principles for grants administration
included in the CGGs). One practical way for
agencies to demonstrate a focus on
outcomes is for briefings to grant decisionmakers to address whether the applications
recommended for funding are, collectively,
expected to result in the programme
meeting its key performance targets. For
example, there may be situations where the
package of recommended applications are
eligible, have demonstrated merit and any
risks are able to be managed, but funding
these projects is not expected to see the
programme deliver the extent of the
community benefits foreshadowed when
the programme was designed and approved
for implementation. In these circumstances,
ANAO will look to see whether the decisionmaker and the relevant Minister (where the
Minister is not the decision-maker) were
advised of this situation and, if funding is
nevertheless awarded, the basis on which it
was decided that proceeding to award
funding provided value with public money.
 are eligible
 have met the assessment criteria and,
where
the
granting
activity
is
competitive, have demonstrated the
greatest comparative merit in terms of
those criteria
 involve a reasonable (rather than
excessive) cost having regard to the
quality and quantity of deliverables that
is proposed (and any relevant
benchmarks/comparators)
 have a risk profile that is acceptable to
the Commonwealth, with any identified
risks able to be efficiently and effectively
managed.
ANAO’s perspective is that applications that
are assessed as ineligible or as not
satisfactorily meeting the published merit
assessment criteria are most unlikely to
represent value with public money in terms
of the objectives of the granting activity.
Additionally, such practices can adversely
affect whether the desired outcomes are
able to be achieved.
Contacting Grants News
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on the Grants News webpage located at
http://www.finance.gov.au/financialframework/financial-management-policyguidance/grants/news.htm.
Submissions – to submit an article for Grants
News please contact grants@finance.gov.au.
Collaborative opportunities – to request
interagency engagement or to share
information on a collaborative opportunity
please contact grants@finance.gov.au.
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Grants policy framework – please visit
http://www.finance.gov.au/financialframework/financial-management-policyguidance/grants/
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