Grants Decision Tree Tool

Will you be purchasing goods or services for your entity’s own use? (or on behalf of another relevant entity)

For example,

Procuring supplies and equipment, consultancy services, memberships, advertising and travel.

• an entity purchases stationary for it’s own use
• An entity procures the services of a consultant to conduct stakeholder consultation or prepare a research report.

Procurement includes the acquisition of goods and services by an entity for its own use and, the acquisition of goods and services on behalf of another entity or a third party. Where an arrangement meets the definition of a procurement, then the CPRs apply.

Related guidance

Procurements are subject to:

• Commonwealth Procurement Rules
• AusTender website
• Department of Finance website

Will a third party be procuring on behalf of a Commonwealth entity?

For example:

• A software developer (the third party) is engaged to manage the delivery of an ICT project and conducts a procurement on behalf of a relevant entity. The software developer enters into a contract with the supplier on behalf of the relevant entity.
• A software developer (the third party) is engaged to manage the delivery of an ICT project and conducts a procurement on behalf of a relevant entity. The relevant entity enters into a contract directly with the supplier.

The acquisition of goods and/or services for the Commonwealth or third parties is typically done as a procurement.  

Procurements include the acquisition of goods and services on behalf of another entity or a third party. Where an arrangement meets the definition of a procurement, then the CPRs apply.

If the goods or services being delivered by the Third party were previously provided by a Commonwealth official or entity, and the goods and services are now being provided by a third party this is likely to be a procurement.

If the goods or services delivered by the third party would not be provided if the Commonwealth declined to provide financial support this is likely to be a procurement.

The CPRs outline third-party procurement (4.17 and 4.18)

Related guidance

Procurements are subject to:

• Commonwealth Procurement Rules
• AusTender website
• Department of Finance website

Will all or part of the service/activity be provided by a contribution from the Government?

For example: Where an organisation delivers a service/activity to the community, that both the organisation and the government have provided a financial contribution to. Grants are used to promote policy objectives through the provision of financial assistance with or without conditions.

Is the activity a contribution to the achievement of an Australian Government policy outcome?

For example: services described as contributions/outputs and/or outcomes:

• Improved health outcomes amongst a target population:, such as quit smoking programs
• A reduction in homelessness, such as provision of shelter services
• Improved employment outcome for a target group
• A contribution to assist a business sector to promote products to become more competitive

Will the contribution by the Commonwealth be to individuals or organisations that are separate to the government,  the purpose of which is to achieve an outcome on behalf of the Government, (i.e. a recipient other than the Commonwealth)?

For example, payments to help an organisation provide services, such health services and legal services or help fund infrastructure that will assist to achieve Government policy outcomes.

Will a third party administer the grant on behalf of the Government?

For example: a commonwealth entity may engage another independent organisation to administer grants to other organisations to deliver services on behalf of the government.

Is the funding intended to help to address one or more Commonwealth policy outcomes as well as achieve the organisations own objectives (consistent with Commonwealth goals?

For example: where an entity provides financial assistance to an organisation to deliver a service to the community on the government’s behalf. At the same time achieving the organisations outcome of providing support. 

The arrangement is likely a grant

Grants promote policy objectives both for the Australian Government as well as the grant recipient through the provision of financial assistance with or without conditions. 

Grants can include gifts of relevant money, benefits or entitlement payments, subsides, rebates, sponsorships and scholarships. 

It's likely NOT a grant, but another type of financial arrangement

Grants and procurements are not the only financial arrangements available to Government. There are financial arrangements.

It is recommended that you contact your legal and/or internal grants team on specific advice on what the financial arrangement is. Under the Commonwealth Grants framework it is the entity that will have the determination on the type of arrangement.

Payments to States and Territories – RMG 419 Guide to classifying payments to other levels of government for specific purposes and Commonwealth own-purpose expenses.

Loans and Investments – RMG 115 Accounting for concessional loans

Benefits and entitlement payments

The Commonwealth can also provide finances through, gifts of relevant property, compensation payments, benefit and entitlement payments, tax concessions or offsets, investments, loans and act of grace payments. A breakdown of these arrangements is provided in RMG 411