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Industry, Science, Energy and Resources

The Department of Industry, Science, Energy and Resources (the Department) and its Portfolio agencies drive long-term economic and productivity growth, and job creation across Australia. The Department has a central role in positioning Australia to recover from the ongoing economic consequences of the COVID-19 pandemic and helping businesses and industry respond to a shifting global environment. The Department does this by building on Australia’s comparative strengths, removing obstacles to growth, and unlocking new opportunities for long-term productivity and prosperity.

The Industry, Science, Energy and Resources Portfolio (the Portfolio) is committed to improving the business environment of Australian industry, with a particular focus on businesses with a strong base in regional Australia. The Portfolio has policy responsibilities for a number of sectors that underpin the Australian economy including resources exploration and extraction, the energy supply chain, and manufacturing. These sectors continue to be major contributors to business and employment opportunities in regional Australia. Ensuring that regional Australians benefit from projects that improve Australia’s digital capability, secure scientific capacity, and invest in existing and emerging low emissions technologies is also a key priority.

The Portfolio delivers a number of initiatives to support the business environment in regional Australia to ensure Australian businesses have the capacity to innovate and excel in a range of markets. The Department’s Outreach Network consists of 28 Regional and Business Development Managers located across regional centres and capital cities who deliver front line, face-to-face services. The network provides local businesses with information about programs, grants, and services available from all levels of government. The network is in a unique position to gather insights from the business community and economic environment on current and emerging regional issues, which then feed into policy and program design.

The Government’s decentralisation agenda is supporting programs and projects such as the Modern Manufacturing Strategy, the Square Kilometre Array (SKA) Radio Telescope Project and Australian Industrial Power’s Port Kembla gas power station project, all of which help regional businesses and sectors to stimulate opportunities for employment and skills development. The Government also continues to support regional communities involved in the site selection process for the Australian Radioactive Waste Management Facility through the extension of the Community Benefit Program Fund into 2021‑22.

The Portfolio is working with Australian businesses to reduce their greenhouse gas emissions. The Emissions Reduction Fund (ERF) is a fundamental part of the Government’s approach to emission reduction and more than $2 billion has already been committed to projects in regional and rural areas. Additional funding is available through the $2 billion Climate Solutions Fund to build on the success of the ERF and continue investment in practical projects that deliver low-cost abatement. The Portfolio also administers the annual Low Emissions Technology Statement which complements the activities of the ERF. The Statement aims to accelerate the development and commercialisation of technologies such as hydrogen production, carbon farming, and carbon capture, use and storage, which will reduce emissions and create jobs, many of them in regional communities.

The Government is investing in energy security, supporting jobs and improving energy affordability for Australian families and businesses. It is accelerating the development of new gas resources and investment in gas infrastructure to guarantee Australia’s gas supply. This will stimulate the economy following the COVID-19 pandemic. By unlocking gas supply, helping to deliver an efficient pipeline and transportation market, and empowering gas customers, the Government will create a more competitive and transparent Gas Trading Hub for the east coast. Targeted investments in energy generation and transmission infrastructure as well as consumer focused energy market reforms will continue to deliver affordable, reliable and secure energy to all Australians.

Australia’s resources sector continues to generate wealth for all Australians. Comprising over half of Australia’s total exports, the Portfolio works to ensure that Australia’s resources sector can operate in attractive, predictable, and efficient business conditions. The Portfolio is responsible for encouraging exploration, maintaining a strong regulatory framework, investing in the resources of the future including critical minerals, and supporting a globally attractive mining equipment, technology, and services (METS) sector. The Portfolio, through the Critical Minerals Facilitation Office, is the central coordination point to grow the critical minerals sector and position Australia globally as a secure, reliable, and ethical supplier of critical minerals.

The Rum Jungle Rehabilitation project will address historical environmental contamination and hazards from the former Rum Jungle mine site in the Northern Territory, and will create significant employment and local supply opportunities. Aside from the significant employment and local supply opportunities, this project will also create training opportunities, and engage the site’s traditional owners and surrounding regional communities.

The Next Five Year Plan for northern Australia will stimulate economic recovery and create jobs in northern Australia by piloting a new strategic approach which targets designated ‘Regions of Growth’.

Across regional Australia, the Portfolio is helping industry to adapt to global and local market shifts by diversifying supply chains, strengthening local resilience to future disruptions, and capitalising on export opportunities.

The Portfolio is also committed to improving the productivity and competitiveness of Australian industry, including in the regions through high quality service delivery. AusIndustry, the Government’s principle agency for delivery assistance, programs and services, connects the Portfolio with regional industry and businesses. AusIndustry is well represented across regional Australia through the Department’s Regional Offices.

To develop the skills and knowledge needed to ensure regional communities and businesses thrive in the ‘workplaces of tomorrow’, the Portfolio is supporting programs to build science, technology, engineering and mathematics capabilities (STEM). In regional and rural areas, outreach measures offered by Questacon – The National Science and Technology Centre guide young Australians toward STEM professions, support teachers in the classroom, and boost regional tourism through low cost touring exhibitions.

In support of the Portfolio’s responsibility for northern Australia, the Department’s Office of Northern Australia (ONA) coordinates the northern Australia economic development agenda. ONA has officials in Cairns and Townsville in addition to officials in Darwin, Brisbane, Canberra and Sydney. From its headquarters in Cairns, the Northern Australian Infrastructure Facility (NAIF) boosts regional employment and economic and population growth. Through the NAIF, the Portfolio is unlocking the productivity and potential of regional northern Australia by encouraging and complementing private sector investment.

Portfolio agencies are undertaking a range of projects and initiatives in regional Australia. The Australian Institute of Marine Science continues a broad research program supporting sustainable coastal ecosystems and industries in regional Australia. The Australian Renewable Energy Agency (ARENA), the Clean Energy Finance Corporation, the Clean Energy Regulator, and the Climate Change Authority all provide policy and program support to Australia’s fast growing renewable and low emission technology industries.

Additionally, the Commonwealth Scientific and Industrial Research Organisation (CSIRO) covers a wide variety of sectors including agriculture and mining that are major contributors to Regional Australia. Geoscience Australia’s $225 million Exploring for the Future program is providing the pre-competitive information for the next major mineral discoveries in Australia and the National Offshore Petroleum Safety and Environmental Management Authority continues to facilitate a strong regulatory framework for the oil and gas industry particularly in regional Western Australia, the Northern Territory and Victoria. Snowy Hydro continues to have a strong employment footprint in Regional Australia which will grow with the delivery of Snowy 2.0.

As at 31 December 2020, the Industry, Science, Energy and Resources Portfolio employed 5,565 staff under the Public Service Act 1999. Of this total, 4,867 staff (87 per cent) of Portfolio staff are employed in Canberra, central Melbourne, and central Sydney, 642 staff (12 per cent) in other capital cities, and 56 staff (1 per cent) in regional areas.

 Outside of capital cities, the Department has Regional Offices in:

  • New South Wales – Newcastle, Tamworth, Wagga Wagga and Wollongong.
  • Queensland – Bundaberg, Mackay, Toowoomba, Southport and Townsville.
  • South Australia – Mount Gambier andPort Pirie.
  • Tasmania – Launceston.
  • Victoria – Geelong, Bendigo and Traralgon.
  • West Australia – Mandurah.

The Portfolio’s agencies work around the country and employ 6,946 staff under their respective legislation. Of this total, 939 are located in Canberra (14.0%), 673 (10.0%) are in Sydney and 1059 (15.0%) are in Melbourne. These Portfolio agencies also have locations in other capital cities that employ 3228 (46.0%) staff, whilst 1047 (15.0%) employees work in other regions across Australia.

New Initiatives

Our North, Our Future − Next Five Year Plan for Northern Australia

The Government is investing $189.7 million over five years from 2021-22 through the Next Five Year Plan for Northern Australia. The plan builds on the 2015 White Paper on Developing Northern Australia and focuses on job creation through concentrated investment aligned to geographic regions of growth. It includes initiatives that will enable greater digital connectivity in northern Australia; and support for businesses to scale-up and diversify.

Regions of Growth

The Government is investing $9.3 million over five years from 2021-22 to pilot Regions of Growth in northern Australia locations. The investment will support on-ground specialists to focus effort on capitalising on the strengths of the region, including critical minerals, advanced manufacturing, and agriculture/aquaculture; and data compilation to better understand economic potential.

Connecting Northern Australia

The Government is providing $68.5 million over 2 years from 2021-22 in dedicated funding to improve telecommunications infrastructure across northern Australia through the Regional Connectivity Program and the Mobile Black Spot Program. The Department of Infrastructure, Transport, Regional Development and Communications is responsible for the delivery and administration of this initiative.

The investment supports telecommunications infrastructure projects which maximise economic and social opportunities in regional, rural and remote northern Australia. The investment will improve the commercial viability of telecommunications projects in high cost, low population density locations including remote Indigenous communities.

Northern Australia Development Program

The Government is investing $111.9 million over five years from 2021-22 to support northern Australian businesses to scale-up and diversify by providing co-investment grants to businesses for a range of activities including infrastructure, assets, feasibility studies and business planning. The investment will be supported by a Strengthening Northern Australia Business advisory service to build business capability and resilience, maximising the growth potential of businesses accessing the grant funding.

Northern Australia Infrastructure Facility (NAIF) – Expansion

In the 2020-21 Mid-Year Economic and Fiscal Outlook, the Government provided an additional $18.6 million over 4 years from 2020-21 (and $215.9 million from 2024-25 to 2026-27) to simplify the NAIF’s use of debt instruments and allow the NAIF to make limited equity investments.

This measure builds on the 2020-21 Budget measure Northern Australia Infrastructure Facility — extension and enhancements and strengthens the NAIF’s impact across northern Australia.

Rum Jungle Rehabilitation Project

The Government is funding rehabilitation of the former Rum Jungle mine site in the Northern Territory. Rehabilitation activities will address environmental contaminants and hazards resulting from historical uranium and copper mining at Rum Jungle.

The Government’s investment will deliver a significant economic impact in the Batchelor/Coomalie region, supporting jobs and create significant indirect employment and local supply opportunities. Training, employment and other engagement opportunities for the site’s traditional owners will support their participation in delivery of works and land management.

This investment builds on the 2020-21 Budget measure Rum Jungle Rehabilitation Project – additional funding.

Square Kilometre Array (SKA) Radio Telescope Project

The Government is investing $387 million over 10 years from 2021-22 to 2030-31 (with $29.6 million in 2031-32 and $29.5 million per year ongoing from 2032-33).

The Government’s investment provides Australia’s share of construction and operations of the SKA telescopes, supporting 350 jobs during construction and a further 230 ongoing jobs, the majority of which will be based in Western Australia’s Mid-West region. The SKA telescopes will help Australian scientists make vital scientific breakthroughs – such as a better understanding of the origin and future of stars and galaxies, and the structure of the universe. The investment will also support Australia’s hosting of the SKA-Low telescope by:

  • Establishing the Australian SKA Regional Centre which will enable the SKA’s high value science and data activities to be carried out in Australia.
  • Ensuring Australia meets its commitment to provide the SKA Observatory with an appropriate site to build the SKA-Low telescope.
  • Installing a fibre optic link from the existing SKA fibre link (which runs from Geraldton to the Murchison Radio-astronomy Observatory [MRO]) to the Pia Wadjarri Remote Aboriginal Community (which lies within eight kilometres of the link) and the Murchison Settlement (which lies within 52 kilometres of the link).

Australia’s Global Resources Strategy

The Government is providing $20.1 million over 2 years from 2021-22 to deliver a Global Resources Strategy that will diversify and strengthen Australia’s access to key export markets and reduce the risk of trade disruptions.

The resources sector employs over 260,000 people and is the largest employer of Indigenous Australians, with many of these jobs located in regional Australia. Any boost to the domestic resources sector will have flow on effects through regional job creation and economic benefits in regional communities.

Junior Minerals Exploration Incentive (JMEI) − extension

The Government has allocated $100 million to extend the JMEI for 4 years from 1  July 2021 to 30 June 2025. This measure is estimated to cost $77.6 million over the four years from 2023-24. This investment will continue the Government’s support and encouragement of greenfield mineral exploration across Australia and brings total investment in the JMEI to $200 million.

Greenfields mineral exploration underpins Australia’s mining industry by finding new mineral deposits and ensuring a strong investment pipeline. Exploration predominately occurs in remote and rural areas across Australia, providing jobs and economic activity in regional communities. The extension of the JMEI will encourage more exploration activity, supporting future resources development.

Delivering accelerated exploration in the Beetaloo sub-basin

In the 2020-21 Mid-Year Economic and Fiscal Outlook, the Government provided $52.1 million over 3 years from 2020‑21 to accelerate gas development in the Beetaloo sub-basin in the Northern Territory. The funding includes:

  • $50.6 million over three years from 2020-21 for the Beetaloo Cooperative Drilling Program, launched on 18 March 2021, that provides grants to accelerate gas exploration activities in the Beetaloo sub-basin
  • $1.5 million over 3 years from 2020-21 to strengthen collaboration across government and industry to support the development of the sub-basin.

The Beetaloo sub-basin, approximately 500 kilometres south-east of Darwin, has the potential to be a world-class gas province. Development of the Beetaloo will provide a steady flow of jobs and economic activity in Top End communities, as well as unlocking downstream opportunities across the Northern Territory. Accelerating development activities in the Beetaloo will help to realise those benefits sooner.

This measure builds on the 2020-21 Budget measure JobMaker Plan — gas fired recovery, which provided $28.3 million over 3 years to establish 5 Strategic Basin Plans, and is a key measure of the Government’s Unlocking the Beetaloo: The Beetaloo Strategic Basin Plan released on 14 January 2021.

Strategic Basin Plans

The Government will provide $15.8 million over three years from 2021-22 to drive economic opportunities and support strategic basin plans. Funding includes $15.7 million in 2021-22 to support gas industry field appraisal trials in the North Bowen and Galilee basins, and $2.2 million over three years from 2021-22 to build the capacity of the Northern Land Council to facilitate land use agreements and drive economic opportunities in the Beetaloo sub basin.

This measure builds on the 2020-21 Budget measure JobMaker Plan — gas fired recovery and the Government’s Unlocking the Beetaloo: The Beetaloo Strategic Basin Plan released on 14 January 2021.

Advancing Australia’s Gas-Fired Recovery

The Government is providing $58.5 million over four years from 2021-22 to 2024-25 to further advance Australia’s Gas-Fired Recovery Plan announced 15 September 2020. The funding includes support for the following initiatives:

  • $38.7 million over two years from 2021-22 to ensure the Government is well positioned to alleviate the potential gas shortfall on Australia's east coast and support critical gas infrastructure projects.
  • $6.2 million over 3 years from 2021-22 to develop the Wallumbilla Gas Hub in Queensland into a more open and transparent gas trading hub.
  • $5.6 million over two years from 2021-22 to further strengthen the Government’s energy system planning framework and build on national gas infrastructure planning already completed and underway. This includes the delivery of an additional National Gas Infrastructure Plan in 2022 that identifies strategic priorities through an assessment of costs and benefits, and gas market modelling.
  • $4.6 million over 4 years to develop initiatives that empower gas reliant businesses to better negotiate competitive outcomes in their gas supply agreements.
  • $3.5 million in 2021-22 to design a framework to facilitate Australian Government investment in medium to longer term critical gas infrastructure projects, ensuring the reliable and secure supply of gas to Australian consumers.

The delivery of the Gas-Fired Recovery Plan will benefit regional Australia, including supporting regional jobs, where many gas production and infrastructure projects are located. 

This measure builds on the 2020-21 Budget measure JobMaker Plan — gas fired recovery.

Emissions Reduction and New Investments under the Technology Investment Roadmap

The Government will invest $1.5 billion over 10 years from 2021-22 to incentivise private investment in new and emerging low emissions technologies and back the Government’s commitment to real and practical action to reduce emissions. It will enable ambitious international technology partnerships to be established and support the JobMaker agenda, creating 6,000 jobs, many in regional communities.

Increased investment in priority low emissions technologies – such as an emerging hydrogen industry, low emissions steel and aluminium and carbon capture storage – are expected to deliver significant employment and economic benefits to regional areas, where many of these industries are located.

The Government is investing $1.2 billion over 10 years into a Technology Co-Investment Facility to incentivise private investment in new and emerging low emissions technologies identified as priorities in the Technology Investment Roadmap’s first Low Emissions Technology Statement and deliver international partnerships to accelerate low emissions technologies to parity with higher emitting alternatives.

This new funding to support the Facility, in combination with the previous $1.4 billion over 12 years to support ARENA and $95.4 million to establish the King Review Technology Co-Investment Fund, both announced in the 2020-21 Budget, will support the Government’s technology-based approach to reduce emissions.

This measure builds on the 2020-21 Budget measure JobMaker Plan – Investment in New Energy Technologies and the 2019-20 Budget measure titled Climate Solutions Package. 

Investment in new technologies to help farmers voluntarily reduce their emissions

The Government will invest $59.6 million over five years from 2021-22 under the land sector investment stream of the Technology Co-Investment Facility to support voluntary action by farmers to lower emissions while growing their businesses. The package includes $36.7 million for a National Soil Carbon Innovation Challenge to help lower agricultural emissions through better soil management, and $22.9 million to develop and trial technologies to deliver low emissions feed supplements to grazing animals without imposing additional costs. This investment stream is estimated to deliver 190 jobs.

Regional Clean Hydrogen Hubs

The Government is supporting the growth of Australia’s hydrogen industry as part of significant new investment to back technologies and projects that will help to reduce global emissions, boost jobs and support Australia’s economic recovery.  

To further embed hydrogen technologies in regional Australia, the Government will invest $275.5 million through the 2021-22 Budget to support the development of four regionally located, additional clean hydrogen hubs. This funding is in addition to the $70.2 million provided in the 2020-21 Budget, including $55.7 million over four years to 2023-24, for a first hydrogen hub. Hubs will help to build opportunities for the domestic use of hydrogen while providing an avenue to create jobs and investment in regional centres. The National Hydrogen Strategy identifies hubs as a priority action, and there is recognition internationally that hubs are a cost-effective route to achieving scale. Development of hydrogen hubs will help the industry to scale up and work towards achieving the Technology Investment Roadmap’s goal of ‘H2 under $2’.

Funding for certification trials and hydrogen related legal and market reforms will facilitate future international trade and remove barriers for export of low carbon fuels. This will create opportunities to expand trade centres around the country, unlocking further jobs and economic growth in regional areas located close to hydrogen hub export ports.

This investment builds on the $383.4 million provided in the 2019-20 Mid-Year Economic and Fiscal Outlook to support the national Hydrogen Strategy and establish the Advancing Hydrogen Fund within the Clean Energy Finance Corporation.

The Government’s total funding commitment to establishing a hydrogen industry not exceeds $850 million.

Carbon Capture, Use and Storage (CCUS) Hubs and Technologies

The Government will provide $263.7 million over 10 years from 2021-22 to fund CCUS projects, establish hubs in proximity to high emitting industrial areas and provide support for research, development and commercialisation efforts. Projects will support emissions reduction across power generation, natural gas or hydrogen production and heavy industries.

Large scale projects supported through the CCUS Hubs and Technologies Program will primarily be located in regional or offshore Australia, which will provide enhanced economic opportunities to local communities. Deployment of CCUS will create jobs in regional Australia and enable new or expanded export opportunities in low-carbon hydrogen, LNG and carbon-recycled products.

This investment builds on the $50 million allocated to support pilot and pre-commercial CCUS projects in Australia as part of the 2020-21 Budget.

Enabling industry to reduce energy waste, improve productivity and build skills for long-term change

The Government will provide $26.4 million over four years from 2021-22 to support industries, including those in regional areas, adopt voluntary energy management systems. These systems will support ongoing reductions in energy consumption thereby improving global competitiveness for Australian businesses. Lowering ongoing energy costs for business will also stimulate regional economies through increased demand for local goods and services.

The investment will provide support and resources to businesses who make voluntary public commitments to reduce their energy use by providing access to dedicated expert facilitators to give them guidance and help find energy savings.

Improving Energy Affordability and Reliability

The Australian Government is providing support for investment in new dispatchable generation and affordable and reliable power for consumers.

This measure builds on the 2020-21 Budget measure JobMaker Plan – Improving Energy Affordability and Reliability.

Hydrogen ready gas turbines

The Australian Government has committed $24.9 million over three years from 2021-22 to support the development of hydrogen-ready gas generation infrastructure. Supporting upcoming gas generation projects to be hydrogen ready will enable these generators to remain commercially competitive in the future, should clean hydrogen become comparable in cost to natural gas. These generators could also have broader regional benefits for hydrogen industry growth. 

This funding will support hydrogen-ready capability for new gas generators through financial support for hydrogen-ready turbines or associated hydrogen supply infrastructure. Funding could also be provided for research, consultant studies, or similar components if there are complexities relating to infrastructure for projects to be hydrogen ready.

Supporting the Port Kembla Power Station

The Government is providing $30.0 million over two years from 2021-22 to support Australian Industrial Power to undertake early works on its proposed power station at Port Kembla, New South Wales. The investment will go towards ensuring a final investment decision can be reached for the project. If it proceeds, the power station will support electricity reliability and lower prices in New South Wales.

Measures to Support the Northern Territory State Deal

The Australian Government is investing up to $30 million in 2021-22 to increase energy security, reliability and affordability in the Northern Territory, while reducing emissions.

Up to $15 million will be invested to help build a 35 megawatt big battery in Darwin to maintain security and reliability in light of increasing renewable energy in the Darwin-Katherine Interconnected System.

A further $15 million will support deployment of microgrids with batteries in up to 10 remote Indigenous communities across the Northern Territory to reduce their reliance on diesel based generation.

This investment builds on the Northern Territory’s Solar Energy Transformation Program (SETuP), which previously received $35 million from ARENA, and the Australian Government’s Regional and Remote Communities Reliability Fund.

Renewable Energy Microgrid in the Daintree Community

The Government is providing up to $19.3 million over 3 years from 2021-22 to support the deployment of a renewable energy microgrid for the Daintree community in far north Queensland.

The microgrid will replace costly diesel generation with a renewable energy microgrid incorporating hydrogen in the northern side of the Daintree community. A cleaner energy supply is an important consideration for this world heritage site. The project will also demonstrate innovative microgrid technologies, helping to accelerate the uptake of microgrids in other regional and remote areas.

Extension of the role of the Australian Energy Infrastructure Commissioner

The Government will invest $3 million over 5 years from 2021-22 to extend the role of the Australian Energy Infrastructure Commissioner to ensure community concerns over construction of large-scale energy projects and new transmission are taken into account. Most large scale renewable energy projects are deployed in regional areas due to the availability of space and the required quality of solar and wind energy resources. The Commissioner’s office will continue to play a vital role in addressing concerns in regional areas. The Commissioner was formerly known as the National Wind Farm Commissioner.

Digital Economy Strategy – Artificial Intelligence Action Plan

The Government is investing $124.1 million over six years through its Artificial Intelligence Action Plan (AI) to uplift capability, productivity and competitiveness of Australian businesses through the adoption and use of AI.

The Government’s AI Action Plan is a key initiative under the Digital Economy Strategy that sets out how Australia will secure its future as a modern and leading digital economy and society by 2030. This includes accelerating the digital capability of Australian businesses, by supporting strategic investments in digital technology, skills and infrastructure, and finding digital solutions to reduce the regulatory burden on businesses.

Catalysing the AI Opportunity in our Regions

The Government is investing $12 million over 5 years from 2021-22 in a pilot to co-fund up to 36 community based projects that solve regional challenges and increase AI capability. Projects will link AI practitioners with regional businesses or communities: raising awareness of the local opportunities to develop and adopt AI, while supporting the development of in-demand skills.

This measure builds on the 2020-21 Budget measure JobMaker Plan – Digital Business Plan.

Community Benefit Program Extension in Kimba − extension

The Government is investing $2.4 million over 3 years from 2021-22 to extend the Community Benefit program in Kimba, South Australia. The program will deliver $2  million in grants to support social-cohesion and economic development in the Kimba region of South Australia during the site selection process for the National Radioactive Waste Management Facility.  

Australian Space Agency – Strengthening Regulatory Capacity

The Government will invest $13.3 million over 4 years, commencing in 2021-22, and ongoing annual costs of $3.3 million from 2025-26, to expand the Australian Space Agency to meet the increased demand for regulatory services from businesses seeking to undertake space activities, in turn helping to drive further growth of the industry.

This supports the Government’s goal to triple the size of the space sector to $12 billion and create up to another 20,000 jobs by 2030. Firms interacting with the Australian Space Agency’s regulatory services are expected to be located in both metropolitan and regional areas.

This measure builds on the 2018-19 Budget measure Australian Technology and Science Growth Plan — growing the Australian space industry, the 2019-20 Budget measure Space Infrastructure Fund, and the 2020-21 Budget measure Growing Australia’s Space Industry.

Current Initiatives

JobMaker Plan – Modern Manufacturing Strategy

Manufacturing is critical to a modern Australian economy and to economic recovery following the COVID-19 pandemic. It has an important role in many supply chains and adds significant value to all sectors. The Modern Manufacturing Strategy harnesses Australia’s manufacturing capability, boosts competitiveness, delivers transformation at scale and secures jobs for the future.

The 6 identified National Manufacturing Priorities (NMPs) – Resources Technology and Critical Minerals Processing, Food and Beverage, Medical Products, Recycling and Clean Energy, Defence, and Space – are playing an important role in regional Australia. Approximately 51 per cent of the resources workforce is located in regional and remote areas. Major regional inland and port towns in Australia have been developed on the strength of resources activities. Resources projects attract investment that helps drive a wider diversity of regional businesses. As an example, resources technology manufacturing and services provides strong opportunities for many regional areas.

As with earlier waves of major investment in energy production, regional Australians are also positioned to be key beneficiaries in emerging areas of clean energy and recycling. Manufacturing projects in processing and remanufacturing waste, equipment manufacturing for clean energy projects, and manufacturing low emissions industrial products (such as hydrogen and low emissions steel) are all growth opportunities for regional Australia.

The Australian Food and Grocery Council in 2019 estimated that over 107,000 jobs or 39.3 per cent of the food and grocery manufacturing sector are employed in regional areas. The sector both provides jobs and helps boost and sustain regional economies. The scale, success, and geographic coverage of the food and beverage sector could transform manufacturing in regional Australia.

Modern Manufacturing Initiative

The Government is providing $1.3 billion to industry over five years from 2020-21 through the Modern Manufacturing Initiative (MMI). The MMI addresses barriers to scale for Australian manufacturers and supports Australia’s post-COVID-19 recovery by targeting private sources of capital to invest in manufacturing. The MMI will
co-fund projects that will transform Australian manufacturing in the
6 NMP areas through the following 3 targeted streams:

  • The Manufacturing Collaboration Stream, which will provide co-funding for large-scale projects that support business-to-business and business-to-research collaboration, to build economies of scale.
  • The Manufacturing Translation Stream, which will provide co-funding for industry-led projects to translate good ideas into commercial outcomes.
  • The Manufacturing Integration Stream, which will target the integration of local firms to deliver products and services into domestic and global value chains.

The MMI is open to applications for projects from across Australia. The Government’s investment in the NMPs will support a wide range of regional businesses servicing our agricultural, food processing, mining and resources industries with manufactured goods that are sold locally and to international markets.

With manufacturing a key regional employer, the MMI will support regional businesses, job generation and local economies. 

Currently, manufacturing employs more than 902,000 Australians, or around 6.9 per cent of the workforce. For many regions the proportion of employment in manufacturing is much higher; up to 14 per cent of the workforce are employed in manufacturing in some regions of Australia. 

Australian Bureau of Statistics (ABS) figures indicate that over 31 per cent (or 266,000 people) of the total manufacturing employment is located in regional areas of Australia. For Tasmania, 59.2 per cent of manufacturing employment is in the regional areas and for Queensland it is 47.3 per cent. 

Commercialisation Fund

The Government is supporting Australia’s manufacturers to turn their good ideas into world-beating realities that create more local jobs, with a $30 million fund delivered over 18 months to 30 June 2022. Consistent with all programs under the Modern Manufacturing Strategy, this fund will support projects within the 6 NMPs.

The fund is managed and administered by the Advanced Manufacturing Growth Centre, in collaboration with the 5 other Industry Growth Centres: AustCyber, Food Innovation Australia Ltd, MTPConnect, METS Ignited and National Energy Resources Australia, and the CSIRO. 

Supply Chain Resilience Initiative

The Government is providing $107.2 million over four years from 2020-21 for critical supply chain analysis and funding to address identified gaps in the resilience of these supply chains through manufacturing, including in regional areas.

Activities under the Initiative include:

  • Conducting a robust analysis of supply chains and working with industry to develop supply options to address vulnerabilities in domestic and international supply chains for identified critical products. Sovereign Manufacturing Capability Plans (SMCPs) will be developed and outline the domestic capabilities that would contribute to enhanced resilience for identified products.
  • Grants for businesses to establish or scale a capability that addresses a critical supply chain vulnerability for a critical product or input identified in
    SMCPs.

The grants program will be rolled out from July 2021 and is expected to benefit manufacturing-related companies in regional and metropolitan areas who fall within the scope of the product categories identified within the SMCP. Initial product categories being examined are common medicines, personal protective equipment and agricultural production chemicals, with additional product categories to follow.

Manufacturing Modernisation Fund – establishment and round 2

The Manufacturing Modernisation Fund (MMF) is supporting manufacturers to become more competitive and create new jobs by co-funding capital investments that help them scale-up, invest in new technologies and develop new high-value products.

On 30 April 2020, the Government announced a commitment of $50 million through the MMF over three years from 2019-20, to support around 200 projects valued at more than $215 million. In 2021-22, the MMF is providing $9.8 million in support to 54 businesses in regional Australia to fund projects worth over $43.6 million.

The Government expects projects under round one of the MMF to create thousands of new jobs across Australia over the life of the program and have a positive impact on the economy through increasing the competitiveness of Australian manufacturing businesses.

On 1 October 2020, the Government announced a further $52.8 million over three years from 2020-21 for a second round of the MMF. This second round will continue support to manufacturers across a wide spread of regions and NMP areas to fast-track Australia’s recovery from the COVID-19 pandemic.

The second round of the MMF is part of the Government’s $1.5 billion Modern Manufacturing Strategy.

This measure extends the 2019-20 Mid-Year Economic and Fiscal Outlook measure Election Commitment - Manufacturing Modernisation Fund – establishment.

Unlocking Australia’s Resources Potential – Exploring for the Future 2

On 23 June 2020, the Government provided an additional $124.5 million over four years from 2020-21 to continue and expand the Exploring for the Future program, bringing total investment in the program to $225 million.

The measure provides pre-competitive data about potential mineral, energy and groundwater resources across Australia. Eight new projects were announced in March 2021. They include three deep-dive projects in the geological regions of Officer-Musgrave in central-west Australia, Darling-Curnamona-Delamerian in south-east Australia, and Barkly-Isa-Georgetown in north-east Australia. The eight projects also include three continental-scale projects that have national applications but with a focus in southern Australia.

The program will deliver on-the-ground data collection and field work activities in regional and remote Australia, including local contract positions in the mining, equipment, technology and services sector. As it has done over the last four years, Exploring for the Future will continue to unlock new resource-rich regions across the country. Development of those regions will provide ongoing economic growth across Australia and create short, medium, and long-term jobs in regional communities.

This measure builds on the 2016-17 Budget measure National Resources Development Strategy — exploring for the future.

Steel Processing and Galvanising Plant in Whyalla – upgrade

The Government provided $15 million in 2020-21 to Ferretti International to upgrade its steel and galvanising plant in Whyalla, South Australia. The upgraded plant will allow an expanded range of steel to be processed in the Spencer Gulf for the Australian market, with flow-on benefits to the region.

This measure builds on the 2019-20 Mid-Year Economic and Fiscal Outlook measure Interconnector Funding – delivering reliable and affordable energy.

Entrepreneurs Programme

The Entrepreneurs’ Programme, delivered by AusIndustry, is the Government’s flagship initiative for business competitiveness and productivity at the firm level. The program delivers advice and grants to enable high potential businesses, including in regional and remote areas, to strengthen, grow, innovate and commercialise nationally and globally. The program is ongoing with a value of $454 million over four years from 2021-22, and provides businesses with access to tailored advice from a national network of over 170 industry experts and supporting grant funding. 

This support is provided through a variety of service offerings, including Accelerating Commercialisation, Growth, Innovation Connections, and Strengthening Business. In addition to improving outcomes for clients, the program benefits the broader community, as well as regions, sectors and communities.

In particular, the program has been expanded to support businesses in regional Australia that have been impacted by the 2019-2020 bushfires through dedicated facilitators and targeted assistance.

National Bushfire Recovery Fund – Entrepreneurs’ Programme – Regional Business Recovery and Resilience

The Government committed $2 billion to a National Bushfire Recovery Fund (NBRF) to assist regional communities and businesses to recover and rebuild following the 2019‑20 bushfires. Through the NBRF, the Government is providing $12.8 million over two years from 2020-21 to help businesses recover, rebuild and renew from the impacts of the bushfires.

Businesses have access to 22 independent business facilitators (including three digital solutions specialists) across 32 regional areas of New South Wales, South Australia and Victoria. Facilitators focus on building resilience into all aspects of the business, particularly where digital systems and strategies would play a key role. Facilitators have strong community and small business backgrounds, are local to the regions they service, and work collaboratively with other small business and recovery organisations on the ground.

National Research Centre for Natural Hazards and Disaster Resilience

On 23 July 2020, the Government announced $88.1 million to extend and scale up funding for critical research into natural hazards. The funding includes $85 million over 10 years from 2021-22 for a new, world class research centre for natural hazard resilience and disaster risk reduction, which will deliver and scale up applied research to inform Australia’s disaster recovery and resilience effort. The work of the new research centre will support businesses and communities across Australia, including in regional Australia. It is expected that this research will benefit regional Australia as the regional landscape is at a heightened risk of impact from natural hazard events such as bushfires and flooding.

Nuclear Science and Technology, Including Nuclear Medicine Supply to Regional Australia

The Government provided $93.8 million over four years from 2020-21, to the Australian Nuclear Science and Technology Organisation (ANSTO) to support the production and supply of nuclear medicines used in services delivered all around the country. Nearly one third of ANSTO’s customers are located in regional Australia and receive an estimated 3,000 patient doses of the most commonly used nuclear medicine, Technetium‑99m, each week.

The investment is contributing to the maintenance of key productive infrastructure that supports domestic manufacture and distribution to ensure that Australians, in particular those in remote or regional locations, can continue to access these vitally important health products and associated services.

JobMaker Plan – Second Women's Economic Security Package

Boosting Female Founders Initiative – expansion

The Government has provided an additional $35.9 million over five years from 2020-21 to expand the Boosting Female Founders Initiative and increase the number of co-funded grants provided to majority women owned and led start-ups. The expansion also introduced a new service to provide access to expert mentoring and advice for women entrepreneurs. Grant recipients of round one of the Initiative were announced in December 2020, with 51 women led start-up businesses sharing in approximately $11.9 million in grant funding.

The Initiative offers more generous matched funding to underrepresented groups, such as women founders who are from regional or remote locations, to ensure greater support and access to capital. Round 2 of the Initiative is underway with approximately $11.6 million in grant funding available. The mentoring service is also underway and being delivered to eligible applicants of round one of the Initiative.

Building Community Support for the Gas-Fired Recovery

The Government has committed $13.7 million over four years from 2020-21 to continue the Onshore Gas Social and Economic Research Fund. The Fund provides independent scientific research to enable individuals and communities to form their own views of the social, economic and environmental impacts and benefits of gas development. This is done through the work of the CSIRO’s Gas Industry Social and Environmental Research Alliance, which is a collaboration between the CSIRO, the Australian Government, State and Territory Governments, and industry.

Legislative Changes to Enable Growth of the Offshore Renewable Energy Sector

The Government provided $4.8 million over two years from 2020-21 to develop a regulatory framework to provide investment certainty to offshore clean energy investors. Offshore clean energy regulation will enable private investments in commercially viable locations with exceptional wind resources, which are typically found near regional communities.

Future Fuels Package

The Government will provide $74.5 million over four years from 2020-21 to implement the Future Fuels Package to assist businesses overcome barriers to incorporating new vehicle technology into their fleets, including charging and refuelling infrastructure, and to support long-term opportunities offered by future liquid fuels, electricity and hydrogen. The measure includes:

  • The co-investment Future Fuels Fund to enable businesses to integrate new vehicle technologies using electricity, hydrogen or biofuels into their fleets, including support to install chargers at commercial bases for fleet cars and light commercial vehicles, and installation of chargers to address electric vehicle charging blackspots.
  • Undertaking a study to ensure the transition to electric vehicle technology and infrastructure is planned and managed, so the electricity grid is prepared for increased electric vehicle charging.
  • Funding research to model Australia’s future transport fuel mix to ensure Australians have access to fuel when they need it.
  • Updating the Government’s Green Vehicle Guide website, including improved information on electric vehicles and charging infrastructure to help businesses and communities make informed choices.

The first funding round of the Future Fuels Fund was launched on 15 February 2021, and focuses on public electric vehicle charging infrastructure. Applications closed on 6 April 2021 with ARENA receiving 43 submissions under round one of the Fund.

Support to install infrastructure for businesses choosing to integrate new vehicle technology into their fleets is expected to create jobs, many in regional areas, by accelerating the growth of clean vehicle technology industries. Improving access to chargers will also increase the ability of regional consumers to choose electric vehicles and increase options for transport in regional areas.

Enabling Markets, Supporting Communities and Boosting Energy Productivity in the Building Sector

The Government will provide $52.2 million over five years from 2020-21 to improve productivity and lower energy costs in the building and community sectors. This measure includes funding for:

  • The Hotel Energy Uplift Program to provide a total of $10.2 million in grants to small and medium sized hotels for use in upgrades to improve productivity and lower energy costs. Approximately 80% of eligible hotels (those with one to 99 rooms) are in regional locations. It is expected economic benefits beyond energy savings will be realised in regional Australia, with local suppliers and trades engaged to carry out the funded projects.
  • The Powering Communities Program to provide $67,700 of grants in each Federal electorate to assist not-for-profit community organisations to improve energy efficiency practices and technologies and better manage energy consumption. Total grant funding available is $10.2 million. It is expected economic benefits beyond energy savings will be realised across Australia, including in regional areas, with local suppliers and trades engaged to carry out the funded projects.
  • Improving the energy efficiency of residential and commercial buildings in Australia is expected to generate economic benefits. Energy savings will be realised across Australia, including in regional Australia.

Improving energy efficiency will contribute to cost savings across the economy, will help lower energy bills and improve health and comfort for Australians, including those living in rural and regional communities.

Regional Australia Microgrid Pilots Program

The Government is providing $53.6 million over 6 years from 2020-21 to support pilot studies for microgrids in regional and remote areas. This will support feasible microgrid projects to undertake pilot studies to resolve the remaining barriers to final investment and full deployment for those projects. Grants will fund 50 per cent of the project value up to a maximum value of $5 million and will be based on community needs and ability to pay.

Projects are expected to be deployed in regional and remote communities, stimulating local economies and demonstrating the value of microgrids in areas prone to outages. Microgrids can provide increased energy security, resilience and affordability through integration of distributed energy resources. They can also contribute to lowering emissions, as regional households and businesses lower their reliance on diesel generators by adopting solar and storage systems. This measure will benefit regional and remote communities connected to pilot sites. The program will launch in 2021-22.

Critical Minerals Capabilities

On 14 November 2019, the Government announced $16.1 million over five years from 2019-20 to support the development of Australia’s critical minerals capabilities, and boost Australia’s contribution to enhancing the stability and security of global critical minerals supply chains. Australia has world-leading reserves of critical minerals across regional areas. These present commercial opportunities for our businesses, as well as job creation potential in regional Australia.

The measure provided, over five years from 2019-20, $9.4 million to establish a Critical Minerals Facilitation Office (CMFO) in the Department; $4.5 million for the Advancing Research and Development for Critical Minerals Program, to be implemented by the Government’s scientific agencies, and $2.2 million to Austrade to expand its program of critical minerals trade and investment facilitation.

The CMFO is providing a whole-of-government critical mineral policy coordination function; dedicated project facilitation service for strategic Australian critical minerals projects; and undertake international engagement to promote investment in Australia.

Former British Government Nuclear Testing Site at Maralinga, South Australia – funding support

On 8 July 2020, the Government announced it will provide $2.5 million over four years from 2020-21 ($0.4 million per year ongoing from 2024-25) to support monitoring and maintenance work at the former British Government nuclear testing site on the Maralinga Tjarutja lands in remote South Australia. The funding is enabling site investigations to inform a long-term remediation action plan for non-radiological materials at the site and construction of permanent accommodation for current and future Maralinga caretakers.

The Government funds monitoring and maintenance activities connected to the British Government’s nuclear testing program at Maralinga under the terms of the 2009  Handback Deed. The Government has provided annual funding for these activities since Maralinga’s rehabilitation in the 1990s; this announcement provides greater certainty to Indigenous communities by preserving ongoing funding. 

Cooperative Research Centres Program

The Cooperative Research Centres (CRC) Program, established in 1990, is a competitive, merit-based grant program that supports industry led collaborations between industry, researchers and the community. The CRC Program has two funding streams:

  • CRCs, which undertake medium to long term, industry-led high quality collaborative research
  • CRC Projects (CRC-Ps), which undertake a short-term, industry-identified and industry-led collaborative research project.

Businesses investing in research and development through CRCs and CRC-Ps are increasing their income, competitiveness and productivity. The CRC Program continues to support CRCs and CRCPs that have impacts on rural and regional Australia.

Currently, the CRC stream has 27 CRCs nationally receiving over $1 billion in grant funds over their terms and of these, several impact on regional and rural Australia. The CRC-P stream currently has 14 projects led by partners located in regional Australia which are receiving over $27.3 million in CRC Program grant funding.

CRCs and CRC-Ps contribute to strengthening rural and regional development in areas such as agriculture and mining industries, farming systems and improving health outcomes for Indigenous Australians. Regional businesses (including small and medium-sized enterprises), Rural Research and Development Corporations, universities and other research organisations can be a part of CRCs and CRC-Ps and their activities.

Cooperative Research Centre for Developing Northern Australia

The Our North, Our Future: White Paper on Developing Northern Australia included $75 million over 10 years for a Cooperative Research Centre (CRC) for Developing Northern Australia to help northern businesses generate new ideas and innovation that leverage the north’s strengths and address its challenges. The CRC commenced operations in Townsville in 2017-18 and has three focus areas: agriculture and food (including aquaculture), northern Australia health service delivery and Traditional Owner-led business development. Industry situational analysis is occurring on the beef sector, broadacre cropping, aquaculture, horticulture, rice, forestry, bush foods, sugar and health sectors in Northern Australia. In November 2020, the CRC launched the State of the North 2020 report providing a roadmap to drive greater economic development across Northern Australia.

Measures to build STEM and cybersecurity skills

Each year outreach activities by Questacon and Portfolio agencies, delivered in person and online, provide thousands of regional young Australians, teachers, and families with access to STEM learning opportunities. Questacon commits $2.4 million to these activities annually.

In the 2019-20 Budget, the Australian Government provided $15.1 million over three years from 2019-20 to expand Questacon’s outreach activities. This included $8.9 million over 3 years to expand the delivery of Questacon’s regional programs, enabling teachers to gain confidence with Engineering is Elementary and extending the Questacon Science Circus to reach more remote and regional communities.

The 2020-21 Budget measure Australia’s Cyber Security Strategy 2020 included a further commitment of $8.7 million over 5 years for Questacon to deliver a new national cyber security education program, aimed at growing a cyber-skilled workforce including in Australia’s regions.