Funding opportunity to bolster Australia’s defence sector by supporting businesses to enhance their capabilities across four key areas: Sovereign Industrial Priorities, Exports, Skilling and Security.
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What is the Defence Industry Development Grant (DIDG)?
Under the 2026 Defence Industry Development Strategy (DIDS26), the Defence Industry Development Grants (DIDG) Program has been extended to 2030.
An additional $80 million has been committed, bringing total program funding to around $250 million. New DIDG Grant Opportunity Guidelines (GOGs) and a revised application form are expected to be released towards the end of 2026.
In the meantime, applications will continue under the current guidelines and application process.
The Defence Industry Development Grants Program will fund small to medium enterprises to build Australia’s sovereign capability, global competitiveness, technical superiority and national security.
There are four streams within the program, including:
- Sovereign Industrial Priorities – funding to help SMEs purchase, lease, construct, install or commission manufacturing plant and equipment that directly supports priority systems nominated within the Sovereign Defence Industrial Priorities.
- Skilling – funding to help defence sector SMEs upskill and train staff in priority trade, technical and professional skillsets, and to support Defence Industry Associations to deliver eligible training activities for defence sector SMEs.
- Exports – funding to help SMEs overcome export barriers, build export capability and improve competitiveness in defence capability priority areas.
- Security – funding to help defence industry businesses improve or maintain security controls, including activities aligned with the Defence Industry Security Program (DISP) and relevant Defence security requirements.
Funding is also available for applications supporting Australia’s Nuclear-Powered Submarine (NPS) program.
Nuclear-Powered Submarine (NPS) funding
- The DIDG program includes dedicated funding for projects that support Australia’s Nuclear-Powered Submarine (NPS) program.
- Applicants seeking NPS funding should identify this within their application.
- Applicants are encouraged to provide a Letter of Support from the Australian Submarine Agency (ASA) where available.
Defence Industry Development Grant level of support
Minimum and maximum grant amounts
- Sovereign Industrial Priorities Stream: $50,000 to $1,000,000
- Skilling Stream: $5,000 to $250,000
- Exports Stream: $15,000 to $250,000
- Security Stream: $10,000 to $100,000
Co-contribution:
- Grants cover up to 50% of eligible project expenditure.
- Applicants must contribute at least 50% of eligible project costs.
- Applicants are responsible for any project costs that are deemed ineligible under the grant guidelines.
- Funding from other Commonwealth, state, territory or local government grant programs cannot be used to fund the applicant’s required contribution towards eligible expenditure.
Co-contribution example
- Total eligible project expenditure: $200,000
- Grant contribution (50%): $100,000
- Applicant contribution (50%): $100,000
Funding caps
Maximum funding available to a recipient over a rolling three-year period:
- Sovereign Industrial Priorities Stream: $3 million
- Skilling Stream: $250,000
- Exports Stream: $500,000
- Security Stream: $200,000
Defence Industry Development Grant important dates
The closing dates for the current batches are:
- Exports stream: Friday 31 July 2026, 11:59 pm AEST
- Security stream: Monday 31 August 2026, 11:59 pm AEST
- Skilling stream: Friday 31 July 2026, 11:59 pm AEST
- Sovereign Industrial Priorities stream: Monday 31 August 2026, 11:59 pm AEST
- Register your interest with GrantHelper
Defence Industry Development Grant objectives
The objectives of the Defence Industry Development Grants Program are to:
- Develop a more capable, resilient, and competitive Australian defence industry.
- Support Defence outcomes in areas of strategic priority.
- Enhance the skills and capacity of the Australian defence industry workforce.
- Strengthen export capability in defence sectors aligned with Sovereign Defence Industrial Priorities.
- Uplift the security of Australia’s defence industrial base in response to the challenging strategic environment.
Projects eligible for Defence Industry Development Grant support
Eligible projects must:
- be undertaken in Australia
- include eligible activities under the stream being applied for
- have a clear link to the grant opportunity objectives and outcomes
- align with priority systems nominated within the Sovereign Defence Industrial Priorities, where relevant
- meet the minimum eligible expenditure threshold for the relevant stream.
Here’s what is eligible under each stream:
1/4 Sovereign Industrial Priorities Stream
- Projects must involve the purchase, leasing, construction, installation or commissioning of manufacturing plant and equipment used directly to develop and/or deliver priority systems nominated within the detailed Sovereign Defence Industrial Priorities.
- Eligible activities may also include related design, engineering, workforce training and commissioning activities where they directly support the funded plant and equipment.
2/4 Skilling Stream
- Projects must increase Defence-related technical skills capacity or capability within the applicant organisation, or within an eligible SME where a Defence Industry Association is applying.
- Projects must be delivered by a registered training organisation, tertiary education provider, professional training provider, appropriately qualified employee within the business, or an original equipment manufacturer.
- Eligible activities may include technical and trade skills training, micro-credentials in technical fields, apprenticeship supervision, on-the-job technical training supervision and other approved technical skills development activities aligned with Defence capability needs.
3/4 Exports Stream
- Projects must help eligible SMEs expand existing defence export capability or build new defence export capability in priority areas.
- Eligible activities may include the purchase, lease, construction, installation or commissioning of manufacturing plant and equipment used directly to develop and/or deliver defence export opportunities. Activities may also include related design, engineering, commissioning, workforce training and approved international certifications or accreditations required to become export-ready.
4/4 Security Stream
- Projects must help businesses uplift or maintain security controls needed to build defence industry capability in priority areas.
- Eligible activities must support the Security Stream objectives and may include activities linked to DISP requirements, Defence security requirements, or relevant DISP Maturity Action Plans or DISP Audit Reports. Some activities require mandatory supporting evidence, such as a DISP Maturity Action Plan or DISP Audit Report issued by Defence.
Ineligible expenditure under all streams includes:
- activities, purchases or commitments made before the execution of a grant agreement
- costs that are not directly related to the approved project
- routine business operating expenses and business-as-usual activities
- salaries and on-costs for existing employees, unless specifically permitted under the relevant stream guidelines
- costs associated with preparing the grant application
- financing costs, including interest payments and loan repayments
- depreciation of existing assets
- entertainment, gifts, hospitality and alcohol
- fines, penalties or legal disputes
- costs related to the purchase of land or buildings, unless specifically permitted under the relevant stream guidelines
- expenditure funded through another Commonwealth, state, territory or local government grant program
- goods and services tax (GST), where the applicant is entitled to claim an input tax credit from the Australian Taxation Office
- any expenditure that Defence determines does not represent value for money or does not align with the objectives of the relevant grant stream.
See the individual guidelines for each stream for full details of projects eligible and ineligible for DIDG support.
Other Defence Industry Development Grant important details that you will need to know
Organisations eligible for Defence Industry Development Grant support
To be eligible, applicants must:
- have an Australian Business Number (ABN)
- be registered for GST
- have an account with an Australian financial institution
- be non-income-tax-exempt
- be an SME with fewer than 200 employees, except for the Skilling Stream where Defence Industry Associations may also be eligible
- be one of the following entity types:
- an entity incorporated in Australia
- a company limited by guarantee
- an incorporated trustee applying on behalf of a trust.
Joint applications are acceptable where there is an eligible lead organisation that is the main driver of the project. The lead organisation must submit the application and, if successful, enter into the grant agreement with the Commonwealth.
You are not eligible to apply if you are:
- an organisation not included in the eligible entity types
- an organisation, or project partner, listed under the National Redress Scheme as an institution that has not joined or signified its intent to join the Scheme
- an employer of 100 or more employees that has not complied with the Workplace Gender Equality Act 2012
- an individual
- a partnership
- an overseas organisation
- an unincorporated association
- a trust, unless an incorporated trustee applies on behalf of the trust
- a Commonwealth, state, territory or local government agency or body, including government business enterprises.
Defence Industry Development Grant assessment criteria
Applications must score at least 65% against each assessment criterion to be considered meritorious.
Sovereign Industrial Priorities Stream
Assessment Criterion 1: The extent to which the grant project will help the business contribute to one or more Sovereign Defence Industrial Priorities.
Applicants should demonstrate:
- how the project will contribute to the development or enhancement of priority systems nominated in one or more detailed Sovereign Defence Industrial Priorities
- details of the SDIP product, defence contract opportunities, customers, collaboration, maturity of commercial negotiations, timing and size of the opportunity
- the broader benefits for the business and the defence industry
- the level of support for the opportunity, as demonstrated through a Letter of Support from Defence or a defence industry customer, where applicable.
Assessment Criterion 2: The applicant’s capacity, capability and resources to deliver the project and its commercial benefits.
Applicants should demonstrate:
- a clear project management approach, including project scope, milestones, risks and mitigation strategies
- an itemised project budget
- access to personnel with the right technical and management skills
- experience delivering similar capital equipment projects on time and on budget
- current and proposed methods to secure intellectual property, equipment and technology against physical and cyber threats
- how the project differs from any previously funded Sovereign Industrial Capability Priority or Sovereign Industrial Priorities project, where applicable.
Skilling Stream
Assessment Criterion 1: The extent to which the project develops industrial workforce capacity and capability to service the defence industry sector in priority areas.
Applicants should demonstrate:
- the technical skills the project will develop and why they are required to support defence industry priority areas
- current challenges in upskilling staff in the defence industry sector
- for SME applicants, details of defence opportunities currently being supplied, tendered for or subcontracted to perform
- for Defence Industry Association applicants, evidence of market need, likely training uptake, minimum-viable participant numbers, target and maximum participant numbers, cost per participant and how participant eligibility and training completion will be documented.
Assessment Criterion 2: The applicant’s capacity, capability and resources to deliver the project.
Applicants should demonstrate:
- a clear project plan, including key risks, timeframes and deliverables
- a project and risk management plan where required
- a clear project budget
- the qualifications, skills and experience of training providers
- the capability of personnel involved in delivering the project
- how project success will be measured
- how the project differs from any previously funded Skilling Australia’s Defence Industry or DIDG Skilling project, where applicable.
Exports Stream
Assessment Criterion 1: The extent to which the project will help the business expand existing or build new defence industry export capability in priority areas.
Applicants should demonstrate:
- the defence export opportunities the project will support
- details of customers, collaboration, maturity of commercial negotiations, timing and size of export opportunities
- how the project will overcome export barriers, build competitive advantage and strengthen supply chain resilience
- how any proposed international certification or accreditation is required for the export opportunity
- alignment with priority systems nominated in the detailed Sovereign Defence Industrial Priorities
- broader benefits for the business and Australian defence industry.
Assessment Criterion 2: The applicant’s capacity, capability and resources to deliver the project and its commercial benefits.
Applicants should demonstrate:
- a clear project management approach
- key risks and how they will be managed
- a project budget proportionate to the funding requested
- access to the personnel, technical skills and commercial capability required to deliver the project
- the ability to convert the project into export-related commercial outcomes
- how the project differs from any previously funded DIDG Exports project, where applicable.
Security Stream
Assessment Criterion 1: The extent to which the project will help the business uplift or maintain the security controls needed to build defence industry capability in priority areas.
Applicants should demonstrate:
- how the project will uplift or maintain security controls
- current and proposed methods to protect intellectual property, equipment and technology from physical and cyber threats
- how DISP requirements will be addressed
- how the project aligns with a DISP Maturity Action Plan or DISP Audit Report, where applicable
- the defence opportunities the project will open up
- alignment with priority systems nominated in the detailed Sovereign Defence Industrial Priorities
- the level of support for the opportunity, as demonstrated through a Letter of Support from Defence or a defence industry customer, where applicable.
Assessment Criterion 2: The applicant’s capacity, capability and resources to deliver the project.
Applicants should demonstrate:
- current DISP membership status across governance, personnel, physical, ICT and cyber security domains
- if not currently a DISP member, how the business intends to meet DISP eligibility requirements
- a clear project plan, including risks, milestones and deliverables
- a project budget proportionate to the funding requested
- access to personnel with relevant technical and management skills
- provider qualifications and experience, where relevant
- details of any proposed security officer appointment or security clearance activities, where relevant
- how the project differs from any previously funded DIDG Security project, where applicable.
How do I get the Defence Industry Development Grant?
Applicants should:
- Choose the stream that best matches their project: Sovereign Industrial Priorities, Skilling, Exports or Security.
- Read the relevant grant opportunity guidelines, sample application form and sample grant agreement before applying.
- Check that the organisation meets all eligibility requirements.
- Confirm the project includes eligible activities and meets the minimum eligible expenditure threshold for the relevant stream.
- Make sure the project clearly aligns with the stream objectives and the relevant Sovereign Defence Industrial Priorities.
- Prepare all required attachments before starting the online form.
- Prepare evidence to support the assessment criteria, such as project plans, quotes, budgets, letters of support or technical documentation.
- If applying for Nuclear-Powered Submarine program funding, prepare a Letter of Support from the Australian Submarine Agency where available.
- Create an account in the online portal.
- Complete and submit the application through the online portal.
- Address all eligibility and assessment criteria in the application.
- Check that all information is complete and accurate before submitting, as applications cannot be edited after submission.
- If applying as part of a consortium, appoint an eligible lead organisation and prepare letters of support from project partners.
- If successful, enter into a grant agreement and deliver the project as agreed.
Information to prepare for the Defence Industry Development Grant application
Applicants should prepare all required documentation before starting the online application. The total size of all attachments must not exceed 20MB, and only requested documents should be attached.
Sovereign Industrial Priorities Stream
Prepare the following:
- project budget using the template provided on business.gov.au and GrantConnect
- project and risk management plan, limited to four pages
- accountant declaration using the required template
- Letter of Support from Defence or a defence industry customer, if applicable
- Letter of Support from the Australian Submarine Agency, if applying for NPS funding
- trust deed, where applying as an incorporated trustee on behalf of a trust.
Skilling Stream
Prepare the following, where applicable:
- itemised quotes obtained in the last 12 months for proposed training activities
- itemised quotes obtained in the last six months for domestic and international travel
- training plan or syllabus for OEM and internal training
- letter or email from the OEM provider for OEM training
- project budget using the template provided on business.gov.au and GrantConnect
- project and risk management plan, limited to four pages, if total project costs exceed $100,000 or there are more than 10 proposed participants
- accountant declaration if the application is for more than $50,000 in funding
- Letter of Support from Defence or a defence industry customer, if applicable
- Letter of Support from the Australian Submarine Agency, if applying for NPS funding
- trust deed, where applying as an incorporated trustee on behalf of a trust.
Exports Stream
Prepare the following, where applicable:
- project budget using the template provided on business.gov.au and GrantConnect
- project and risk management plan, particularly for projects involving manufacturing plant and equipment
- accountant declaration if the application is for more than $50,000 in funding
- Letter of Support from Defence or a defence industry customer, if applicable
- Letter of Support from the Australian Submarine Agency, if applying for NPS funding
- trust deed, where applying as an incorporated trustee on behalf of a trust.
Security Stream
Prepare the following, where applicable:
- DISP Maturity Action Plan or DISP Audit Report, where required for the proposed activities
- project budget using the template provided on business.gov.au and GrantConnect
- project and risk management plan, limited to four pages, for projects where total project costs exceed $100,000
- accountant declaration if the application is for more than $50,000 in funding
- Letter of Support from Defence or a defence industry customer, if applicable
- Letter of Support from the Australian Submarine Agency, if applying for NPS funding
- trust deed, where applying as an incorporated trustee on behalf of a trust.
Applying for the Defence Industry Development Grant
Applications are submitted online through portal.business.gov.au.
Register your interest here with GrantHelper to explore your alignment with this grant and how we can assist you to increase your chances of success.
Defence Industry Development Grant resources
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