The program will provide up to $17 million per year to help grow a deeper industrial base for the Australian Defence Force.

The initiative supports the 10 Sovereign Industrial Capability Priorities that are critical to the ADF's operational requirements, which concluded that the majority of its industrial base are SMEs.

Minister for Defence Industry Steven Ciobo said the grants were important for improving defence capability moving forward.

"Government is delivering the largest modernisation of the ADF since the Second World War, investing more than $200 billion in defence capability over the next decade. Involving Australia’s SMEs in this major renewal of Australia’s defence capability will grow our industry and economy, helping create new jobs," Minister Ciobo said.

Only small-to-medium sized companies (less than 200 employees) are eligible for the grant, and can use the funding towards capital equipment, design and engineering, or workforce training and accreditations. Grants range from $50,000 to $1 million and are provided on a 50:50 matched funding basis. 

Decisions about investment will be driven by Defence capability needs.

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Minister Ciobo explained the growing importance of Australia's defence industry SMEs, saying, "The plan concluded Australia’s defence industrial base is mostly composed of SMEs. This grants program aims to ensure Australian businesses have the capacity and resilience to support Defence’s most critical capabilities." 

The initial Sovereign Industrial Capability Priorities are:

• Collins Class submarine maintenance and technology upgrade;
• Continuous shipbuilding program (including rolling submarine acquisition);
• Land combat vehicle and technology upgrade;
• Enhanced active and passive phased array radar capability;
• Combat clothing survivability and signature reduction technologies;
• Advanced signal processing capability in electronic warfare, cyber and information security, and signature management technologies and operations;
• Surveillance and intelligence data collection, analysis dissemination and complex systems integration;
• Test, evaluation, certification and systems assurance;
• Munitions and small arms research, design, development and manufacture; and
• Aerospace platform deep maintenance.

"The grants will help SMEs meet up to 50 per cent of eligible project costs including capital equipment, specialist software and security infrastructure, non-recurring engineering costs, design activities or enhancing workforce training and accreditation," he explained further. 

The grants program will be delivered through the Centre for Defence Industry Capability. For more information, or to apply for a Sovereign Industrial Capability Priority Grant, click here. 

"Involving Australia’s SMEs in this major renewal of Australia’s defence capability will grow our industry and economy, helping create new jobs," Minister Ciobo said.