Relatively Access to Funding

ANAO Report No.11 2014–15 The Award of Grants under the Clean Technology Program 76

3.11 In

practice, if an application was found to be incomplete during the eligibility assessment, the applicant would receive a letter or email detailing the information required to complete the application. In this respect, the procedures manual outlined that: If there is a minor omission or oversight in an application, a line manager may agree to provide the applicant with a brief opportunity to address this, and subject to this being done, may deem the application complete as at the date of receipt. Alternatively an application may be deemed complete at a later date where it takes more time for an applicant to provide all mandatory data and attachments.

3.12 However,

a ‘minor omission’ was not defined or illustrated in the procedures manual. In June 2014, the department advised ANAO that: AusIndustry CSMs [Customer Service Managers] have a significant level of experience in program delivery. Our culture is to assist businesses to access our programs where possible. Typically where applications are incomplete, we would contact applicants and give them an opportunity to provide the outstanding information. Generally speaking only in those circumstances where customers did not address information gaps as requested, would applications be formally determined to be incomplete and therefore ineligible for merit assessment. 3.13 The department also implemented processes relating to additional information requests that did not promote equitable access to funding. For example, the department advised ANAO in June 2014 that: During the high application volume period of the program, guidance was provided to the network in which streamlined assessment processes were recommended for small grants [less than 300 000].

3.14 The

process, referred to by the department, resulted in applicants who were seeking less than 300 000 in grant funds not being afforded the same opportunity to provide additional information as applicants seeking more than 300 000 in funds. In this respect, the departmental assessors were advised to not engage the applicant in extensive information requests, but rather seek the minimum level of information needed to complete the assessment and provide the applicant with a specified response date after which ’AusIndustry will complete its due diligence with the information available and forward it to [the] Committee for merit assessment and Delegate decision‘. It is not clear from the assessment records how many applications were assessed using this process. However, 245 applications that sought less than 300 000 in grant funding were submitted, merit assessed and considered by the program ANAO Report No.11 2014–15 The Award of Grants under the Clean Technology Program 77 delegate after this guidance was issued to the department. Of these applications, 69 per cent were approved by the delegate. This is slightly lower than the overall rate of approval of applications, which, as discussed in paragraph 2.33, was 74 per cent.

3.15 In

September 2014, the department advised ANAO that its streamlined processes for projects seeking less than 300 000 in grant funds was designed to encourage staff to ‘limit their due diligence in accordance with the complexity and risk of applications’. However, for the wider group of applications, the department’s due diligence went beyond simply clarifying and confirming the information presented in each application and extended to initiating and promoting changes to projects that were unlikely to be funded under the programs in their original form. 88 In this context, the approach of seeking to limit departmental assistance to some applicants and not others was inequitable, particularly when considered against the advice given in the customer guidelines that incomplete applications would not be considered. Reframing of applications by the department and Innovation Australia

3.16 In

addition to the 61 applications identified as ineligible, the grant amount was changed by the applicant, department or IA committee during the assessment process for a further 215 applications. 89 Of particular note in this respect was that:  a number of applications were reframed to exclude ineligible expenditure items 90 with 83 applications reframed during the departmental assessment and five applications reframed during the IA committee assessment 91 ;  applications were also reframed to exclude eligible expenditure items that did not provide value for money with 56 applications reframed to exclude eligible items during the departmental assessment and 88 Examples of the approach taken by the department are set out in paragraphs 3.25 and 3.26. 89 In reference to the 814 applications that were considered by the program delegate, the rate of reframing applications was 26 per cent. 90 An appendix to the customer guidelines outlined the items of expenditure that were eligible for funding. 91 There was one application that was reframed during the departmental assessment and the IA committee assessment. Therefore, a total of 85 applications were reframed to exclude ineligible expenditure items.