Queensland Pays Up to Half for Factory Equipment if You Apply by 25 November

If you run a manufacturing business in Queensland and have been putting off a big equipment upgrade, the state government will now pay up to half the cost of it. Grants of $100,000 to $1.5 million are open until 1pm on 25 November for advanced equipment and software: think a five-axis CNC machine, a welding robot, or the software that ties a production line together.

It is the second round of a $79.1 million program running over three years. The first round paid out $12.5 million to 18 manufacturers last month, including Gold Coast skincare brand MooGoo, which received $1.3 million to bring production it had been sending interstate back under its own roof. This round has another $12.5 million, and half of it is reserved for businesses in regional Queensland.

What it means for your business

The most important thing to understand is how the money works. The grant covers at most half the cost of the equipment that qualifies, and some things do not qualify at all. The application form's own examples rule out a forklift and an electrical upgrade. If your project includes anything like that, your share ends up being more than half, and you need that money lined up before you apply.

It is also competitive. In the first round, 119 businesses applied for those 18 grants. That is no reason to sit it out, but it does mean the project should make sense on its own numbers, with the grant making a good investment better.

There is one more condition worth knowing before you start. If you are successful, the government may ask for security before it signs the grant agreement, either a bank guarantee or security over your business assets. A bank guarantee can use up some of the credit your bank is willing to give you, and security over assets has to fit around anything your lender already holds. The government's own advice is to check that your bank is comfortable with this before you apply.

What to do before 25 November

Start with your accountant and your supplier. The application asks for three years of accountant-prepared financial statements, five years of forecasts, and a dated quote for each piece of equipment, so those two people hold most of what you need. With about three weeks to go, that is achievable if the project is already scoped. If it is still an idea, aim for the next round, due about six months later.

Then talk to your bank. Tell them about the grant, the security it might need, and how you plan to pay your share, whether that is cash, an existing facility or equipment finance. If you are financing the equipment, check whose name it will be in, because the application expects the business applying to be the one that owns it.

Finally, call your local Queensland Manufacturing Hub. They can tell you whether your project is likely to fit before you spend weeks on the application.

For a manufacturer who was going to make the investment anyway, half the cost of the qualifying equipment is a lot of money to leave on the table.

This article is general information only and is not financial advice.