Defence industry grants are changing. Here's how to be ready when they reopen.

The short version: the Defence Industry Development Grants Program is being updated. It offers small to medium defence businesses grants of up to $1 million, covering up to 50% of eligible expenditure. Its four streams are closing in turn, and business.gov.au says new guidelines are expected by 3 November 2026, when all streams will reopen. The new guidelines may change the amounts or rules, so use the gap to get ready rather than to commit spending.

If you were planning an application, a pause like this can be unsettling. The good news is that the program isn't going away, and a lot of the preparation work doesn't depend on the final wording of the new rules. Here's what's confirmed, what's only expected, and what you can do now.

At a glance

What's changing

The business.gov.au program page says the program "is being updated" and that each of the four streams will close in turn so new application forms can be put in place. At 20 October 2026, it says the Sovereign Industrial Priorities stream is temporarily closed and the Skilling stream will temporarily close in October.

The same page says new grant opportunity guidelines and supporting templates for each stream "are expected to be released by 3 November 2026", when all streams will reopen. Defence's October 2026 Industry Engagement Update describes this as a transition period and says the streams are expected to reopen "in early November". Treat that date as expected, not guaranteed.

Two things are settled. The 2026 Defence Industry Development Strategy adds $80 million to the program through to 2030, bringing total investment to around $250 million, according to Defence. And Defence says the program's focus on assessment criteria 1 and 2 "will not fundamentally change".

The four streams and current maximums

These are the amounts under the current guidelines, as listed on business.gov.au. The new guidelines may change them.

In every stream, grants cover up to 50% of eligible expenditure. That means you need to fund at least half the eligible costs, plus anything the guidelines exclude. Our guide to co-contributions and matched funding explains how to work out your real share.

Who can apply under the current rules

Under the current rules, business.gov.au says you need an ABN, GST registration, an Australian bank account and to be non-income tax exempt. You must be an SME with fewer than 200 employees (or, for Skilling only, a Defence Industry Association), and be an entity incorporated in Australia, a company limited by guarantee, or an incorporated trustee on behalf of a trust. Individuals, partnerships, unincorporated associations and government bodies can't apply.

Defence's guidance says applications are likely to be ineligible if they include product development, prototyping or research and development. Projects must show a strong link to one or more Sovereign Defence Industrial Priorities.

What to do now

You can't apply under the new rules yet, but you can make sure you're ready when they're published. These steps hold up whatever the final guidelines say:

• Check the eligibility basics. Confirm your ABN, GST registration, entity type and employee count against the list above.
• Map your work to the priorities. Defence encourages businesses to review the Sovereign Defence Industrial Priorities in Annex A of the 2026 Defence Industry Development Strategy and work out where your products and services fit.
• Gather quotes, but don't commit. The current guidelines say you must not start project activities until a grant agreement is executed, and you may need quotes for major costs. Collect quotes, but hold off signing, ordering or paying deposits. Our guide on grants for projects that have already started explains why.
• Talk to your accountant early. The current guidelines require an accountant declaration confirming you can fund your share of the project, including ineligible costs.
• For the Security stream, talk to your DISP case officer. Defence says cybersecurity applications currently need a Maturity Action Plan with action items agreed with a Defence Industry Security Program case officer.
• Stay up to date. Check the business.gov.au program page and subscribe to Defence's Industry Engagement Update. Send questions to industry.grants@defence.gov.au.

When the new guidelines are out, GrantAlly reads the guidelines you upload, checks each published rule against your project and recommends whether to apply. See how the eligibility check works.

Things to watch

• Amounts and rules may change. Everything in the stream table comes from the current guidelines. Read the new guidelines in full before you rely on any figure.
• The reopening date is an expectation. business.gov.au says "expected by 3 November 2026" and Defence says "early November". Neither is a promise.
• Current batch dates may shift. The program pages still list batch closing dates of 31 October 2026 (Exports, Security) and 30 November 2026 (Skilling, Sovereign Industrial Priorities). Given the transition, check the program page or contact the program before relying on them.
• It's competitive. Under the current rules, applications must score at least 65% against all criteria and are then ranked on criterion 1.

Frequently asked questions

When will the Defence Industry Development Grants reopen?

business.gov.au says new guidelines and templates are expected to be released by 3 November 2026, when all four streams will reopen. Defence says early November. Check the program page for confirmation.

How much can I get from a Defence Industry Development Grant?

Under the current guidelines, grants range from $5,000 in the Skilling stream up to $1 million in the Sovereign Industrial Priorities stream, covering up to 50% of eligible expenditure. The new guidelines may change these amounts.

Can I start buying equipment now and claim it later?

Not under the current rules. The guidelines say you must not start project activities until a grant agreement is executed. Collect quotes, but don't sign, order or pay until you have an executed agreement.