Community grants framework delayed as funding concerns remain

The framework was released in March 2025 by the then Minister for Social Services, Amanda Rishworth, following a public consultation that ran from September to November 2023 and drew 237 submissions. It promised "whole-of-government administrative and cultural change" in how agencies design and manage community sector grants.

The framework was accompanied by a "Ways of Working" statement committing the government to being more collaborative, transparent, innovative and outcomes-focused. Grantmakers were advised it would work "in parallel" with the existing Australian Government Grants Framework and Commonwealth Grants Rules and Principles.

A long time coming

The consultation was commissioned after the government's 2022 election commitment to strengthening the community sector. The issues it canvassed – short grant cycles, inadequate indexation, excessive compliance burden – had been raised in previous reviews dating back to the Productivity Commission's 2010 report on the not-for-profit sector.

The 237 submissions described a sector under strain, with respondents raising:

• increased community need and demand for services
• workforce shortages, exhaustion and burnout
• a decline in volunteer numbers
• increasing red tape
• unsustainable funding.

Sector scepticism about the framework

A 2022 Australian Council of Social Service (ACOSS) community sector survey found that only 12 per cent of sector leaders agreed their funding enabled them to meet demand. The framework acknowledged the concern and committed to developing guidance for Australian Public Service (APS) employees on understanding service delivery costs.

Community Council for Australia (CCA) chief executive David Crosbie welcomed changes to indexation at the time but said there were few new commitments from DSS.

"There may be some benefits for organisations contracted by the Department of Social Services, and the document has many good intentions, but I don't think it is a game changer," Crosbie said.

What the DSS says now

In response to questions from SmartyGrants, a departmental spokesperson said the framework "is driving a whole-of-government administrative and cultural change, improving how grants are designed and managed to help the sector plan for the future and to improve outcomes for vulnerable Australians."

The spokesperson pointed to the DSS’s ongoing engagement with the Community Services Advisory Group (CSAG) and a Community Services Ministerial Roundtable as evidence of progress. A departmental spokesperson said those were “valuable channels to listen to the sector and inform future policies and programs.'"

Several of the framework’s short-term aims have been achieved. A dedicated community sector webpage has been published on the DSS website, and the Department of Finance published updated whole-of-government grant guidelines and templates in late 2025. These appear to have addressed a cluster of related short-term commitments covering information on indexation, longer-term agreements, notification requirements and grant flexibility.

It is unclear whether the DSS has met other short-term commitments.

This includes mapping cross-government consultation to “alleviate consultation fatigue experienced by CSOs” and providing clearer operational guidance on the duration of grants. Also outstanding is a business case for a Commonwealth grant connected policy under the National Agreement on Closing the Gap, which would require agencies to prioritise Aboriginal and Torres Straig Islander community-controlled organisations when designing grant programs.

Progress report late, measurement plan outstanding

The DSS committed to publishing the first progress report on the framework during the 2025–26 financial year. It now says it will be published in late 2026, meaning it will miss that deadline.

The DSS also committed to developing an Outcomes Measurement Plan to underpin the progress report, and said in a statement that that plan was “on track”.

Data on whether agencies have passed on indexation in full to grantees, offered longer-term grant agreements, and provided earlier notification of grant cessation or renewal will not be released before the progress report in late 2026.

Full-cost funding and grant duration unresolved

When asked to identify any mechanism in the framework that would require grants to cover the full cost of service delivery, the DSS did not respond.

Grant duration was the single most widely raised issue across the 237 submissions, with most calling for a minimum five-year term. The DSS did not respond to questions about how many new grant agreements since March 2025 have been for five years or more.

Minister declines to answer

Questions sent to Minister Tanya Plibersek's office – the portfolio has passed from Rishworth to Plibersek – received no direct response. The DSS’s media unit replied on behalf of both the department and the minister's office. Three questions put to the minister – on the progress report timeline, full-cost funding and grant duration – were not answered.

Plibersek has been more direct in other forums. In a keynote address to the Amplify Alliance national not-for-profit summit in October 2025, she announced a revamp of five family and community services programs worth $430 million a year, to be replaced by a single national program from 2027. The changes include a trial of "relational contracting" – five-year contracts, reduced reporting and a greater focus on outcomes.

"Community organisations have told us loud and clear – too much red tape and admin is holding them back from doing what they do best: supporting kids, families and communities," Plibersek said.

Whether the family services trial becomes a template for broader community sector grants remains to be seen. The framework's own components – including longer-term agreements and better understanding of service delivery costs – share similar objectives, though the DSS has not indicated a timeline for extending the relational contracting model beyond child and family programs.

What comes next

The framework responded to longstanding sector concerns – consultation fatigue, inadequate indexation, short grant cycles – that had been raised across multiple previous government reviews. Whether it translates into measurable change is a question the DSS says will be answered when the progress report lands in late 2026.

The DSS did not to respond to questions about full-cost funding mechanisms, grant duration data, and the timeline for the Outcomes Measurement Plan.

More information

Community Sector Grants Engagement Framework