If you’ve been building a case for an Industry Growth Program grant, you may have already heard the news. As of May 2026, the program stopped accepting new applications while the government reviews its future. There’s no announced reopening date. If you’re a founder who was counting on it, that’s a genuine problem, and you’re not alone in feeling it.
This isn’t a small program quietly winding down. The Industry Growth Program (IGP) has been the federal government’s flagship commercialisation grant since 2023, backed by $392 million and built specifically to help innovative small and medium businesses bridge the gap between research and market. By March 2026, it had awarded 111 grants worth a combined $171.2 million. It was, for a lot of hardware, medtech and manufacturing-adjacent startups, the obvious first stop for non-dilutive funding.
Now it’s paused, and founders are left working out what to do next.
It’s worth being clear about who this actually hits. If you’re a pre-revenue software founder outside the National Reconstruction Fund’s priority sectors, IGP was probably never your program anyway, and none of this changes much for you. If you’re in hardware, medtech, manufacturing, agtech or renewables and you’d built a funding plan around an Early-Stage Commercialisation or Commercialisation and Growth grant, this is the article for you.
What the Industry Growth Program actually offered
Worth recapping quickly, because the gap it leaves is easier to understand once you know what was in it.
The program worked in two stages. First, eligible businesses (turnover under $20 million, an ABN, registered for GST, structured as a company, co-operative or incorporated trustee) were connected with an Industry Growth Program Adviser. The adviser worked through your commercialisation strategy, tested your business model, and pointed you toward suitable funding pathways. Only after that advisory step, and only if the adviser’s report recommended it, could you apply for one of two grant types:
Early-Stage Commercialisation grants, worth $50,000 to $250,000, for businesses at the feasibility, proof-of-concept or prototyping stage, roughly Technology Readiness Levels 3 to 6.
Commercialisation and Growth grants, worth $100,000 to $5 million, for businesses moving from prototype through to market-ready and scaling, roughly Technology Readiness Levels 4 to 9.
Both were matched funding, meaning your business had to contribute dollar for dollar. Both were merit-assessed by an independent committee, so getting the advisory report didn’t guarantee a grant. And both were restricted to projects within the National Reconstruction Fund’s priority areas: resources, agriculture and fisheries value-add, transport, medical science, renewables and low emissions technology, defence capability, and a handful of “enabling capabilities.” If your business sat outside those sectors, IGP was never going to be your program anyway.
Why it paused, and why nobody announced it loudly
According to reporting from SmartCompany and Startup Daily, businesses and advisers were told about the pause with little public fanfare, and internal documents reportedly show officials had discussed not flagging the change in proactive communications. The stated reason is that the department wants to redesign the program for “better targeted grant rounds and a more predictable grant application process.”
Existing advisory services and signed grant agreements are continuing. It’s only new applications that are frozen. But if you were mid-preparation, and commercialisation grant applications typically take months of groundwork before you even lodge, that pause lands at an awkward time. There’s no published date for reopening, so “wait it out” isn’t really a plan you can put a timeline on.
What this means if you were relying on IGP funding
A few honest observations, because vague reassurance doesn’t help anyone budgeting a runway.
First, if IGP was your only funding plan, you need a second one now, not when the program reopens. Grant timing gaps are exactly when good projects stall for lack of cash, not lack of merit.
Second, IGP was always a competitive, merit-based program. Even when it was open, not every advisory client went on to get a grant. That’s worth remembering when you’re weighing it against alternatives that don’t carry the same competitive uncertainty.
Third, and this is the part founders often miss: IGP was never your only non-dilutive option, even before the pause. It was just the biggest and most talked about. There are others still open right now.
The funding option that isn’t paused: the R&D Tax Incentive
This is the one we’d point every eligible founder to first, and not just because it’s what Granton does.
The R&D Tax Incentive (RDTI) is a federal program that refunds up to 43.5% of what an Australian business spends on eligible R&D, as cash, even if the company is loss-making. It’s jointly run by AusIndustry, which decides whether your activities qualify as R&D, and the ATO, which pays the refund.
The structural difference between RDTI and IGP matters more than the headline numbers. RDTI is not merit-based and not sector-locked. If your development work involved genuine technical uncertainty, meaning there was a real point where you didn’t know if your approach would work and had to test, fail and iterate to find out, it can qualify. That’s true whether you’re building software, hardware, a new formulation or a novel process, and whether you’re in medtech, SaaS, agtech, consumer goods or somewhere else entirely. There’s no priority sector list to fit inside.
It’s also not competitive in the way a grant round is. There’s no pool of applicants ranked against each other for a fixed pot of money. If your activities meet the legislative test and your spend clears the $20,000 minimum, you’re entitled to the offset. That’s a very different risk profile to waiting on a government committee to reopen a paused program and then rank your application against everyone else’s.
The trade-off is that RDTI isn’t matched funding you apply for upfront. It’s a refund on money you’ve already spent, claimed after the fact through registration with AusIndustry and a schedule lodged with your company tax return, due by 30 April each financial year, no extensions. So it doesn’t replace a $250,000 grant in your bank account before you’ve spent a dollar. But for most startups, especially ones already spending on genuine development work, it’s cash that’s sitting there unclaimed regardless of what’s happening with IGP.
It’s worth flagging one thing about where the program is heading. The 2026 Budget announced changes to the R&D Tax Incentive, though they’re not legislated yet, so treat this as what’s proposed rather than current law. From 1 July 2028, the core rate is proposed to move to around 48%, the refundable threshold would lift to $50 million turnover, the minimum spend would rise to $50,000, supporting activities would be removed as a separate category, and refundability would be limited to companies under 10 years old. None of that changes anything for a claim you lodge this year or next. The current 43.5% rate and $20,000 minimum still apply, and will keep applying until any change actually passes Parliament.
Quick answers to the objections we hear most
A few things founders assume that aren’t actually true, worth clearing up while you’re weighing options.
“My work isn’t innovative enough to count.” The test for RDTI is technical uncertainty, not how impressive the work sounds. If there was a genuine point where you didn’t know if your approach would work, and you had to test and iterate to find out, that’s R&D, even if it feels routine to you because you live in it every day.
“We use offshore developers, so we probably don’t qualify.” Offshore labour itself doesn’t qualify, but Australian spend around it, founder time, local contractors, subscriptions and tools, often still creates a genuine claim. Worth checking rather than assuming.
“My accountant already handles this.” Most accountants don’t do the AusIndustry technical registration and write-up, which is a separate step from the tax return. A specialist works alongside your accountant, not instead of them.
“We’re pre-revenue, so there’s nothing to claim against.” Pre-revenue and loss-making companies are exactly who the refundable offset is built for. You get cash back, not just a smaller tax bill, and there’s no profitability requirement.
Other non-dilutive options still open right now
RDTI is the biggest lever for most founders, but it’s not the only one worth checking while IGP is frozen.
Export Market Development Grants (EMDG) support businesses spending money to promote exports, and the program is running normally. If international expansion is part of your growth plan, it’s worth a look.
State government grants haven’t paused just because a federal program has. Queensland, Victoria, NSW and others all run their own innovation and manufacturing grant streams, often with less competition than a national program because fewer people think to check.
Early Stage Innovation Company (ESIC) status doesn’t hand you cash directly, but it makes your business more attractive to investors by giving them a tax offset on what they put in. If you’re about to raise, it’s worth confirming your eligibility before you open the round, not after.
None of these individually replace a $5 million Commercialisation and Growth grant. Together, alongside RDTI, they’re a genuine funding strategy that doesn’t depend on one paused program reopening on someone else’s timeline.
What to do this week
If you were planning around IGP, three things are worth doing now rather than waiting.
Work out what you’ve already spent on genuine R&D this financial year, even informally. GitHub commits, design docs, meeting notes and emails all count as evidence, so you don’t need perfect timesheets to start.
Check whether your spend already clears the $20,000 RDTI threshold. A lot of founders are surprised to find they’re already there.
Get a straight answer on eligibility before you spend more time building a case for a program that isn’t taking applications. A 15-minute conversation is usually enough to know whether it’s worth pursuing, and if you don’t qualify, a good adviser will tell you that upfront rather than string you along.
If you’re about to raise capital, ask about ESIC status in the same conversation. It costs you nothing to check and can make your round meaningfully more attractive to investors while you wait out the IGP pause.
The bottom line
The Industry Growth Program pause is a real setback, and pretending otherwise doesn’t help anyone. Founders who built their funding plan around a $250,000 or $5 million grant now have a genuine gap to fill, and there’s no published date for when that gap closes.
But it’s a pause on one program, not on Australian startup funding as a whole. The R&D Tax Incentive is open, it’s not merit-based, it’s not sector-restricted, and for most founders doing genuine development work, there’s a refund sitting there whether IGP reopens next month or next year. Layer EMDG, your state’s grant programs and ESIC status on top, and you’ve got a funding strategy that doesn’t depend on a single paused program.
At Granton we only work success-fee, so we only take on a claim we’re confident in, and we don’t get paid unless the client does. That’s built 55+ client claims with a 100% success rate and $7.9 million in refunds unlocked so far, with zero audits on a claim we’ve lodged.
If you want a straight answer on what you can claim, book a quick eligibility conversation at granton.io/meet. Thirty minutes, no obligation, and you’ll know exactly where you stand.
Are you ready to turn your funding aspirations into reality? At Granton, we specialize in helping individuals and businesses navigate the world of grants, offering expert guidance on grant applications and finding opportunities that best suit their needs. Whether you’re seeking funding for a startup, nonprofit, or a specific project, our team is here to assist you every step of the way. We take the guesswork out of Grant Applications, R&D Tax Incentives, and Accelerator Programs, making the process smoother and increasing your chances of success. Ready to take the next step? Book a free consultation with us today, and let’s explore how we can help you secure the grants you deserve. Visit our website at granton.io to learn more or use our contact form to get in touch. Your grant journey starts here!