The most common types of arrangements that agencies enter with other organisations are procurements and grants. This guide will help you determine what your arrangement should be.
The CPRs (2.7, 2.9), the CGRGs (2.3, 2.6) and RMG 411 provide detailed guidance on this issue.
The basic difference
A procurement is an agency acquiring (typically buying) goods or services to meet a need the agency has. A procurement contract is usually a commercial deal with a business enterprise.
A grant is an arrangement (typically a legally binding agreement) for an agency to provide financial assistance to another party, which is intended to help address one or more Australian Government policy outcomes and also help the grantee achieve its objectives. See CGRG 2.3.
How to tell them apart
The assessment is case by case. The table below includes typical features that tend to indicate one or the other.
Some features are usually consistent between the two. In both procurements and grants:
- the agreement is usually legally binding
- the agreement can extend over more than one financial year (subject to financial approval)