Victorian Common Funding Agreement Recipient Fact Sheet December 2015 Version 2

VICTORIAN COMMON FUNDING AGREEMENT Fact Sheet for Victorian government departments

The Victorian Common Funding Agreement (the Agreement) is used by all Victorian government departments when funding the not-for-profit (NFP) community sector and local government for human and community services and community projects, including specified capital works1.

What is the Victorian Common Funding Agreement The Agreement provides a standardised funding agreement for use by all Victorian government departments when funding the not-for-profit (NFP) community sector and local government for human and community services and projects, including specified capital works. Designed to benefit all users by being scalable, predictable and easy to understand, the Agreement is based on core Terms and Conditions that apply to all funding, and which are used as a basis for three consistent, risk- proportionate forms of Agreement:  Short Form used with lower risk funding as an abridged version of the Standard Form  Standard Form used for most types of funding comprising a Schedule and the core Terms and Conditions (may also be referred to as the 'long form')  Service Agreement form used for funding health, human and early childhood services through the Department of Health & Human Services (DHHS) and the Department of Education & Training (DET).

A Clause Bank of additional terms and conditions is drawn on to support each form of Agreement, as needed.

The diagram below illustrates the Agreement model and how its parts fit together.

1Capital works funding which involves Alliance Contracting, Partnerships Victoria including Public Private Partnerships, Major Projects Victoria, or which is provided by the Director of Housing to housing agencies registered under Part VIII of the Housing Act 1983 (Vic) or must comply with the Victorian Government Public Construction Policy is out of scope for application of the Victorian Common Funding Agreement. PAGE 1 VICTORIAN COMMON FUNDING AGREEMENT FACT SHEET-FUNDING RECIPIENTS DECEMBER 2015 VERSION 2.0 Who uses the Agreement and what funding it covers

Users in scope Victorian government departments use the Agreement with different types of funding recipients in the following ways:

 Mandated for use when funding NFP community For the purpose of the Agreement, NFP community organisations2 organisations are:  Authorised for use as the standard funding “Organisations that operate for social or community purposes, do not distribute profits to agreement when funding local councils as defined members, are self-governing and independent of under the Local Government Act 1989 (Vic) government.” Source: Victorian Public Sector Commission (formerly State  Optional to use when funding individuals or other Services Authority), 2011 types of organisatons3. Organisations with a legal status as an Incorporated Association, Co-operative, or Company Limited by Other funding providers can use the Agreement with their own Guarantee may fall into this category. recipients under specified Creative Commons licensing provisions that maintain the integrity of the Agreement.

Funding in scope In its scope for use, the Agreement covers a broad range of For the purpose of the Agreement, grant funding is: grant funding for human and community services and projects, “Money given to organisations or individuals for a including specified capital works, which may be allocated specified purpose to achieve objectives through a grant program or other funding initiative on a once- consistent with government policy… including ad hoc payments, competitive assessment or when off or recurrent basis, regardless of whether the funding specified criteria are satisfied.” process is ad-hoc, competitive, negotiated or targeted. Grant funding excludes donations, sponsorships, the non-contested transfer of funds to a government The Standing Directions of the Minister for Finance under the entity, and procurement or purchase of good or Financial Management Act 1994 acknowledge grants as a services on commercial terms. discretionary financial benefit. Source: Victorian Government ‘Better Grants by Design’, 2014

Why we have the Agreement The Agreement reduces red tape and streamlines administrative processes associated with the provision of Victorian government funding in response to sector calls for simpler funding arrangements. In turn, this helps to strengthen the capacity and performance of funded organisations while improving state and sector relations.

For more information  Visit http://www.dhs.vic.gov.au/for-business-and-community/not-for-profit-organisations/common- funding-agreement  Contact VCFA support at [email protected] or on (03) 9096 1213  Touch base with your funding department’s contact – see your funding agreement for details.

2Examples of NFP community organisations include Aboriginal community controlled organisations (ACCOs), community arts organisations, community clubs, community service and health providers, co-operatives, drug and alcohol services, industry organisations, kindergartens and preschools, neighbourhood houses and community centres, peak bodies, self help groups, social enterprises, sport and recreation clubs, tourism groups, and volunteer groups.

3The Agreement may be used for the funding of businesses or non-core services for hospitals, medical centres, professional associations, religious congregations, research institutes, schools, TAFE colleges, trade unions, or universities.

VICTORIAN COMMON FUNDING AGREEMENT FACT SHEET-FUNDING RECIPIENTS DECEMBER 2015 VERSION 2.0