The Commonwealth Investment Framework Explained

Thursday, 1 October 2026

The Commonwealth Investment Framework is a Resource Management Guide (RMG 308) issued by the Department of Finance that brings together the policy and best practice guidance for Commonwealth entities developing, implementing and managing investment proposals. The Framework overview exists alongside the Public Governance, Performance and Accountability Act 2013 (PGPA Act) as the governance mechanism that determines how Commonwealth entities commit public resources to major investments. It is not optional guidance. Material investment proposals are required to complete a staged approval process aligned with the Budget Process Operational Rules (BPORs). For officials responsible for investment proposals, the Framework defines what must be done, how it must be documented and what approvals are required at each stage.

What does the Framework cover?

The RMG 308 applies to all policies and programs delivered using non grant financing approaches. This includes equity investments, loans (both commercial and concessional), guarantees, hybrid instruments and specialist investment vehicles. It also covers investment funds where money is set aside to earn interest or returns. The Framework does not cover grant programs, which are governed by the Commonwealth Grants Rules and Guidelines. It does not cover routine procurement, which falls under the Commonwealth Procurement Rules.

The scope is significant. Any Commonwealth entity considering a loan program, an equity investment in a government business enterprise, a guarantee to underwrite a private sector project or the establishment of an investment fund must operate within this Framework. The Framework and Policy Objectives page describes the policy intent: the Government is committed to using the Commonwealth balance sheet to support quality investments that make the most effective use of public funding.

How does the staged approval process work?

Material investment proposals must complete a first pass and second pass process. The first pass establishes the strategic case for the investment: what problem it addresses, what options exist and why government intervention through investment (rather than grants, regulation or procurement) is the appropriate mechanism. The second pass presents the detailed business case, including the commercial structure, financial analysis, risk assessment and implementation plan.

The Part 1 guidance on investment proposal development requires that business cases be developed iteratively and continually updated throughout the decision making process to include the best information available. This means the business case is a living document, not a one time submission. As commercial negotiations progress, as risk assessments are refined and as financial modelling is updated, the business case must reflect the current position.

What toolkits support the Framework?

The Commonwealth Investments Toolkit provides the practical “how to” guidance that sits beneath the RMG’s policy direction. The Toolkit includes guidance on commercial models (designing and evaluating options for private sector involvement), a three step commercial assessment (designing and evaluating financing options), delivery vehicles (choosing the right governance structure for implementation) and developing a business case.

The Toolkit is designed to ensure that Commonwealth entities have access to relevant advice at all stages of the investment lifecycle. Where the RMG tells entities what to do, the Toolkit tells them how to do it. For officials who are new to the Framework, the Toolkit is the practical starting point because it provides templates, worked examples and step by step guidance for each stage of the process.

How does the Framework connect to the PGPA Act?

The PGPA Act is the primary financial governance framework for the Commonwealth. It establishes the duties of accountable authorities, the requirements for proper use of Commonwealth resources and the accountability mechanisms that apply to all Commonwealth entities. The Commonwealth Investment Framework sits within this broader structure, providing specific guidance for investment decisions that the PGPA Act’s general provisions do not address in detail.

In practice, this means that officials developing an investment proposal must comply with both frameworks. The PGPA Act requires proper use of public resources and sets the duty of care for officials. The Investment Framework specifies how that duty is discharged when the decision involves a major investment: through a staged approval process, a detailed business case, independent assurance and ongoing monitoring throughout the investment lifecycle.

What should officials know about investment management?

The Framework does not end at approval. Part 4 of the RMG covers investment management, requiring Commonwealth entities to actively monitor and evaluate investments throughout their lifecycle. Entities are responsible for developing a whole of life investment management plan that includes performance monitoring, risk management and exit planning. The Framework encourages investments to be time limited, with exit representing a net benefit to Australians where possible.

For many officials, the post approval phase is where the Framework is most relevant to their daily work. Managing the ongoing financial, risk and governance obligations of a live investment is as demanding as preparing the original business case. The Framework’s management requirements ensure that the rigour applied at the approval stage continues through to completion or exit.

How can professionals build capability in this area?

AcademyGlobal (AG), the Chartered Institute of Procurement & Supply (CIPS) Centre of Excellence for Australia, New Zealand and Southeast Asia, delivers programs that build the financial literacy and governance capability the Framework requires. AG’s Finance for Non-Finance Professionals program is designed for officials who need to understand financial concepts, read financial statements and contribute to investment decisions without a formal accounting background. For professionals who need to build the specific analytical skills that business case development demands, AG’s Business Case Fundamentals workshop covers options analysis, cost benefit analysis and the Five Case Model.

The Commonwealth Investment Framework is the governance backbone for how Australia invests public resources through non grant mechanisms. The officials who understand it are better equipped to develop credible proposals, manage complex investments and meet the accountability standards that the PGPA Act demands.

Frequently asked questions

What is the Commonwealth Investment Framework?
RMG 308 is the Department of Finance’s policy and guidance for developing, implementing and managing major Commonwealth investment proposals. It covers non grant financing approaches including equity investments, loans, guarantees and investment funds.
Who does the Framework apply to?
All Commonwealth entities considering material investment proposals using non grant financing approaches. Entities must consult with the Department of Finance to confirm materiality thresholds and engage early in the process.
What is the difference between the RMG and the Toolkit?
The RMG (Resource Management Guide) provides the policy framework: what entities must do. The Toolkit provides the practical guidance: how to do it, including templates, worked examples and step by step instructions for each stage.
Does the Framework apply to procurement?
No. Routine procurement is governed by the Commonwealth Procurement Rules. The Investment Framework covers non grant financing approaches such as equity, loans, guarantees and investment vehicles.
Where can non-finance professionals learn to engage with investment decisions?
AcademyGlobal’s Finance for Non-Finance Professionals program builds the financial literacy that officials need to read financial statements, understand investment structures and contribute to governance decisions.

References

1. Department of Finance, “Commonwealth Investment Framework,” Overview Page
2. Department of Finance, “Commonwealth Investment Framework (RMG 308),” Resource Management Guide
3. Department of Finance, “Framework and Policy Objectives,” Commonwealth Investment Framework
4. Department of Finance, “Part 1: Investment Proposal and Business Case Development,” RMG 308
5. Department of Finance, “Commonwealth Investments Toolkit,” Updated August 2026