Sarsfield, Ensay rejected by National Bushfire Recovery Fund

In both cases, ABNs have defined their groups as a state government entity, which deemed them ineligible for the funding.

Sarsfield Community Association president Simon Hoff said it was devastating to hear the news, especially as the community had not received a single major state or federal grant since the fires tore through the area.

"[In] the actual moment where we found out [the application was rejected], we didn't have any of the context of why, but it was just shattering, and you cannot imagine how that felt," Mr Hoff said.

"This community's been to hell and back and just to think in the moment, someone kind of couldn't care less - that was shattering for me as an individual but also for our community."

He said after the bushfires, a lot of work had gone into rebuilding the community hall, as well as into nurturing a part of land by the Nicholson River close to town.

"We set up as a group to say, 'right, let's get a community plan' and that's ended up being called the Sarsfield 2030, and, at a township level, charts the hopes and dreams of all our community and becomes our playbook for what to do in our recovery," he said.

North of Sarsfield at Ensay, local resident Kym Skews said the Black Summer bushfires were still difficult to talk about.

"It went for a long time and burned all around us," Ms Skews said.

"It was a different fire and burnt from the south-east, where we normally get our bad weather from the north, so it was very unexpected."

Ms Skews is the facilitator for Activating Ensay, a group of volunteers who were looking to rebuild the relief centre, so it would be easier for landowners to relocate horses and other stock to their nearby recreation reserve in the event of another tragedy.

But sadly the community will have to wait longer for the $1.8 million upgrade due to the ABN technicality.

"It was very disheartening," she said.

"We felt like the rug had been pulled out from underneath us, for a small community which is predominantly made up of farmers who battled the bushfires on many properties for nearly two months alongside CFA volunteers."

She said she has been mostly disappointed in how the competitive grant process disadvantages smaller communities, especially considering the vast amount of work the group went through to be applicable for the fund.

"We had Bushfire Recovery Victoria providing us with a consultant to help us apply and prepare the business plan, because these applications have to be shovel ready.

"It's a competitive grant process and you're competing against other people in your community, and against your shire for the funding and so it was it was quite an involved process to get the consultant and then go through that."

The process has also left her wondering about whether government agencies have considered communities like Ensay who were so devastated in the Black Summer bushfires.

"I think we don't necessarily feel government agencies work together with communities - for example the Great Alpine Road needs to remain open immediately prior to and following a bushfire, to allow an escape for livestock and fodder transport," she said.

"It's the only road out of Ensay to the south and it's the only road in for trucks for livestock and for fodder to be brought in after any future fires.

"Sometimes we need to work with government agencies like Vic Roads to enable our community to deal with these disasters in a effective way, and this grant process is another example of government not working with communities."

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Federal Member for Gippsland Darren Chester has criticised his own government over the decision to exclude the communities for grant money.

Mr Chester wrote to Federal Emergency Management and National Recovery and Resilience Minister Bridget McKenzie over the technicality earlier this month and also highlighted similar issues with an application from the Wairewa community.

"While there are many excellent projects on the list of successful applicants, there is enormous disappointment with the final outcome," Mr Chester wrote in his letter.

"The 'Canberra knows best' centralised model of decision-making is fundamentally flawed and disrespects my community and everything we have been through."

He said no one through the grant process spoke to him regarding strategic regional priorities for bushfire recovery funding and that the issue over the technicality could have been avoided.

He said the situation appeared to be an unintended consequence of excessive and heavy-handed bureaucracy.

"To rule community not-for-profit groups ineligible to receive funding for a grant because they happen to manage a parcel of land which is owned by the state government demonstrates a complete lack of understanding of regional communities," he said.

"It also reeks of a lack of emotional intelligence and a blind adherence to bureaucracy at the expense of common sense to exclude projects from further consideration without bothering to check with the hard-working volunteer groups, which were the project proponents."

Ninety Victorian projects were backed by National Bushfire Recovery Fund, which included the construction of the Gippsland Agricultural Recovery and Resilience Centre and the rebuilding of a runway at Bairnsdale Airport.

National Recovery and Resilience Agency coordinator-general Shane Stone said there was a comprehensive process which ensured proposals would best deliver for communities.

Mr Stone chaired a panel made up of senior officers of the NRRA and two independent external members who undertook a competitive, merit-based assessment process.

"However, based on early assessments, the committee identified that there were so many more projects that met the guidelines," he said.

"The Australian government is funding all projects that the committee recommended for funding.

"The quality of the projects shows that the locally-led approach of the NRRA works."