Communications Minister Michelle Rowland made the announcement on Tuesday as she launched consultation on the News Media Assistance Program, also known as News MAP, and a landmark media diversity study by the regulator.
The funding for AAP recognised its fundamental role in supporting public interest journalism and media diversity, including in regional communities, the minister said.
The program will help guide and inform future government intervention to support public interest journalism and media diversity in Australia, Ms Rowland added.
AAP CEO Lisa Davies welcomed the minister's announcement and the government's ongoing commitment to public interest journalism.
"AAP's trusted, independent newswire is vital to a thriving and diverse news media landscape in Australia," she said.
News MAP has three stated elements: clear policy objectives; potential measures to support the sector; and improving the evidence base to assess the state of public interest journalism and media diversity in Australia.
Consultation on the program will close on February 22.
The minister also announced support for a study into media diversity.
The Australian Communications and Media Authority undertook consultation this year to develop a new framework for measuring media diversity in Australia that accounted for the impacts of the digital news environment.
The government has accepted ACMA's framework and provided $11.2 million over four years to implement it.
Public-interest journalism is on the agenda for federal Communications Minister Michelle Rowland. (Lukas Coch/AAP PHOTOS)
"The (framework) will provide a comprehensive evidence base about the state of the news market, help identify gaps and examine developments in the era of digital media, generative AI and online intermediaries," Ms Rowland said.
The authority will publish its first report by the end of 2024, and will then produce a report every two years.
The government has also set aside a further $800,000 for the Public Interest Journalism Initiative to track the news media landscape in Australia.
"The Albanese government understands that media diversity and public-interest journalism play an important role in the functioning of Australian society and democracy," Ms Rowland said.