The agency will develop the community-led child and youth crime action plan with the involvement of young people, Child Youth and Family, Police Youth Aid and three iwi Maori providers.
She said it would run in two phases, with the first of them already getting under way.
It is the foundation of putting a youth crime action plan together and will involve 14 to 16 past and present offenders being taken aboard.
Two young people, referred to Te Ikaroa Rangatahi by youth agencies, had already been interviewed to be part of the community-based initiative and Ms Ruru said they were keen to be involved, and do something to help stem youth crime.
The funding allowed them to get a designated person to prepare and develop the programme.
The second phase - a "whanau pathway" - will look at young offenders and their families and will initially work with up to 12 child offenders (aged 11 to 13) and their families.
That area was crucial, she said, as while recent crime statistics for Hawke's Bay had shown a decrease in youth offending there had been a concerning rise in child offending.
"This is about early intervention and prevention - working with children from when they are 11," Ms Ruru said.
"Our core business is youth justice and we have to get smarter and brighter."
She said the approach being taken by Te Ikaroa Rangatahi was the first of its kind and other agencies would undoubtedly be watching closely.
"You get a bit nervous when you think about that but I am confident this will come through."
National's Napier candidate Wayne Walford said the grant was good news for the region and came on the back of the Government's Better Public Service target of a 25 per cent reduction in youth crime by 2017.
"This latest initiative continues this hard work and it is an important part of our commitment to give our children and young people the best possible chance to a positive future."
