You might know the prototype fund already. It’s helping open source projects with money and supporting them on their way.
The 11th round includes the GNOME Shell Mobile:
https://prototypefund.de/en/project/gnome-shell-mobile/
Apart from Gnome Shell Mobile there is also funding for Mastodon (On which Librem One Social is based on):
https://prototypefund.de/en/project/mastodon-mobile-apps-and-e2e-encryption/
Does this mean funding from the German government, from German taxpayers’ money?
yes, but in this case, it is a good investment, unlike some other fundings
How is this project different from the existing work on Phosh done by Tobias for Purism?
Maybe @tobias.bernard can answer this himself, as he is also working on the GNOME Shell Mobile Project.
From the design side there’s basically no difference, the UX we want is the same for both 
The motivation for wanting to try this was that GNOME Shell post-40 already has many of the things that are hard/impossible to do in GTK3 (and therefore Phosh for the foreseeable future), such as multitasking gesture navigation and a user-editable app grid.