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TAS Country : September 30th 2010
12 Tasmanian Country Friday, October 1, 2010 TFGA www.tfga.com.au Genuine value of agricultural research TFGA matters with Jan Davis Australian farmers are shouldering an increasingly heavy burden to keep the Australian economy in the black and to maintain national food security. ' PUTTING a tape measure across agri- cultural research in Australia to deter- mine its performance and adequacy is challenging at the best of times. Rural Development Corporations, govern- ments, the CSIRO, universities, cooper- ative research centres and private sector businesses all carry out this research. The Productivity Commission re- leased a report last week that attempted to measure the efficacy of the RDC sector. RDCs are jointly funded by the Federal Government and industry through industry levies, which the government collects on the industry's behalf. This investment is worth about $490 million a year. Or it was. The Productivity Commission has concluded that, as the program is currently structured, government money ''appears to have supported R&D that primary producers would have had sound financial reasons to fund themselves''. So it has recommended two changes. The first would be a new, government- funded RDC called Rural Research Australia. This would concentrate on those areas of research that the industry-funded bodies were unlikely to cover --- largely what are referred to as cross-sector issues like climate change. Funding for this would eventu- ally be capped at about $50 million a year. Meanwhile, the industry-specific RDCs would focus on research of direct benefit to their levy payers ''but with the cap on the government's funding contribution gradually reduced to half its current level over 10 years''. In my view, these suggested reforms are code for the government saying that taxpayers are unfairly subsidising research for farming activities and, as a consequence, there should be a significant government withdrawal from rural research funding. The commission points to the out- come that Australian rural industries would still be better off than most of their counterparts in other developed countries in terms of the research dollar. However, that does not take into account the harsh climatic conditions that many Australian farmers face in delivering the goods. We need good research if, for instance, we are to maintain our expertise in dry climate farming. Nor does it accurately account for the investments made by other governments in supporting agriculture through taxpayer-funded subsidies. The Productivity Commission's re- port is in draft form and Tasmanian farmers have the opportunity to com- ment verbally and in writing until the end of November. The TFGA will be strongly arguing that the commission is wrong to assert that the benefits of joint funding between the industry and the govern- ment under the present arrangements ''are not sufficient to justify public funding''. That would suggest that it is a form of profiteering or undue underwriting of an eventual private benefit. I have a different view to that. Australian farmers are shouldering an increasingly heavy burden to keep the Australian economy in the black and to maintain national food security. That, in my view, provides enor- mous community benefit. An efficient, well-researched, well-funded rural sec- tor has direct and indirect conse- quences for the economy at large. This is the ''genuine value'' of rural research to which the commission refers in its draft report. It is far more than improving the bottom line on individual farm incomes. The massive gains in productivity that have been achieved over recent decades are largely the result of signifi- cant investments in R&D made in the 1960s and 1970s. The rate of gain has slowed, largely as investment in R&D has fallen. Yet we are facing an enormous expectation of continued productivity gains as we struggle to feed the ever- increasing world population. Now is not the time to become parsimonious about agricultural re- search. That would be a blinkered view of the world. EXPAND YOUR BOUNDARIES GROW YOUR LANDHOLDINGS WITH LENDING SOLUTIONS FROM RURAL BANK. This information has been prepared without taking into account your personal circumstances, objectives, financial situation or needs. All applications for loans or credit are subject to lending criteria. Terms, conditions, fees and charges may apply. Full details are available on application or by phoning our Customer Service Centre on 1300 660 115, online at www.ruralbank.com. au, or by visiting your loc al branch. 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September 23rd 2010
October 7th 2010