08 May 2009

Reducing rural industry research

It is sad to read the report in the 7 May 2009 Australian Financial Review (p. 8) that Land and Water Australia (LWA) is to be abolished and the Rural Industries Research and Development Corporation (RIRDC) is to have its budget reduced from $13 million to $10 million (i.e., a 23% reduction).

Land and Water Australia began life in 1990 as the Land and Water Resources Research and Development Corporation, an R&D Corporation established by the Hawke Government under the Primary Industries and Energy Research & Development (PIERD) Act 1989.

It acts as a research investor and research broker developing, in collaboration with industry, government and local communities, research programs directed to the development of the knowledge required for sustainable management and use of Australia’s natural resources. In 2007-08 it delivered a $38.7 million R&D program, leveraging its $13 million budget appropriation to $38.9 million through its collaboration with other government agencies and industry. Given that we have custodianship of a land mass of about 7.5 million sq. km., with great geographical, climatic and biological diversity, $13 million p.a. of Government expenditure does not strike me as excessive, even in the toughest of times.

I have been through one of these R&D corporation executions. It was my sad duty as Secretary, Department of Primary Industries and Energy in 1996 to preside over the wind up of the Energy Research & Development Corporation. It is never an elegant procedure – simply a matter of shutting everything down, paying all the bills, switching off the lights and sending everyone home, no matter how important, high quality or close to completion any given program might be.

No doubt there will be some fine words at budget time about how LWA has done a great job but its job is done, the baton will be picked up by the Caring for our Country Program, or CSIRO, or someone. Don’t believe a word of it, it never works that way. R&D is a delicate flower. It is not possible to break up research teams and shut down programs and have everything continue as though nothing has happened. And as this is about saving money, there is by definition a clear intention to reduce expenditure on the function.

The Rural Industries Research and Development Corporation (RIRDC) was established under the same legislation as LWA. It is an interesting and important body because it is the home for funding R&D projects which cut across rural industry in general and thus cannot readily obtain funding from any of the sector-specific R&D bodies, and for R&D relating to new and emerging rural industries. I find it hard to explain why its budget is as small as it is, let alone why anyone would want to cut it.

Reductions of this kind at the present time raise a larger question about the Government’s response to the Global Financial Crisis. The Government has, for understandable reasons, spent tens of billions of dollars attempting to stimulate consumer spending and the housing industry, in the interest of sustaining employment levels. That is all very well and good, but given that just about every consumer product is manufactured overseas, it is a mystery why the Government chooses to stimulate consumer spending to the point where it feels it is necessary to bring about the abolition of the jobs of people who are currently employed in contributing to the business of government, such as people working on rural R&D programs, people collecting essential data for the Bureau of Statistics, or self-employed contractors working for government agencies.

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