It is an undeniable truth that, no matter how blessed we may be with a favourable climate, natural resources and professional skills as farmers, there will always be a limited future for us if we do not have the highest level of research, development and extension (RD&E).
Without a sound intellectual base for our industry, often we could well be wasting our time.
It is not simply a matter of ensuring we are engaged in the right business activities but also that we are operating as profitably and productively as possible. That means we also have to be doing it better than anybody else.
But it is difficult to form an objective view of the right level of RD&E funding and the appropriate areas upon which to concentrate that research.
The Australian Farm Institute (AFI) says that tracking the benefits derived from experimental outcomes to the bottom line of farm businesses is both difficult and involves long-term assessment. Yet regularly we are asked to assess the level of RD&E levies that we should pay.
To that end the AFI is undertaking its own research project to develop a format or regime to assist Australian rural industries to decide appropriate levels of research funding. If you like, it’s a research project that will help determine the optimal funding on research projects.
According to the AFI, under the current levy arrangement the 0.5 per cent or more taken from gross farm output in the form of levies “can be a significant cost, potentially reducing net farm business profit by up to two per cent per annum”.
First, though, one has to establish a baseline of existing RD&E funding, which is apparently easier said than done. On the available evidence it has been of the order of $1 billion to $1.4 billion a year.
“In an ideal world optimal funding levels should be based on an optimised RD&E network, within which discoveries are rapidly translated into new farm innovations and adopted by farmers,” the AFI says.
“This is almost certainly not the case in the real world. Nor can it be assumed that decision-makers are successful at optimally allocating funds to those areas likely to generate most benefits for levy-payers.”
Confounding the picture is the concentration of research and development in information and communication technology rather than pure or practical agriculture.
“Farmers and policymakers need to tease out the actual contribution of Australian agricultural RD&E funding, separate from the gains generated by these external factors,” the AFI advises.
In effect, this is the background to the need for us as farmers to establish a framework for assessing research and development priorities and making sure our levies are spent in the most productive way.
If we don’t establish this, then we are in danger of wasting our time and effort and money.
THIS ARTICLE FIRST APPEARED IN THE TASMANIAN COUNTRY ON 14TH AUGUST.
TFGA president Wayne Johnston