AUSTRALIAN broadacre agriculture is starting to pay the price for a slowdown in public agricultural research and development (R and D) spending which began in the late 1970s, according to a new paper.
The paper – released at the Australian Agricultural and Resource Economics Society conference in Sydney last month – found productivity growth will only continue to slow unless there is a major shift in public policy.
It is the lead in a set of six papers commissioned by the Australian Farm Institute (AFI) to explore the scope of the “productivity challenge” facing Australian agriculture, and was written by former NSW Agriculture principal research scientist, Charles Sturt University Adjunct Professor John Mullen, and AFI executive director Mick Keogh.
Dr Mullen said while Australian broadacre agriculture had grown by about 2 per cent per year from 1953 to 2009, since 2000 the rate of growth had fallen to 0.4pc per year, taking into account weather variability.
He said this decline in productivity growth was largely attributable to a stalling of public agricultural R and D spending since the 1970s.
“Public investment in research for Australia as a whole grew strongly to the early ’50s to reach $870 million (in 2010 dollars) in 1978. It drifted sideways to a new peak of $990m in 2001 and has since fallen sharply to $717m in 2009,” he said.
Dr Mullen found investment in research relative to the value of agricultural production fell from 5.1pc in 1978 to 3.3pc in 2009.
“Recent research undertaken with ABARES strongly suggests that a consequence of this reduced investment in research is a marked slowdown in productivity growth threatening agriculture’s competitiveness relative to other sectors of the Australian economy and the agricultural sectors of other countries,” he said.
“The lag from commencing research and seeing its full impact on farms is often 30 years or longer – a planning horizon a bit too distant for governments it would seem.”
The findings come as the NSW Department of Primary Industries (DPI) is in the throes of restructuring its agricultural research and extension services and farmers continue to raise concerns about the new agricultural service delivery organisation, Local Land Services.
As part of the restructure, the NSW government imposed cuts on the DPI budget and is currently in the process of employing new research and extension officers.
Primary Industries Minister Katrina Hodgkinson said it was a case of public funds being spent more wisely rather than just being cut back.
“There is $100m spent on R and D in NSW, we have more than 1000 active projects across 50 different disciplines just from the DPI,” she said.
“Dollars don’t necessarily equal outcomes. You can throw a lot of money at things but unless it is being utilised in the most practical way it could be money which is not necessarily best spent.”
Ms Hodgkinson said she was determined to ensure the DPI remained a source of high-quality independent research and development.
“We want to make sure that at the end of the day farmers and landowners are able to get the sort of assistance that will assist them into the future to better manage and profit from their farm,” she said.
However, federal Agriculture Minister Joe Ludwig sees a different picture.
While the federal government had provided $1.1 billion to the rural R and D corporations in the five years since it took office, Mr Ludwig said State governments were “ripping funding out of primary industries departments and out of R and D”.
“Of course agriculture and R and D is a priority for the Australian government. Investment in R and D is vital to ensuring continued productivity growth and competitiveness for our primary industries,” he said.
“Liberal/National governments across Australia are ripping funding out of primary industries departments, and out of R and D. With Tony Abbott’s growing list of proposed cuts, their federal counterparts would do the same.
“The federal Labor government will continue to invest in R and D and needs the states to contribute their share.”
In 2008-09 the Productivity Com-mission estimated about $1.5b of public and private funds were invested in rural research and development.
Of that, the federal government provided $715m through the research and development corporations, co-operative research centres, CSIRO and universities.
