Rural R&D for Profit Program chided

The competitive research grants program underpinned the federal government’s 2013 agricultural election policy, making an initial $100 million commitment over four years which was doubled in the Agricultural White Paper, delivered in July last year.

That additional funding extended the program out another four years to 2022 - but this year’s federal budget saw $9.5m of its $200m redirected to the National Water Infrastructure Development Fund.

The ANAO analysed the R&D program’s design process, performance measurements and reporting arrangements with a report tabled today making recommendations for improvement.

It concluded that the Department of Agriculture and Water Resources’ selection of a program delivery model - in favour of existing mature funding arrangements - wasn’t informed by an appropriately structured and documented assessment of alternatives.

The report said the absence of such an assessment subsequently limited the Department’s ability to “demonstrate that the most appropriate model was selected”.

It also concluded that there was limited evidence to demonstrate the basis on which the additional $100m was allocated via the Agricultural White Paper.

“Further, the performance monitoring and reporting framework established for the program does not provide sufficient information about progress towards achievement of the program objectives,” it said.

“As a result, the Department is not well positioned to determine the extent to which the program’s objectives have been met and to inform stakeholders, including the parliament, of program achievements.”

The research program delivers strategic funding to the 15 Rural Research and Development Corporations (RDCs) aimed at improving commercial research outcomes to try and bolster farm-gate returns.

Government funding is allocated to various projects run by the different RDCs for their specific commodities like cotton or grains, in partnership with other researchers that provide cash or in-kind co-contributions.

The ANAO report said that as at September 2016, two rounds of the program had been completed, with a total of $78.9m in Australian government funding approved for 29 R&D projects.

RDCs and their partners have committed to provide $54.7m cash and $54.5m in-kind contributions to the funded projects.

“When the funding reduction that was announced in the 2016–17 budget and the Department’s administrative costs are taken into account, the funding that is available for grants to RDCs and their partners over the life of the program is around $187 million,” the report said.

The 50-page report found the Department had established a sound process to develop the more specific aspects of the program’s design and implementation, like research priorities and the eligibility and assessment criteria.

There was, however, scope for the Department to have given greater consideration to the impact of the program’s co-contribution requirements, the ANAO assessment found.

“The Department did not consult external stakeholders regarding the development of a delivery model for the program,” the report said.

“Once the delivery model had been determined, the Department conducted a range of engagement activities to develop the detailed design parameters for the program, particularly in relation to the research priorities and grant guidelines.

“In response to the feedback obtained from stakeholder engagement activities, a number of changes were made to elements of the program design.”

The ANAO’s analysis found that in the absence of data on the achievement of program objectives, the Department and the White Paper Taskforce drew on a range of available information to support a recommendation to the government, to extend the program.

But it said the basis on which key parameters for that extension were determined - including the additional $100m and four year extension - was not documented.

“Given that the decision to extend the program and to double its funding was not based on evidence demonstrating its success in meeting the governments’ objectives for the program, it will be important for the Department to undertake a comprehensive program evaluation to inform the implementation of the second tranche of funding,” the report said.

The report also found that the program’s current performance measurement and reporting arrangements do not provide internal and external stakeholders with sufficient information about the extent to which program objectives are being achieved.

It said external reporting could be improved after it had only produced one performance report that was published in October 2015.

It said as the program progresses, there would be merit in the Department publishing regular updates on its outputs and outcomes, including information on individual projects.

“The department should also explore opportunities to use its website (or other channels

such as social media) to assist in the achievement of the program objective of ‘strengthening pathways to extend the results of rural R&D’, for example by publishing case studies to communicate project results or to publicise extension activities being undertaken by individual projects,” the report said.

The ANAO recommended the Department ensure that the design of new programs is informed by an appropriate assessment of costs, risks and benefits of alternative delivery models.

It also said the Department should expand the program’s existing performance measures and/or develop additional measurement tools, to better inform an assessment of the achievement of (or progress towards) program objectives.

Shadow Agriculture Minister Joel Fitzgibbon attacked his counterpart Barnaby Joyce over the report’s findings, accusing him of announcing the second $100m without assessing the first round of the program and without any policy justification.