THE findings of an independent review into the performance of Horticulture Australia Limited (HAL) has reignited the debate about the way grower levies are spent by industry bodies.
HAL commissioned ACIL Allen Consulting to conduct a third party review of its operations earlier this year, which found current arrangements imposed unnecessary costs, led to widely perceived conflicts of interest and provided little compelling evidence of net benefits to levy paying growers.
Further, it determined that a new structure was needed to provide greater accountability back to levy-paying growers from the body responsible for spending the levy funds.
Following the release of the report earlier this month, the Pastoralists and Graziers Association (PGA) has called on the Grains Research and Development Corporation (GRDC) to broaden the scope of its governance review to include the performance of its research and development activities.
The GRDC commissioned Marsden Jacob to conduct an independent review into its inner workings last year, which will utilise a broad consultation program with industry, particularly grain growers, using a wide range of mechanisms to seek feedback, including through industry representative organisations.
PGA Western Grain Growers Committee chairman John Snooke said the HAL review showed the spending of levy money was of great concern to farmers.
"We are seeking an independent thorough examination of the GRDC," Mr Snooke said.
"We want this because the outcome of the HAL review and the dysfunction in that organisation is very similar to what grain growers are now seeing in the GRDC.
"Our hats go off to HAL that it had the courage to stand and have a thorough examination of itself."
Mr Snooke said the GRDC governance review was a "box ticking exercise" that had been undertaken to justify the conversation around converting the organisation into an Industry Owned Corporation (IOC).
"Essentially we think that is going to deliver more of the same, which is bad R&D outcomes," he said.
"We want to lift the lid on it, have a look inside and analyse its performance since 1988."
Mr Snooke said if the GRDC was to become an IOC there would be less accountability within the organisation.
Mr Snooke said tight Federal and State budgets meant it was also time for the Government to stop matching funding.
"The co-contribution from the Federal Government ensures that the government ultimately has the say on R&D," he said.
"What happens is the GRDC can follow political fashionable themes such as climate change."
Further, Mr Snooke said grower levies should be voluntary.
"Our idea is that if the GRDC is so good give it the ultimate test, and the ultimate test is to let it be voluntary, then the GRDC will earn its income," he said.
"Let growers decide whether it is a good investment or not."
GRDC chairman Richard Clark said the current review had the right terms of reference for what it was intended to do.
"This is what industry wanted," Mr Clark said.
"All the industry representative organisations got together and decided what they wanted out of this review, which was a forward-looking review to ensure the structure of GRDC is the best it can be going forward.
"My understanding was PGA was invited to that and pulled out of that process."
Mr Clark said the review would allow the organisation to scope out the future direction of GRDC.
"If industry decides it was to do a backwards-looking review at the successes, failures or otherwise of the GRDC, then that, I believe is a completely different issue and wouldn't sit well with an organisation trying to work out how GRDC should look in the future," he said.
"I am absolutely confident that any review of the productivity and profitability improvements delivered through R&D in WA will show up that the GRDC is doing an excellent job."
Mr Clark said a final draft from the review would be released for consideration by the industry steering committee by about June this year.
"This is all run by industry for industry and GRDC has had no input into it," he said.
"Frankly I don't think it would be appropriate for GRDC to dictate the terms, in some ways Mr Snooke and I agree that it is something that shouldn't be run by GRDC and it's something that the GRDC shouldn't be intimately involved in."
Mr Clark said the committee had determined the terms of reference of the review and consultants were both selected completely separate from GRDC.
"I assume the outcome will be completely separate too," he said.
"I have spoken to the consultants and obviously they have spoken to GRDC management because they need to do the job properly.
"But it has been something that has been driven by industry from the very beginning and all sections of industry have had the opportunity to participate."
Mr Clark said a key outcome he expected from the review would be to identify the organisational structure that would deliver better, faster and cheaper outcomes for R&D, which would be quantified and put to industry.
Responding to suggestions that the review was designed to justify the conversion of the GRDC into an IOC, Mr Clark said if the review couldn't identify a structure that would deliver better outcomes, it would recommend things remain the same.
"If that was to happen it would require a substantial amount of legislation and probably several years of transition," he said.
"But we would only do that if the consultants identified that change of structure would give us more R&D outcomes."
Commenting on suggestions that co-contributions from the Federal Government ensured that the government had input into R&D, Mr Clark said GRDC worked hard to keep sight of both grower and government agendas.
"I have to say that in all my time at GRDC never once have we received direction from the Minister to do something," he said.
"We have always discussed with our regional panels, regional cropping solutions groups and national panel what we think are the best outcomes for industry.
"In every case the Government has supported our research agenda every year."
Grain Producers Australia director Andrew Weidemann said the GRDC already had processes in place to engage with industry through consultations held every six months.
"The PGA are invited to attend and to prepare papers that provide some evidence-based discussion around their concerns," Mr Weidemann said.
"We call for submissions every six months and this is due to go out in early June again because the consultation is at the end of July.
"Those calls for submissions will go out and we will prepare them and present them to the GRDC board with industry concerns."
Mr Weidemann said he was disappointed that there had only been six submissions made during the review.
He said the GRDC was looking to the future through the governance review.
"So we are not looking at the current operations of the GRDC but we feel that post the governance review, should the groups decide there should be further review of the operations, that through the proper consultation mechanisms that are already in place, industry could agree to some sort of a process out of that," he said.
"The steering committee spent a lot of time discussing the scope of the review.
"And they really wanted to make sure that this review clearly focused on what type of structure is required to serve the industry in the future."
