GRDC 'not generating value'

04 Nov, 2014 01:00 AM
Farmers could actually retain that money and invest it in far more profitable things than the GRDC

RADICAL changes have been proposed for the Grains Research and Development Corporation (GRDC) in light of the governance review into its operations and structure.

Vastly varying ideas have been thrown out for debate as possible improvements on the current model, ranging from doing away with the entire organisation to levy payers having more input into research priorities and developing a levy payer database.

Western Australian farm advisor Paul McKenzie says a shake-up of the current system is required.

Mr McKenzie, based at Geraldton, said the problem of flat-lining productivity gains meant drastic change had to be considered, right up to doing away with the GRDC altogether.

“The issue of R&D involves private and public sector funds, which for 24 years have been blended together for minimal benefit to the grains sector at just 0.2 per cent per annum productivity gain (since 1990),” he said.

“After the cost of interest on levies, the net result at a sector level has been negative."

Big changes needed

Mr McKenzie said research had to be continued, but proposed a model where public funds were managed by the public sector and private funds by the private sector.

And his thoughts have won some admirers in his home state.

In its submission to the federal Senate agricultural levies inquiry, the WA Pastoralists and Graziers Association (PGA) is calling for a revamp of the GRDC to give growers direct control over their levy funds.

PGA Western Graingrowers committee member Leon Bradley agreed with Mr McKenzie that big change was needed at the GRDC.

"The basis of our argument in a nutshell is that the GRDC is not generating value for growers or grains, for the country,” he said.

“At the current level of performance for the GRDC, farmers could actually retain that money and invest it in far more profitable things than the GRDC levy.”

GrainGrowers Limited (GGL) chief executive Alicia Garden also supported a move for more grower input into the use of levy funds.

She suggested government exemptions for the organisation as a means of making it more nimble and allow it to enter into useful partnerships.

Ms Garden said GGL’s national policy group had also identified focusing more on on-farm extension as a way to improve GRDC’s usefulness to growers.

Most levy payers happy

For its part, GRDC managing director John Harvey said he believed only a small group of growers had issues with compulsory levies. He said annual GRDC surveying suggested most growers were either "comfortable or very comfortable" with the levy system and paying for research work that they benefited from.

“Last year we surveyed 1200 growers across the grain belt and 77 per cent of the growers surveyed were either comfortable or very comfortable with paying the R&D levy,” he said.

“One of the reasons why I believe growers are comfortable with paying the levy is because they have seen the benefits of research and development on their farms.

In terms of grower input into project priorities, Mr Harvey said there was strong grower involvement in all GRDC processes through the regional cropping solutions network and regional panels, comprising growers and researchers.

The administrators of the statutory obligations of GRDC under the Primary Industries and Energy Research and Development (PIERD) act Grain Producers Australia has also conducted a review into GRDC governance.

Grain Producers Australia chairman Andrew Weidemann said the best way to ensure GRDC levy payers got maximum bang for their investment buck was to set up a levy payer data base.

“This sort of set-up would mean structural changes at GRDC, such as moving from a statutory corporation to an industry-owned corporation (which is something that has been raised as a possibility), could happen, as you’d be able to have a poll of levy payers.”

Mr Weidemann agreed growers needed to have better interface with GRDC, and said more structured meetings of levy payers with senior management at GRDC would be a good starting point.

He backed up Ms Garden’s point about reducing regulation in the organisation.

“A reduction in the potential regulatory burdens and a move to more commercial arrangements would help, as would increased flexibility in relation to the use of levies.”

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White lighning
4/11/2014 5:29:01 AM

John Harvey neglected to mention GRDC's miserable responses times, paralysed by Process.
4/11/2014 5:35:55 AM

I suggest we direct the levy money to CSIRO. At least CSIRO have a track record of achievements.
4/11/2014 6:58:59 AM

As a livestock producer, who receives some of GRDCs publications, I would say, don't throw out the baby with the bathwater. GRDC manages some great initiatives like NVT trial sites and provides what appear to be excellent updates to growers. I do note that all research projects aren't managed optimally, so potential room for improvement. Has the question been asked "how much production would we lose without GRDC?" I think this is a question worth considering alongside the question posed about how much benefit GRDC provides.
4/11/2014 7:19:54 AM

Here we go again. The defenders of this archaic, self serving and highly political system trot out the " poll ". So design a set of questions to get a certain result then declare the majority are happy and dismiss the rest as just a small minority. Reminiscent of the export wheat debate. GRDC are dead scared of a forensic independent audit and analysis because it will reveal what Paul McKenzie and the PGAWA submissions are saying. Levy payers around Aust. should do themselves a favour and have a read.
4/11/2014 7:28:11 AM

Communication has to be response to emails to program managers is the norm. If GRDC needs a shake-up then the other RDC's must be terminal!
Jock Munro
4/11/2014 8:11:41 AM

GRDC needs a fully transparent and open democratic process for the appointment of directors. At present producers pay a compulsory levy on production but are not able to nominate or vote in an open election. This is taxation without representation and the process is based on a communist style kremlin model where a selection committee is used to select directors. The Minister has a power of veto over the selection committee and the choices that they make.
4/11/2014 10:30:28 AM

GRDC funds help breed Mace wheat which around 80% of WA now grows. GRDC lacked the business sense to commercialise itself and generate royalties. Instead EPRs are now being charged to growers which kind of stings as a double dip on pre tax profits. The system is broke and it has to be scrapped. Make it voluntary and watch catchment focused grower groups bloom out of their own resources which are now compulsorily acquired by GRDC. Many vested interested protecting their gravy train here
4/11/2014 11:46:01 AM

Been no recent updates on HAL other than the name change to HIAL. New logos, stationery etc now and there goes the levy money.
Slave to Levies
4/11/2014 12:56:46 PM

these levies sting. where are the benefits? if i spend $20/ha on fungicides i know my crops will yield more. no such return on investment in research. the problem is not lack of research the problem is poor allocation of research dollars. make em voluntary and watch the research sharpen its focus!!!!!
Fred Haskins
4/11/2014 5:11:24 PM

Doesn't matter which ag levy system we are in, they are not consulting with the producers, those at the top are only pandering to their special interest groups, jock Munro is correct, transparency and accountability.
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