According to a new report by the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES), the value of Australian rural research and development is on the rise.
ABARES’ Rural research, development and extension investment in Australia report (September 2017) shows that in the past decade, the value of Australia’s rural RD&E increased substantially in real terms, from $2.6 billion in 2005-06 to $3.3 billion in 2014-15, with the private sector an increasingly important contributor.
“Private sector funding of rural R&D and extension grew rapidly, from just over $1 billion in 2005-06 to $1.6 billion in 2014-15,” noted Acting Assistant Secretary of ABARES’ Agricultural Productivity and Farm Analysis branch David Galeano. “This increase is likely due to greater competition, new investment opportunities and Australia’s strong protection of intellectual property rights.”
Over the 10 years examined, public sector funding for rural R&D grew slowly in comparison – from $1.5 billion in 2005-06 to $1.7 billion in 2014-15, Galeano said.
Who’s giving what to our rural R&D?
“The Australian Government was the largest single contributor – with funding rising from over $880 million in 2005-06 to $1.1 billion in 2014-15 – and university contributions increased from $264 million in 2005-06 to just short of $380 million in 2014-15,” ABARES’ Galeano noted.
“The growth in funding from the Australian Government and universities came at a time of declining funding from the state and territory governments – from $390 million in 2005-06 to $280 million in 2014-15,” he said.
“Further growth in rural R&D investment is most likely to flow from the private sector, but will depend on expected returns and the international competitiveness of our R&D providers,” Galeano said.
“Public budget pressures mean federal and state funding for rural R&D is unlikely to increase significantly; however, contributions from universities could rise as they seek to improve their international standing through R&D.”
While government bodies and tertiary institutions tend to back basic scientific research, private sector funds are more likely to flow into areas of potential profit, contended ABARES’ Galeano.
“Public sector funding has been important for supporting long-term fundamental science and research, whereas the private sector has tended to concentrate on more readily marketable technologies like those related to seeds or chemicals,” he said.
According to ABARES’ report, trends in funding for individual research categories varied significantly over the decade to 2014-15.
“Funding for agriculture, fisheries and forestry R&D increased dramatically over the 10 years to 2014-15,” the report’s authors state, “driven by greater private R&D funding, which almost doubled from $340 million to $637 million ... in real terms”.
Meanwhile, public sector funding for agriculture, fisheries and forestry decreased from $851 million in 2005-06 to $714 million in 2010-11 before rising again to reach $921 million in 2014-15, in real terms.
Funding for sustainable production research rose less significantly over the period, from $433 million in 2005-06 to $485 million in 2014-15 in real terms, the report states, reflecting the public funding priorities that accompanied Australia’s changing political climate.
“Total investment in sustainable production R&D increased in the mid-2000s, then declined from 2012-13 to 2014-15, largely driven by changes in public funding,” ABARES’ report states.
“Public funding of sustainable production and agriculture, fisheries and forestry R&D tend to move in opposite directions over time, likely reflecting re-categorisation of project funds within a fixed budget and changes in government priorities.”
Funding for agricultural inputs research increased from $98 million in 2005-06 to $162 million in 2014-15, while total funding for rural processing R&D rose from $565 million to $793 million over the same period, in real terms. In both areas, the private sector accounted for around three-quarters of the financial backing.
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