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Preface   Our Profile
Executive Summary
Australian Government Research Priorities
RIRDC’s Performance Framework
RIRDC 2007–08 Budget
Appendices		 RIRDC’s Portfolios and Programs
Portfolio One – New Rural Industries
Portfolio Two – Established Rural Industries
Portfolio Three – National Rural Issues
Corporate Management
 
Preface
In this 2007–08 Operational Plan, the Rural Industries Research and Development Corporation’s (RIRDC) industry and government clients will see a portfolio of research and development investments carefully selected to generate knowledge outcomes and maximise adoption.

We propose targeted investments to contribute to an overall outcome of a more profitable, sustainable and dynamic rural sector in three key areas:

In keeping with these three mandates, our funds are sourced from government and industry.

While RIRDC recognises that rural innovation is intrinsically a long-term process, we are also determined to ensure that our research and development investments are strategic, high-performing and responsive.

In 2007–08, RIRDC has applied its new investment framework by:

The result, detailed in this plan, is that RIRDC will re-allocate resources in 2007–08 to respond to strategic opportunities and apply its investments to areas assessed as potentially more
beneficial.

In applying its investment framework we have identified eight strategic issues to be addressed to ensure effectiveness, both operationally and in the application of investments.

Drought continues to be a dominating issue for many of RIRDC’s industries – driving down production and compromising industry capacity to adopt innovation. Levy revenue for R&D is also reduced substantially. RIRDC’s objective is to sustain its R&D investments and it achieves this through prudent application of a policy to utilise reserve funds and through controls on expenditure. The Australian Government Finance Minister has approved an operating loss of up to $2m as RIRDC applies this policy in 2007–08.

RIRDC is appointed Managing Agent for the Council of Rural Research and Development Chairs and an active contributor to work on evaluation of R&D impact and to cross-RDC collaboration. In 2007–08, RIRDC will develop R&D priorities to facilitate R&D co-investment in trade and energy – two areas identified as high priority by the Rural Research and Development Corporation. We will also conduct robust benefit-cost assessments of lapsing sector five year R&D plans to guide R&D investments and inform RDC evaluations.

RIRDC’s evaluation program is designed to measure the impact of our R&D investments, with a focus on our sectoral programs, and will form part of a wider reporting framework across the Rural Research and Development Corporations and companies.

RIRDC will respond effectively to new Government expectations in 2007–08. We have responded to the Parliamentary Secretary’s new Statement of Expectations with a Statement of Intent, and will report against this in our Annual Report, initially for 2007–08. We have also aligned our work to reflect the new National Rural Research Priorities, including new co-investment on climate change. In 2007–08, RIRDC will also meet the new Compliance Reporting requirements of the Minister for Finance and respond to the application of the Australian Government’s Protective Security Manual to the Corporation.

RIRDC looks forward to a challenging and productive 2007–08—confident that our activities are aligned with the knowledge needs of our industry and government clients.
 
Mary Boydell
Chairperson		 Peter O’Brien
Managing Director

Our Profile
Purpose
This Rural Industries Research and Development Corporation (RIRDC) Annual Operational Plan presents RIRDC’s planned research and development (R&D) investments and corporate expenditure in 2007–08.

Enabling Legislation and Directives from Government
RIRDC’s enabling legislation is the Primary Industries and Energy Research and Development Act 1989 (Commonwealth of Australia) (the PIERD Act, see Appendix F).

The RIRDC Board is accountable to the Parliament of Australia through the Parliamentary Secretary to the Minister for Agriculture Fisheries and Forestry (see the RIRDC Performance
Framework Chart on page *).

RIRDC actively addresses the Government’s priorities while also addressing the future research and development objectives of our industry partners. See page * for details.

Responsible Ministers
The Hon. Peter McGauran, MP, Minister for Agriculture, Fisheries and Forestry
Senator the Hon. Eric Abetz, Minister for Fisheries, Forestry and Conservation
The Hon. Sussan Ley, MP, Parliamentary Secretary to the Minister for Agriculture, Fisheries and Forestry

RIRDC Board
Chairperson: Ms Mary Boydell
Deputy Chairperson: Mr Steve Marshall
Managing Director: Dr Peter O’Brien
Non Executive Directors:
Mr Robert Boshammer
Ms Lindy Hyam
Dr Andrew Johnson
Mr John Lawrenson
Mr Norman McAllister

Our Vision
A more profitable, dynamic and sustainable rural sector

Our Mission
To maximise the knowledge outcomes from our R&D investments for Australian industries and government in:

Our Values
In delivering on our mission we are: RIRDC’s Goals, Strategies and Measures of Success

Executive Summary

This Annual Operational Plan sets out RIRDC’s planned investments for 2007–08 to implement its Corporate Plan 2007–2012. To determine which investment
areas and amounts best deliver on our objectives, we have applied a new investment framework.

RIRDC’s Investment Framework
In 2007–08 RIRDC introduced a new framework for assessing prospective investments. The main elements of RIRDC’s investment framework are:

Investment framework implementation

Strategic Issues for RIRDC
RIRDC’s operating environment, and that of our rural industries, is complex and dynamic. Over the life of this Plan, RIRDC will help Australia’s rural industries and communities respond to a range of challenges and help them to capture opportunities. In identifying these challenges and opportunities, RIRDC has been informed by:

The Government has provided RIRDC with a Statement of Expectations, setting out its expectations of RIRDC, and RIRDC has responded with a Statement of Intent, setting out how we will meet these expectations. In particular, RIRDC is focussing on the development of new collaborative arrangements which will contribute to corporate objectives, and supporting systematic and comprehensive evaluation of R&D impacts across Corporations. The Government has also introduced new compliance and protective security requirements which the Corporation will meet in 2007–08. Where required, our performance in these areas will be reported though RIRDC’s Annual Report. Collectively, these are the issues that RIRDC will respond to through its R&D plans in 2007–08 and over the next five years.

Key elements of the RIRDC 2007–08 Operational Plan
RIRDC's overall income in 2007-08 is budgeted to be $23.9m - similar to that budgeted for 2006-07 and a decrease of $1.6m against the 2006-07 forecast income of $25.5m. Total expenditure in 2007-08 is budgeted to be $25.2m - an increase of $1.7m to that budgeted for 2006-07 and an increase of $1.1m against the 2006-07 forecast expenditure of $24.1m.

This increase includes budgeted new revenue and expenditure in the New Rural Industries Portfolio. These increases are offset by decreases in levy revenue, especially for rice, resulting from the continuing impact of drought on production in RIRDC’s established rural industries and on associated levy income, which will see sub-accounts for established rural industries draw on reserves in 2007–08 to sustain R&D investments (see following table).

Key changes to RIRDC’s Portfolios in 2007–08
New Rural Industries:

Established Rural Industries:
For the Established Rural Industries Portfolio, drought is the significant driver. RIRDC’s levy revenue is production-based and the continuing low production in drought sees levy revenue down and our long term approach to large, non-levy based industries is a strategic issue.

National Rural Issues:
For the National Rural Issues Portfolio, reduced expenditure is proposed as we wind down and close programs in environment and farm management and wildlife and rangelands with new initiatives proposed in:

These changes to the Portfolio are in response to the strategic issues.

Corporate Management:

For Corporate Management expenditure budgeted for 2007–08 is $3.72m, similar to 2006–07 ($3.68m). Over 2007–08, the focus of corporate management will include: meeting new corporate reporting and protective security obligations; full implementation of Clarity business software following successful piloting; a new RIRDC website; streamlined reporting, and a review of communications activities to ensure we maximise knowledge outcomes.

Risk management
The impact of the drought on RIRDC industries as well as on levy revenue and our capacity to sustain R&D is a significant risk that we have identified and addressed through the
application of our reserves policy and prudent expenditure controls. The Corporation will draw down significant reserves to sustain R&D over 2007–08.

Identified additional risks are:

Key deliverables
In 2007–08 RIRDC has identified key deliverables that address the Government’s National and Rural Research Priorities and the priorities of our industry stakeholders, as well as the challenges and opportunities discussed..

Key deliverables for Portfolio 1 – New Rural Industries
The Portfolio proposal for 2007–08 will deliver:

Key deliverables for Portfolio 2 – Established Rural Industries
The portfolio proposal for 2007–08 will deliver: Key deliverables for Portfolio 3 – National Rural Issues
The portfolio proposal for 2007–08 will: Key deliverables across the Corporation:
Corporate Activities Administration Human Resources and Board Communications Cross-Portfolio Activity Strategic Directions for 2007–08
The Corporation has identified a number of strategic issues which form part of the RIRDC Board’s agenda in the coming year: