Tracking Performance
In December 2002 the Prime Minister announced a set of National Research Priorities. These national priorities were subsequently incorporated into the Government’s priorities for rural R&D that were formally communicated to the Chairs of the RDCs in March 2003 by the Parliamentary Secretary to the Minister for Agriculture Fisheries and Forestry.
"…we can be proud of the achievements of the RDCs in delivering positive outcomes for rural industries. However, we must continue to do this and be able to demonstrate to both your industry and the government that your research is being adopted."
Source: Letter to RIRDC Chair fromSenator the Hon. Judith Troeth 12 March 2003
Returns on investment and triple bottom line reporting
Over the past six years the Corporation has conducted a program of impact evaluations via benefit/cost analyses of its research. During the first four years one of the four research program areas was evaluated each year. For the last two years the Corporation changed the focus of its evaluation activity from the program to sub-program level.Last year’s study evaluated the Agroforestry sub-program which is being incorporated into the program’s new five year plan. This year’s study looked at the Rice sub-program. The study, by the Centre for International Economics (CIE), used the RIRDC/GRDC guidelines as a basis for the evaluation. However, specific emphasis continued to be placed on further developing methods for evaluating the more difficult to quantify environmental and social impacts. This still involved a two-stage process. The first stage developed an overview of all projects in the Rice Sub-Program. This overview provided a general picture of the impact of all projects and their classification into themes and groups so that a sub-set could be chosen for detailed benefit/cost evaluation.
The second stage involved a detailed evaluation of 32 completed or nearly completed projects of the 157 projects identified in stage 1. Although 32 projects were covered by the evaluations, seven summary benefit/cost evaluations are reported. This was because several projects were identified as being part of a single R&D effort.
What was found
As has been the case in previous years a significant effort was involved in documenting in detail the results of the stage 1 part of the study. This stage involves a detailed description of all of the 157 funded projects and grouping them into research areas and research efforts. The major funding focus has been on production issues with 71% aiming to develop technologies to improve competitiveness and 16% aiming to improve sustainable development. The rest focused on communications, 9.8%; industry training and development, 2%; processing, 1%, and markets, 0.2%. It was also found that emphasis on basic or fundamental research has been reasonably high at around 35% of funding, with applied research around 50% and development about 15%. This assessment of all projects provided the basis for selecting projects to be evaluated in more detail.The detailed project evaluations reported in the stage 2 report indicate a range in rates of return to the projects evaluated, see table 1. The average net benefit to investment ratio (NBIR) for the projects evaluated was about 40 with a range from 9 to 99. The average internal rate of return (IRR) was about 100% with a range from 45 per cent to 180 per cent, although evaluation of the impacts of one set of projects, the SWAGMAN activity proved to be very difficult so no benefits were measured. These investment performance indicators suggest the returns to rice research have been consistently very high.
All but one NBIR achieved the established industries benchmark of 10 and all easily met the established industries IRR benchmark of 25%. As is seen from figure 1 the investment returns for rice have been consistently higher than those estimated in all other years. It should also be noted that some of the research activities, such as breeding and quality evaluation, were not included in the evaluation because they have been shown to be high return areas previously.
Table 1: Cluster evaluation results – RIRDC rice R&Da
a the net present value ( NPV) results are discounted at a social rate of 5 per cent.
Rice Research Evaluation Outcomes Fertiliser management Weed management - SCWIIRT Weed management - resistance Pest management – bloodworm and snails Pest management - rotations EM-31 SWAGMAN
na Unable to clearly measure the impactsAn important reason for such high return estimates is the high rates of adoption of research outcomes for the rice industry. This issue was given specific attention in the evaluation process and the full report includes details of this. A recent review of the rice extension system has also confirmed that the extension activities for the rice industry are amongst the most effective in Australia, which is confirmed by this evaluation.
The triple bottom line impact
Last year was the first year that the evaluations rigorously embraced detailed triple bottom line assessments. They did this by mapping economic, environmental and social outcomes, see figure 2. This process was also adopted in 2002/2003 and refinements made to the techniques being applied.Figure 1: summary of results for all evaluations
Figure 2 Triple Bottom Line mapping process
The details of these types of evaluations are complex, however, in summary it was shown that for the total investment of $11 million the triple bottom line net benefit was estimated as $292 million. Of this return 59 per cent was estimated as a direct return to rice producers with the remaining 41 per cent reflecting the share of benefits which were estimated to flow to a range of measurable environmental and social dimensions of rice production. At the outset these latter two types of benefits were expected to be even higher for some of this research. However, the evaluators often had difficulty finding concrete and convincing clear evidence of, especially, the environment impacts of rice production which could be used in the quantification process.For example, reduced spray drift and chemical run-off were difficult to quantify because events were rare, and, by most accounts, had negligible impact on the environment. Also an important gap in the values presented comes from not being able to clearly identify the impact of rice production and the R&D on the water tables and hence on salinity. There is simply not sufficient information to conclude either that the R&D has yet made an impact in the case of SWAGMAN, or in the case of EM-31, what would have happened to salinity and the water table in the absence of the adoption of the technology. The highly complex nature of these relationships presents a challenge for this type of evaluation.
The reduction in risk to the industry’s access to water arising from reduced water use and exclusion of leaking areas from rice production is highly significant but difficult to value. At a maximum it is the total value of the rice industry, estimated as the return on rice growing above the return on the next best alternative. This is estimated as around $156 a hectare. On current projections rice remains the most profitable option for farmers in the rice growing regions. The baseline incorporates the impacts of yield and water efficiency improvements expected to arise from existing R&D outputs. If these are not taken into account, at constant water prices, the cost to the industry from 2002 to 2015 was estimated to be $344 million.
One of the social benefits of the R&D has been to reduce, although not remove, the uncertainty over the future of the industry. This benefit can be demonstrated using indicators such as the level of confidence in the future and satisfaction with the lifestyle. Similarly, the reduction in spraydrift, which has important social benefits in terms of neighbour relations, can be captured by such indicators. It is not appropriate, nor indeed possible, to translate these to dollar terms and they must always be considered separately in any TBL evaluation. Unfortunately measurement of these indicators was beyond the scope of this evaluation exercise.
How stakeholders rate performance
Every two years the Corporation surveys its stakeholders on our performance. The latest survey was carried out in April 2003.The full report of the survey is at our website (http://www.rirdc.gov.au/2003survey), but, in essence, the survey shows that our stakeholders continue to view the Corporation’s performance as strengthening over time. On the key question of ‘overall performance’ the results for 2003 compared with earlier surveys are as follows:
RIRDC continues to be highly rated by clients and stakeholders in terms of ‘overall performance’. Eighty four per cent of respondents to the general survey rated RIRDC as either ‘excellent’ or ‘good’ in carrying out its role. It is most pleasing that no respondents rated it as ‘poor’.
Stakeholder opinions of RIRDC’s overall performance in carrying out its role have steadily increased since the first survey in 1995. In the 2003, 2001 and 1999 surveys ‘good’ was the most frequently recorded rating, followed by ‘excellent’, while in both the 1997 and 1995 surveys ‘good’ was the most frequently cited rating followed by ‘satisfactory, with ‘excellent’ coming in as the third most frequent rating. The 2003 ‘excellent’ rating was supported evenly by all client groups, with little variance evident between groups.
The rate of adoption of research by industry and producers is perhaps the most important accountability measure. RIRDC customers obviously do use information from RIRDC in an ‘adoption’ capacity.
In 2003, of the 121 producers who answered this question in the two-page survey, 63% indicated they had used RIRDC information to make a change. In 2001, 50 producers answered this same question and once more 63% indicated they had used RIRDC information to make a change. Most stakeholders rate highly RIRDC’s role in promoting adoption of research findings and this rating appears to be improving.
Sixty two per cent of the respondents to the general survey recognised RIRDC’s role in promoting adoption of research findings as ‘good’ or ‘excellent’. Just 5% of respondents rated RIRDC’s promotion of research findings as ‘poor’.
The same question was also asked in the producer-specific survey. In 2003, 61% of producers recognised RIRDC’s role in promoting research findings as either ‘good’ or ‘excellent’. However, 15% of producers rated RIRDC promotion of research findings as ‘poor’. This compares to 2001 when 45% of producers recognised RIRDC’s role in promoting research findings as ‘good’ or ‘excellent’ and 20% rated it as ‘poor’.
There is always room for improvement and the 2003 Survey pointed to the following areas that we need to work on:
• conduct further work to quantify rates of adoption
• develop a Board policy on delivery of research outcomes to end users
• review branding and communications strategies
• build stronger relationships with accountability stakeholders
• integrate databases
Addressing government priorities
RIRDC reported on its future actions to meet the Government’s National and Rural R&D Priorities in its 2003-2004 Annual Operational Plan. The following table summarises the main outputs in 2002-2003 that will contribute to these priorities
S.74 of the Occupational Health and Safety Act 1991–Reporting
Section 74 of the Occupational Health and Safety Act 1991 sets out requirements to be included in the Corporation’s Annual Report. In a formal sense, our occupational health and safety policy framework is codified in the Staff General Terms and Conditions. These were reviewed in September 2000 and run for a two year period from 1 October 2000. Copies of the Staff General Terms and Conditions are available on request. No claims were lodged with Comcare in 2002–03. Our reporting against the requirements of S.74 for 2002–03 is as follows
s516A of the Environment Protection and Biodiversity Conservation Act 1999–Reporting
Legislation S.74 RIRDC Action Details of any agreement made with employees relating to occupational health and safety. • see General Staff Terms and Conditions, 1 October 2003 to 30 September 2002 Details on any Committees established to deal with occupational health and safety. • no formal committees. The Corporation only has 18 full time staff and specialist committees are not required. Our consultations include all staff Details of the selection of health and safety representatives. • Mr Claudio Ciuffetelli is responsible for occupational health and safety issues • Ms Keller (resigned 27/6/03), Mr Ellwood (resigned 21/2/03) and Ms Suen were the Corporation’s qualified first aid officers during the year
Measures taken during 2002–03 to ensure health, safety and welfare at work. • the recommendations of the workstation assessments conducted in 2001–02 were implemented by a qualified occupational therapist Statistics on any accidents. • no accidents recorded Investigations conducted during the year that relate to undertakings given by employer. • no undertakings given. As a tenant we have continued to seek confirmation about air quality systems from the building owner • no directions or notices given to the Corporation
Legislation S.516A RIRDC Action How actions of the agency during the period accorded with the principles of ESD • the Corporation operated under a Five Year Strategic Plan for 2002-2007 that includes a goal of minimizing and, where possible, improving the impact of existing, emerging and new rural industries on the environment • the Corporation manages a number of programs that specifically focus on improved economic and environmental outcomes. These include the Organics, Agroforestry and Resilient Agricultural Systems Programs. All RIRDC programs incorporate sustainability in their five year strategic plans
• the RIRDC project selection process specifically requires an assessment of whether prospective projects are likely to have a negative impact on sustainability or biodiversity. This criterion is second in a set of eight criteria that the Corporation uses to assess project applications and can lead to the rejection of a project if the research objectives, methodology and/or outcomes outlined in the application are judged to have adverse environmental consequences
How the outcomes specified for the agency in the Appropriations Act contribute to ESD • the outcome specified for the Corporation is to facilitate a more profitable, dynamic and sustainable rural sector. It contributes to ESD by recognising the need for research outputs that integrate economic, environmental and social objectives The effect of the agency’s actions on the environment • the Corporation’s charter is to make and manage research investments. Impacts of this activity on the environment are sometimes difficult to attribute and may be subject to long response times. Some key impacts are the following: – more sustainable management of natural resources such as soil, water and biodiversity is an integral objective of RIRDC’s Joint Venture Agroforestry Program. Activities that met this objective during the year were the publication of a report on irrigation management and groundwater uptake in young tree plantations and research into banded agricultural systems (that mimic vegetation systems with discrete linear patches) for reduced recharge, reduced runoff and greater productivity
– the Program also published the first in the Integration Series booklets – Managing Riparian land for Multiple Uses, a report on the Landcare Revolving Fund and several reports on trees in low rainfall areas that aim to improve the commercial viability of agroforestry in those areas where groundwater recharge and salinity are most prevalent.
– the Deer Sub-program has improved knowledge of issues related to drought management and tolerance of deer to increasing salinity levels with evaporation in surface water sources
– the Chicken Meat Sub-program completed a desk-top evaluation of the viability of a range of possible odour control strategies for chicken meat farms and developed recommendations for strategies to reduce dust emissions from chicken sheds
– the Rice Sub-program continues to be a major partner in the CRC for Sustainable Rice Production. This year the Sub-program commercialised a new rice variety ‘Quest’ with significantly improved water use efficiency and released significant results on rice nutrition including; an update of ‘maNage rice’, which provides guides to improved fertiliser use by growers and now also includes water use options; and an effective NIR testing service for crop nitrogen management
– the Resilient Agricultural Systems Program continues to support R&D on environmental management systems and produced a handbook on integrated agri-acquaculture systems
– RIRDC collaborates with Land and Water Australia and other stakeholders in the National Dryland Salinity Program (NDSP) and the Climate Variability in Agriculture Program (CVAP). The NDSP has provided vital new information on the causes and management of dryland salinity and the CVAP is providing farmers with better climate forecasts and improved risk management for extreme events such as drought
Measures the agency is taking to minimise the impact of actions by the agency on the environment • the Corporation’s research and development project agreement requires a specific assessment of the potential for environmental damage to result from a project. Applicants must alert the Corporation to any proposal that may be considered an "environmentally significant action" Mechanisms for reviewing and increasing the effectiveness of the above measures • the Corporation reports to the Federal Government after each Board meeting and publishes most final reports. This transparency facilitates stakeholder input to our operations and the application of ESD principles
 
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Last updated: October 2003
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