october 2016 sardi review · 2017. 2. 9. · sardi’s current capabilities and revenue are...

REPORT TO

DEPARTMENT OF PRIMARY INDUSTRIES AND REGIONS SOUTH AUSTRALIA

OCTOBER 2016

SARDI REVIEW

FINAL REPORT

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ACIL ALLEN AND VTT (2016) SOUTH AUSTRALIAN RESEARCH AND DEVELOPMENT INSTITUTE REVIEW – FINAL REPORT

© ACIL ALLEN CONSULTING 2016

SARDI REVIEW FINAL REPORT i

E X E C U T I V E S U M M A R Y

Purpose

The Department of Primary Industries and Regions South Australia (PIRSA) commissioned ACIL Allen Consulting and VTT Technical Research Centre of Finland to review how the South Australian Research and Development Institute (SARDI) can continue to grow, adapt and meet the changing requirements of the agribusiness, food and fisheries sectors, without compromising its well established research, capabilities and reputation. Specifically the Review sought to provide findings with regard to SARDI’s:

1. business model and its potential to capitalise on existing and future commercialisation opportunities, particularly as a means of delivering services and technologies to South Australia’s agribusiness, fisheries and food and beverage industries

2. funding sources and its ability to access non-traditional funding sources, including the National Innovation and Science Agenda, industry development schemes (Growth Centres) and direct commercial investment in technology transfer and innovation

3. potential future key relationships, including SARDI’s role as a ‘connector’ between theory and the research community through to commercialisation and enhancing state, national and international collaborations with other research institutions

4. organisational structure and how it compares to those organisations which obtain a higher proportion of research funding from private sources.

Approach

The Review considered the terms of reference in three dimensions:

— challenges and opportunities in SARDI’s operating environment to which it needs to respond

— strategic fit of SARDI’s business model with the changing operating environment (TOR 1)

— suitability and potential improvements to key elements that enable the business model:

― funding sources, including non-traditional sources (TOR 2) ― key future relationships, including commercialisation, connector and collaboration (TOR 3) ― organisational structures and how it compares to those with greater private funding (TOR 4).

Key SARDI, PIRSA and other documentation of six comparable organisations in Australia and overseas were reviewed against these dimensions. The Review interviewed 31 stakeholders and received 22 (from 83 invited) submissions. The Review was informed by an Advisory Group chaired by PIRSA which provided feedback on the approach, stakeholder consultation findings and draft report.

SARDI REVIEW FINAL REPORT ii

Findings

The Review found the State Economic Priority of “premium food and wine produced in our clean environment and exported to the world” is important to South Australia but challenging for both industry and SARDI.

In gross food value terms South Australia has a number of well-established industries that have limited prospects to expand the area under primary production (with the exception of horticulture and aquaculture) so productivity gains are critical. In all industries, the efficient and sustainable use and management of the natural resource base and biosecurity is paramount. Consequently a key focus is on sustainably increasing the farmgate multiplier, exports and proportion of value adding undertaken in the State.

Overall, it is clear that SARDI has established a strong reputation for its technical excellence and is undertaking significant and important research at national and state levels, particularly in “pre-farmgate” research focused on sustainable production.

A key challenge is that the State Economic Priorities require SARDI, and the networks within which it operates, to increase their focus on post-farmgate research. This represents a significant shift for SARDI and many of its funders who focus on pre-farmgate, natural resources and industry integrity research—areas where future gains are also important and realistic.

Many stakeholders expressed the need for SARDI to expand beyond its strong focus on sustainable production and “move up the value chain”, beyond areas such as supply chain traceability and industry integrity where it is well established (Figure ES 1A).

SARDI’s investment is also unevenly distributed across South Australia’s primary industries (Figure ES 1B). This is a result of where SARDI has been able to most readily secure external funding, as well as a nationally agreed approach to RD&E in which SARDI specialises on certain areas and the gaps addressed by other organisations under a series of national strategies.

FIGURE ES 1 SARDI INDUSTRY AND VALUE CHAIN FOCUS (2015/16)

A. SARDI value chain focus (2015/16 project budgets) B. SARDI sectoral focus (2015/16 project budgets)

Notes:

Whole value chain is for projects that cover the whole value chain, including areas such as supply chain integrity and traceability

Sustainable production includes water and soil

In Figure ES 1 B projects related to water resources and management have been proportionally allocated to each industry

SOURCE: SARDI FINANCIAL AND PROJECT RECORDS

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SARDI REVIEW FINAL REPORT iii

TOR 1: SARDI’s business model and potential to capitalise commercialisation opportunities

SARDI’s current capabilities and revenue are predominantly concentrated on publically funded pre-farmgate, natural resources and supply chain integrity research. In this context, commercialisation within SARDI focuses on plant breeder rights royalties and fee for service diagnostics that account for around 10 per cent of its revenue.

To capitalise on additional commercialisation opportunities requires SARDI to either expand these traditional fields and/or embark on a process to explore new areas. Both are constrained by the willingness of funders and the capacity of SARDI to do so. There is also a degree of confusion around whether the goal of commercialisation is to accelerate the rate of industry development, or to generate additional income streams within SARDI and amongst stakeholders. While this can be readily addressed by strengthening SARDI’s processes and capabilities, it is unlikely to realise its full potential until there is clarity on SARDI’s strategy, and one that is agreed to and aligned with its funders.

TOR 2: SARDI’s funding sources and ability to access non-traditional funding

Over the past decade SARDI has received around $60 million of funding per year. During that time there has been a structural shift in funding sources as greater public R&D funding and provision of cost recovery services to PIRSA have offset a declining State Allocation (see Figure ES 2 below). SARDI’s external funding ratio is 4:1 and in 2015/16 around half of SARDI’s funding came from organisations not based in South Australia while 39 per cent was funded by Rural Research and Development Corporations which operate with a national focus.

FIGURE ES 2 SARDI FUNDING 2006/07 TO 2015/16

SOURCE: SARDI

There is certainly potential to further increase funding from the national public primary industries R&D funding sources managed by the RDCs. This is an area where SARDI is currently performing strongly; for example SARDI has been successful in increasing its funding for animal welfare from RDCs. However, growth will be limited by the actual capabilities SARDI holds and funders “sharing the funding” between research organisations on the basis of equity and risk management.

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Infrastructure Income State Allocation

PIRSA Cost Recovery R&D Funding

Royalties Diagnostic & Consultancy Services

SARDI REVIEW FINAL REPORT iv

The current high level of public funding provided to SARDI and others for existing services renders gaining increased funding for these services from new sources challenging, as there is an expectation that many services have already been paid for by industry levies or government funding. Again this requires a targeted approach to differentiate the additional request from existing funding and services, such as occurred with the Great Australian Bight Research Program.

Gaining new sources of funding for new services is even more challenging, as it will most likely involve value adding post farmgate services, where SARDI does not currently have a full capability offering. In these cases, whether it be to industry or new initiatives, SARDI faces considerable costs and effort to identify the opportunity, assemble the consortia to secure the funds and develop the capability to deliver the service.

In all these cases, a critical consideration for SARDI is the degree to which it can free up its own State Allocation (and capability) to pursue such opportunities. Therefore, to access new funding, particularly in areas where SARDI has limited involvement but needs to pursue new value-adding services, there will be a need to either a reallocation of funding or efficiency gains. Both are challenging if the State Allocations continue to decline and reduced service levels cannot be agreed with stakeholders.

TOR 3: SARDI’s potential key future relationships

Since 1992 SARDI has been progressively specialising around particular priorities and capabilities as part of a deliberate and coordinated approach to organising research as a network of national, state, sector and cross sector initiatives. SARDI is now part of a complex ecosystem consisting of South Australian based research organisations, Strategic South Australian Initiatives funded by the State, and a national research network (See Figure ES 3 below).

FIGURE ES 3 SARDI RELATIONSHIP GROUPINGS

SOURCE: ACIL ALLEN CONSULTING

Sustaining and further developing relationships across these three groupings is essential to SARDI’s future. SARDI is well established in the national research network, which will likely remain a key source of funding and partners, to deliver research for South Australia. The challenge lies in working with the network to navigate a complex structure that can render stakeholder engagement and focused coordinated research difficult. There is a clear opportunity for SARDI and other members of the South Australian Primary Industries Research Cluster to improve coordination around capability development, further resource sharing, international linkages and collective action. This is not something SARDI or even the cluster organisations can do on their own given their different remits and governance arrangements. There is, however, an opportunity for the South Australian Government to use its strategic initiatives and associated funding to drive stronger collaboration. Strengthening the strategic alignment between SARDI and PIRSA will be crucial to realising these outcomes.

SA Strategic Initiatives

SA Primary Industries Research Cluster

(Inter) National

Research Network

SARDI REVIEW FINAL REPORT v

More broadly, SARDI needs to further develop its relationships with industry bodies and individual businesses across the value chain if it is to attract additional funding and accelerate industry development. SARDI’s current highly leveraged and programmed research has resulted in a committed investment portfolio and specific capability that is difficult to shift to new and emerging areas. This is further constrained by a bottom up planning process that only tactically aligns activity and investment with stakeholder priorities rather than articulates a clear overall strategy for SARDI.

TOR 4: SARDI’s structure compared to organisations with higher private funding proportions

The case studies highlight that all the reviewed comparable organisations in Australia and overseas operate in complex systems and many are located within larger government departments. Overall there is no one predominant or prevailing model, but the practices and arrangements have been framed by conscious decisions using:

— Boards to provide independent, representative and skills based advice

— targeted goals to define their mandate and limit their scope

— decision support tools, such as those used by AgVic, to provide consistent objective assessments.

SARDI has the highest level of external funding amongst comparable organisations, which all rely on high levels of public funding. While recognising that the contexts and arrangements differ in other countries, in all the case studies there are role definitions and processes to clarify how research organisations and industries collaborate. This highlights the importance of having clear research goals for South Australia as well as SARDI and a clear understanding of how SARDI, PIRSA and others should coordinate to achieve them.

Structurally the case studies highlight organisations that can be organised on a commodity (as SARDI currently is) or service/functional basis. Either way it is apparent where commercialisation is important to the organisation there is a deliberative process delivered by a separate unit within the organisation or a third party. The case studies also highlight the use of Centres of Excellence to focus research and/or increase adoption of research.

Strategic considerations

Overall, it is clear that SARDI has established a strong reputation for its technical excellence and is undertaking significant and important research at national and state levels. At the same time, the State Economic Priorities provide a clear direction and potentially expand SARDI’s focus and capability, particularly in areas beyond its pre-farmgate core, while strengthening relationships that foster industry development and commercialisation opportunities. Funding levels over recent years have encouraged SARDI to pursue relatively high levels of external, though mainly nationally publicly funded, research, which may not always be explicitly aligned with state priorities.

To enact a strong and vibrant state industry development agenda requires both PIRSA and SARDI to co-establish and align policy and research, to fund the fixed essential public and regulatory functions appropriately, and to set clear goals and payment for the desired research outcomes.

The following sets out seven priority areas for PIRSA and SARDI to work together to achieve the expectations being sought by government and stakeholders. It presents an action sequence through which to resolve and address strategic choices and questions identified through the Review but which cannot be addressed through the Review itself.

Setting of clear and strategic goals

These should be, at minimum, in relation to a number of key elements:

— a 5 year business mandate or strategy

— the preferred research model

— relationships and funding sources designed in consideration of a 10-15 year horizon.

The Review found many varying views within and outside government, some conflicting, around the desired directions in these areas. Only with these goals agreed and set can decisions be made regarding the most appropriate organisational structure.

SARDI REVIEW FINAL REPORT vi

These goals should be based on the State Economic Priorities taking into consideration which industries, parts of the value chain, and research South Australia and SARDI has and requires future comparative advantage in. The goal setting should be jointly led by SARDI and PIRSA and part of an annual rolling strategy with at least triennial updating to manage four-year state and three-year national electoral cycles. It should also engage key stakeholders as the strategy/mandate needs to not only set SARDI’s direction but contextualise how this fits in the wider national and South Australian innovation network.

Matching funding sources to state priorities

SARDI is currently generating or leveraging a significant proportion of its funding from non-state sources, which in part explains why state objectives are not readily visible in its portfolio of work.

The setting of clear goals for SARDI will largely address this, enabling SARDI to work through a directed process to match to these goals and State Economic Priorities with its own State Allocation capabilities, and other funding sources and capabilities. This process should be more than just a mapping of investment, capabilities and key actions against SARDI, PIRSA, State and other stakeholder goals as currently occurs. There needs to be more objective analysis and adaptive decision making on what can be achieved, where the gaps lie and how they can be addressed in collaboration with others.

This will require some refocussing away from existing R&D investments to concentrate on value for money to South Australia and utilising these funds to develop new opportunities in the state. The principle of retaining and applying internal SARDI efficiency gains to developing new opportunities and capabilities should be considered. SARDI will also need to work with industry and the various research networks to build support for the transition and transfer of capabilities.

Importantly the strategic goals and directions will need to be funded appropriately, with explicit guidance on what areas will (or will not) be funded, and incentives to continuously pursue productivity gains whether based on efficiency or effectiveness improvements.

Linking research to state policies and structures

Strong organisational relationships and mechanisms between SARDI and PIRSA, as well as other South Australian policies and structures are essential. Towards this end, SARDI should strengthen its economic development capability and linkages to the broader strategic initiatives being driven by PIRSA.

The annual planning cycle utilised by PIRSA and SARDI is not effective in establishing clear goals and expectations and how they will collaborate together and with others. Greater clarity is also needed across South Australia regarding how stakeholders will collaborate with SARDI to accelerate achievement of the State Economic Priorities, particularly in food and value adding. This is essential to accelerating the various initiatives underway and ensuring SARDI has the understanding and capability to provide improved research based evidence to inform government and industry policy within PIRSA.

Objective investment decision making

With clear goals and funding sources linked to state policies in place, an objective test or investment framework is needed to ensure SARDI’s ongoing research investment decisions are in areas where:

— It has a distinctive advantage (i.e. is this the role of the South Australian Government and is SARDI best placed to provide the necessary research, regulatory, biosecurity and food safety services).

— There is a direct contribution or added value to state economic growth and future research capability (i.e. will this investment add value and how).

The framework should be applied with rigour on investment decisions, from project to corporate scales, within SARDI and with PIRSA and key funders. The framework should include a “portfolio balancing tool” so that risk-return (and other) trade-offs and alignment with SARDI’s goals and other priorities can provide a clear basis for transparent decision making and reporting, considering the option value of new capabilities as well as the closure of existing capabilities.

SARDI REVIEW FINAL REPORT vii

Business and research leadership

The increase in industry development focus and brokering of commercial opportunities being sought by many requires a strong combination of business and scientific research expertise. This needs to be strengthened and embedded in SARDI’s Executive and business processes and structures.

Recruitment of the next SARDI Executive Director may provide an important opportunity to appoint a leader with both requisite skills, though there are successful models where these are represented in separate roles. Similarly a detailed capability assessment should be undertaken covering the science (applied and discovery), technology/market development and business (entrepreneurial, management and stakeholder engagement) and used to inform future training and recruitment across the Executive to provide the balance of skills needed.

Embedding industry development and commercialisation

A key decision required is the extent to which SARDI pursues commercialisation itself as an additional source of funding, or the facilitation/brokering of commercialisation aligned with and to the ultimate benefit of SA industry. Both are possible but the experience in comparative organisations in other jurisdictions leans towards the brokering role as the more feasible and appropriate. This leaves the question of how to fund and organise the brokering function within SARDI. Brokering is a specialist skill beyond pure IP/contract management and research knowledge. Important also is opportunity and partner search and evaluation, and this would need to be strengthened within SARDI. Options include a special unit within SARDI, leaders within SARDI divisions or engaging another party (in government or the private sector). These should be assessed and then implemented as part of the strategy development process and will require additional resourcing.

Establishing a SARDI Board and broader industry engagement

Most successful or effective peer research organisation models have an independent management or advisory Board involved to maintain regular corporate practices of business planning and monitoring. Such Boards are a feature common to nearly all the case studies considered as part of this Review, irrespective of their corporate form.

A Board would provide SARDI with the governance processes and rigour to assist with resolving the various and often competing priorities and expectations, while also strengthening stakeholder engagement and accountability.

Board membership should be based on skills relating to science, management and industry knowledge and expertise. Whether it is a management or advisory Board will depend on what is legally practical and politically acceptable. Either way the governance structure must establish clear accountabilities for SARDI and the Board.

In addition to the importance of a Board, Review consultations indicated that there needs to be stronger and broader engagement between SARDI and industry. Improvements need to be considered in light of “one PIRSA” and the large number of Boards and committees with which SARDI is already involved to avoid unnecessary duplication and cost. This essentially requires SARDI to update its communication-stakeholder engagement strategy to map out how it will identify key stakeholder groups and decide how best to:

— seek advice

— communicate its intentions

— work collaboratively where required

— report results and seek feedback.

Above all, the ability of SARDI to meet the needs of all its stakeholders is integrally linked to its relationship within PIRSA and its industry policy role. The sequence of activities presented above seeks to establish the components which will ultimately guide the appropriate adjustments to the business model, funding basis, key relationships and structure to best achieve the state priorities. In doing so it recognises the importance of, and is critically dependent on, the process being conducted in close partnership with PIRSA.

C O N T E N T S

EXECUTIVE SUMMARY I

1

Introduction 1 1.1 Context 1 1.2 Review objectives 1 1.3 Approach 3 1.4 This report 3

2

About SARDI (current arrangements and capability) 4 2.1 Business model 4 2.2 Funding 6 2.3 Key relationships 7 2.4 Organisational structure 10

3

Alignment against objectives (performance assessment and gap analysis) 12 3.1 State economic priorities 12 3.2 Which industries and parts of the value chain does SARDI focus on? 13 3.3 What services does SARDI provide 16 3.4 What capabilities does SARDI hold 18 3.5 Who funds SARDI 19 3.6 Commercialisation 21 3.7 Relationships and purpose clarity 23

4

Lessons from comparator organisations (good practice) 28

5

Conclusions (Improvement opportunities) 31 5.1 Overall assessment against the terms of reference 31 5.2 Improvement considerations 34

A

SARDI employment data A–1 A.1 Staff overview A–1 A.2 SARDI staff breakdown by OCPE category A–1 A.3 SARDI staff breakdown by role A–2

B

SARDI facilities and assets B–1

C O N T E N T S

C

Comparator organisations C–1 C.1 Tasmanian Institute of Agriculture C–1 C.2 Agriculture Victoria, DEDJTR C–8 C.3 Plant & Food Research NZ C–15 C.4 Institute of Food Research (UK) C–20 C.5 Teagasc (Ireland) C–24 C.6 INRA (France) C–29 C.7 INIA (Spain) C–32

D

Stakeholders consulted D–1 D.1 Review working group D–1 D.2 Stakeholder interviews D–1 D.3 Stakeholder submissions received D–2

E

Submissions summary E–1

FIGURES

FIGURE 2.1 SARDI FUNDING 2006/07 TO 2015/16 6 FIGURE 2.2 PIRSA ORGANISATIONAL STRUCTURE 8 FIGURE 2.3 SARDI RELATIONSHIP GROUPINGS 8 FIGURE 2.4 SARDI ORGANISATIONAL STRUCTURE 11 FIGURE 3.1 FARMGATE MULTIPLIERS AND FINISHED VALUE OF KEY SOUTH AUSTRALIAN INDUSTRIES 13 FIGURE 3.2 SARDI INDUSTRY AND VALUE CHAIN FOCUS (2015/16) 14 FIGURE 3.3 SARDI SERVICE FOCUS 2015/16 17 FIGURE 3.4 SARDI RESEARCH DELIVERY PLATFORMS (PROJECT EXPENDITURE 2015/16) 18 FIGURE 3.5 SARDI FUNDING SOURCES 20 FIGURE 3.6 SARDI EXPENDITURE ALLOCATIONS 2015/16 21 FIGURE 3.7 SARDI RESEARCH TYPE FOCUS 205/16 22 FIGURE C.1 EXTERNAL GRANTS SECURED BY TIA IN 2014 C–4 FIGURE C.2 TIA FUNDING BY SOURCE, 2006-2014 C–5 FIGURE C.3 TIA ORGANISATIONAL STRUCTURE C–6 FIGURE C.4 THE AGRICULTURE INVESTMENT FRAMEWORK C–10

TABLES TABLE 2.1 SA GOVERNMENT’S KEY PRIORITIES FOR THE PUBLIC SECTOR 4 TABLE 2.2 SARDI FUNDING 2006/07 TO 2015/16 7 TABLE 2.3 SARDI RELATIONSHIPS 9 TABLE 2.4 KEY SOUTH AUSTRALIAN AND NATIONAL BOARDS AND COMMITTEE MEMBERSHIPS 10 TABLE 3.1 PRIMARY INDUSTRIES AND FOOD SNAPSHOT 12 TABLE 3.2 SARDI SERVICE DEFINITIONS 16 TABLE 3.3 SARDI ROYALTIES 22 TABLE 3.4 SARDI INVESTMENT DECISION FRAMEWORK 26

C O N T E N T S

TABLE 4.1 CASE STUDY OVERVIEW 30 TABLE A.1 SARDI STAFF NUMBERS, BY HEADCOUNT AND FTE A–1 TABLE A.2 SARDI STAFF NUMBERS AND PERCENTAGE BY OCPE CATEGORY AND DIVISION A–1 TABLE A.3 SARID STAFF BREAKDOWN BY ROLE AND DIVISIONS A–2 TABLE B.1 SARDI FACILITIES AND KEY ASSETS B–1 TABLE C.1 AGRIBIO’S VISION, AIM AND OBJECTIVES C–9 TABLE C.1 INTELLECTUAL PROPERTY PORTFOLIO C–11 TABLE D.1 SARDI REVIEW WORKING GROUP D–1 TABLE D.2 STAKEHOLDER INTERVIEWS D–1 TABLE D.3 ORGANISATIONS WHO MADE A SUBMISSION TO THE REVIEW D–2 TABLE D.4 ORGANISATIONS INVITED TO MAKE A SUBMISSION TO THE REVIEW D–3 TABLE E.1 SUMMARY OF SUBMISSIONS MADE TO THE REVIEW E–1

BOXES

BOX 1.1 TERMS OF REFERENCE 2

SARDI REVIEW FINAL REPORT 1

1 I N T R O D U C T I O N

1 Introduction

1.1 Context

The Department of Primary Industries and Regions South Australia (PIRSA) has commissioned this Review to examine how the South Australian Research and Development Institute (SARDI) can continue to grow, adapt and meet the changing requirements of the agribusiness, food and fisheries sectors, without compromising its well established research, capabilities and reputation.

1.2 Review objectives

With the overarching objective of SARDI increasing its commercial return to partners and investors (including the State Government), the Review will provide findings with regard to SARDI’s:

1. business model and its potential to capitalise on existing and future commercialisation opportunities, particularly as a means of delivering services and technologies to South Australia’s agribusiness, fisheries and food and beverage industries.=

2. funding sources and its ability to access non-traditional funding sources, including the National Innovation and Science Agenda, industry development schemes (Growth Centres) and direct commercial investment in technology transfer and innovation

3. potential future key relationships, including SARDI’s role as a ‘connector’ between theory and the research community through to commercialisation and enhancing state, national and international collaborations with other research institutions

4. organisational structure and how it compares to those organisations which obtain a higher proportion of research funding from private sources.1

The Review output will consist of a status report of specific aspects of SARDI’s structure and operations, and identify potential areas of work which may be addressed subsequent to this Review.

1 See Box 1 overleaf for the detailed terms of reference


BOX 1.1 TERMS OF REFERENCE

OBJECTIVE

In an ever competitive world, global innovation and consumer preferences are continuously changing and

we must ensure SARDI can capitalise on the opportunities presented.

This Review will examine how SARDI can continue to grow, adapt and meet the changing requirements of the

agribusiness, food and fisheries sectors, without compromising its well established research, capabilities

and reputation.

TERMS OF REFERENCE

This Review needs to be completed by the end of 2015/16 financial year and within a limited initial budget. The

Review output will consist of a status report of specific aspects of SARDI’s structure and operations, and

identify potential areas of work which may be addressed subsequent to this Review.

With the overarching objective of SARDI increasing its commercial return to partners and investors

(including the State Government), the Review will provide findings with regard to:

1. SARDI’s business model and its potential to capitalise on existing and future commercialisation opportunities,

particularly as a means of delivering services and technologies to South Australia’s agribusiness, fisheries and

food and beverage industries. Specific consideration should be given to:

a) Mechanisms to ensure SARDI can operate effectively in the commercial market (e.g. intellectual property

(IP) /commercialisation policy, IP management systems, inventor reward policy and IP/third party freedom

to operate audits).

b) Mechanisms to safeguard the contribution of SARDI to the State Government’s regulatory role.

c) Mechanisms to channel profit into “public good” activities (e.g. a charter).

2. SARDI’s funding sources and its ability to access non-traditional funding sources, including Commonwealth

Innovation Agenda, industry development schemes (Growth Centres) and direct commercial investment in

technology transfer and innovation, with particular consideration given to:

a) National and international commercial arrangements to assist delivery of SARDI’s outcomes as well as

expand its revenue base.

b) Appropriate prudential/risk management policies and practices (Government and corporate governance).

c) Criteria against which potential commercial projects are assessed.

3. SARDI’s potential future key relationships, including but not limited to:

a) Commercial relationships - identifying new industry partners prepared to fund and rapidly adopt research

outcomes.

b) The role of SARDI as a ‘connector’ between theory and the research community through to

commercialisation (e.g. by piloting new ideas, in-field trials, new practices and new technologies).

c) Enhancing state, national and international collaborations with other research institutions.

4. SARDI’s organisational structure and how it compares to those organisations which obtain a higher

proportion of research funding from private sources, with particular consideration given to:

a) Structures and relationships that work without excessive formality and enable quick adaptation to

changing market needs and opportunities (allow for agility).

b) Interactions within PIRSA and across other agencies in support of the ‘One PIRSA’ corporate objectives.

c) Contribution of R&D to evidence-based advice to inform policy, legislation, Government programs and

strategic and economic priorities.

d) Flexibilities in contractual and administrative arrangements to support projects.

SOURCE: SARDI REVIEW TERMS OF REFERENCE


1.3 Approach

Based on the terms of reference (Box 1 above) the Review considered three dimensions:

— challenges and opportunities in SARDI’s operating environment that it needs to respond to

— strategic fit of SARDI’s business model with the changing operating environment (TOR 1)

— suitability and potential improvements to key elements that enable the business model:

― funding sources, including non-traditional sources (TOR 2) ― key future relationships, including commercialisation, connector and collaboration (TOR 3) ― organisational structures and how it compares to those with greater private funding (TOR 4).

Key SARDI, PIRSA and other documentation from six comparable organisations in Australia and overseas were reviewed against these dimensions. The Review interviewed 31 stakeholders and received 22 (from 83 invited) submissions. The Review was informed by a Working Group chaired by PIRSA which provided feedback on the approach, stakeholder consultation findings and draft report.

1.4 This report

The report is structured as follows:

— Chapter 1: Review context, purpose and approach (this Chapter)

— Chapter 2: Overview of SARDI’s current arrangements and capability

— Chapter 3: Assessment of SARDI’s alignment against the Review objectives

— Chapter 4: Lessons from the comparator organisation case studies

— Chapter 5: Conclusion and improvement opportunities

— Appendix A: Summary of SARDI staffing

— Appendix B: Summary of SARDI infrastructure

— Appendix C: Case studies on comparable organisations

— Appendix D: Stakeholders consulted

— Appendix E: Summary of stakeholder submissions


2 A B O U T S A R D I ( C U R R E N T A R R A N G E M E N T S A N D C A P A B I L I T Y )

2 About SARDI (cur rent arrangements and capability)

2.1 Business model

2.1.1 Mandate and mission

SARDI was established in 1992, and is a division of Primary Industries and Regions SA (PIRSA), an economic agency of the South Australian Government. The role of SARDI within PIRSA is to:

Deliver robust products and solutions for primary industries. To this end SARDI’s scientific programs

create opportunities for market growth while increasing the productivity, sustainability and adaptability of

our agriculture, food and wine industry partners. SARDI’s R&D outputs are targeted at providing applied

solutions to our industry partners.

Consequently, SARDI’s strategic, applied and adaptive research provides the innovation needed to

underpin the competitive advantage achieved through the production of premium food and wine through

secure and sustainable production systems.

SARDI Divisional Plan, July 2015 - June 2016

As part of PIRSA, SARDI is guided by the South Australian Government’s overarching strategic and economic priorities for the public sector (see Table 2.1 below).

TABLE 2.1 SA GOVERNMENT’S KEY PRIORITIES FOR THE PUBLIC SECTOR

State Priorities Economic Priorities

– Premium food and wine

from our clean

environment

– Growing advanced

manufacturing

– Realising the benefits of

the mining boom for all

South Australians

– Safe communities,

healthy neighbourhoods

– Creating a vibrant city

– An affordable place to

live

– Every chance for every

child

1. Unlocking the full potential of South Australia’s resources, energy and

renewable assets

2. Premium food and wine produced in our clean environment and exported to

the world

3. A globally recognised leader in health research, ageing and related services

and products

4. The knowledge state—where international students are attracted to our

educational opportunities and we commercialise our research

5. South Australia—a growing destination of choice for international and

domestic travellers

6. Growth through innovation

7. South Australia—the best place to do business

8. Adelaide, the heart of the vibrant state

9. Promoting South Australia’s international connections and engagement

10. South Australia’s small businesses have access to capital and global markets

SOURCE: SARDI DIVISIONAL PLAN JULY 2015 - JUNE 2016


2.1.2 Research model

SARDI provides services to all of the major primary industries in South Australia. Its key functions as outlined in its Divisional Plan are:

— to help position South Australia as internationally competitive in primary industries and environmental related biosciences, through applied research delivering:

― technical solutions to address relevant industry issues ― developed knowledge in new products, processes and technologies that deliver solutions to SA

primary industries, food and agribusiness sectors

— to provide leadership to South Australian industry, investors and other stakeholders by:

― influencing the South Australian and national innovation, science and technology policy and strategy agenda

― matching scientific advances and industry opportunity, realigning its capabilities and facilities to ensure South Australia remains internationally competitive in the areas of primary industries and environmental sciences

— to deliver scientific and technical inputs into the South Australian Government’s and Primary Industries and Regions policy development and programs by:

― providing knowledge and innovation required to inform policy development and underpin regulation ― securing food production through the sustainable utilisation of natural resources and providing

adaptive solutions to climate variability and change.

SARDI’s planning framework is outlined in its Divisional Plan July 2015–June 2016. SARDI’s corporate plan is developed with consideration for:

— national and state legislation

— the South Australian Strategic Plan

— the South Australian Government’s plans, policies and priorities

— national and international agreements, including the National Primary Industries RD&E Framework

— PIRSA’s risk management framework

— industry and community perspectives

— global market trends.

The corporate plan feeds into divisional business plans, and further into project plans and individual performance plans.

SARDI’s services are predominantly focused around on-farm production although whole of value chain services are also significant. Post-farmgate services are a small part of SARDI’s activities, centred on market access issues.

SARDI’s research model comprises three research divisions: Aquatic Sciences, Livestock and Farming Systems, Sustainable Systems.

Aquatic Sciences

The focus of the Aquatic Sciences division is to:

— support ecologically sustainable management of fisheries resources and aquatic environment

— underpin sustainable growth of aquaculture industries.

The division includes four programs: Aquaculture; Marine Ecosystems; Inland Waters and Catchment Ecology; and Fisheries.

Livestock and Farming Systems

The focus of the Livestock and Farming Systems division is to:

— conduct research and development to improve the credence, quality, safety and economic output of livestock, grain and food products.

The division includes four science programs: Farming Systems; Food Safety and Innovation; Livestock Innovation and Welfare; and Pigs and Poultry.


Sustainable Systems

The focus of the Sustainable Systems division is three-fold:

— research for the grains, wine and horticulture industries

— technical (including diagnostic) advancements to underpin plant biosecurity research

— research which underpins independent advice to inform government policy—water, climate and biosecurity.

The division includes seven programs: Climate Applications; Water Resources, Irrigated Agriculture & Crops; New Variety Agronomy; Entomology; Plant Health and Biosecurity; and Soil Biology & Diagnostics.

2.1.3 Policy advice

SARDI’s policy advice functions include influencing the innovation, science and technology agenda and providing the knowledge and innovation to inform policy development. The functions are fulfilled through SARDI’s interactions with PIRSA, participation in state, national and international committees and its research projects.

2.1.4 Commercialisation

SARDI provides commercialisation through diagnostic services, aquaculture production and third party royalties (predominantly for Plant Breeders Rights). The total net value of royalties was approximately $1.2 million in 2015/16. Intellectual property is managed through up and downstream agreements, under the South Australian Government’s Intellectual Property Policy (2006).

2.2 Funding

SARDI receives approximately $60 million of funding per annum from a number of sources (Figure 2.1).

FIGURE 2.1 SARDI FUNDING 2006/07 TO 2015/16

SOURCE: SARDI

$-

$10

$20

$30

$40

$50

$60

$70

Mill

ions

Infrastructure Income State Allocation

PIRSA Cost Recovery R&D Funding

Royalties Diagnostic & Consultancy Services


SARDI receives an annual State Allocation as well as PIRSA funding to deliver specified functions

funded on a cost recovery basis through Service Level Agreements. Over the past decade SARDI’s

State Allocations have declined and are currently 33 per cent less than the ten-year average. This has

been offset by a 12 per cent increase in PIRSA Service Level Agreements and 18 per cent increase in

R&D funding from numerous other organisations. SARDI is also funded through Diagnostic and

Consultancy Services (15 per cent reduction on the ten-year average), royalties (56 per cent increase

on the ten-year average) and infrastructure income (19 per cent reduction on the ten-year average).

The latter includes both research farms income and infrastructure cost recovery.

Since 2006/07 core income (State Allocation, PIRSA Cost Recovery and Infrastructure) has declined

from 47 to 23 per cent of total annual funding. The net result is that SARDI has become increasingly

reliant on external funding to maintain its total funding level and retain the capability developed.

TABLE 2.2 SARDI FUNDING 2006/07 TO 2015/16

Year Infrastructure State Allocation PIRSA Cost

Recovery a

R&D Funding Royalties Diagnostics/

Consultancy

2006/07 $3,691,843 $19,183,768 $4,740,858 $24,947,997 $ 784,794 $5,425,708

2007/08 $4,452,110 $23,417,410 $4,703,840 $23,752,103 $ 768,895 $4,943,891

2008/09 $4,221,316 $21,697,937 $5,238,174 $27,097,623 $ 594,311 $6,823,108

2009/10 $5,225,296 $19,429,156 $5,364,863 $26,739,823 $ 564,182 $4,877,414

2010/11 $3,700,578 $17,615,007 $5,508,928 $24,169,690 $ 928,674 $6,684,342

2011/12 $3,350,042 $17,802,731 $5,922,037 $27,888,968 $1,134,120 $5,010,836

2012/13 $3,367,016 $17,538,024 $5,580,343 $25,555,148 $1,333,760 $5,518,988

2013/14 $3,869,686 $10,985,594 $5,700,018 $32,122,842 $1,130,195 $5,782,838

2014/15 $3,905,365 $12,458,435 $5,680,080 $32,359,478 $1,693,490 $4,709,098

2015/16 $3,311,585 $11,425,852 $6,109,169 $32,706,501 $1,649,750 $4,384,625

Changeb -15% -33% 12% 18% 56% -19%

a PIRSA cost recovery encompasses payments made by PIRSA to SARDI for provision of agreed services

b 2015/16 funding as a proportion of average annual funding over the last decade

SOURCE: SARDI

This trend places pressure on SARDI’s strategy in two ways. Firstly SARDI has limited discretion to

pursue emerging priorities given over 90 per cent of current expenditure is non-discretionary once

base costs, matching contributions and the external funding is accounted for. Secondly SARDI needs

to secure significant external funding each year simply to maintain current expenditure and capability.

The result is that SARDI must continually manage the risk of a “means end inversion” where funding

pressures drives tactical opportunism rather than strategic approach which is moderated by the

priorities and risk appetite of its external funders, including PIRSA, and available discretionary funding.

2.3 Key relationships

SARDI is one of 9 divisions within PIRSA (Figure 2.2). Operationally SARDI has strategic and operational linkages to the Fisheries & Aquaculture, Biosecurity SA and Agriculture Food & Wine divisions. SARDI is contracted to provide a number of regulatory and non-regulatory functions through the cost recovery based Service Level Agreements. SARDI also works with Rural Solutions SA, which provides one of the extension channels available to South Australian industry, and the Corporate Services and Strategy & Engagement divisions on planning, reporting and administrative services.


FIGURE 2.2 PIRSA ORGANISATIONAL STRUCTURE

SOURCE: PIRSA JULY 2016

Externally SARDI’s key relationships revolve around three key groupings (Figure 2.3). There is a strong cluster of research organisations which have a primary industries focus and are based in South Australia. The cluster is centred on the University of Adelaide’s Waite Campus where SARDI’s head office is located along with CSIRO and organisations such as AWRI and Food SA. The cluster also includes the wider network of South Australian based research organisations (e.g. Flinders University, University of SA, Wine Australia) and locations such as Roseworthy, West Beach and other regional SARDI facilities. The concentration of research capability is a valuable resource to primary industries research for South Australia and the nation, while allowing the organisations to realise the benefits of collaboration and specialisation by being located closely to each other.

FIGURE 2.3 SARDI RELATIONSHIP GROUPINGS


More broadly within South Australia, SARDI’s key relationships are defined through strategic initiatives addressing priorities within the State. These are broadly captured under the South Australian economic priorities, as well as key national initiatives such as the Murray Darling Basin Plan and Inter-Governmental Agreement on Biosecurity, and relate to sustainable natural resource management/ development and industry development through value adding, premium food, market access and other initiatives. SARDI’s role in these areas is extending beyond providing research to inform policies and develop technologies and practices to being a broker of partnerships across all the dimensions involved.

The final grouping relates to the network of national and international organisations involved in primary industries, natural resource management and food industry development research that SARDI needs to collaborate and coordinate with to secure additional funding and deliver its services. Over the past decade the National Primary Industries Research Development and Extension Framework has

Chief Executive

Deputy Chief Executive

Corporate Services

Regions SARural Solutions

SAStrategy &

Engagement

Deputy Chief Executive

ForestryFisheries &

AquacultureBiosecurity SA

Agriculture,Food & Wine

SARDI

SA Strategic Initiatives

SA Primary Industries Research Cluster

(Inter) National Research Network


become a critical structure for public organisations and industry to coordinate their efforts. In addition SARDI also maintains strategic relationships with key rural Research and Development Corporations such as Grains Research Development Corporation (GRDC) and Fisheries Research and Development Corporation (FRDC) which provide significant funding. CRCs are also important to SARDI and South Australia providing the coordination and additional funding to target key priorities.

The Framework has been instrumental in transforming primary industries RD&E for the South Australian and other state governments in Australia. Through a collaborative process the South Australian Government (via SARDI) has worked with other governments, universities, RDCs and national industry bodies to develop RD&E strategies for the major sectors and cross sectors that have been formally approved by all these stakeholders. The Framework and Strategies have allowed SARDI to transition from needing to fully cover all primary industries RD&E to specialising in areas of greatest priority and capability. In turn, South Australia benefits from other stakeholders conducting RD&E important to South Australia and SARDI improving its economies of scales by conducting research which is applicable to Australia as well as South Australia.

These relationships involve membership of 69 PIRSA, South Australian and key national Boards and Committees alone (Figure 2.4 overleaf) and extend to some 465 public and private sector relationships in South Australia, the rest of the nation and overseas (Table 2.3 below). While the majority of funders are based in South Australia and the private sector, the public sector is the largest source of funding. Funding from outside South Australia is also significant. This is discussed further in Chapter 3. SARDI maintains an extensive network of 230 non-financial collaborations and has 46 single and multi-party collaboration agreements.

TABLE 2.3 SARDI RELATIONSHIPS

Type South Australia Australia Overseas Total

Funders 77 39 4 120

Private 50 11 2 63

Public 27 28 2 57

Non-financial collaborators 74 99 57 230

Private 55 30 8 93

Public 19 69 49 137

Boards/Committees 35 33 1 69

Private 1 2 0 3

Public 34 31 1 66

Collaboration agreements 20 16 10 46

Private 9 3 1 13

Public 11 13 9 33

Total 206 187 72 465

SOURCE: SARDI


TABLE 2.4 KEY SOUTH AUSTRALIAN AND NATIONAL BOARDS AND COMMITTEE MEMBERSHIPS

National South Australia

Agricultural Biotechnology Council of Australia Animal Welfare Advisory Committee

AGT Pty Ltd ASBTIA/FRDC Research Council

Animal Welfare Science Centre AW Howard Trust

Australian Pork Research Institute Ltd Eyre Peninsula Agricultural Research Foundation (EPARF) Board

AW Howard Trust Great Australian Bight Research Program Management Committee

Great Australian Bight Research Program Management Committee Government Working Group on Long-nosed Fur Seals in the

Coorong, Lower Lakes and Murray Mouth area

Integrated Marine Observing System Board Goyder Institute for Water Research Advisory Committee

National Grains National Grains RD&E Strategy Implementation

Committee

JS Davies Committee (University of Adelaide)

National Animal Welfare RD&E Strategy MISA Research Advisory Committee

National Beef RD&E Strategy (RMCIC) MISA Steering Committee

National Biosecurity RD&E Strategy NRM Research and Innovation Network

National Climate Change Research Strategy (CCRSPI) One PIRSA Livestock Network Group

National Dairy RD&E Strategy PIRSA Animal Ethics Committee

National Fishing & Aquaculture RD&E Strategy Research Providers'

Network

Roseworthy Piggery Pty Ltd Board

National Horticultural Research Network (NHRN) SA Advisory Board of Agriculture

National Marine Science Committee SA Aquatic Biosecurity Centre Management Committee

National Plant Biosecurity CRC (PBCRC) Participants Committee SA Dairy Industry Development Board

National Pork RD&E Strategy SA Fisheries and Aquaculture Research Advisory Committee

National Poultry RD&E Strategy SA Food Innovation Centre

National Sheep Meat (RMCIC) SARDI DPI Vic Aquatic Science Alliance Board (South Eastern

Australia Aquatic Sciences)

National Soils RD&E Strategy South Australian Animal Ethics Chairs and Executive Officers

Committee

National Food & Nutrition Strategy Steering Committee Southern Australian Meat Research Council

National Water Use in Agriculture (WUiA) RD&E Strategy Spencer Gulf Ecosystem Development Initiative Board

Pork CRC R&D Committee State Biosecurity Committee

Red Meat Co-Investment Committee Sterile Insect Technology (SIT) Plus Steering Committee

South Australian Meat Research Committee Waite Strategic Leadership Group

Wine Innovation Cluster (WIC) Leadership Group

SOURCE: SARDI

2.4 Organisational structure

SARDI’s organisational structure includes its three research divisions and a business support division, which report to the Executive Director (Figure 2.4 overleaf). SARDI currently employs 318 FTE staff located at Waite, West Beach, Roseworthy and numerous locations across South Australia. The Sustainable Systems and Business Support divisions are headquartered at Waite, while the Aquatic Sciences and Livestock & Farming Systems are headquartered at West Beach and Roseworthy respectively. SARDI has a number of specialist research facilities and field equipment (including a research vessel) at these locations. Together they provide 10 delivery platforms through which SARDI delivers its services:

— Animal Welfare

— Aquaculture

— Cropping Systems

— Fisheries

— Food Safety & New Products


— Marine Ecosystems

— Molecular Diagnostics

— Pigs & Poultry

— Plant Health & Biosecurity

— Water Resource Utilisation

The Business Support division is responsible for corporate services and facilities management, contracts and marketing and communications.

FIGURE 2.4 SARDI ORGANISATIONAL STRUCTURE

SOURCE: SARDI DIVISIONAL PLAN JULY 2015 - JUNE 2016

Executive Director

Research Chief Aquatic Sciences

Aquaculture

Marine Ecosystems

Inland Waters & Catchment

Ecology

Fisheries

Research Chief Livestock &

Farming Systems

Livestock Innovation &

Welfare

Pigs & Poultry

Farming Systems

Food Safety & Innovation

Research Chief Sustainable

Systems

Climate Applications

Water Resources, Viticulture &

Irrigated Crops

Crop Improvement

New Variety Agronomy

Entomology

Plant Health & Biosecurity

Soil Biology & Diagnostics

General Manager Business Support

Research Infrastructure

Farm Network

Marketing & Communications

Corporate Services

Contracts Unit

Executive Project Officer

Director, Science Partnerships


3 A L I G N M E N T A G A I N S T O B J E C T I V E S ( P E R F O R M A N C E A S S E S S M E N T A N D G A P A N A L Y S I S )

3 Alignment against objective s (performance assessment and gap analysis)

3.1 State economic priorities

Primary industries, and increasingly food, are important industries to South Australia generating significant economic value, exports and employment from 13,000 primary producers, 1,500 manufacturers and 720 wineries (PIRSA, 2016). The challenge set for SARDI by the State Economic Priorities is to conduct applied research which will both contribute to increased sustainable production and increase the premium received at the farmgate and up the value chain within South Australia for existing and emerging industries (Table 3.1).

TABLE 3.1 PRIMARY INDUSTRIES AND FOOD SNAPSHOT

2014-2015

($ million)

Farmgate Finished

value

Commodity

exports

Finished

exports

Total

exports

Net

interstate

trade

Retail and

service

sales

Gross

food

revenue

Livestock 1,751 3,447 69 1,369 1,438 1,191 2,895 5,523

Field Crops 1,636 1,080 1,902 123 2,024 452 2,114 4,590

Horticulture 999 1,499 0 225 225 756 2,094 3,075

Seafood 394 481 0 245 245 138 493 876

Other 0 136 0 72 72 60 2,211 2,343

Total food 4,779 6,644 1,971 2,033 4,004 2,596 9,807 16,407

Grapes and

wine

470 1,592 0 1,216 1,216 14 559 1,789

Total food

and wine

5,249 8,236 1,971 3,249 5,220 2,610 10,366 18,196

Notes:

Farmgate: the value of a commodity at the local level of production. Calculated by multiplying the volume of production by the price received.

Finished value: the value of foods and beverages processed at their highest level of processing in South Australia. Represented by their wholesale price into the

retail or export markets.

Exports (commodity and finished): the value of overseas exports of food commodities and products sold overseas by South Australian firms. Calculated by using

free on board prices.

Net interstate trade: the difference in the value of goods exported interstate from those imported from interstate. A positive value represents net interstate

exports.

Retail and service sales: the value of food sales made through all retail stores and restaurants, hotels and other service operations in South Australia.

Gross revenue: sum of exports, net interstate trade and retail and service sales.

SOURCE: SARDI, PIRSA, ABS, ABARES


3.2 Which industries and parts of the value chain does SARDI focus on?

In addressing this challenge SARDI must decide on which industries and where in the value chain it can accelerate their development to achieve the State Economic Priorities.

This essentially comes down to where South Australia has potential to sustain and build competitive industries grounded in the resources where it has comparative advantage. The economic snapshots show that in gross food value terms (Figure 3.1A) South Australia has a number of well-established industries that have limited prospects to expand the area under primary production given the resource base is mostly allocated. Therefore unless additional resources are allocated (e.g. water resources for horticulture and aquaculture), expansion will rely on productivity gains, switching to higher value primary production or post-farmgate value adding. In all industries the efficient and sustainable use and management of the natural resource base and biosecurity is paramount. Consequently a key focus is on sustainably increasing the farmgate multiplier (Figure 3.1A), exports and proportion of value adding undertaken in South Australia (Figure 3.1B). The challenges and opportunities associated in addressing these priorities differ across each industry. So to be successful SARDI must have the capability to identify both what research is needed and how this will accelerate realisation of the state priorities rather than maintain the status quo.

FIGURE 3.1 FARMGATE MULTIPLIERS AND FINISHED VALUE OF KEY SOUTH AUSTRALIAN INDUSTRIES

A. South Australia’s farmgate value and gross food revenue ($ billion 2014/15) B. South Australia’s food markets (per cent gross food revenue 2014/15)

Note: the farmgate multiplier for Other is zero because it represents the value of food sales made through all retail stores and restaurants, hotels and other service operations in South Australia and some exports.

SOURCE: ACIL ALLEN CONSULTING ANALYSIS OF PIRSA, SARDI, ABS AND ABARES ECONOMIC SNAPSHOT DATA

SARDI’s current focus is not completely aligned with the current value of the major South Australian industries and is concentrated on sustainable primary production (see Figure 3.2 overleaf).

Figure 3.2A overleaf highlights that SARDI is predominantly a pre-farmgate organisation with 79 per cent of its expenditure focused on pre-farmgate sustainable production, including water and soil. Furthermore much of its post-farmgate investment is focused on systems food safety, supply chain integrity and market access research. While important, this is only part of the wider research, development, marketing and policy agenda to increase post farmgate value adding.

2.2

3.8

0.0

3.12.8

3.2

$0

$1

$2

$3

$4

$5

$6

Farm gate Gross food

Food/farmgate multiplier

55%

89%

6%

49%

67%

25%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Retail and service sales

Net interstate trade

Total exports

Finished (in SA) value (% gross food value)


FIGURE 3.2 SARDI INDUSTRY AND VALUE CHAIN FOCUS (2015/16)

A. SARDI value chain focus (2015/16 project budgets) B. SARDI sectoral focus (2015/16 project budgets)

Notes:

Whole value chain is for projects that cover the whole value chain, including areas such as supply chain integrity and traceability

Sustainable production includes water and soil

In Figure 3.2B projects related to water resources and management have been proportionally allocated to each industry


While SARDI’s industry focus (Figure 3.2B) may seem to be misaligned with the economic value of South Australia’s industries at first glance (Figure 3.1A) it actually represents a deliberate strategy of coordinated RD&E specialisation and SARDI’s broader regulatory and public good roles (e.g. fisheries stock assessments, biosecurity, animal welfare and water resources). The result is that SARDI provides different services at differing levels to each industry and works with others to coordinate all services to industries.

Since 1992, SARDI has been progressively specialising in line with South Australia’s industry’s comparative advantage and SARDI’s own research comparative advantage as well as the priorities and policies of the South Australian Government, national industries and the Commonwealth Government. Over the last decade this has been driven by the National Primary Industries RD&E Framework and where SARDI’s role and effort has been nationally agreed to by industry and governments through the cross sectoral and sectoral strategies. While the move from a full service to a more targeted organisation is considered to be positive, it does mean that SARDI has an uneven distribution of both investment and capability. A finer scale industry breakdown of SARDI’s current focus is shown in Figure 3.3 below.

$45.4

$0.2 $0.001 $1.9

$10.2

$-

$10

$20

$30

$40

$50

Mill

ions

$18.7

$2.74 $2.8 $3.3

$25.8

$4.4

$-

$5

$10

$15

$20

$25

$30

Mill

ion

s


FIGURE 3.3 SARDI INDUSTRY FOCUS 2015/16

Notes:

Based on the primary and secondary focus industry for SARDI projects.


The impact of specialisation is highlighted in water and four key industries where South Australia has comparative advantage: grains, livestock, seafood and grapes and wine.

From a natural resources perspective South Australia is constrained by water rather than land. As such much of SARDI’s water R&D is focused on water use efficiency, especially in horticulture as well as sustainable natural resource management.

Grains and livestock are the largest South Australian industries and serviced through a national research network within which SARDI provides significant specialist services for South Australia and nationally. It is the network rather than SARDI alone that provides RD&E to develop the South Australian industry. Fisheries and aquaculture are also significant for South Australia and SARDI. While it operates under a similar national RD&E network to grains and livestock, SARDI offers more than RD&E to fisheries and aquaculture. SARDI is actively involved in providing regulatory services (i.e. stock assessments) in South Australia for PIRSA, the Commonwealth and previously in Victoria.

For grape and wine, RD&E is coordinated through the Wine Innovation Cluster involving AWRI, Wine Australia, CSIRO and others. Again it is the cluster that supports industry development and the networked approach has allowed SARDI to specialise in viticulture.

The network approach is similar across all of the industries in Figure 3.3, resulting in SARDI being actively involved in the National Rural RD&E sectoral and cross sectoral Strategies and other national and state committees. Through these, it has identified on which industries and research specialisations it will focus, animal welfare being an example. However, these activities are at different stages of maturity, have had varying levels of success, and are not necessarily positioning SARDI strategically or focusing RD&E within South Australia.

For example, in horticulture it is critical to develop proposals with industry in the first instance to secure funding through Horticulture Innovation Australia. The national cross sectoral strategies, such as food and water, have struggled to develop beyond information sharing networks. For water research, RD&E coordination happens more through state and national based water resource planning.

Overall the process of progressive specialisation has allowed SARDI to develop critical mass in some key areas and establish a series of specialist niches. The result is that South Australian industries rely on the national network under Primary Industries RD&E Framework to provide the range of services to address industry priorities. There is a degree of opaqueness around these networks in terms of understanding who provides what and how they can be engaged. This makes it difficult for SARDI, PIRSA, the SA Government, industry and others to understand where capabilities lie to address South Australia’s priorities and how they can be harnessed.

$0.02$0.1 $0.3 $0.5 $0.8 $0.9 $1.4 $2.2 $2.5 $2.6 $2.9$5.0 $5.8

$11.9

$21.1

$-

$5

$10

$15

$20

$25

Mill

ions


Just as importantly, SARDI is strongly focused on pre-farmgate RD&E for which it is highly valued. If South Australian industries are to “move up the value chain” to achieve the State Economic Priorities, the strategic choice lies around whether SARDI or others should evolve (and are funded) to develop the services, capabilities, funding and processes to do so.

3.3 What services does SARDI provide

There are asymmetry challenges for SARDI based on the type of services it is funded to provide. For the purposes of the Review each of SARDI’s projects were categorised by the services which deliver on its divisional plan: research, policy advice and regulation – see Table 3.2 and Figure 3.4 overleaf).

Public and private research have been categorised separately to reflect their different foci and establish how much commercial income (outside of Commercialising RD&E) SARDI receives.

Australia has a mature and sophisticated system for funding public research which accounts for 64 per cent of SARDI’s funding. In 2015/16 SARDI delivered 202 public research projects with an average annual value of $182,577. The system is primarily focused on sustainable pre-farmgate production and resource sustainability research, as well as industry integrity, and is funded by industry levies and governments. These funds are critical to sustaining the public good focus of SARDI. Stakeholder views around SARDI’s public research were relatively consistent. They see pre-farmgate, natural resource management and industry integrity (biosecurity and food safety) RD&E as being core SARDI business that should be sustained. Indeed there is considerable interest, especially amongst industry, in SARDI increasing the level of service and making sure its research is relevant and can be readily adopted. They also expressed concern on whether SARDI has the depth of capability to sustain the service and manage succession if key staff should leave.

TABLE 3.2 SARDI SERVICE DEFINITIONS

Service Description

Policy advice Providing research based evidence to inform government policies

Regulation Natural resource condition assessment and stewardship regulation

Industry integrity Research and response capability for biosecurity, food safety and other matters

Private

Research

Industry funded to improve individual businesses (including fee for service testing)

Public Research Public funding (including RDCs) to improve the productivity and sustainability of primary

industries as a whole



FIGURE 3.3 SARDI SERVICE FOCUS 2015/16

NOTE: Policy advice is also funded through the state allocation which is distributed across the other categories. Financial information available does not indicate what proportion of funding is dedicated to policy advice for these categories.

SOURCE: SARDI PROJECT RECORDS

Private research only accounts for 4 per cent of SARDI’s funding. In 2015/16, SARDI delivered 56 privately funded projects with an average annual value of $41,161. The category includes fee for service testing, various industry groups and the private funding component of the Great Australian Bight (GAB) Research Program. SARDI co-invests in the GAB Research Program through its State Allocation to reflect the public good and strategic research outcomes.

Stakeholder views around private research are mixed. They understand the commercial importance of private research to SARDI’s bottom line and a means to establish new partnerships, particularly in post-farmgate RD&E. However, some expressed concern that private research (and regulation) may distract SARDI from its core public research. The submissions from DEWNR and MDBA highlight that SARDI delivers important public good research relating to the environment which should not be lost at the expense of pursuing private research. The industry body submissions note that SARDI has an important role in providing core pre-farmgate research and industry integrity (biosecurity and food safety) that should be funded by government and (existing) industry levies. Concerns were raised that private research will result in greater fee for services and levies if existing government and levy funds are reallocated or even decline. As a counterbalance, the research organisations noted the importance of private research to diversifying income and establishing stronger partnerships with SARDI provided it is targeted and consistent with competition principles. These tensions were reflected in stakeholder interviews as well as in the Flinders University submission around the GAB Research Program, which is variously seen as an important synergistic opportunity or an unnecessary distraction from core business.

SARDI also has a regulatory role in relation to natural resource condition assessment and stewardship (particularly in fisheries, aquaculture and the aquatic environments) and biosecurity which are defined in the cost recovered Service Level Agreements. In 2015/16 SARDI delivered 52 projects with an average annual value of $211,780, accounting for 19 per cent of expenditure. Generally stakeholders regard this as an important and strategic synergy that creates economies of scale and scope by deploying the same delivery platform for the two services. However, the fishing industry consultations and submissions identified that the fisheries industry bodies have concerns around fisheries research and regulation. This in part stems from the Service Level Agreements being partially funded by levies imposed on these industries, and was the reason given for the sector’s interest in improving the cost-effectiveness of services being delivered through greater transparency and engagement; cost benchmarking; efficiency gains; and competitive tendering. A number of research organisation submissions also raised the question of whether SARDI is sufficiently cost competitive to attract private investment.

The comparatively small allocation of project investment to policy advice suggests that few projects have this as their primary goal and that SARDI is reliant on the remaining projects to develop and

$1.4 $2.3

$6.3

$11.0

$36.9

0

50

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provide the policy evidence required, which may involve investigating areas where neither the information nor resources are readily available. The latter is the most important given SARDI must have a degree of adaptive capability to provide policy advice as required.

3.4 What capabilities does SARDI hold

SARDI has 10 research delivery platforms which consist of the human capability and infrastructure distributed across SARDI, the divisions, sites and programs. Figure 3.4 shows their current utilisation based on 2015/16 project expenditure.

FIGURE 3.4 SARDI RESEARCH DELIVERY PLATFORMS (PROJECT EXPENDITURE 2015/16)

Note:

Other includes projects which could not be assigned to a specific platform.


These platforms reflect SARDI’s strong pre-farmgate focus and a critical question is to what degree do they provide opportunities or constraints to achieving the State Economic Priorities? Stakeholders agree SARDI has the capability to conduct applied research that benefits pre-farmgate production, sustainable resource management and industry integrity.

While the pathway for targeting and expanding the capability pre-farmgate is relatively straight forward, the degree to which it can be deployed post-farmgate is unclear. In the pre-farmgate arena SARDI is established and well connected to the networks which collectively provide the research to adapt its capability and focus. The challenges lie firstly in the costs of maintaining and aligning what are essentially a series of networks, and then deciding which priorities and capabilities should be maintained and developed overall in agreement with stakeholders. While the submissions highlight some areas for improvement as well as frustrations around particular priorities and capability not being met, they largely report this as an area where SARDI performs well.

How SARDI can best deploy capability post-farmgate—beyond the supply chain integrity—is less clear. Stakeholders are keen for SARDI to sustain its biosecurity and food safety capabilities which are important to supply chain integrity and market access. However, RDCs, SARDI’s largest funding source, are less willing to fund post-farmgate research beyond supply chain integrity. At the same time, while SARDI has some well recognised niche expertise, such as using analytical capability to progress functional foods, much of the post-farmgate agenda requires capability that SARDI does not hold, including commercial development, market analysis and finance. The submissions also highlight that stakeholders are looking to SARDI to act as a broker of the collaborative arrangements in this

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area as much as a provider of research itself, and of which they have varying understanding of SARDI’s capability. This highlights that wider post-farmgate deployment of SARDI’s capability is more than participating in various immediate opportunities or mandated initiatives. Rather it is a strategic shift that requires both SARDI and end users to engage in a process to understand what is needed and how SARDI can contribute.

Beyond that stakeholders are satisfied with SARDI’s technical capability and are keen for SARDI to do more. However, there are concerns about the depth of this capability and its adaptability to both sustain what it is presently delivering and to realise new opportunities.

The capability concerns stem primarily from SARDI’s broad portfolio that results in it being reliant on key staff for which there is no readily embedded replacement and aging infrastructure in some key areas. SARDI has a high proportion of staff on contract which increases this risk but stakeholders are expressing interest in increasing joint appointments/sharing staff in addition to continuing joint projects and shared facilities.

In relation to infrastructure, while some is being renewed—such as the laboratory at the Waite Campus—0other key infrastructure such as the West Beach complex, the research vessel, animal facilities at Roseworthy and other research facility all require significant capital expenditure.

3.5 Who funds SARDI

SARDI currently receives funding from 6 types of sources involving more than 120 organisations on top of its state allocation (Figure 3.5). Overall SARDI has the highest external leverage ratio (4:1) of the organisations compared in Chapter 4. While the high level of funding is important to sustaining SARDI’s current capability it does create a number of risks that need to be carefully managed.

Firstly, around half of SARDI’s funding comes from organisations not based in South Australia and 39 per cent is funded by Rural Research and Development Corporations which operate with a national focus. This creates a potential means-end inversion risk where SARDI delivers effectively on important national and other priorities but does not fully optimise its role in delivering on South Australia’s priorities.

This is not to say that national funding sources are not benefitting state needs, as SARDI is involved in extensive partnership agreements, contract negotiations, committee structures and various strategies to ensure South Australian priorities are addressed by SARDI or others through the external funding provided. It is, however, unclear whether greater state benefit could be realised. This is due to in part to the broad nature of SARDI’s own strategy and the financial imperative to secure external funding to maintain capability. While SARDI is successful in sustaining its revenue base to provide valued services that benefit both South Australia and the nation, what is lacking is a strategy that outlines how SARDI will contribute to the State Economic Priorities over a 5-10 year period in collaboration with PIRSA and others. This is a critical missing element in SARDI’s strategic framework for driving decision making.

The second key factor is that industry funding generally has higher transaction costs, driven by the larger number of projects and relatively smaller total funding (especially if the Great Australian Bight Research Program is excluded). This in turn limits the attractiveness of pursuing industry funds when public sources are more readily secured.

PIRSA and other South Australian Government funding (excluding SARDI’s own state allocation) collectively provide 18 per cent of SARDI’s funding, this directed at state priorities.


FIGURE 3.5 SARDI FUNDING SOURCES

Notes:

SA Govt includes all South Australian Government Department other than PIRSA and SARDI’s State Allocation

PIRSA includes the Service Level Agreements and other project funding

Other Govt includes funding received from Commonwealth and State and Territory Departments (other than South Australia)

Public Res Org includes universities, CSIRO and CRCs

Industry includes companies in the value chain, not for profit organisations, private Trusts and Funds, consultants, industry associations and farmer groups

State Allocation includes the SARDI division and overall overhead funding

RDC includes all funding provided directly by Rural Research and Development Corporations.


In terms of access to additional and “non-traditional” funding, the broad options for SARDI are:

— existing sources for additional services

— new sources for existing services

— new sources for new services.

There is certainly potential to increase funding from the national public primary industries R&D funding sources managed by the RDCs. This requires a targeted approach of identifying a need aligned with SARDI’s capabilities and industry priorities, an area where SARDI is currently performing strongly. For example SARDI has been successful in increasing its funding for animal welfare from RDCs. However, growth will be limited by the current strong pre-farmgate focus and a degree of “sharing the funding around” on the basis of equity and risk management.

The current high level of public funding provided to SARDI and others for existing services renders gaining increases and/or new sources here challenging as there is an expectation that many services have already been paid for by industry levies or government funding. Again this requires a targeted approach to differentiate the additional request from existing funding and services, such as occurred with the GAB Research Program.

Gaining new sources for new services is even more challenging, as it will most likely involve value adding post-farmgate services, where SARDI does not currently have a full capability offering. In these cases, whether it be to industry or new initiatives, SARDI faces considerable costs and effort to identify the opportunity, assemble the consortia to secure the funds and develop the capability to deliver the service.

In all these cases, a critical consideration for SARDI is the degree to which it can free up its own State Allocation (and capability) to pursue such opportunities. The potential here is currently limited given the State Allocation has been declining (Table 2.2) and only a third is “available” given $3.6 million is allocated to group overheads, research farms and research infrastructure (Figure 3.6 overleaf). On top of that much of the remaining $7.1 million of the State Allocation is committed to joint programs with SARDI’s external funders.

Therefore, to access new funding, particularly in areas where SARDI has limited involvement but needs to pursue new value adding services, there will be a need to either reallocate funding or find

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efficiency gains to do so. Both are challenging if the State Allocations continue to decline and reduced service levels cannot be agreed with stakeholders.

This is not to say that SARDI should not pursue such opportunities. Rather that it must be part of a deliberative and appropriately resourced strategy. For example, royalties are partially allocated back to the science programs which generate the royalties but there may be some capacity for them to fund new areas of work, using appropriate investment criteria

FIGURE 3.6 SARDI EXPENDITURE ALLOCATIONS 2015/16

SOURCE: SARDI FINANCIAL RECORDS

3.6 Commercialisation

Commercialisation is a term that is applied in many contexts and can have many interpretations. Here it is taken to mean the introduction of a new product or production method into commerce, such as SARDI’s development of plant varieties and provision of diagnostic services. The current extent of commercialisation of SARDI research is provided in Figure 3.7.

Commercialisation is both a way for SARDI to accelerate industry development and increase its own revenue. The former is about SARDI partnering to or licencing its IP to develop a product/service which is then sold to users. The advantage of such an approach is to avoid the need to hold all the capability, manage risk and reduce the time before benefits are realised. Given the high costs involved and relatively small size of the South Australian market, commercialisation often needs to occur at a national or international scale. The latter involves SARDI increasing its own revenue through commercialisation licence fees or providing products/service for a fee itself.

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FIGURE 3.7 SARDI RESEARCH TYPE FOCUS 205/16

Notes:

Extension funding is provided from non-PIRSA/SARDI sources.

SOURCE: SARDI

Commercialisation in SARDI is largely centred on plant variety royalties (licence fees) and diagnostic services (fee for service). Royalties are mainly related to plant varieties (Table 3.3) where SARDI is the recipient of its proportion of IP or has licenced varieties it has developed (e.g. oats varieties to Heritage Seeds). Diagnostic and Consultancy Services generated $3.9million and $3.3million of income in 2014/15 and 2015/16, respectively.

TABLE 3.3 SARDI ROYALTIES

Royalty 2014/15 2015/16*

Pastures $ 315,571 $ 349,976

Oats - Grain $ 131,999 $ 71,200

Oats - Hay $ 274,039 $ 408,020

Vetch $ 12,913 $ 17,080

Wheat $ 134,259 $ 115,000

Barley $ 338,684 $ 206,100

Pulses $ 118,968 $ 43,000

Other $ 5,097 $ 4,698

Total $ 1,331,530 $ 1,215,074

Note: * Figures for 2015/16 not finalised and indicative only

SOURCE: SARDI

The ability of SARDI to significantly develop additional revenue from commercialisation is dependent on the type of research it does, the amount of potential income and its own capability.

At present SARDI is investing predominantly in applied research. Gaining additional commercial income from this research will require SARDI to:

— secure sufficient rights from the underpinning basic and strategic research

— have an active commercialisation process that identifies opportunities and establishes appropriate partnerships.

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This is a specialist capability that extends well beyond just IP management to include product development, market analysis, finance, partnerships and business cases. While these are available for some of SARDI’s research (e.g. plant varieties) in many areas they need to be developed on a case-by-case basis.

In general terms the structure of SARDI’s portfolio and its strategic focus on the applied end of the research spectrum is such that it will generate research with some commercial potential but high value fundamental breakthroughs are less likely. So while such opportunities are important and must be realised they are unlikely to be a core driver of SARDI or an area where it can hold all the required expertise. Moreover, SARDI does not hold the full commercial rights to all the IP it generates since it is shared with its research collaborators and therefore limits the size of opportunities generated.

There is also demand from some stakeholders for SARDI to increase its investment at the other end of the continuum—that is, to increase its short term impact—which will draw SARDI away from research with commercial potential.

A key issue is whether the potential commercialisation value of SARDI’s portfolio warrants an enduring commercialisation capability or a systematic approach that utilises external expertise. This is a matter for decision within SARDI’s strategic framework, recognising that commercialisation is a means to both increase revenue, and accelerate the rate of gain in line with its strategic goals rather than an end itself.

There is not a clear position on commercialisation, either within SARDI staff or stakeholders. Some question whether it is appropriate for SARDI to receive revenue from commercialisation. This stems from the view that SARDI is funded largely by public money (including industry levies) and therefore should not seek income for a public/industry benefit that has already been paid for. There are also questions around whether SARDI should undertake the commercialisation itself or provide a facilitation or partnering role for third parties to commercialise research for overall state economic benefit. Nonetheless, there is strong imperative for SARDI to attract more external funding from all sources to maintain capabilities in the face of declining State Allocation.

These questions are evident in some key areas of SARDI’s current activity. As an example, SARDI holds a significant grapevine collection that it is in the process of genotyping with CSIRO after which new commercial cultivars will be developed and intended to be commercialised. This will require explicit decisions to be made on how to commercialise the varieties and the pricing. SARDI has also developed a soils test that has widespread applicability but is currently too expensive (despite a subsidy) to drive wide scale adoption.

SARDI is also currently upgrading the soil biology and molecular diagnostic laboratory to reduce the unit cost for both commercial and research samples. There may be future opportunities to licence the test or partner with a company to further reduce cost. Some staff also reported they are unclear whether public or industry funds should be used when the partnering organisation does not agree to make the results publicly available. A final example is a current partner seeking SARDI to develop more varieties as soon as possible because of the success of the varieties they are currently licenced to sell.

These examples highlight the need for a strategic and structured decision process to identify commercial opportunities to establish both the public and private benefits, risks and how they align with SARDI’s strategy and own development requirements.

3.7 Relationships and purpose clarity

3.7.1 Stakeholder views

A consistent theme running through the stakeholder interviews and submissions is that SARDI is at its best when it provides “practically oriented, outcome focused research”. The existing and potential span of where stakeholders are looking for such research is large and includes:

— cost reduction and value adding

— commodities and value adding

— farming and food


— pre-farmgate and post-farmgate

— technology/practices and policy

— sustainable environment and reduced industry impact

— cheaper services and greater benefits

— connector and provider of research solutions

— regional and (inter)national presence/focus

— targeted and part of “One PIRSA”.

The range and diversity both represents the breadth of SARDI’s (potential) scope and is in part explained by the vested interests of the stakeholders it serves and collaborates with. This was reflected in the consultations and submissions where stakeholders understandably are seeking SARDI to focus on their priorities. Organisations with a strong pre-farmgate focus are seeking producer-related priorities while environmental agencies are seeking public good outcomes. Research organisations are seeking SARDI to act as a conduit, not compete with their own capability and to contribute to building stronger collaborative structures. All are seeking greater value at lower cost and research that provides practical technology/practices and sound policy advice. Most telling is that few organisations reflected a state economy-wide perspective, perhaps reflecting the absence of a good dialogue with, or understanding of, the range of objectives and outcomes being sought from SARDI.

Having said this, there is questioning amongst many as to whether SARDI fully understands and has the capability to address their priorities. This lies more within South Australia than nationally where regional industry bodies, government departments, research organisations and others are seeking greater collaboration with SARDI.

This concern is partly fuelled by the large research agenda to achieve the State Economic Priorities, as well as the specific priorities of each industry and stakeholder. While the agenda is too large for SARDI to deliver on its own, there is an expectation that SARDI maintains and increases the level of service to fill the gaps. This would preferably be at lower cost to each stakeholder group through SARDI’s own efforts and by collaboration with others.

To that end stakeholders are looking for ways to better engage with SARDI. The ways suggested range from setting state research priorities to greater on the ground services in regions/industries. Nonetheless the outcome sought is similar: stronger collaboration to ensure the services required are provided and aligned with their priorities.

It is also apparent that not all stakeholders know of or make best use of the existing engagement mechanisms used by SARDI and the wider South Australian and national innovation network structures it is engaged with. Indeed the complexity of the network is a significant barrier to some. The challenge for SARDI and the other network members is to clearly communicate how the network is structured and where and how stakeholders can engage. This should be done within South Australia perspective as a matter of priority.

Ultimately this has led to a mixed perception of SARDI, at times a critical and valued expert capability, and at other times a disconnected and somewhat fragmented SARDI that is hard to understand. Clarifying SARDI’s purpose and focus, better accountability and improved reporting of demonstrable outcomes are some of the suggested improvements. This needs to be undertaken in a participatory manner if SARDI is to address the legitimacy concerns many stakeholders have, whether real or perceived.

3.7.2 Accountability

SARDI is accountable to PIRSA and through PIRSA to the South Australian Government. SARDI is also accountable to the other organisations that it collaborates with and receives funding from as well as the industries/wider public good it serves. Fulfilling these accountabilities effectively requires strong relationships and a clear purpose or vision.

While these relationships work and are clear in some cases, there are issues with all three. PIRSA and SARDI need to work in close partnership in order to deliver on state priorities. As discussed earlier, SARDI has a strong technical base and industry focus which complements PIRSA’s wider policy mandate and functional role, but there are evident tensions, even in the cost recovered Service


Level Agreements. Some of the tension stems from a lack of a common evidence base on which to plan, as well as differing expectations of the levels of granularity in terms of goals and actions.

Importantly both PIRSA and SARDI need to resolve and agree on their relative roles and whether the significant external funding and associated partnerships are structured to optimise the state priorities. This is not a simple task given it will require breaking down the state priorities into strategies and aligning these with PIRSA and SARDI’s capabilities as well as with those of the other partners. Inevitably this will need to be developed and adapted progressively.

One such priority area is in food and “moving up the value chain” where both SARDI and PIRSA are involved, as well as the wider Waite Research cluster, the national research network and industry businesses. Throughout consultations stakeholders consistently reported they believe it necessary for all the parties involved to improve collaboration to accelerate this priority. Stakeholders are keen for SARDI to play a more active “broker” role to connect existing and new funding sources, research organisations and industry businesses to collaborate on research. The Food CRC application, while unsuccessful, would have been an important catalyst in this area, though not sufficient in itself since the underlying objective is to establish an enduring innovation system that connects all parties. This would essentially be a new role for SARDI given much of its current efforts here are focused on well-established value chain integrity RD&E. As such, it would need to develop new relationships and capability rather than simply applying its existing delivery platforms.

SARDI has strong links and accountability to industry and external funders through its projects/programs and the various committees in which it is involved (Tables 2.3 and 2.4). However, these create a considerable administrative burden in their own right, vary in effectiveness and don’t deal with the whole of SARDI.

Ultimately SARDI faces many competing opportunities and stakeholder obligations that it must consider and factor into a strategy to drive its on-going development. In the past a SARDI Board provided the formal mechanism to provide strategic industry and government advice and accountability from a whole-of-organisation perspective to address these matters. With the dissolution of the Board, SARDI is now more reliant on individual guidance from industry, research partners and PIRSA. The nature of this advice will naturally be tied to the individual perspectives which, in the absence of other formal broad-based investment planning processes, significantly limits SARDI ability to determine an agreed focus and to adapt its strategy, investment and capability so that it can “move up the value chain, broaden its focus and attract new sources of funding”.

The unresolved tensions around balancing the needs of government, industry and research partners have seen SARDI plan and adopt a bottom-up strategy process in which collaborations with partners, programs, Service Level Agreements and other finer scale plans are “rolled-up” and presented as divisional business cases within the SARDI Corporate Plan, with the key actions and outcomes cross-tabulated against state priorities.

While useful in capturing SARDI’s key investments and actions, a greater justification and compelling strategic narrative for the next 3-5 years is required to report to and engage with staff and stakeholders.

The stated purpose of the SARDI Investment Decision Framework (IDF; Table 3.4 overleaf) is

To assist in prioritising investment of State appropriation funded ‘in-kind salary’ into State and national

research portfolios.

State appropriation is used to build capability in key areas (as aligned with strategic priorities at

National/State/PIRSA/SARDI level) and maintain and grow major science leads (i.e. AGSOC RD&E

strategy). The ‘in-kind salary’ is then used to leverage external funds, or as required State in-kind

contributions to National or State programs.

The IDF is used to identify investment opportunities which align with South Australian Government

economic and sector research priorities.

SARDI Investment Decision Framework


TABLE 3.4 SARDI INVESTMENT DECISION FRAMEWORK

Questions

1. What is the nature and scale of the problem and is it consistent with our expertise and facilities, and/or

those of collaborators?

2. Who regards the researchable question as an issue and is there a clearly defined need for the work to be

carried out?

3. Is it a research area/product that could provide first mover advantage or cover an area of market failure?

4. Project feasibility and potential to be delivered in the limited time frame?

5. Is it supported by industry and consistent with funding body priorities?

6. Presence of a unique SA competitive advantage?

7. Potential for a commercial outcome that could be licenced/sold or used to deliver commercial income?

8. Leverage ratio?

9. Proposal underpins SA Government Commitment under the National Primary Industries Research

Development and Extension Framework R&D Strategy? Sector or Cross Sector alignment?

10. Proposal aligns with Industry and RDC Strategic Priorities?

11. Proposal is part of a contracted commitment to:

a) SARDI-GRDC Bilateral

b) National Almond Centre

c) CRC Plant Biosecurity

d) Animal Welfare Science Centre

e) South Eastern Australia Aquatic Sciences Alliance

12. Proposal will generate Intellectual Property

a) Commercial opportunities

b) Patents

c) Fee for service provision

13. Public good

a) Growing Advanced Manufacturing

b) Premium Food and Wine from Our Clean Environment

c) Realising the Mining Boom for all South Australians

d) The Knowledge State

14. Proposal meets at least one of PIRSA’s 5 Building Blocks (PIRSA’s Corporate Plan 2015-16)

a) Build Capacity

b) Secure Production

c) Expand Markets

d) Grow Regions

e) Perform Well

15. Proposal has measurable outputs for industry

a) Role in helping to grow the State’s prosperity and wellbeing

b) Increasing security of food production systems

c) Delivering on consumer drivers

d) Securing market access and / or market development

e) Building capability and capacity

f) Other

16. Timeframe for outputs from proposal to translate to benefits/impacts

a) Immediate

b) Short term (1-3 years)

c) Medium term (3-5 years)

d) Long term (> 5 years)

SOURCE: SARDI INVESTMENT DECISION FRAMEWORK


The Review was unable to identify systematic use or documentation of how the Framework is applied to make investment decisions or how these are reviewed as a whole to balance SARDI’s portfolio.

SARDI faces a situation where its strategic position and focus is changing, needing to move beyond its traditional core to address new priorities for which it does not have the financial resources or capability to fully meet. The move towards a national research network means that SARDI does not need to address all the priorities on its own. Where such networks are well established and adaptable the transition is well underway, both in specialisation and operating as an innovation rather than an RD&E system. However, the networks are not necessarily formed or fully functional across all the priorities SARDI must consider. In these cases SARDI needs to play an active role to ensure the networks are well formed and establish its own position to ensure they fully address the State Economic Priorities.

This will not happen under a business as usual scenario. Rather, there is a need for a more strategic, engaged and disciplined approach to planning, capability management and investment decision making.


4 L E S S O N S F R O M C O M P A R A T O R O R G A N I S A T I O N S ( G O O D P R A C T I C E )

4 Lessons from co mparator organisations (good practice )

One of the Review’s objectives is to compare SARDI against other organisations to consider what arrangements support: agility to respond to challenges and opportunities; R&D based evidence advice to government; and alignment with other agencies within their jurisdiction. To that end, case studies were developed for seven publicly funded research organisations in Tasmania (TIA), Victoria (AgVic), New Zealand (PFR), UK (IFR), Ireland (Teagasc), France (INRA) and Spain (INIA).

The case studies are provided in Appendix D and summarised in Table 4.1. In considering the relevance of these for SARDI, it is important to not look for a single model but to identify where there are practices that may be appropriate to review further for their potential adaptation or benefit to the South Australian environment. These are highlighted in bold in Table 4.5.

In relation to the business models, there is a mix of government and university involvement, from primarily a government department or agency (AgVic), a formal joint venture between government and academia (TIA) or government owned enterprises (PFR). The business mandates vary considerably in their focus on public and private good, coverage of the value chain, focus on policy advice, commercialisation and the mix of research, training, knowledge transfer and science communication. Training of scientists, knowledge transfer and science communication, is a common theme (IFR, Teagasc, TIA). The investment framework approach developed by Victoria’s former DPI is perhaps the most formal, comprehensive and intensive approach amongst the case studies for the identification, planning, execution and evaluation of research priorities but is yet to be consistently implemented.

The structures of the organisations are defined by each organisation’s mandate and whether they are independent or part of a larger organisation. TIA has four sector based and one food safety centres which conduct RD&E and a School of Agricultural Science, reflecting a joint venture to which both government and university functions have been moved. PFR on the other hand is organised on functional lines that has separate science and delivery arms in line with its specific industry development goals. AgVic is organised on sectoral lines but part of DEDJTR, a large department focused on economic development, jobs, transport and resources, with AgServices providing commercialisation. Teagasc is part of a larger Department of Agriculture, Food and Marine and organised on a sectoral basis and also includes a rural economy and development unit. Teagasc also offers a series of pathways to commercialise its research through “technology offers”. INIA on the other hand is structured around key research centres, as well as a series of research departments and has a specific unit to evaluate varieties and products. It also has arrangements to liaise with the autonomous regions (equivalent to states in Australia). IFR is structured around two key five year programs focused on food and health, and gut health and food safety.

Also common is an explicit mandate for providing policy advice (TIA, PFR, IR, INRA, INIA). PFR’s simulator tool for assessing the impact of agriculture policy is a particularly noteworthy example of the formalisation of its policy role. Commercialisation is undertaken to varying degrees, in line with the organisation’s business mandate. Agriculture Victoria Services Pty Ltd in Agriculture Victoria and the


Technology Transfer Office in INIA are examples that may warrant further investigation for relevant practices and lessons.

A number of the case studies have established relationships throughout the value chain. A particularly notable example is AgBio, established by the Victorian Government and La Trobe University. AgBio has a demonstrated ability to attract significant levels of public and private co-investment, and arguably is operating on a near or fully commercial basis. Other examples are the Carnot institutes in INRA which have an explicit focus on research that favours industry innovation, and the Coordination Commission in INIA which conducts collaboration forums with the autonomous regions in Spain. One dimension which seems to be coming through is that many of the organisations use commercialisation to both accelerate the realisation of benefits and generate additional income to achieve their goals, rather than having commercialisation as a goal in itself. This is based on the recognition that not all research can be commercialised and that the pipeline of commercialisation opportunities is likely to generate occasional rather enduring base income.

To the extent the funding information is publicly available, it shows a wide range of balances between core or state funding and that obtained from publicly funded research grants and industry fee for service. The case studies that appear to have the highest proportions of non-core state funding are TIA and PFR. None of the case studies achieve SARDI leverage of 4:1 with 2:1 being closer to the norm.

A strong feature of the governance models of many of the case studies is the presence of formal management or advisory boards, with a wide representation that covers government, universities and industry and is at arm’s length from government, even where the host organisation is a government department of agency (TIA, IFR, Teagasc).

Overall the case studies indicate that there is no one predominant or prevailing model, but that the practices and arrangements have been framed by conscious decisions regarding the desired:

— business mandate or strategy, especially in relation to state and national (even international) priorities

— scope of services encompassing research, training, science communication and (rural/regional) economic development

— balance of prescribed public good and industry development

— role in facilitating and/or conducting commercialisation

— levels of public and industry funding.

All of the organisations have broad mandates, potential research foci and operate in complex systems. To clarify their strategy they use a combination of:

— Boards to provide independent, representative and skills based advice

— targeted goals to define and limit their scope (e.g. Plant & Food Research NZ)

— decision support tools such as used by AgVic to provide consistent objective assessments

SARDI does not have an Advisory Board and there is scope to improve both its strategic goals and decision support tools.

SARDI has the highest level of external funding amongst the organisations compared and all rely on high levels of public funding. The Australian RDC model is important to SARDI, as well as TIA and AgVic. There are challenges arising from the model because RDCs fund research on an industry by industry basis against national goals. While the arrangements differ in other countries, in all the case studies there are role definitions and processes to clarify how research organisations and industries collaborate. This highlights the importance of having clear research goals for South Australia, as well as SARDI and a clear understanding of how SARDI, PIRSA and others coordinate to achieve them.

Structurally the case studies highlight organisations can be organised on a commodity (as SARDI currently is) or service/functional basis. Either way it is apparent where commercialisation is important to the organisation there is a deliberative process delivered by a separate unit within the organisation or a third party. The case studies also highlight the use of centres to focus research and/or increase adoption of research.


TABLE 4.1 CASE STUDY OVERVIEW

Characteristic TIA

Tasmania

AgVic

Victoria

PFR

NZ

IFR

UK

Teagasc

Ireland

INRA

France

INIA

Spain

Business model JV b/w Govt and UTAS

“Science-community

dialogue” – training,

research, information

Department within

DEDJTR

“Assist industry … in a

sustainable manner”

One of 7 Crown Research

Institutes

Private company limited

by shares

Research for the public

good (8:1 RoI), training of

future scientists, science

communication

Integrated research,

advisory and training

services to underpin

profitability and

competitiveness

National research

institute, “to feed France”,

now international focus

Public good is primary

function

Autonomous public

research body

Coordinate and execute

research projects

Research focus State, national and

international

RD&E across VC from

production to consumption

Biosciences, Informed by

Investment Framework,

PAGs, Annual

Investment Conference

Increase value

Protect and enhance

Sustain growth

Targeted industries

Two 5 year strategic

programs, publications

plus knowledge transfer

to industry and

consumers

Entire VC, incl. food

processing, integration of

research with knowledge

transfer and absorption,

industry development

High volume of

publications

Agroecology and systems

biology

Full VC from resource

production to food

technology, Analysis and

evaluation services

Policy focus Explicit through Science

for Society and Policy

program

Undertaken variously

through respective teams

Explicit through adoption

indicators, simulator tool

for policy impact

Advises UK (EU) policy

making and regulation

Explicit in org structure

Role not explicit or clear Explicit objective to

inform public policy, with

steering committee

Explicit function to

provide advice and

information to Govt

Commercialisation Hindered by disconnect

between RDC funding and

HE research incentives

AVS Pty Ltd

($12m, $8m in royalties)

Undertaken internally

Royalties (1/3 all research

contracts)

Fundamental research

with public good and not

for profit mandates

Seeks industry partners

through one page

Technology Offers

IP dealt with in case-by-

case basis according to

public/private partners

Technology Transfer

Office, patents, licensing

and marketing as explicit

objectives

Relationships Value chain an explicit

focus CVCR (Kent) and

AVCRG (UQ)

AgBio PPP b/w Govt,

La Trobe University and

Plenary Research

PICCC (UoM)

12 NZ based partnerships

4 research centres in

China

Plant biosecurity CRC in

Australia

MOUs with research

bodies locally and

internationally

Member of UK scientific

and food committees

Links to Govt depts,

National Science

Foundation

Formal partnerships with

universities

Carnot institutes which

facilitate and encourage

collaboration between

researchers and industry

partners

Coordination

Commission b/w INIA

and autonomous regions,

collaboration forums

with industry

Funding ($20m), core funding

around 45 per cent

($108m), 46% is

externally funded

($130m), 1/3 is core NZ

Govt)

(£23m), majority is core

(86%)

(€16m), core is 78% of

total

(€880m), 80% from grants

for public services

(€78m), details on

additional funding N/A

Governance TIA Advisory Board

Staff employed by UTAS

Departmental Wholly owned by NZ Govt

Science Advisory Panel

BBSRC, University of

East Anglia, IFR Trustees

as corporate members

Teagasc authority (11

member) with wide

representation

Ministries of Research

and Agriculture

Separate mgmnt, science,

and ethics boards

Ministry of the Economy

and Competitiveness

Governing Board,

Research Council

SOURCE: ACIL ALLEN CONSULTING 2016


5 C O N C L U S I O N S ( I M P R O V E M E N T O P P O R T U N I T I E S )

5 Conclusions (I mprove ment opportunities)

This chapter draws together the Review findings, first as an assessment against the terms of reference, then using this to suggest a way forward to progress the improvement opportunities identified.

5.1 Overall assessment against the terms of reference

While there is understandably an overlap and interrelationship between the terms of reference, the following addresses in turn the key aspects of each of the terms of reference.

5.1.1 Business model and potential to capitalise on commercialisation opportunities

SARDI’s mandate is to deliver robust products and solutions for primary industries. It does so through delivering applied research to industry and policy advice to PIRSA and the South Australian government. SARDI is also responsible for leadership in the wider research networks that contribute to South Australia’s competiveness in primary industries and associated research capabilities.

SARDI’s current capabilities and revenue are predominantly concentrated on publicly funded pre-farmgate, natural resources and supply chain integrity research. In this context commercialisation within SARDI currently focuses on plant breeder rights royalties and fee for service diagnostics that account for around 10 per cent of its revenue.

To capitalise on additional commercialisation opportunities requires either expanding these traditional fields or embarking on a process to explore new areas. Both are constrained by the willingness of funders and capacity of SARDI to do so. Publicly funded plant breeder rights are nationally coordinated so SARDI’s ability to further commercialise here is a function of the agreed varieties it specialises in, the share of royalties it can obtain and the future success of the breeding program. With respect to diagnostic services SARDI also needs to balance the consideration of whether licencing undermines the operational efficiency of its own facilities.

In terms of identifying and pursuing new opportunities, these are to some extent limited by competitive neutrality policies and the preparedness of public funders to underwrite commercialisation in new areas. There is also a degree of confusion around whether the ultimate goal of commercialisation is to accelerate the rate of industry development or simply to generate additional income streams for SARDI. Some submissions contend that SARDI’s core research should be publicly funded by government and industry levies. Other submissions note that commercialisation is a specialist capability that SARDI should source externally. The case studies also support this with the comparator organisations generally utilising specialist units to assess the commercialisation potential of their research portfolio and establish the partnerships to realise the opportunities.

Whether SARDI should hold or outsource such capability depends on the purpose and potential value of commercialisation. If SARDI only focuses on its current fields of commercialisation for the purposes


of generating revenue, the value generated does not warrant holding such capability. What is needed, however, is a structured process to systematically and continually assess opportunities which extend SARDI’s existing approaches. While this can be readily achieved with external assistance, the establishment of such as process is unlikely to realise its full potential until clarity is first achieved around SARDI’s strategy, and one that is agreed to and aligned with its funders.

5.1.2 Funding sources and ability to access non-traditional funding

While the State Economic Priority of “premium food and wine produced from our clean environment and exported to the world” provides clear direction it presents challenges for both SARDI’s strategy and funding.

Since 1992 SARDI has been progressively moving from a full service model to a specialist organisation targeting particular priorities and capabilities. The shift is part of a deliberate and coordinated approach to organising research as a network of national, state, sector and cross sector ecosystems.

The net result is that the goals of SARDI, and South Australia’s primary industries more broadly, are in effect set by the research ecosystem and funders rather than SARDI. This is not to say that SARDI has not contributed to the goals. Indeed SARDI’s contributions are highly valued and the organisation has been successful in maintaining revenue at around $60 million per annum despite considerable shifts in its funding base.

A key challenge is that the State Economic Priorities require SARDI, and the networks within which it operates, to increase their focus on post-farmgate research. This represents a significant shift for SARDI and many of its funders who focus on pre-farmgate, natural resources and industry integrity research—areas where future gains are also important and realistic.

Critically, the majority of SARDI’s funders have limited ability to fund post-farmgate research beyond industry integrity given they are funded by producer levies (e.g. RDCs) or public good outcomes (e.g. PIRSA cost recovery, DEWNR and MDBA).

In this environment it is important that non-traditional funding be from new sources or existing funders supporting new areas. Within the national research framework the inability of the primary industries funding base to invest in post farm-gate research is widely acknowledged. Change is driven in the main by the RDCs who set the research agenda but are constrained by their governance and the fact that majority of their income is provided by producer levies.

Despite these challenges the “traditional funding” base is and will remain important to SARDI in the future. Somewhat paradoxically, SARDI’s success in increasing this funding constrains its ability to attract “non-traditional” funding. SARDI currently relies on a high external funding ratio of around 4:1. The high leverage built into its “traditional funding” means that any shift away puts great pressure on maintaining its existing expenditure levels and capability. Moreover, the relatively high base costs and co-contributions means that more than 90 per cent of SARDI’s expenditure is non-discretionary. Submissions to the Review and stakeholder consultations both indicate that stakeholders are seeking existing services to be maintained, and provided at a lower cost.

The net result is that SARDI has limited ability to establish new funding sources or offer new services unless they directly and immediately align with its capability.

The question of how to achieve this transition alongside with commercialisation is one of strategy. SARDI’s current approach is to establish services which address national and state frameworks and fund its operations and capabilities, which are then rolled up into a whole of SARDI plan. While each of the programs and services that make up the plan can be justified and may deliver value, they lack a clear outline that shows how they align with the efforts of other stakeholders and create the optimal strategy to deliver on the State Economic Priorities.


5.1.3 Potential future key relationships

SARDI’s key future relationships fall into four domains—South Australian Government Initiatives; South Australian industries; South Australian Primary Industries Research Cluster; and the (Inter)national Research Networks. Of these, the first poses many challenges and the second poses many risks, with the last two the most straightforward.

As a division of PIRSA and part of the South Australian Government, SARDI’s alignment with both and their strategic initiatives are paramount. SARDI has robust working relationships that are highly effective in some areas, such as fisheries, and less clear in others, such as agricultural policy and how it engages with Rural Solutions. The respective roles and responsibilities of PIRSA and SARDI where they need to coordinate to deliver on strategic priorities are also not clear. These challenges can be addressed through a stronger and joint strategic planning framework, one that outlines how SARDI and PIRSA will work together to achieve the State Economic Priorities.

SARDI has close relationships to industry through the services and programs it delivers and the various state and national industry and research structures with which it works. Notwithstanding the strengths of these relationships, they are at considerable risk if industry believes SARDI is not delivering cost-effectively and adapting to address their priorities. This in part stems from research being coordinated and delivered through national and (cross) sectoral networks, through which industry needs to engage in order to address their priorities or look to SARDI to co-fund or advocate on their behalf. The risk is evidenced in the industry submissions requesting more extension for primary industries and concerns around regulation from the fisheries industries.

It should be noted that this situation is not unique to SARDI or South Australia, as evidenced by on-going industry concerns around RDCs and government funding of primary industries across Australia. An important question is whether SARDI’s current industry relationship structures are adequate, particularly if it transitions to more post-farmgate research. An obvious gap is that, while SARDI engages with business and industry organisations, there is no established regular forum where all come together to consider what industry requirements and directions collectively mean for SARDI. This in turn impacts SARDI’s ability to retain and harness the base level of goodwill and support across industry.

The South Australian Research Cluster and the (Inter)national Research Networks are of critical strategic importance to South Australia, and SARDI is active and respected in both. These networks are similarly challenged in terms of clearly articulating how they are structured and engage with industry. Both are also at a stage where further evolution of their structures and relationships will benefit the participants and industries they serve.

Nationally the emphasis lies around refreshing the sectoral strategies and making the cross sectoral strategies fully functional. The latter is particularly important since animal welfare, biosecurity and food are important contributors to the State Economic Priorities. Within the South Australian Research Cluster there is a clear opportunity to improve coordination around capability development, further resource sharing, international linkages and collective action as highlighted in the submissions. This is not something SARDI or even the cluster organisations can do on their own, given their different remits and governance arrangements. There is, however, an opportunity for the South Australian Government to use its strategic initiatives and associated funding to drive stronger collaboration.

5.1.4 Structure to enable higher private funding

The Review found that SARDI external funding ratio of 4:1 is much higher than the ratio of 2:1 or less amongst the comparator organisations. The high leverage ratio means that RDC funding in particular largely influences the strategic direction and limits SARDI’s ability to make any significant adjustments in the short term.

All of the organisations operate in a complex research ecosystem to secure funding and deliver research. TIA, AgVic and INIA also operate in a federal system where there are national and state/provincial public research organisations structured variously from divisions to independent companies. There is no one ideal structure that is evident from the case studies. Rather the key message is that a clear and agreed strategy should define structure within the specific constraints of the jurisdiction and research ecosystems and industries in which they operate.


All of the organisations, other than AgVic, use Boards or similar to seek advice and drive their strategy based on conscious and transparent decisions around scope, services, balance of private and public good, commercialisation and finance.

5.2 Improvement considerations

Overall, it is clear that SARDI has established a strong reputation for its technical excellence and is undertaking significant and important research at national and state levels. At the same time, the State Economic Priorities provide a clear direction and potential expand SARDI’s focus and capability, particularly in areas beyond its pre-farmgate core, while strengthening relationships that foster industry development and commercialisation opportunities. Funding levels over recent years have encouraged SARDI to pursue relatively high levels of external research. Though funded mainly from national public sources, it may not always be explicitly aligned with state priorities.

To enact a strong and vibrant state industry development agenda requires both PIRSA and SARDI to co-establish and align policy and research, to fund the fixed essential public and regulatory functions appropriately, and to set clear goals and payment for the desired research outcomes.

The following sets out seven priority areas for PIRSA and SARDI to work together to achieve the expectations being sought by government and stakeholders. It presents an action sequence through which to resolve and address strategic choices and questions identified through the Review but which cannot be addressed through the Review itself.

Setting of clear and strategic goals

These should be, at minimum, in relation to a number of key elements—a 5-year business mandate or strategy, the preferred research model, and relationships and funding sources designed in consideration of a 10-15 year horizon. The Review found many varying views within and outside government, some conflicting, around the desired directions in these areas. Only with these goals agreed and set can decisions be made regarding the most appropriate organisational structure.

These goals should be based on the State Economic Priorities taking into consideration which industries, parts of the value chain, and research South Australia and SARDI has and requires future comparative advantage in. The goal setting should be jointly led by SARDI and PIRSA and part of a an annual rolling process with at least triennial updating to manage four-year state and three-year national electoral cycles. It should also engage key stakeholders as the strategy/mandate needs to not only set SARDI’s direction but contextualise how this fits in the wider national and South Australia innovation network.

Matching funding sources to state priorities

SARDI is currently generating or leveraging a significant proportion of its funding from non-state sources, which in part explains why state objectives are not readily visible in its portfolio of work.

The setting of clear goals for SARDI will largely address this, enabling SARDI to work through a directed process to match to these goals and State Economic Priorities with its own State Allocation capabilities and other funding sources and capabilities. This process needs to be more than a simple mapping of investment, capabilities and key actions against SARDI, PIRSA, State and other stakeholder goals as currently occurs, to a more objective analysis and adaptive decision making on what can be achieved, where the gaps lie and how they can be addressed in collaboration with others.

This will require some refocussing away from existing R&D investments to concentrate on value for money to South Australia and utilising these funds to develop new opportunities in the state. The principle of retaining and applying internal SARDI efficiency gains to developing new opportunities and capabilities should be considered. SARDI will also need to work with industry and the various research networks to build support for the transition and transfer of capabilities.

Importantly the strategic goals and directions will need to be funded appropriately, with explicit guidance on what areas will be funded (and not), and incentives to continuously pursue productivity gains whether based on efficiency or effectiveness improvements.


Linking research to state policies and structures

Strong organisational relationships and mechanisms between SARDI and PIRSA, as well as other South Australian policies and structures are essential. Towards this end, SARDI should strengthen its economic development capability and linkages to the broader strategic initiatives being driven by PIRSA.

The annual planning cycle utilised by PIRSA and SARDI is not effective in establishing clear goals and expectations and how they will collaborate together and with others. Greater clarity is also needed across South Australia regarding how stakeholders will collaborate with SARDI to accelerate achievement of the State Economic Priorities, particularly in food and value adding. This is essential to accelerating the various initiatives underway and ensuring SARDI has the understanding and capability to provide improved research based evidence to inform government and industry policy within PIRSA.

Objective investment decision making

With clear goals and funding sources linked to state policies in place, an objective test or investment framework is needed to ensure that SARDI’s ongoing research investment decisions are in areas where:

— It has a distinctive advantage (i.e. is this the role of the South Australian Government and is SARDI best placed to provide the necessary research, regulatory, biosecurity and food safety services).

— There is a direct contribution or added value to state economic growth and future research capability (i.e. will this investment add value and how).

The framework should be applied with rigour on investment decisions, from project to corporate scales, and within SARDI and with PIRSA and key funders. The framework should include a “portfolio balancing tool” so that risk-return (and other) trade-offs and alignment with SARDI’s goals and other priorities can provide a clear basis for transparent decision making and reporting, considering the option value of new capabilities as well as the closure of existing capabilities.

Business and research leadership

The increase in industry development focus and brokering of commercial opportunities being sought by many requires a strong combination of business and scientific research expertise. This need to be strengthened and embedded in SARDI’s Executive and business processes and structures.

Recruitment of the next SARDI Executive Director may provide an important opportunity to appoint a leader with both requisite skills, though there are successful models where these are represented in separate roles. Similarly a detailed capability assessment should be undertaken covering the science (applied and discovery), technology/market development and business (entrepreneurial, management and stakeholder engagement) and used to inform future training and recruitment across the Executive to provide the balance of skills needed.

Embedding industry development and commercialisation

A key decision required is the extent to which SARDI pursues commercialisation itself as an additional source of funding, and/or the facilitation or brokering of commercialisation to the ultimate benefit of SA industries. Both are possible but the experience in comparative organisations in other jurisdictions leans towards the brokering role as the more feasible and appropriate. This leaves the question of how to fund and organise the brokering function within SARDI. Brokering is a specialist skill beyond pure IP/contract management and research knowledge. Important also is opportunity and partner search and evaluation, and this would need to be strengthened within SARDI. Options include a special unit within SARDI, leaders within SARDI divisions or engaging another party (in Government or the private sector). These should be assessed and then implemented as part of the strategy development process and will require additional resourcing.


Establishing a SARDI Board and broader industry engagement

Most successful or effective peer research organisation models have an independent management or advisory Board involved to maintain regular corporate practices of business planning and monitoring. Such Boards are a feature common to nearly all the case studies considered as part of this Review, irrespective of their corporate form.

A Board would provide SARDI with the governance processes and rigour to assist and resolve the various and often competing priorities and expectations while also strengthening stakeholder engagement and accountability.

Board membership should be based on skills relating to science, management and industry knowledge and expertise. Whether it is a management or advisory Board will depend on what is legally practical and politically acceptable. Either way the governance structure must establish clear accountabilities for SARDI and the Board.

In addition to the importance of a Board, Review consultations indicated that there needs to be stronger and broader engagement between SARDI and industry. Improvements need to be considered in light of “one PIRSA” and the large number of Boards and committees with which SARDI is already involved to avoid unnecessary duplication and cost. This essentially requires SARDI to update its communication-stakeholder engagement strategy to map out how it will identify key stakeholder groups and decide how best to:

— seek advice

— communicate its intentions

— work collaboratively where required

— report results and seek feedback.

Above all, the ability of SARDI to meet the needs of all its stakeholders is integrally linked to its relationship within PIRSA and its industry policy role. The sequence of activities presented above seek not only to establish the components which will ultimately guide the appropriate adjustments to the business model, funding basis, key relationships and structure to best achieve the state priorities, but in doing so recognise the importance of, and are critically dependent on, upon the process being conducted in close partnership with PIRSA.

SARDI REVIEW FINAL REPORT A–1

A . S A R D I E M P L O Y M E N T D A T A

A SARDI employment data

A.1 Staff overview

TABLE A.1 SARDI STAFF NUMBERS, BY HEADCOUNT AND FTE

Number of staff

By headcount 314

Casuals registered to work 100

Total registered staff 414

FTE (Contract and permanent) 293.18

FTE (Casual average per month) 25.00

Total FTE per month 318.18

SOURCE: SARDI FTE BY ROLES DOCUMENTATION, 27 MAY 2016

A.2 SARDI staff breakdown by OCPE category

TABLE A.2 SARDI STAFF NUMBERS AND PERCENTAGE BY OCPE CATEGORY AND DIVISION

OCPE

category

Division of SARDI Total Percentage of

total

Business

Services

Aquatic

Sciences

Livestock &

Farming

Services

Sustainable

Systems

Permanent 30 10 8 24 72 17%

Contract 30 73 45 94 242 58%

Casual 2 12 13 73 100 24%

Total 62 95 66 191 414

NOTE: the total includes PIRSA staff embedded in SARDI


SARDI REVIEW FINAL REPORT A–2

A.3 SARDI staff breakdown by role

TABLE A.3 SARDI STAFF BREAKDOWN BY ROLE AND DIVISIONS

Classification/type

(excluding causals)

Business

Services

Aquatic

Sciences

Livestock & Farming

Systems

Sustainable

Systems

Total

Administrative Services 18 4 5 4 31

Managerial Services 1

1 2

Executive Services 2 1 1 1 5

Operational Services 18 10 5 23 56

Professional Services 5 65 33 78 181

Technical Services 2 3 6 12 23

Marine Research Vessel 4

4

Government Services

Employees

9 3 12

59 83 53 119 314


SARDI REVIEW FINAL REPORT B–1

B . S A R D I F A C I L I T I E S A N D A S S E T S

B SARDI facilities and assets

TABLE B.1 SARDI FACILITIES AND KEY ASSETS

Facility Assets / features Division Program

Waite Research Precinct, Urrbrae – Microbiological and molecular biological laboratories (PC2 & QC2)

– New product development kitchen

– Sensory facility and booths

– Small-scale packaging and processing equipment

– Shelf-life assessment facilities

– Food analytical laboratory

– Meat science laboratory

– Harvesters (3)

– Trucks (4)

– Spray rig (1)

– Tractors and cone seeders (2)

– Insect collection

Livestock & Farming

Systems

Sustainable Systems

Food Safety & Innovation


Entomology




Plant Research Centre (at Urrbrae) – Australian Pastures Genebank

– Molecular Diagnostic Centre

– Controlled environment rooms (30)

– Greenhouse capability

– Laboratories

– Coolrooms and freezers

Sustainable Systems Plant Health and

Biosecurity

South Australian Aquatic Sciences Centre,

West Beach

– Seawater and freshwater supply (four inlet/outlet pipes)

– Pool farm

– Indoor aquaria room

– Shellfish hatchery

– Finfish hatchery

– Algae production and analytical facility

– Aquarium Room and Pool Farm

– Controlled environment rooms (4)

Aquatic Sciences

Southern Australian Integrated Marine

Observing System

Aquatic Sciences Oceanography

Research vessels – RV Ngerin (25m, 200t research vessel)

– Smaller vessel fleet

Aquatic Sciences

North Arm Store, Port River – Mooring and secure storage facility Aquatic Sciences

South Australian Aquatic Biosecurity

Centre, Roseworthy

– Marine and freshwater recirculation facilities

– Unit comprising filters, a heater and UV system

– Tanks of 3 L, 200 L and 5 KL are installed with a recirculated water supply,

biofilters, aerators and UV sterilisation

Aquatic Sciences

Aquatic Sciences Mount Gambier

Lincoln Marine Science Centre (Port

Lincoln)

Aquatic Sciences

Sustainable Systems




Port Lincoln Research Centre – Range of wet and dry laboratories

– Research farm facilities

– Harvesters (2)

– Trucks (2)

– Spray rig (1)


Sustainable Systems New Variety Agronomy

Roseworthy Campus – Research piggery

– Pig and poultry laboratory

– Feed mill

– Poultry Research Unit

– Free range poultry research facility

– Endocrine laboratory

– Molecular biology laboratory equipped for DNA/RNA/protein analysis

– Medium-high throughput genotyping and gene expression analysis platforms

Livestock & Farming

Systems

Pigs & Poultry

Clare Research Centre – Harvesters (4)

– Windrower (1)

– Trucks (4)

– Spray rig (1)


– Wet and dry laboratories, shedding, offices, and conference facilities due for

completion in 2017


Nuriootpa Research Centre – Post-harvest, soils and general laboratories

– Farm machinery stores, chemical store and farm workshop

– Automatic weather and soil monitoring equipment

– Mains/BIL and bore-fed irrigation infrastructure with a 20ML BIL water licence

– Vine and cherry germplasm collections

– Small scale research vineyards


Water Resources,

Viticulture and Irrigated

Crops




Turretfield Research Centre

– Turretfield (650ha)

– Kingsford (370ha)

– Research farm facilities for the conduct of sheep and cattle

research/management

– Large and small-scale holdings for sheep and cattle

– Range of wet and dry field laboratories

– Reproduction laboratory with embryo/cell culture facilities

– Surgery and associated equipment/facilities

– Facilities for collection and cryopreservation of germplasm/tissue samples

– Paddocks for cropping

Livestock & Farming

Systems

Sustainable Systems


Welfare

Plant Health &

Biosecurity

Minnipa Agricultural Centre – Range of wet and dry laboratories

– Research farm facilities

– Harvester (1)

– Truck (1)

– Utility and trailing sprayer (1)

– Tractor and cone seeder (1)

Livestock & Farming

Systems

Sustainable Systems

Farming Systems


Struan Research Centre – Research farm facilities for the conduct of sheep and cattle

research/management

– Large and small-scale holdings for sheep and cattle

– Field laboratories

– Centre pivots for irrigation (2)

– TechnoGrazing™ system under irrigation and dry land conditions

– Harvesters (2)

– Windrower (1)

– Trucks (2)

– Spray rig (1)


Livestock & Farming

Systems

Sustainable Systems


Welfare




Loxton Research Centre – Almond Centre of Excellence Sustainable Systems Plant Health and

Biosecurity


Water Resources,

Viticulture and Irrigated

Crops

Note: This table has been compiled using information from the SARDI Facilities and ‘Key Assets by SARDI Research Divisions’ documents. It may not include an entire list of SARDI assets.

SOURCE: SARDI FACILITIES AND KEY ASSET DOCUMENTATION

SARDI REVIEW FINAL REPORT C–1

C . C O M P A R A T O R O R G A N I S A T I O N S

C Comparator organisations

C.1 Tasmanian Institute of Agriculture

C.1.1 Overview

Established in 1996, the Tasmanian Institute of Agriculture (TIA) is a joint venture between the Tasmanian Government and the University of Tasmania (formerly known as the Tasmanian Institute of Agricultural Research). It undertakes research, development and extension in the agricultural sector, and provides agricultural education at both undergraduate and postgraduate levels. TIA currently has research sites in four locations across the state, and employs approximately 160 people.

C.1.2 Business model

Mandate and mission

TIA considers itself to be a ‘boundary organisation’ between science and society, uniquely “positioned to create a constructive science-community dialogue”, and with a state, national and international research mandate. Its mission is to “conduct and deliver targeted, innovative and responsive agricultural education, research, development and extension” (TIA Strategic Plan 2012-2016)—notably, the mission statement does not refer to a particular location or sphere of influence. In many of its official documents, TIA notes that its work takes place across multiple levels.

At the state level, we work closely with our partners in government and industry to improve the

performance of Tasmania’s agricultural sector, across all industries and value chains. At a national level

we show leadership in research excellence and partner strategically with many other organisations

across Australia. Internationally we are rapidly increasing our research portfolio, influence and student

numbers.

Professor Holger Meinke, Director and Head of School, TIA Strategic Plan 2012-2016

The 2012-2016 Strategic Plan outlines the key policy documents informing TIA’s work, from an overarching national level through to an internal level:

— National Primary Industries Research, Development and Extension Framework

— Tasmania’s Economic Development Plan

— the University of Tasmania’s ‘Open to Talent’ 2012-2016 Strategic Plan

— the Joint Venture Agreement between the Tasmanian Government and the University of Tasmania

— existing strategic plans for each TIA Research Centre and the School of Agricultural Science.

TIA operates in a similar way to the ‘Land Grant College’ system in the United States, where some colleges are mandated to provide training in agriculture, undertake agricultural research, and provide information to farmers (TIA 2014, National Research Council 1995). However, TIA differs from the US


model in that it does not have legislative or other ongoing support from the Australian Government, although grants from the Australian Government account for roughly a third of its external funding.

Research model

TIA provides research, development and extension (RD&E) services across the value chain, from production to consumption, with a focus on temperate agriculture. Many of the projects that TIA undertakes are collaborations between universities, industry Research and Development Corporations (RDCs), various state governments, the Australian Government, and the private sector. This is outlined in section C.1.4.

Five sector-based Research Centres form the basis of TIA operations:

1. Dairy Centre

2. Extensive Agriculture Centre

3. Food Systems Centre

4. Perennial Horticulture Centre

5. Vegetable Centre.

Across each of these centres, there are six key programs (themes) that are aligned with the strategic plan and provide a framework for project delivery and decision-making (Figure C.3). A focus on value chains, education, and systems as a whole rather than discrete aspects of a system, are among the program areas:

— Learning and Teaching: creating the future

— Science for Society and Policy: science matters

— Agricultural Production Systems, understanding complexity

— Future Farming: managing risks and opportunities

— Understanding Value Chains: creating value

— Vision-driven Leadership and Management: creating excellence

Each of these areas is incorporated into the work of the five Research Centres. For example:

TIA will have an explicit focus on value chain related research, development and extension (RD&E)

through its Value Chain Program which works with TIA Research Centres to:

– create knowledge of value chain innovation principles and actions

– assist stakeholder agribusinesses to develop more sustainable competitive advantages through

implementation of insights gained from value chain analyses

– build TIA's research capacity and reputation in the value chain field.

The Value Chain Program supports TIA's Research Centres and projects by providing an integrated

analysis of the whole production and marketing systems – from on-farm production to retailing and

consumption.

TIA 2016

TIA’s network partners in this area are the Centre for Value Chain Research at the University of Kent Business School, and the Agribusiness Value Chain Research Group at the University of Queensland. The program includes research on Tasmanian and Australian value chains, as well as international value chains (through a number of ‘Research for Development’ projects).

A recent year-long collaborative project in this area was ‘A Value Chain Approach to Food Product Innovation’, aiming to identify, develop and demonstrate the potential to create new products from fruit, vegetable and nuts through use of by-products, excess capacity and out-grades. This project was supported by Horticulture Australia Limited, via levies and matched funds from the Australian Government, and led by the University of Central Queensland, with collaboration from the TIA Perennial Horticulture Centre, the Queensland Department of Agriculture, Fisheries and Forestry and MacTavish West Pty Ltd (TIA 2016).


Research Centres

1. The TIA Dairy Centre undertakes RD&E for the dairy industry. It works with and receives support from other organisations, including sector groups such as Dairy Australia, DairyTas and other research groups such as the CSIRO and the University of Melbourne. Funding has also been received from the Australian Government. The Dairy Centre manages a number of extension programs for farmers, Dairy Smart—skills development for dairy farmers—and Young Dairy Network Tasmania.

2. TIA’s Extensive Agriculture Centre conducts applied research for the extensive agricultural industries of cropping and red meat production, across different climatic zones. It has worked with a range of other organisations, including RDCs, production system groups, natural resource management regions, other universities and the CSIRO, as well as with individual farmers in its research projects. A recent example is the Cressy Research and Development site, consisting of 10 projects being undertaken in herbage development, sustainable grazing, cereals development, salinity and national pasture variety trials (TIA 2015). Funding for this initiative was received from the Grains Research and Development Corporation, Meat & Livestock Australia, the Tasmanian Government, PGG Wrightson Seeds, the NSW Department of Primary Industries and SARDI.

3. The Food Systems Centre is the third of TIA’s Research Centres, reflecting its view that “the integration of agriculture with food systems is an important priority” for the organisation (TIA 2015). This group incorporates the Food Safety Centre and works with the Centre for Food Innovation. The Food Safety Centre specialises in food microbiology—including predictive microbiology—to model the ecology of bacteria in foods, and delivers a range of teaching and training programs. Recent projects have been undertaken at the state and national level. The Centre for Food Innovation, established in 2013, comprises an agreement between the University of Tasmania, the Australian Government’s Defence Science and Technology Organisation and the CSIRO, for the purposes of initiating joint research and linking into national food research networks. The Centre works with TIA and other University of Tasmania institutions and initiatives.

4. The Perennial Horticulture Centre focuses on quality and yield in apples, cherries, wine grapes and wine making. Its research also covers extractive crops, walnuts and berries. The Centre has led a number of large national collaborations, including the National Cherry Development Program. It undertakes research at a state, national and international level. In 2014, staff from the Centre provided advice to the Thai Government on the feasibility of establishing a cherry industry in a region in northern Thailand (TIA 2015).

5. The Vegetable Centre’s research covers Tasmania’s vegetable crops and allied industries. TIA runs the Forthside Vegetable Research Facility, a 54 hectare research farm established in 1963. The farm’s paddocks are also used by external clients. The TIA Vegetable Centre also conducts research on other commercial farms, and delivers the Tasmanian Certified Seed Potato Scheme (TIA 2015).

Policy advice

Through its Science for Society and Policy program, TIA provides policy support and advice to inform university, government and agribusiness decision-making. This is seen by TIA as its responsibility, because of its unique position as a ‘boundary organisation’ and the funding it receives from government and other sources.

Given that the majority of TIA’s research funding comes from specific agricultural sectors, government

and the university, it is our obligation to support decision-making in agribusiness, government and UTAS

through the provision of objective information and expertise…We aim to positively influence the

development of effective agricultural policy.

TIA Strategic Plan 2012-2016

TIA’s strategies for this program are to:

— achieve the status of a key authority on agricultural issues with particular relevance to Tasmania

— influence rural policy by making science visible in the community

— foster dialogue about the everyday value and benefit of agricultural science.


Commercialisation

There is limited public information about TIA’s commercialisation processes. In its submission to the Australian Government’s Agricultural Competitiveness White Paper (2014), TIA notes that there can be a disconnection between the goals and funding models of RDCs and the research incentives provided by universities and/or the CSIRO. TIA also observes that university grant funding can include limitations to commercialisation, which may create a disincentive for researchers to innovate.

The University of Tasmania’s Business Development and Technology Transfer office is responsible for the commercialisation of research at the university. This office represents the university in any negotiations regarding rights of use or commercialisation of the university’s intellectual property (University of Tasmania 2016).

Reviews

There are no publicly available reviews of TIA or its joint venture model.

TIA received maximum scores for its research in the areas of (i) agriculture, land and farm management and (ii) horticultural production from the Australian Research Council State of Australian University Research 2015-16: Volume 1 ERA National Report.

C.1.3 Funding

TIA receives core funding from its two joint venture partners each year, the Tasmanian Government and the University of Tasmania, as well as external funding from the Australian Government, RDCs, industry, other universities, and other state governments.

In 2014, TIA secured almost half of its external grant funding from RDCs, and an additional third from the Australian Government. Other industry sources account for over 10 per cent of TIA’s external grant funding (Figure C.1).

Since 1997, TIA has won 681 grants (excluding institutional grants), averaging $144,456. Almost 30 per cent of grants were valued at over $100,000. The average size of its 10 largest grants is $3,499,774 (TIA 2016).

FIGURE C.1 EXTERNAL GRANTS SECURED BY TIA IN 2014

SOURCE: 2014 TIA ANNUAL REPORT

TIA reports annually on its funding from the University of Tasmania, the Department of Primary Industries, Parks, Water and Environment, and industry research grants—including private industry and National Competitive Research grants. The contribution from each of these funding groups since 2006 is shown in Figure C.2.

The University of Tasmania contributes annual Operating Grant Funds to TIA/School of Agricultural Science, as well as providing funding towards Research Scholarships for PhD students studying in areas related to TIA activities. Total funding from these three groups increased between 2006 and 2007, but has remained relatively stable since then, although a decrease can be seen in 2009.

Industry R&D Corporations

46%Australian Government

33%

Industry11%

Other universities8%

State Governments2%


Funding grew between 2012 and 2013, but declined for 2014. Figures for 2015 are due to be released in late 2016.

FIGURE C.2 TIA FUNDING BY SOURCE, 2006-2014

Note: Funding is displayed in nominal terms. In 2011 the organisation changed its name to Tasmanian Institute of Agriculture, incorporating the Agricultural Science discipline.

SOURCE: TIA ANNUAL REPORTS

C.1.4 Key relationships

The primary relationship for TIA is its joint venture status—since 1996 it has operated as a joint venture between the Tasmanian Government and the University of Tasmania.

TIA has a number of other formal and informal partnerships, including:

— a Memorandum of Understanding with Lincoln University in New Zealand, to formalise research collaborations and facilitate future opportunities for collaboration (signed in 2015).

— working with the Centre for Food Innovation, which is a partnership between the University of Tasmania, the Defence Science and Technology Organisation, and the CSIRO.

— involvement in specialist networks run by other universities, such as the Agribusiness Value Chain Research Group at the University of Queensland.

TIA undertakes a significant amount of work for the industry RDCs and the Australian Government (Figure C.1). It also collaborates with other universities and state governments.

TIA has formal communication pathways with industry groups and members. The TIA Advisory Board comprises four industry members, and each of its five Research Centres has an Advisory Group consisting of relevant industry representatives. The Terms of Reference for these groups includes (i) ensuring RD&E and educational activities are impact-focused, and (ii) industry-relevant and creating a channel for two-way communication between industry stakeholders and TIA (TIA 2012).

TIA also has affiliations for a number of its programs (section C.1.2), such as the Consortium for Science, Policy, and Outcomes at Arizona State University and CSIRO’s Science into Society Group for the Science for Society and Policy program.

$15,435,163 $19,208,109 $18,317,283 $16,387,770 $19,783,277 $19,437,227 $19,017,178 $19,898,345 $18,596,025

$0

$2,000,000

$4,000,000

$6,000,000

$8,000,000

$10,000,000

$12,000,000

2006 2007 2008 2009 2010 2011 2012 2013 2014

Fun

ding

con

trib

utio

n (A

UD

)

UTAS Operating Grant Funds UTAS PhD Research Scholarships DPIPWE Industry

Total:


C.1.5 Organisational structure

As discussed in section C.1.2, TIA’s organisational structure includes five sector-based Research Centres. Alongside these centres sit TIA’s corporate services and the School of Agricultural Sciences (Figure C.3). The TIA Director is also the Head of School. TIA itself sits within the University of Tasmania’s Faculty of Science, Engineering and Technology, and all TIA staff are employed by the university.

FIGURE C.3 TIA ORGANISATIONAL STRUCTURE

SOURCE: TIA STRATEGIC PLAN 2012-2016

TIA is overseen by an Advisory Board, which is chaired by the Secretary of the Department of Primary Industries, Parks, Water and Environment and comprises the TIA Director, senior government and university staff, and four industry members. The Board supports the Minister and Vice Chancellor.

TIA’s senior management team currently consists of the following positions:

— Director and Head of School, TIA

— Dairy Centre Leader

— Extensive Agriculture Centre Leader

— Food Safety Centre Leader

— Perennial Horticulture Centre

— Vegetable Centre Leader

— Director Centre for Food Innovation

— Corporate Director

— Senior Lecturer – Horticultural Science, First Year Coordinator.

TIA has a five-year strategic plan, which concludes this year (2012-16). Its strategic plan states that it will report annually on progress against the plan, and prepare Annual Operating Plans to direct operational activities around its strategic goals. These do not appear to be publicly available, however, TIA publishes annual reports on its website.


C.1.6 Tasmanian Institute of Agriculture

TIA (Tasmanian Institute of Agriculture), 2015. Annual Report 2014, available: http://www.utas.edu.au/tia/about-us/reports-and-publications/reports-and-publications/reports-and-publications/reports-and-plans.

TIA (Tasmanian Institute of Agriculture). Annual Reports 2006-2013, available: http://www.utas.edu.au/tia/about-us/reports-and-publications/reports-and-publications/reports-and-publications/reports-and-plans.

TIA (Tasmanian Institute of Agriculture). Strategic Plan 2012-2016, available online: http://www.utas.edu.au/tia/about-us/reports-and-publications/reports-and-publications/reports-and-publications/reports-and-plans.

TIA (Tasmanian Institute of Agriculture), 2012. RD&E Centre Advisory Groups: Terms of Reference, available: http://www.utas.edu.au/__data/assets/pdf_file/0020/382241/RDE-Centre-Advisory-Groups-Terms-of-Reference-10032015.pdf.

TIA (Tasmanian Institute of Agriculture), 2014. Submission to the Australian Government’s Agricultural Competitiveness White Paper, IP550, available: http://agwhitepaper.agriculture.gov.au/IP%20Submissions%20for%20publication/2014-04%20April/IP550%20Tasmanian%20Institute%20of%20Agriculture.pdf.

TIA (Tasmanian Institute of Agriculture), 2016. Various webpages:

— A Value Chain Approach to Food Product Innovation (http://www.utas.edu.au/tia/centres/perennial-horticulture-centre/other-activity-areas/other-activity-areas/a-value-chain-approach-to-food-product-innovation)

— About Us (http://www.utas.edu.au/tia/about-us/about-tia2/about-tia)

— History of TIA (http://www.utas.edu.au/tia/about-us/about-tia2/history-of-tia)

— Understanding Value Chains (http://www.utas.edu.au/tia/programs/uvc/understanding-value-chains)

University of Tasmania, 2016. Creating Impact from Your Research webpage, available: http://www.utas.edu.au/research/partnering/technology-transfer-and-commercialisation.

http://www.utas.edu.au/tia/about-us/reports-and-publications/reports-and-publications/reports-and-publications/reports-and-plans






http://www.utas.edu.au/__data/assets/pdf_file/0020/382241/RDE-Centre-Advisory-Groups-Terms-of-Reference-10032015.pdf

http://www.utas.edu.au/__data/assets/pdf_file/0020/382241/RDE-Centre-Advisory-Groups-Terms-of-Reference-10032015.pdf

http://agwhitepaper.agriculture.gov.au/IP%20Submissions%20for%20publication/2014-04%20April/IP550%20Tasmanian%20Institute%20of%20Agriculture.pdf

http://agwhitepaper.agriculture.gov.au/IP%20Submissions%20for%20publication/2014-04%20April/IP550%20Tasmanian%20Institute%20of%20Agriculture.pdf

http://www.utas.edu.au/tia/centres/perennial-horticulture-centre/other-activity-areas/other-activity-areas/a-value-chain-approach-to-food-product-innovation



http://www.utas.edu.au/tia/about-us/about-tia2/about-tia

http://www.utas.edu.au/tia/about-us/about-tia2/history-of-tia

http://www.utas.edu.au/tia/programs/uvc/understanding-value-chains

http://www.utas.edu.au/research/partnering/technology-transfer-and-commercialisation


C.2 Agriculture Victoria, DEDJTR

C.2.1 Overview

The Victorian Government’s agricultural research is conducted through the relevant department. This is currently the Department of Economic Development, Jobs, Transport and Resources, although previously it has been the Department of Environment and Primary Industries and the Department of Primary Industries. Following the election of the Andrews Government in November 2014, the functions of the former Department of Environment and Primary Industries were divided into two new departments: the Department of Economic Development, Jobs, Transport and Resources (which now incorporates Agriculture Victoria) and the Department of Environment, Land, Water and Planning.


Mandate and mission

There are a number of levels to the public agricultural research model in Victoria. At the highest level, it currently sits within the Department of Economic Development, Jobs, Transport and Resources (DEDJTR). The Minister for Agriculture oversees these activities (there are nine Ministers in the Department). The Minister for Agriculture is also responsible for the Regional Development portfolio.

Agriculture and Resources is one of seven groups within this department. Within the Agriculture and Resources group sits the re-introduced ‘Agriculture Victoria’ brand, being rolled out in 2016 (Agriculture Victoria 2016). Agriculture Victoria is cross portfolio grouping within the Agriculture and Resources Division comprising:

— Agriculture and Rural

― Strategic Planning ― Policy ― Agriculture Research ― Biosciences Research ― Biosecurity

— Agriculture Services and Biosecurity Operation

— Fisheries.

At the Department-level, the focus is on broad economic growth and employment, rather than growth in the agricultural or food industries specifically. DEDJTR’s mission is “to lift the living standards and wellbeing of all Victorians by sustainably growing Victoria’s economy and employment, and by working with the private and public sectors to foster innovation, creativity, productivity, investment and trade” (DEDJTR 2016).

More specifically, the aim of the Department’s agricultural research services is “to assist industry to respond to ongoing issues and trends by providing services that meet needs in a sustainable manner”. The vision for its biosciences research is “to underpin—through leading science and strong science capacity—innovation in biosciences and bioprotection essential to the prosperity and well-being of Victoria’s primary industries, ensuring high impact and relevance, and leading to significant industry and societal benefits” (Agriculture Victoria 2015). The mission and vision, while broad, explicitly focus on the state of Victoria.

Research Model

Research Centres

DEDJTR’s agricultural research centres, located across Victoria, have different focuses which correspond to the prevalent regional industry:

— AgriBio, Centre for AgriBioscience, a partnership with La Trobe University (based at its Bundoora campus)

— Primary Industries Climate Challenges Centre (PICCC), a partnership with the University of Melbourne


— DEDJTR Ellinbank. This site in West Gippsland houses the National Centre for Dairy Research and Development. Regional DEDJTR offices are also located in Bairnsdale, Leongatha and Maffra.

— DEDJTR Hamilton. This site houses the Red Meat Innovation Centre, with a focus on lamb research.

— DEDJTR Horsham. There are two sites in Horsham, incorporating the Grains Innovation Park (with Australian Grains Genebank and Plant Phenomics Victoria) and the DEDJTR Plant Breeding Centre Farm, which includes a collaborative project with the University of Melbourne (through PICCC).

— DEDJTR Mildura. This site houses the Centre for Expertise in smoke taint research, for grapes and horticultural products.

— DEDJTR Rutherglen. Research across industries and topics is conducted at the Rutherglen site, including climate variability, red meat, dairy and viticulture.

— DEDJTR Tatura. Research across industries and topics is conducted at the Tatura site, including horticulture, dairy, entomology, irrigation technology, biosecurity and emergency management.

The focus of Agriculture Victoria’s research work is state-wide, across all primary industries. Later-stage value chain research is not mentioned in its vision or mission, although facilitating private-sector value chain investment and innovation is included in other initiatives, such as its Food Source Victoria grants program (Agriculture Victoria 2015).

AgriBio

AgriBio, Centre for BioScience, was established as a public-private partnership between the (then) Department of Environment and Primary Industries (DEPI; now DEDJTR) and La Trobe University. Major Projects Victoria managed the procurement, design and construction of the project on behalf of DEPI and La Trobe. Over 400 staff from the Department and La Trobe work at AgriBio.

It has predominantly a state, then national, focus to its research, however, it aims to be an “international leader” and attract “world-leading scientists”. It is not focused on any particular industries, but rather on ‘agricultural bioscience’ as a whole.

TABLE C.1 AGRIBIO’S VISION, AIM AND OBJECTIVES

Vision To be Australia's international leader in agricultural bioscience research and development to improve productivity, sustainability, fight disease and reduce environmental impacts, and to support agricultural education in Victoria.

Aim AgriBio aims to deliver internationally recognised agricultural research and development outcomes for the benefit of Victoria and Australia.

Objectives – attracts world-leading scientists – fosters collaboration across scientific disciplines to provide solutions to industry problems – enables the sharing of leading-edge technology, high-cost equipment and facilities required for

advanced research and development – provides a flexible facility capable of rapidly adapting to future requirements – achieves energy efficiency and be environmentally and ecologically sustainable.

SOURCE: AGRIBIO WEBSITE

There is no publicly available information on AgriBio’s operating budget, however, its establishment costs were $288 million. The Victorian Government provides AgriBio with “co-investment and strategic funds that enable the attraction and leveraging of external funding” (AgriBio 2015). External funding predominantly comes from RDCs, industry, Cooperative Research Centres, and the Australian Government.


The Agriculture Investment Framework

Developed under the (then) Department of Primary Industries, the Agriculture Investment Framework is used to guide its decision-making around investments.

Figure C.4 The Agriculture Investment Framework

Source: VAGO, Enhancing Food and Fibre Productivity, August 2016

The Victorian Auditor General’s Office report on Enhancing Food and Fibre Productivity in August 2016 found that inter alia that it was a

… well-designed investment framework … [enabling] effective, evidence-based RD&E priority-setting

and project selection in line with the national framework. This is achieved through:

– quarterly industry fora that give the department the opportunity to discuss existing and potential

future industry priorities with key stakeholders in its four priority industries—dairy, grains,

horticulture and sheep and beef

– regular meetings of industry leadership groups(ILG), made up of departmental staff, that provide

advice to senior management on priorities, investment allocation and stakeholder management in

its four priority industries

– an annual planning conference where draft four-year industry investment plans—which are

produced by ILGs and specify RD&E Priorities and proposed investment shifts—are discussed by

senior management before being finalised

– an annual investment conference where current and proposed agricultural RD&E projects are

presented to senior staff for comments and discussion

– providing opportunities for evaluations of past projects to inform future investment decisions.

Project Assessment Groups (PAG) developed, prioritised, monitored and reported on the delivery of projects and services within programs of work, called Key Projects. Key Projects are the main unit of investment that encompass various integrated projects or service agreements designed to deliver the four year Strategy outcomes.

PAGs reviewed existing projects, guided project development and prioritised projects based on the following investment criteria:

— Strategic Fit, Project Logic

— Role of Government, Level of Co-investment

— Route to Market

— Return on Investment

— Risk Assessment, Likelihood of Success

— Capability and Capacity to Deliver

— Innovation.

The VAGO report also identified:

— Clear alignment with strategies and investment plans


— Appropriate levels of industry co-investment

— Clear route to market , especially for research, through practice change tools or commercialisation pathways [where ‘route to market’ refers to the way the results of research and development are further developed and delivered to the target audience—the next users or end users of the results]

— Favourable estimates of net economic, environmental and/or social benefits

— Reasonable likelihood of project success in terms of technical risk

— Capability and capacity to deliver, including appropriate linkages across the department

— Incorporates innovative new activities, engages with innovative networks or innovation systems and maintains collaboration with leading providers nationally and internationally

— Projects collectively have an appropriate portfolio balance [reviewed after all project proposals are assessed individually].

Policy advice

Policy development is one of the Agriculture and Resources group’s functions in DEDJTR. Although policy formation and research are undertaken by different teams, in different areas of the group, it seems likely that there may be ‘cross-pollination’ between the teams, as policy may inform research priorities and research findings may inform policy development.

Commercialisation

Where a commercial route to market is likely, the department works with Agriculture Victoria Services (AVS) to identify routes to market and commercialise the products. AVS is the department's commercial arm, created to protect intellectual property, to commercialise R&D outputs and to provide an interface between agriculture R&D and the private sector. The department is responsible for identifying the intellectual property and the routes to market, while AVS assumes responsibility for protecting and commercialising the intellectual property. Established in 1986 by the (then) Department of Agriculture and Rural Affairs, it is self-funded through service fees and investment income (AVS 2015). It is supported in the Department by the Technology and Commercialisation Branch. The department pays $2 million a year for these services through a formal five-year service agreement.

The number of intellectual property protections held by AVS has been relatively stable over time—see Table C.1. In any one year, there is a small annual turnover of the intellectual property portfolio.

TABLE C.1 INTELLECTUAL PROPERTY PORTFOLIO

Type Intellectual property portfolio New

2011 2012 2013 2014 2015 2015

Inventions 61 67 70 60 61 13 licences

Trademarks 54 52 56 58 54 3 trademarks

Plant breeders' rights 12 11 12 12 15 3 rights

SOURCE: DEPARTMENT OF ECONOMIC DEVELOPMENT, JOBS, TRANSPORT & RESOURCES.

In 2014-15, total revenue from services rendered by AVS was $12.11 million. The majority of this is from income generated on behalf of the Department through R&D agreements with the private sector. Royalty income was $7.74 million.

In 2014–15, the commercial routes to market stemming from this intellectual property protection generated $7.74 million in royalties and licence fees, particularly from licensing new varieties of barley, pulses and canola – see Figure C.5. This revenue is paid into a fund managed by the department's Agriculture and Resources Group and used to fund the generation, protection and commercialisation of new intellectual property assets and provide for additional science capability.


FIGURE C.5 AVS INCOME BY SOURCE

SOURCE: AVS ANNUAL REPORT 2015

Reviews

There are no publicly available reviews of DEDJTR’s agricultural research work. AVS produces an annual report which includes financial statements (including royalty and R&D income) and an overview of its activities.

C.2.3 Funding

There is limited information available about the funding provided to Agriculture Victoria’s research services, as budgetary information is provided only at the Department level. Additionally, it is difficult to compare the Department’s budget over the medium to long-term, as there have been a number of changes to departmental structure in recent years.

TABLE C.2 INVESTMENT IN AGRICULTURAL RD&E, 2013–14 TO 2015–16

Industry 2013-14 2014-15 2015-16 External

$ million Internal External Internal External Internal External Percent

Dairy 20.62 16.94 19.15 16.65 17.43 15.15 46%

Grains 15.09 20.72 14.44 24.97 14.16 21.93 61%

Horticulture 10.91 4.52 11.02 3.97 9.57 3.91 28%

Sheep and beef 13.81 3.89 13.61 3.73 12.46 2.7 22%

Cross-industry 5.07 5.34 4.43 2.73 5.58 5.4 47%

Total 65.5 51.41 62.65 52.05 59.2 49.09 45%

SOURCE: VICTORIAN AUDITOR-GENERAL'S OFFICE, USING DATA PROVIDED BY THE DEPARTMENT OF ECONOMIC DEVELOPMENT, JOBS, TRANSPORT & RESOURCES.

The VAGO found the majority of funding for the research program is contributed by the Victorian Government which varies across sectors– see Table C.2. There are also a number of partnerships,


such as AgriBio and PICCC (section C.2.2), to which universities contribute funding. The Department and the University of Melbourne have each contributed an initial $10 million per year for PICCC’s activities (Agriculture Victoria 2015). Funding for AgriBio is discussed in section C.2.3.


The primary relationship for Agriculture Victoria (and for public agricultural research in Victoria) is with the Victorian Government. This relationship would determine funding levels and priorities and also in which department the research group is situated. As noted in section C.2.1, this has changed significantly over recent years.

Another important relationship for Agriculture Victoria’s research program is with AVS, which is responsible for intellectual property and commercialisation, and is the ‘connector’ between the Department and private industry.

Much of Agriculture Victoria’s research is conducted in-house, although as discussed in section C.2.2, it has a number of research partnerships with universities—AgriBio (La Trobe University) and PICCC (the University of Melbourne). Additional partnerships include the Australian Grains Genebank, located at Grains Innovation Park in Horsham, to which the Department and the Grains Research and Development Corporation have each contributed $3 million.

Agriculture Victoria also has subject-specific collaborations, such as for its industry biotechnology research, with other research organisations, universities, Australian Government bodies, and the private sector (Table C.3).

TABLE C.3 EXAMPLES OF AGRICULTURE VICTORIA’S RESEARCH COLLABORATIONS

Research area Collaborators and partners

Grain biotechnology research Grains Research and Development Corporation

Joint Centre for Crop Improvement, University of Melbourne

Saskatchewan Wheat Pool, Canada

La Trobe University

International Centre for Agricultural Research in the Dry Areas, Syria

Dairy and other animal biotechnology

research

Dairy Futures Cooperative Research Centre

Dairy Australia

Beef Cooperative Research Centre

Sheep Cooperative Research Centre

Genetics Australia

Meat & Livestock Australia

AgResearch NZ

Agriseeds Holdings

Centre for Animal Biotechnology, Melbourne University

Heska Corporation, USA

Forest biotechnology research University of Melbourne - Department of Forestry

State Forests of New South Wales

Carter Holt Harvey - Forest Genetics, New Zealand

Australian Paper Plantations

Yates Forestry

CSIRO - Forestry and Forest Products, Canberra

CRC for Sustainable Production Forestry

Monash University - Department of Biological Sciences


Research area Collaborators and partners

Australian National University - Department of Forestry

The Forest and Wood Products R&D Corporation

The Australian Research Council

SOURCE: AGRICULTURE VICTORIA 2016


The Victorian Government’s agricultural research program is embedded in the relevant department (currently DEDJTR). Its commercialisation activities, and intellectual property protection, are conducted by a separate company, Agriculture Victoria Services, which is wholly-owned by the Government.

DEDJTR has a number of agricultural research partnerships with universities and other research organisations. The largest of these, AgriBio, is a joint venture with La Trobe University (section C.2.2) which is located on the university’s Bundoora campus.

Agriculture Victoria’s research is undertaken at eleven centres across the state (section C.2.2), distributed by relevant local industry.

C.2.6 Agriculture Victoria (DEDTJR)

Allen Consulting Group, 2012. Review of the DPI Agriculture and Fisheries Investment Framework: Final report, Report to the Department of Primary Industries Victoria.

AgriBio, 2015. Various webpages:

— Vision (http://www.agribio.com.au/about-the-jv/vision)

— Funding (http://www.agribio.com.au/what-we-do/funding)

— Project Partners (http://www.agribio.com.au/construction/project-partners)

— Strengthen Victorian Agriculture (http://www.agribio.com.au/media-and-publications/media-releases/strengthen-victorian-agriculture)

Agriculture Victoria, 2016. Various webpages:

— Agriculture Victoria (http://agriculture.vic.gov.au/about-us/agriculture-victoria)

— Dairy and Biotechnology (http://agriculture.vic.gov.au/agriculture/innovation-and-research/biotechnology/biotechnology-research/dairy-and-biotechnology)

— Forestry and Biotechnology (http://agriculture.vic.gov.au/agriculture/innovation-and-research/biotechnology/biotechnology-research/forestry-and-biotechnology)

— Grains and Biotechnology (http://agriculture.vic.gov.au/agriculture/innovation-and-research/biotechnology/biotechnology-research/grains-and-biotechnology)

Agriculture Victoria, 2015. Various webpages:

— Food Source Victoria (http://agriculture.vic.gov.au/agriculture/food-and-fibre-industries/food-source-victoria)

— Research adoption (http://agriculture.vic.gov.au/agriculture/innovation-and-research/research-adoption)

— Research centres (http://agriculture.vic.gov.au/agriculture/innovation-and-research/research-centres)

— Research services (http://agriculture.vic.gov.au/agriculture/innovation-and-research/research-services)

Agriculture Victoria Services, 2015. Annual Report 2015, available: http://www.agvic.com.au/news/latest-news/avs-annual-report-2015.

DEDJTR (Department of Economic Development, Jobs, Transport and Resources), 2016. Mission and vision, webpage, available: http://economicdevelopment.vic.gov.au/about-us/overview/mission-and-vision.

http://www.agribio.com.au/about-the-jv/vision

http://www.agribio.com.au/what-we-do/funding

http://www.agribio.com.au/construction/project-partners

http://www.agribio.com.au/media-and-publications/media-releases/strengthen-victorian-agriculture

http://www.agribio.com.au/media-and-publications/media-releases/strengthen-victorian-agriculture

http://agriculture.vic.gov.au/about-us/agriculture-victoria

http://agriculture.vic.gov.au/agriculture/innovation-and-research/biotechnology/biotechnology-research/dairy-and-biotechnology

http://agriculture.vic.gov.au/agriculture/innovation-and-research/biotechnology/biotechnology-research/dairy-and-biotechnology

http://agriculture.vic.gov.au/agriculture/innovation-and-research/biotechnology/biotechnology-research/forestry-and-biotechnology

http://agriculture.vic.gov.au/agriculture/innovation-and-research/biotechnology/biotechnology-research/forestry-and-biotechnology

http://agriculture.vic.gov.au/agriculture/innovation-and-research/biotechnology/biotechnology-research/grains-and-biotechnology

http://agriculture.vic.gov.au/agriculture/innovation-and-research/biotechnology/biotechnology-research/grains-and-biotechnology

http://agriculture.vic.gov.au/agriculture/food-and-fibre-industries/food-source-victoria

http://agriculture.vic.gov.au/agriculture/food-and-fibre-industries/food-source-victoria

http://agriculture.vic.gov.au/agriculture/innovation-and-research/research-adoption

http://agriculture.vic.gov.au/agriculture/innovation-and-research/research-adoption

http://agriculture.vic.gov.au/agriculture/innovation-and-research/research-centres

http://agriculture.vic.gov.au/agriculture/innovation-and-research/research-services

http://agriculture.vic.gov.au/agriculture/innovation-and-research/research-services

http://www.agvic.com.au/news/latest-news/avs-annual-report-2015

http://economicdevelopment.vic.gov.au/about-us/overview/mission-and-vision

http://economicdevelopment.vic.gov.au/about-us/overview/mission-and-vision


C.3 Plant & Food Research NZ

C.3.1 Overview

Plant & Food Research is one of seven Crown Research Institutes (CRIs) in New Zealand. It was established in 2008 from a merger between two CRIs, HortResearch and Crop & Food Research. Plant & Food Research is a private company limited by shares, with its sole shareholder the New Zealand Government. It conducts research across the horticultural, arable, seafood and food and beverage industries.

Plant & Food Research employs approximately 860 staff across 14 sites in New Zealand and four international offices—three in Australia (Adelaide, Brisbane and Albury) and one in California in the United States (Plant & Food Research 2015).


Mandate and mission

Plant & Food Research’s mission is to be “a sustainable business delivering science that maximises opportunities to enhance New Zealand’s economic, environmental and social prosperity” (Plant & Food Research 2015). As one of New Zealand’s CRIs, it is tasked with carrying out scientific research for the benefit of New Zealand (MBIE 2016). In contrast to TIA’s mission, the focus is clearly on the national level, rather than multi-level.

Research model

Plant & Food Research’s research model is built around three ‘Core Purpose’ outcome areas, with five strategic focus areas below these:

— increase value of the horticultural, arable, seafood, and food and beverage sectors to the New Zealand economy through the development of high-value products and processes that meet current and future global needs

― better cultivars faster™ ― proprietary, premium foods and beverages ― sustainable, premium seafood and marine products

— protect and enhance market access in New Zealand’s horticultural and arable sectors

― residue-free pest and disease control

— sustain growth in these industry sectors, driving ongoing efficiency gains with the development of environmentally resilient production systems

― sustainable and profitable production systems.

Unlike TIA and Agriculture Victoria, Plant & Food Research is focused on specific industries within the agricultural sector.

Policy advice

Plant & Food Research identifies the use of its research to inform policy-making as one of its adoption indicators within the ‘Sustainable and profitable production systems’ strategic focus area (under the ‘Sustain Growth’ Core Purpose area). Specifically, it seeks to enable “central and local government agencies [to] use knowledge and tools from Plant & Food Research science to inform policy development and systems design” (Plant & Food Research 2015).

An example provided in the 2014-15 Annual Report is its Agricultural Production Systems Simulator, which allows users, such as policy-makers, to model the impact of different policy decisions on agricultural production.


Commercialisation

Plant & Food Research undertakes its commercialisation work internally. This is overseen by the Group General Manager Commercial (section C.3.5). Commercialisation activities include breeding of plant varieties and cultivars, and collaboration with NZ Hops and Chris Little Engineering in a ‘Hop Lab’ to support the identification and commercialisation of new hop characteristics for the craft beer industry. Royalty revenues accounted for almost one third of Plant & Research Australia’s income from commercial science research contracts in 2014-15 (Plant & Food Research 2015).

Plant & Research Australia was recognised for its commercialisation work in 2015:

At the KiwiNet Awards, the business model to commercialise ‘Wakefield’ raspberry in the US, in

partnership with Northwest Plant Company LLC, was awarded the Commercial Deal Award, while the

Biopolymer Network, a collaboration with Scion and AgResearch to develop new biomaterials, was

awarded the Commercialisation Collaboration Award.

Annual Report 2015

Reviews

The New Zealand Government commissions an independent review of each CRI against its Statement of Core Purpose every four years. A review of Plant & Food Research was undertaken in 2013. The review found a number of positive elements of Plant & Food Research’s work and operations, including:

— solid policies, processes, systems and structures

— an extensive research/science portfolio and evidence of its impact

— a “wide range of strong partnerships”

— a ‘refreshed vision and strategy’ and steps taken to implement this in some areas, for example formalising sector advice, analysis and reporting.

The review also identified a range of issues that affect Plant & Food Research’s ability to achieve its Core Purpose, or may do so in the future:

— issues with ownership of the strategy within the organisation, its implementation speed and the monitoring of its progress

— repeated under-delivery on medium-term financial targets and “poor track record in delivering to its financial forecasts”

— room to improve performance in delivering to Māori

— need for clearer “specification of the ‘food’ aspects of the Statement of Core Purpose”

The review panel also expressed “broader concerns about the general operating environment for all the CRIs and in particular the degree of monitoring and the lack of financial and other disciplines for an organisation that repeatedly fails to meet its financial targets” (Plant & Food Research Review Panel 2013).

C.3.3 Funding

The New Zealand Government is Plant & Food Research’s sole shareholder, and it provides a substantial portion of its income, through annual Core Funding of $43.1 million (approximately AUD 38.3 million) as well as Crown-funded research grants. Core Funding was instituted in 2011-12. Prior to this, the level of Government contract-based funding was higher.

However, as shown in Figure C.6, commercial contracts also account for a significant share of its annual funding. In 2014-15, Plant & Food Research received more from commercial science research contracts than from the Government, for only the second time since it was established, and the first time since 2008-9 (Table C.4). Over $66 million (approximately AUD 61.8 million) was received from commercial sources, compared with approximately $60 million from the Government. Of the commercial income, more than $20 million was from royalties (approximately AUD 18.9 million).

Plant & Food Research finished the 2014-15 financial year with a before tax operating profit of $6.45 million (approximately AUD 6.02 million).


FIGURE C.6 PLANT & FOOD RESEARCH INCOME BY SOURCE, 2011-2015

Note: Funding is displayed in nominal terms and New Zealand dollars.

SOURCE: PLANT & FOOD RESEARCH ANNUAL REPORTS

TABLE C.4 INCOME BY SOURCE

Source 2007-8 2008-9 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15

New Zealand

Government $27,181,000 $42,440,000 $63,729,000 $61,700,000 $64,306,000 $62,714,000 $61,481,000 $60,195,000

Commercial $18,852,000 $47,526,000 $51,696,000 $49,498,000 $54,334,000 $53,486,000 $55,276,000 $66,284,000

Other $2,039,000 $2,355,000 $2,104,000 $2,019,000 $2,735,000 $2,851,000 $2,831,000 $2,400,000

Total $48,072,000 $92,321,000 $117,529,000 $113,217,000 $121,375,000 $119,051,000 $119,588,000 $128,879,000

Note: Funding is displayed in nominal terms and New Zealand dollars.

SOURCE: PLANT & FOOD RESEARCH ANNUAL REPORTS

Plant & Food Research provides full financial statements in its Annual Reports. These include details of Plant & Food Research’s investment in subsidiaries and associated companies. Plant & Food Research holds 100 per cent of the following companies:

— CropSeed Limited (formerly GraceLinc), which provides seed growing services

— Plant & Food Research (USA) Corporation, which provides marketing and consultancy services in the USA

— Plant & Food Research Australia Pty Limited, which provides science, marketing and consultancy services in Australia

— Truffle Investment New Zealand Limited (non-trading)

— New Zealand Institute for Crop & Food Research International Limited (non-trading)

— New Zealand Institute for Crop & Food Research Rosehip Limited (non-trading).

It also holds interest in the following companies, the principal activity of which is developing and commercialising intellectual property:

— Jukebox NZ Limited (50 per cent interest held)

— Forage Innovations Limited (49 per cent interest held)

— Biopolymer Network Limited (33.3 per cent interest held)

— Rhindo International Limited (25 per cent interest held).


Plant & Food Research has partnerships with numerous organisations and networks in New Zealand and globally, across the value chain (Plant & Food Research 2016). These include:

— twelve New Zealand-based partnerships, including FoodHQ, Better Border Security, Bioresource Processing Alliance and Nutrigenomics New Zealand

— four joint research centres/laboratories with research organisations in China


— the Plant Biosecurity Cooperative Research Centre in Australia.

Its primary relationship is with the New Zealand Government, its sole shareholder and a key funding provider.

Another key relationship for Plant & Food Research, as mentioned in the 2013 review (section C.3.2) is its engagement with Māori. Te Raranga Ahumāra is the internal group responsible for its Māori strategy. There are two working groups, tasked with:

— developing and nurturing business interactions that realise the value from Māori assets

— developing and nurturing greater understanding of the relationship between science, Plant & Food Research, and Māori (Plant & Food Research 2015).


As discussed above, Plant & Food Research is a Crown Research Institute and operates as a company, wholly-owned by the New Zealand Government.

It currently has 14 sites across New Zealand, as well as three offices in Australia and one in the United States. These sites vary in staff size, with the majority of staff working from the Auckland, Lincoln and Palmerston North sites in New Zealand. There are fewer than 10 staff working at four of the NZ sites, as well as in Australia and the USA. Ten of the New Zealand sites are research farms, varying in size between 4 and 210 hectares. Its research site in Blenheim is operated via the Marlborough Research Centre, an independent research organisation with links to Lincoln University and the University of Auckland.

Plant & Food Research’s management team currently consists of the following positions:

— Chief Executive Officer

— Chief Operating Officer

— Group General Manager Commercial

— Chief Scientist

— Chief Financial Officer

— General Manager Human Resources

Its organisational structure is shown in Figure C.7 overleaf.

Plant & Food Research also has a Board of Directors, with the following Committees:

— Audit & Risk Management Committee

— Appointments & Remuneration Committee

— Mt Albert Redevelopment Project Committee

Plant & Food Research also has an external Science Advisory Panel, to provide strategic advice to the Board regarding science and research strategies, activities and development.

It releases an Annual Report at the end of each financial year. Each Annual Report since Plant & Food Research was established is available on its website. It also publishes annual forward-looking Statements of Corporate Intent, focusing on the next five year period. As outlined in section C.3.2, an independent review of Plant & Food Research was conducted in 2013.


FIGURE C.7 PLANT & FOOD RESEARCH ORGANISATIONAL STRUCTURE

SOURCE: PLANT & FOOD RESEARCH ANNUAL REPORT 2015

C.3.6 Plant and Food New Zealand: various web pages

MBIE (Ministry of Business, Innovation and Employment), 2016. Crown Research Institutes, webpage, New Zealand Government available: http://www.mbie.govt.nz/info-services/science-innovation/research-organisations/crown-research-institutes.

National Research Council, 1995. Colleges of agriculture at the land grant universities: a profile, Committee on the Future of Land Grant Colleges of Agriculture, Board on Agriculture, available: http://www.nap.edu/read/4980/chapter/1#ii

Plant & Food Research, 2015. Annual Report 2015, available: http://www.plantandfood.co.nz/page/about-us/publications/.

Plant & Food Research. Annual Reports 2008-14, available: http://www.plantandfood.co.nz/page/about-us/publications/.

Plant & Food Research, 2015. Statement of Corporate Intent 2015/16 - 2019/20, available: http://www.plantandfood.co.nz/page/about-us/publications/.

Plant & Food Research, 2016. Various webpages:

— Our global network (http://www.plantandfood.co.nz/page/about-us/our-global-network/)

Plant & Food Research Review Panel, 2013. Four-year rolling review: Plant and Food Research 2013, report form the Review Panel, available: http://www.mbie.govt.nz/info-services/science-innovation/research-organisations/pdf-document-library/plant-and-food-report.pdf.

Chief Executive Officer

Chief Operating Officer

SCIENCE DELIVERY

- Breeding & Genomics

- BioProtection

-Sustainable Production

- Food Innovation

- Seafood Technologies

Māori Engagement

Biosafety & Compliance

Science Publishing

Chief Financial Officer

Finance

Financial Planning & Analysis

Information & Knowledge Services

Legal

Assets & Services

Investment

General Manager Human Resources

Payroll

Organisational Development

Human Resources

Health & Safety

Group General Manager Commercial

Impact Evaluation

Business Development

Plant Varieties

Intellectual Property

Strategic Marketing

Communications

Design & Photography

Chief Scientist

http://www.mbie.govt.nz/info-services/science-innovation/research-organisations/crown-research-institutes

http://www.mbie.govt.nz/info-services/science-innovation/research-organisations/crown-research-institutes

http://www.nap.edu/read/4980/chapter/1#ii

http://www.plantandfood.co.nz/page/about-us/publications/



http://www.plantandfood.co.nz/page/about-us/our-global-network/

http://www.mbie.govt.nz/info-services/science-innovation/research-organisations/pdf-document-library/plant-and-food-report.pdf

http://www.mbie.govt.nz/info-services/science-innovation/research-organisations/pdf-document-library/plant-and-food-report.pdf


C.4 Institute of Food Research (UK)

C.4.1 Overview

The Institute of Food Research (IFR) is a publicly funded UK research institute that focuses on the underlying science of food and health. Established in 1986, it operates as a company limited by guarantee, with charitable status. IFR is located in the Norwich Research Park, one of Europe’s largest single-site concentrations of research in food, health and environmental sciences. The institute has a staff of about 160, complemented by visiting scientists and postgraduate students.


Mandate and mission

IFR’s mandate is to engage in research for the public good. It seeks to be influential internationally, but achieve measurable economic impacts within the UK.

It’s mission is “to be an international leader in research that addresses the fundamental relationships between food and health, food and the gut and the sustainability of the food chain in order to further the production of safe, healthy foods” (IFR website).

In addition, it has a stated aim to support growth in the manufacturing sector and the wider UK economy. Emphasising this objective, the corporate brochure and 2015 annual report highlight the statistic that every £1 invested in IFR research returns over £8 to the UK bioeconomy.

IFR’s mission includes training of future food and health scientists. It partners in a doctoral training program with other organisations located in the Norwich Research Park and has an international training centre for EU PhD students and postdoctoral scientists.

In addition to its core research activities, IFR is active in public engagement and science communication. Outreach activities include participating in science fairs and festivals, talks at local and national community groups and school visits. The institute maintains an active presence on social media such as Twitter.

Research model

IFR’s research program is built around two strategic five-year programs funded by the Biotechnology and Biological Sciences Research Council (BBSRC). These are:

— food and health

— gut health and food safety.

IFR has a centre dedicated to food safety and a biorefinery. In addition, IFR hosts three so-called national capabilities: food databanks, a national collection of yeast cultures and ComBase, a freely available web-based system to help assess microbiological risk. These are funded by the BBSRC for the national benefit.

IFR places strong emphasis on the quality of its scientific research and published, peer-reviewed papers are an important output of IFR’s research. These can be found in IFR’s Scientific Publications Library. Websites for individual research programs also list recent publications on the landing page.

In addition to the academic work, IFR works with industrial partners to deliver benefits from its research to businesses and consumers:

— Food and Health Network is knowledge exchange network aiming to link companies in the agri-biotech sector with IFR scientists. The network has around 250 members, including 70 SMEs. Activities include subject-specific cluster meetings and confidential one-on-one meetings.

— IFR Extra Ltd is a commercial subsidiary of IFR. It focuses on short-term and applied research projects, consultancy work and specialist analysis to SMEs and large corporations.

— IFR BioMed links biomedical and pharmaceutical industries with IFR’s experts and fundamental research. A fee-based service, its focus is on collaborative, pre-competitive research and knowledge exchange


Policy and advice

IFR provides advice to UK and EU policy making and regulations. It is a member of the Parliamentary and Scientific Committee, and the Parliamentary Food and Health Forum.

IFR’s advisory role is apparent through its organisational structure. For example, one of the three aims of the IFR Food Safety Centre is to ‘advice government departments and regulators in the areas of food safety and security’. IFR does not have an explicit mandate to develop policy.

Commercialisation

IFR’s focus is on fundamental research, with explicit ‘public good’ and ‘not for profit’ mandates. Apart from knowledge transfer to the private sector it has no apparent focus on commercialising research.

Reviews

In 2013, an independent report quantified IFR’s economic impact as well as the reach of its academic research. This updated an impact assessment undertaken in 2008.

The 2013 review found that every £1 invested in IFR returned £8 to the UK bioeconomy. Assessment of the reach of IFR’s publications over the past five years found that IFR researchers published more than 450 scientific papers with an impact factor greater than 2.5 in 150 leading journals.

IFR publishes an annual report on its website, including financial accounts and risk assessment.

C.4.3 Funding

IFR’s total income in 2015 was £22.5 million, and income excluding capital grants was £14.3 million.

The BBSRC, which also provides funds to seven other UK research institutes, is IFR’s primary sponsor. One of the UK’s seven research councils, BBSRC is funded by the Department for Business, Innovation and Skills. It accounted for 86 per cent of IFR’s financing in 2015, through strategic five-year funding programs, competitive grants and capital funding for infrastructure and technology investments. The principal terms and conditions for BBSRC funding are set out in a grant agreement, which include a rolling-five year business plan discussed by the two parties at least annually.

Other sources of funding were the EU, the Department for Environment, Food and Rural Affairs, other government agencies, the Food Standards Agency and charities.

FIGURE C.8 SOURCES OF IFR FUNDING IN 2015

SOURCE: IFR ANNUAL REPORT 2015



IFR is a partner of the Norwich Research Park and has strategic links with the other park members: John Innes Centre, Norfolk & Norwich University Hospital, The Genome Analysis Centre, The Sainsbury Laboratory and University of East Anglia.

FIGURE C.9 NORWICH RESEARCH PARK

SOURCE: IFR CORPORATE BROCHURE

Apart from close links locally, IFR fosters relationships with universities and research institutes in the UK and overseas. It has memoranda of understanding with several research bodies, including The Rowett Institute of Nutrition and Health, and New Zealand Institute for Crop and Food Research.

At a governmental level, IFR is a member of the Parliamentary and Scientific Committee, and the Parliamentary Food and Health Forum.

Nationally, IFR is a founder and active member of the UK National Technology Platform for Food and participates in its European equivalent. In addition, IFR is a founder and leading member of FOODforce, a network aimed at facilitating research and co-operation among food research centres in Europe.


Governance

IFR has three corporate members: BBSRC, the University of East Anglia and the chair of the IFR board of trustees. Their roles and responsibilities are defined in a members’ agreement.

The board of trustees, sitting below the corporate members in the governance structure, oversees the institute’s activities and set the broad strategic direction of the organisation. Board members typically comprise academics, as well as food industry and public representatives. Board members are recruited for skills such as business and risk, science and technology, as well as social and ethical responsibility.

The IFR director is appointed by the board of trustees, with the approval of the corporate members. The director is accountable for ensuring that the institute achieves the objectives and targets set by the board of trustees.

Thirty research leaders have the responsibility for carrying out IFR’s research mission. They lead small focused groups and host postdoctoral researchers as well as postgraduate students.


C.4.6 Institute of Food Research, 2016. Various webpages:

— Introducing IFR (http://www.ifr.ac.uk/about/)

— Management and Governance (http://www.ifr.ac.uk/about/governance/)

— Science in Society (http://www.ifr.ac.uk/science-society/)

— Working with Business (http://www.ifr.ac.uk/business/)

— Overview of IFR Governance (http://www.ifr.ac.uk/media/cms_page_media/29/GoverningBodyTOR.pdf)

— Corporate Brochure (http://www.ifr.ac.uk/media/cms_page_media/31/IFR_corporate_brochure_dec14.pdf)

— 2015 Annual Report (http://www.ifr.ac.uk/media/cms_page_media/31/IFR_2015_AnnualReport.pdf)

http://www.ifr.ac.uk/about/

http://www.ifr.ac.uk/about/governance/

http://www.ifr.ac.uk/science-society/

http://www.ifr.ac.uk/business/

http://www.ifr.ac.uk/media/cms_page_media/29/GoverningBodyTOR.pdf

http://www.ifr.ac.uk/media/cms_page_media/31/IFR_corporate_brochure_dec14.pdf

http://www.ifr.ac.uk/media/cms_page_media/31/IFR_2015_AnnualReport.pdf


C.5 Teagasc (Ireland)

C.5.1 Overview

Teagasc, or the Agriculture and Food Development Authority, is the Irish national body providing integrated research, advisory and training services to the agriculture and food industry and rural communities. It employs approximately 1,100 staff at 55 locations in Ireland and has an annual operating budget of about €160 million.

Business model

Mandate and mission

Teagasc was established in 1988 under the Agriculture (Research, Training and Advice) Act. As outlined in the Act, Teagasc’s principal functions are to:

— provide education, training and advisory services in agriculture

— obtain and make available relevant scientific and practical information to the agricultural industry

— undertake, encourage and review agricultural R&D, including in relation to food processing and the food processing industry.

This mandate encompasses the entire food chain and Teagasc has the authority to deliver the integrated innovation support deemed necessary to add value to Ireland’s agri-food sector.

Underpinning this mandate, Teagasc’s mission is to “support science-based innovation in the agri-food section and wider bioeconomy so as to underpin profitability, competitiveness and sustainability”. Its vision is to be “nationally and internationally recognised as the knowledge provider of choice for Ireland’s agri-food sector” (Teagasc website).

Research model

Teagasc’s research covers four areas: animals and grassland; crops, environment and land use; food; and rural economy and development. Its business model emphasises the integration of research with knowledge transfer and knowledge absorption. To fulfil this aim, each of the research programs includes dedicated knowledge transfer or industry development functions. Teagasc considers its model to be unique in Europe (Teagasc Strategic Plan 2012-2015).

Teagasc has seven dedicated research locations. Its annual portfolio comprises some 300 research projects, carried out by 500 scientific and technical staff in research centres throughout Ireland. Its postgraduate fellowship program supports more than 100 MSc and PhD students annually.

Staff across 12 regional areas deliver the knowledge transfer advisory program. Approximately 80,000 farmers and rural residents are in contact with the program each year, of which more than half avail of Teagasc’s intensive farm consultancy service.

The member-based farm advisory service is branded as ‘independent, professional and research-backed advice’. It targets intensive dairy, drystock, and tillage farmers. Members can avail of a wide range of services, such as on-farm visits and advice on herd and flock management, breeding, grassland management, business and financial planning, and alternative enterprise development. In addition, two dedicated programs (business and technology, and soils and environment) aim to bring latest technologies and science to help farmers be more competitive and sustainable.

Teagasc’s technology transfer office (TTO) is its main conduit to industry, with five channels through which industry can engage with Teagasc research:

— Technology offers are technologies protected by patent applications where Teagasc is actively seeking industry partners to exploit commercialisation opportunities (approach to commercialisation is outlined in more detail in the next section).

— Technology expertise outlines areas where industry can partner with Teagasc to access its know-how and specialist infrastructure. Examples include cheese, meat and seafood technologies, but also areas such as consumer behaviour and marketing.


— Technology updates, available on Teagasc’s website, summarise main findings and implications from Teagasc’s state-funded projects.

— Technology services is a list of capabilities Teagasc offers to agri-food and related industries.

— Technology profiles detail the expertise of Teagasc staff and highlight the assistance they can provide to companies.

— Moorepark Technology Limited is a joint venture company between Teagasc and companies in the Irish dairy industry. It provides commercial pilot plant and research services for industry customers, including pilot plant rental, contract R&D, pre-commercial manufacture and technical assistance.

— Food Works is a new initiative launched to support next generation food entrepreneurs. It is a joint initiative between Bord Bìa (the Irish Food Board), Enterprise Ireland and Teagasc to find and foster a new group of entrepreneurs.

Policy and advice

Teagasc does not appear to have a role in providing policy advice to the government.

Commercialisation

Teagasc actively seeks industry partners to assist in commercialisation of its research through its ‘technology offers’. These one-page summaries typically outline the problem, how the technology provides a solution, its competitive advantage, stage of development and opportunity offered to industry partners. The potential roles for industry partners include validation, joint development and licensing. At the time of writing (July 2016) the food research program dominated, accounting for nine of the ten technology offers.

C.5.2 Funding

Teagasc’s primary source of funding is the Irish government, mainly through grant-in-aid. It derives operational income from its advisory services and other fees (not specified). Funding from the EU and other grant funding account for the remainder. It 2014, total funding from these sources was €16 million. Around 40 per cent of Teagasc’s income is dedicated to research activities and the remaining 60 per cent is allocated evenly between advisory and education services.

FIGURE C.10 SOURCES OF TEAGASC FUNDING IN 2014

Note: excludes net deferred funding for pensions of €27 million and net disposal of fixed assets of €16,000.

SOURCE: TEAGASC ANNUAL REPORT 2014

State funding78%

Operational income

17%

Other grants and levies3%

EU funding2%

SARDI REVIEW FINAL REPORT C-26

TABLE C.5 TEAGASC RESEARCH PROGRAMS

Research program Research focus Knowledge transfer functions Locations

Animal and grassland Animal and bioscience

Grassland science

Livestock systems

Pig development

Dairy knowledge transfer

Drystock knowledge transfer

Athenry, Co. Galway

Grange, Dunsany, Co. Meath

Moorepark, Fermoy, Co Cork

Crops, environment and land-use Crops

Agri-environment

Forestry development

Horticulture development

Agricultural catchments

Crops knowledge transfer

Environment knowledge transfer

Johnstown Castle, Co. Wexford

Oak Park, Co. Carlow

Food Food biosciences

Food safety

Food chemistry and technology

Food industry development Ashtown, Dublin 15

Moorepark, Fermoy, Co. Cork

Rural economy and development Agricultural economics and farm surveys

Spatial analysis, food marketing and agri-innovation

Farm management and rural

development knowledge transfer

Ashtown, Dublin 15

Athenry, Co. Galway

SOURCE: VTT RESEARCH FOR ACIL ALLEN



The Department of Agriculture, Food and the Marine is Teagasc’s parent department. It also has links with other government departments, including the Departments of Jobs, Enterprise and Innovation; Environment, Community and Local Government; Education and Skills; and Communications, Energy and Natural Resources.

Within Ireland, Teagasc has close links with other agencies such as Science Foundation Ireland, the Environmental Protection Agency, Food and Safety Promotion Board, Bord Bìa (the food authority), and the Food Safety Authority of Ireland. It has formal partnerships with University College Cork and University College Dublin. In addition, it has programs with six industry partners, including multinational Irish corporations such as Glanbia, Carberry Group and Kerry Group.

Internationally, Teagasc has signed bilateral agreements with AgResearch and Dairy NZ (both in New Zealand); Agricultural Research Service (USA); MTT (Finland); INRA (France); and the Scottish Agricultural College (UK).


The 11-person Teagasc Authority provides strategic oversight to the organisation. Members are appointed for five-year terms by the Minister for Agriculture, Food and the Marine. Representatives include farming organisations, the food industry, the universities, the Department of Agriculture, Food and the Marine as well as Teagasc staff. The authority meets monthly and has a number of subcommittees, including for research, advisory and training, and operations.

Teagasc’s organisational structure comprises three directorates: research, knowledge transfer and operations. Each of these contain further sub-functions, and Teagasc’s four research programs are explicitly identified as elements under the research directorate.

As outlined in section C.5.2, each research program includes a distinct knowledge transfer department. The knowledge transfer directorate operates the regional advisory program and an education program delivered in four Teagasc colleges, twelve regional centres and three private colleges. A strong relationship operates between the knowledge transfer departments located within the research directorate and the advisory program, made explicit in the organisational chart (Figure C.11). The operations directorate comprises a number of head office departments (finance, HR and ICT), but also has overall responsibility for the effective delivery of administrative systems across the organisation.

FIGURE C.11 TEAGASC ORGANISATIONAL STRUCTURE



Teagasc’s three-year strategic plan (2012-2015) concluded last year. It defines the organisation’s mandate, mission and vision, and includes an environmental analysis.

C.5.5 Teagasc, 2016. Various webpages:

— Advisory services (https://www.teagasc.ie/about/farm-advisory/advisory-services)

— Engagement with industry (https://www.teagasc.ie/about/research--innovation/engagement-with-industry/)

— Commercialisation opportunities (https://www.teagasc.ie/about/research--innovation/engagement-with-industry/commercialisation-opportunities/)

— Our organisation (https://www.teagasc.ie/about/our-organisation/)

Teagasc 2012. Statement of Strategy 2012-2015. Available at (https://www.teagasc.ie/media/website/publications/2012/1289/Teagasc-Strategy-Statement.pdf)

Teagasc 2015. Teagasc Annual Report and Financial Statements 2014. Available at https://www.teagasc.ie/media/website/publications/2015/3758/Teagasc-Annual-Report-2014.pdf

https://www.teagasc.ie/about/farm-advisory/advisory-services

https://www.teagasc.ie/about/research--innovation/engagement-with-industry/

https://www.teagasc.ie/about/research--innovation/engagement-with-industry/

https://www.teagasc.ie/about/research--innovation/engagement-with-industry/commercialisation-opportunities/

https://www.teagasc.ie/about/research--innovation/engagement-with-industry/commercialisation-opportunities/

https://www.teagasc.ie/about/our-organisation/

https://www.teagasc.ie/media/website/publications/2012/1289/Teagasc-Strategy-Statement.pdf

https://www.teagasc.ie/media/website/publications/2015/3758/Teagasc-Annual-Report-2014.pdf


C.6 INRA (France)

C.6.1 Overview

INRA is the French national institute for agricultural research, operating under the dual aegis of the Ministry of Research and the Ministry of Agriculture. As a public organisation, INRA is dedicated to mission-oriented research in agriculture, food and nutrition, the rural environment.

INRA is ranked as the world’s second greatest producer of publications in the agricultural sciences and has an annual income of around €880 million. Operations are distributed across 186 laboratories and 49 experimental units, organised around 13 scientific divisions and 17 research centres. The INRA community comprises 12,000 people including about 8,300 permanent staff, 1,800 full-time researchers, 2,500 interns and 500 PhD students with INRA grants.


Mandate and mission

INRA was created in 1946 with one initial goal: to feed France. Today, INRA focuses on three interconnected topics: nutrition, agriculture, and the environment. Its emphasis has shifted from the national to the international and its current objective is to sustainably feed the world.

INRA’s main goal is to develop agricultural systems that:

— better meet people’s nutritional needs and can be used in novel ways

— are efficient and competitive

— respect the environment and natural resources and use land responsibly.

The institute’s ten-year strategy (Figure C.12) is designed to help the institute carry out this research task. The strategy is framed around four research priorities, two interdisciplinary fields and the main objective of sustainably feeding the world.

FIGURE C.12 INRA’S 10-YEAR STRATEGY


INRA’s research spans the entire food value chain from microbes found in soil to nutrition strategies. Its research outputs include scientific publications, patents, certified new plant varieties as well as software programs, databases and decision-making tools.

INRA has committed to a policy of open data. Nearly one-fifth of its research publications are open access.

Policy and advice

INRA has an explicit objective to inform public policy. Activities are overseen by a steering committee and include:

Four research priorities:

• improving the performance of all facets of agricultural systems

• mediating and adapting to the impacts of climate change

• using biomass in chemical, energy, and bioeconomic applications

• developing sound, sustainable food-production systems.

Two emerging interdisciplinary fields:

• agroecology

• systems biology.

One main objective:

• to ensure the sustainable nutritional health of the world by 2050.


— scientific expert reports, critical syntheses of confirmed published reports, and may be produced in response to questions submitted by government departments

— advanced studies, analyses of both confirmed and emerging knowledge, possibly complemented by simulations

— foresight publications, exploring the contrasting, long-term scenarios, based on available data and stakeholder expertise.

Commercialisation

INRA established a charter on intellectual property in 2004, which still appears to be current. The charter clearly sets out INRA’s primary function, which is to serve the public good.

Ownership, dissemination and commercial exploitation of research results from joint projects are dealt with differently depending on whether the partner is public or private.

Joint ownership of results and fair division of financial returns is proposed for public partners. In the case of private partners, however, INRA claims full ownership of results carried out on its premises by INRA researchers. Joint ownership may be considered on a case-by-case basis. Any exclusive arrangements, including transfer of IP or exclusive licensing, are not recommended by the charter.

C.6.3 Funding

INRA has an annual budget in the region of €880 million. According to the 2014 annual report, some €670 million of this came from grants for public services, €143 million from research contracts and €64 million from INRA’s own income.


INRA places strong focus on collaboration, including with universities, industry, regional governments, the general public and the agricultural sector.

INRA has an extensive network of international collaborators, partnerships and framework agreements. It is an active participant in European research programs. Further afield, a directory on its website lists key contacts, partners and calls for proposals by country. For example, Australian National University and CSIRO are identified as Australian collaborators. INRA is associated with six international laboratories. Nearly half of its publications include foreign co-authors and a fifth of its researchers in 2014 came from outside of France.

Collaboration with industry takes place in a range of ways.

INRA has three Carnot institutes dedicated to partnering with industry, focussing on food and nutrition, bioeconomy and animal health. The institutes received funding from the French National Research Agency to adapt scientific and technological knowledge to future industry needs.

The main function of INRA’s Carnot institutes is to facilitate and encourage collaboration between researchers and industrial partners2. To achieve this, each institute has a single portal and contact person for industry participants, a consistent thematic and organisational structure and an industry-focussed approach to contracts with short, respected deadlines and a quality assurance procedure.

Two biotechnology catalysts aim to foster scientific innovation and strengthen the link between research (basic and applied) and industry. Partners include higher education institutions, commercialisation firms, SMEs and large corporations. Research outputs include publications and patent applications.

INRA avails of specific government grants aimed at applied research. It collaborates with SMEs and mid-sized companies through six dedicated shared laboratories. Innovation transfer is formalised through two affiliated bodies, one with a broad focus and one specialising in INRA-developed plan varieties.

2 A defined concept in France, a Carnot institute is a research organisation focused on R&D in favour of industry innovation.



INRA has 17 research centres (including in French overseas territories) and one head office. Its research is theme based and organised around 13 divisions and 8 meta programs. As shown in Figure C.13, the management structure includes three boards with oversight responsibilities, as well as a management board.

FIGURE C.13 INRA ORGANISATIONAL CHART


C.6.6 INRA 2016. Various webpages:

— INRA and the world (http://institut.inra.fr/en/INRA-and-the-world)

— Objectives (http://institut.inra.fr/en/Objectives)

— Organisation (http://institut.inra.fr/en/Organisation)

— Overview (http://institut.inra.fr/en/Overview)

— Partners (http://institut.inra.fr/en/Partners)

— Research and results (http://institut.inra.fr/en/Research-and-results)

— Who we are (http://institut.inra.fr/en)

INRA 2004, Charter on Intellectual Property. Available at http://institut.inra.fr/en/Overview/Documents/Charters/Intellectual-property-charter

http://institut.inra.fr/en/INRA-and-the-world

http://institut.inra.fr/en/Objectives

http://institut.inra.fr/en/Organisation

http://institut.inra.fr/en/Overview

http://institut.inra.fr/en/Partners

http://institut.inra.fr/en/Research-and-results

http://institut.inra.fr/en

http://institut.inra.fr/en/Overview/Documents/Charters/Intellectual-property-charter


C.7 INIA (Spain)

C.7.1 Overview

INIA, the Spanish National Institute for Agronomic Research, is an autonomous public research body attached to the Ministry of the Economy and Competitiveness. It is responsible for managing and coordinating national agrifood research and for executing of research projects. INIA collaborates and coordinates its activities with relevant socioeconomic sectors and equivalent regional institutions. It employs 900 people of whom about 600 are directly involved in research activities.


Mandate and mission

INIA has a legislated mandate. Its broad mission is to “contribute to continuous and sustainable progress through development of environmentally friendly technologies” (INIA website). More specifically, INIA’s statement of strategy states that its mission is to generate and transfer knowledge to:

— confront agro-food and forestry sector challenges, including food demand, climate change and sustainability, restrictions on food production and market globalisation

— enhance the competitiveness of companies in the Spanish agri-food and forestry sector through innovation

— support and advise the Spanish administrations.

According to the strategy, INIA’s vision is to facilitate and coordinate agri-food and forestry research in Spain and to be a national and international body of reference, supporting economic and sustainable growth and societal welfare based on the bioeconomy.

Research model

INIA’s research activities are carried out by the General Deputy Directorate of Research and Technology and cover the agri-food value chain from resource production to food technology. The directorate comprises specialised research centres, six research departments as well as other units and associate centres. The research centres and departments are further divided into targeted research groups.

FIGURE C.14 ORGANISATION OF INIA’S RESEARCH ACTIVITIES

SOURCE: INIA WEBSITE


The centres and departments also provide a range of services, presumably to industry, though target clientele is not identified on the website. For example, the food research department offers meat analysis and determination of components in plant material, whereas the Forest Research Centre offers services such as effectiveness evaluation of wood preservatives, wood identification, dating and damage diagnosis, as well as quality assessments of various wood products.

Policy and advice

INIA has an explicit function to provide advice and information to the Spanish government; however, no further detail of how it carries out this function is publicly available.

Commercialisation

Obtaining new patents and registering new plant varieties, as well as licensing and marketing these are explicitly identified as strategic objectives, with associated targets, in the 2014-2017 strategic plan.

INIA coordinates its commercialisation activities through a technology transfer office. Agreements and contracts managed by the TTO include collaboration agreements with companies, as well as public and private institutes, contracts for technical advice and assistance, and patent license agreements.

Reviews

No publicly available reviews. However, the 2014-2017 strategic plan sets a range of quantitative targets, such as quantity and quality of scientific publications, patents and licences, financing from competitive international sources and participation in international projects.

C.7.3 Funding

INIA received €78 million funding from the Spanish government in 2012 (latest figure available). Its budget is further supplemented by various agreements, contracts and EU research funding. Information on the scale of the supplementary funding is not publicly available.


INIA’s director chairs a research coordination commission between INIA and the autonomous regions. This is a platform to identify research priorities and common needs and align these with available resources, with the aim to improve the cohesion of Spanish agri-food research.

INIA has an office in Brussels to coordinate its EU affairs. It is the Spanish representative on the EU Standing Committee on Agricultural Research (SCAR) and is active in the EU’s food, agriculture, fisheries and biotechnology research cooperation program.

Cooperation in Latin America is an area of special significance to INIA. This is done through a permanent forum with equivalent research institutes and as a member of the Regional Fund for Agricultural Technology (FONTAGRO) which finances competitive R&D in agriculture. Through these activities, INIA aims to increase the competitiveness of agri-food in Latin America and the Caribbean.

Formal mechanisms for cooperation with private sector companies include collaboration forums, which aim to disseminate of INIA’s research and allow companies a platform to identify areas where they seek technological improvement. Thematic forums seek multidisciplinary solutions to specific sectoral challenges.


INIA has five levels of coordination:

— The management board meets fortnightly establishes objectives, monitors them and coordinates the units tasked with achieving the objectives.

— A research council meets every second month to coordinate research activities.

— Various inter-unit coordinating committees deal with matters such as finance, training and IT.

— Job coordination takes place through informal and supervisory relationships, unification of work procedures, and INIA’s scientific policy.


— Meetings between employee representatives and the secretariat general.

— Coordination of external activities takes place through participation on relevant committees and platforms.

INIA’s organisational chart is shown in Figure C.15.

FIGURE C.15 INIA ORGANISATION CHART


C.7.6 INIA 2016: Various webpages

— About INIA (http://www.inia.es/IniaPortal/goUrlDinamica.action?url=http://wwwsp.inia.es/en-us/Inia)

— International (http://www.inia.es/IniaPortal/goUrlDinamica.action?url=http://wwwsp.inia.es/en-us/RelInt)

— Research (http://www.inia.es/IniaPortal/goUrlDinamica.action?url=http://wwwsp.inia.es/en-us/Investigacion)

— Technology transfer (http://www.inia.es/IniaPortal/goUrlDinamica.action?url=http://wwwsp.inia.es/en-us/Investigacion/OtrasUni/TransferenciaTecnologia)

INIA 2014. Strategic Plan 2014-2017. Available at http://wwwsp.inia.es/en-us/Inia/Documents/PE%20INIA%2021%2001%202014%20en.pdf

http://www.inia.es/IniaPortal/goUrlDinamica.action?url=http://wwwsp.inia.es/en-us/Inia

http://www.inia.es/IniaPortal/goUrlDinamica.action?url=http://wwwsp.inia.es/en-us/RelInt

http://www.inia.es/IniaPortal/goUrlDinamica.action?url=http://wwwsp.inia.es/en-us/RelInt

http://www.inia.es/IniaPortal/goUrlDinamica.action?url=http://wwwsp.inia.es/en-us/Investigacion

http://www.inia.es/IniaPortal/goUrlDinamica.action?url=http://wwwsp.inia.es/en-us/Investigacion

http://www.inia.es/IniaPortal/goUrlDinamica.action?url=http://wwwsp.inia.es/en-us/Investigacion/OtrasUni/TransferenciaTecnologia

http://www.inia.es/IniaPortal/goUrlDinamica.action?url=http://wwwsp.inia.es/en-us/Investigacion/OtrasUni/TransferenciaTecnologia

http://wwwsp.inia.es/en-us/Inia/Documents/PE%20INIA%2021%2001%202014%20en.pdf

http://wwwsp.inia.es/en-us/Inia/Documents/PE%20INIA%2021%2001%202014%20en.pdf

SARDI REVIEW FINAL REPORT D–1

D . S T A K E H O L D E R S C O N S U L T E D

D Stakeholders consulted

D.1 Review working group

TABLE D.1 SARDI REVIEW WORKING GROUP

Mehdi Doroudi PIRSA (Working Group Chair)

Clive Noble

Goran Roos Economic Development Board of South Australia

Denis Mutton Pork CRC

Rob Kerin Primary Producers SA

Kathy Ophel-Keller SARDI (Observer)

Alison Hackett-Rogers PIRSA (Working Group Executive Officer)

D.2 Stakeholder interviews

TABLE D.2 STAKEHOLDER INTERVIEWS

Name Organisation

Brian Jeffries Australia Southern Bluefin Tuna Industry Association

Vivien Kite Australian Chicken Meat Federation (ex RIRDC Chicken Meat Program)

Dan Johnson Australian Wine Research Institute

Patrick Hone Fisheries Research and Development Corporation

Leanna Read Chief Scientist for South Australia

Catherine Sayer Food SA

Steve Thomas Grains Research and Development Corporation

John Lloyd Horticulture Innovation Australia

Michael Robinson Plant Biosecurity CRC

Roger Campbell Pork CRC

Andy Pointon Pork SA

Matthew Starick Pork SA


Name Organisation

Don Frater Primary Industries and Regions South Australia

Jo Collins Primary Industries and Regions South Australia

Justin Ross Primary Industries and Regions South Australia

Mehdi Doroudi Primary Industries and Regions South Australia

Scott Ashby Primary Industries and Regions South Australia

Sean Sloan Primary Industries and Regions South Australia

Stuart West Primary Industries and Regions South Australia

Will Zacharin Primary Industries and Regions South Australia

Rob Kerin Primary Producers South Australia

Kylie Hewson RIRDC Chicken Meat Program

Justin Phillips SA Rock Lobster Advisory Council

Rob Lewis Science Without Boundaries

Alan Tillbrook South Australian Research and Development Institute

Dave Stewart South Australian Research and Development Institute

Gavin Begg South Australian Research and Development Institute

Jim Cox South Australian Research and Development Institute

Kathy Ophel-Keller South Australian Research and Development Institute

Robert Hill University of Adelaide

Andreas Clark Wine Australia

Liz Waters Wine Australia

D.3 Stakeholder submissions received

TABLE D.3 ORGANISATIONS WHO MADE A SUBMISSION TO THE REVIEW

Organisation

1. Ag Institute of Australia (SA Division)

2. Australia’s Integrated Marine Observing System

3. AUSVEG SA

4. Citrus Australia South Australia Region

5. CSIRO

6. Eyre Peninsula Agricultural Research Foundation

7. Flinders University

8. Food South Australia

9. Department of Environment, Water and Natural Resources

10. Heritage Seeds (confidential)

11. Murray Darling Basin Authority

12. Poultry CRC (confidential)

13. Riverland Wine

14. South Australia Wine Industry Association

15. South Australian Grain Industry Trust


Organisation

16. South Australian Rock Lobster Advisory Council

17. Spencer Gulf & West Coast Prawn Fishermen’s Association (confidential)

18. The Australian Wine Research Institute

19. The University of Adelaide

20. Wildcatch Fisheries South Australia

21. Wine Australia

22. Wine Grape Council South Australia

TABLE D.4 ORGANISATIONS INVITED TO MAKE A SUBMISSION TO THE REVIEW

Organisations Category

Accolade Wines Companies

Ag Institute Australia (SA branch) Industry Associations

Almond Board of Australia Industry Associations

Australian Centre for Plant Functional Genomics (ACPFG) Other

Australian Egg Corporation Limited (AECL) RDCs

Australian Fisheries Management Authority (AFMA) Government

Australian Grain Technologies Companies

Australian Pork Limited RDCs

Australian Poultry CRC Other

Australian Southern Bluefin Tuna Industry Association Industry Associations

Australian Wine Research Institute (AWRI) Other

Australian Wool Innovation (AWI) RDCs

AUSVEG Industry Associations

Bayer Crop Science Companies

BHP Billiton Companies

BP Companies

Cibo (SPQR Holdings Pty Ltd) Companies

Citrus Australia - SA Region Industry Associations

Clean Seas Aquaculture Companies

Commonwealth Environmental Water Office Government

CSIRO Other

Dairy Australia RDCs

DEDJTR Government

Department of the Environment Government

DEWNR Government

EPA Government

Eyre Peninsula Agricultural Research Foundation Industry Associations

Fisheries industry Industry Associations

Fisheries Research and Development Corporation (FRDC) RDCs

Flinders University Other

Food SA Industry Associations



Goyder Water Research Institute Other

Grain Industry Association of SA Industry Associations

Grain Producers SA Industry Associations

Grains Research and Development Corporation (GRDC) RDCs

Heritage Seeds Companies

High Integrity Pork CRC Other

Horticulture Coalition, Apple and Pear and Cherry Growers Association of

South Australia

Industry Associations

Horticulture Innovation Australia Industry Associations

Horticulture Innovation Australia (HIA) RDCs

Industry Associations Industry Associations

Integrated Marine Observing System (IMOS) Other

Livestock SA Industry Associations

Meat and Livestock Australia (MLA) RDCs

Murray–Darling Basin Authority Government

Natural Resource Management, Mediation and Facilitation Services Industry Associations

Northern Zone Rock Lobster industry Industry Associations

NSW DPI Government

Other Other

Pernod Ricard Winemakers Companies

Plant Biosecurity CRC Other

Pork SA Industry Associations

Potatoes South Australia Industry Associations

Primary Producers SA Industry Associations

Riviera Bakery (R B Distributions Pty Ltd) Companies

Rural Industries Research and Development Corporation (RIRDC) RDCs

SA Mussel Growers Association Industry Associations

SADA Industry Associations

SAGIT Industry Associations

Sardine Industry Assoc. Inc. Industry Associations

Seafood CRC Company Ltd Other

Sheep CRC Other

Simplot Companies

South Australian Chicken Meat Council Industry Associations

South Australian Egg Farmers’ Association Industry Associations

South Australian Grains Industry Trust (SAGIT) RDCs

South Australian Oyster Growers Association Industry Associations

South Australian Rock Lobster Advisory Council Inc (SARLAC) Industry Associations

South Australian Wine Industry Association Industry Associations

Spencer Gulf & West Coast Prawn Fishermen’s Association Inc Industry Associations



SunPork Companies

Syngenta Companies

Taings Noodles Companies

Treasury Wine Estates Companies

Tuckers Natural Companies

Uncle Toby's Companies

University of Adelaide Other

University of SA Other

VineHealth Australia Industry Associations

Wild Catch SA Industry Associations

Wine Australia RDCs

Wine Grape Council of South Australia Industry Associations

Yalumba (S. Smith & Son) Companies

SOURCE: PIRSA

SARDI REVIEW FINAL REPORT E–1

E . S U B M I S S I O N S S U M M A R Y

E Submissions summary

TABLE E.1 SUMMARY OF SUBMISSIONS MADE TO THE REVIEW

Submission question Responding organisation Response

Q1: Challenges and opportunities

Industries to focus on Ag Institute of Australia – Agriculture will develop in four interacting directions:

– fewer broad acre farmers farming greater areas with greater

reliance of technology

– farms that focus on niche high value products where provenance is

an important marketing tool

– greater emphasis on value adding

– changing mix of production systems and their distribution.

– There is a perception that governments have mainly focussed on the

second area, without appreciating the potential of other opportunities.

– SARDI should focus on the value chain rather than the supply chain.

– Comprehensive list of technologies and opportunities in the

submission, including irrigation technology, biosecurity, animal welfare

and climate applications.

AUSVEG SA – Horticulture should be a focus area.



Citrus Australia South Australia Region – SARDI should focus on market access, pre and post-harvest research,

pest control, remote sensing for precision agriculture and technologies

that improve competitiveness of Australian farming industries.

Department of Environment, Water and

Natural Resources (SA)

– Any potential environmental threats that could be high risk or high

profile for state government, particularly where these challenges

clearly impact economic production as well as environmental assets.

– DEWNR gets greatest value from the ‘public good’ elements of

SARDI’s work. This is less likely to lead to commercial or industry

development outcomes; however, there are exceptions to this (see

submission for detail).

Eyre Peninsula Agricultural Research

Foundation

– Productivity and profitability of broadacre agriculture should remain a

focus.

Flinders University – Aquaculture should remain a focus area.

Murray Darling Basin Authority – The Murray-Darling Basin Plan implementation will reach a number of

milestones in the next ten years. SARDI should maintain capacity to

monitor the Murray-Darling Basin to determine outcomes of the basin

plan implementation.

Riverland Wine – SARDI should focus on industries important to South Australia’s

economy. This includes industries currently struggling, since these

typically require new technologies to improve competitiveness and

ensure long-term sustainability.

South Australian Grain Industry Trust – Retain strong focus on the grain industry, the largest contributor to

GSP in the agricultural sector.

South Australian Wine Industry

Association

– Viticulture should remain a target, with climate change adaptation and

manufacturing R&D as focus areas.

– SAWIA would like to have a clear understanding of the project,

outcomes and timeframes relevant to the wine industry.

The University of Adelaide – SARDI should align with the National Primary Industries Research

Development and Extension framework.

– Appears unsustainable for SARDI to operate in all parts of the

agriculture, fisheries and food value chain. SARDI should focus on

areas where it can make the most significant contributions.



Wine Australia

SARDI’s strength, and its particular value to the wine industry, has been at the practical end of the value chain, and it has a strong record of developing readily adoptable outcomes for grapegrowers, which allow them to better manage issues of economic significance to their businesses.

– Continue to focus on practically oriented, outcome-focus research for

the wine industry.

– SARDI’s cross-industry expertise in areas such as plant pests,

diseases and diagnostic services is an additional strength that benefits

the wine industry and should continue to be fostered.

Wine Grape Council South Australia – SARDI should continue to focus on winegrape production and ensure

work in the area continues as researchers retire in coming years.

– It would be helpful to clarify the basis of SARDI’s research priorities.

Strengthening collaboration Ag Institute of Australia – SARDI should resume clear and separate identity apart from PIRSA,

while maintaining an administrative connection and close links. Review

should also consider PIRSA’s performance.

– SARDI should broker joint approaches with universities, CSIRO,

industry and funding bodies in Australia and overseas (including New

Zealand and California).

Australia’s Integrated Marine Observing

System

– Consider opportunities from the Commonwealth Government’s

Innovation Agenda

– Continue to maintain and develop marine science capabilities,

including engaging with IMOS planning

– Continue working with the National Marine Science Committee

– Increase collaboration with South Australian universities and ensure

SARDI fully understands their research needs. Marine Innovation

South Australia (MISA) could coordinate.

AUSVEG SA

The research in SARDI in our opinion is closely matched to the capabilities and interests of individual staff rather than the needs of industry.

– Focus more on the needs of industry through strategic realignment.

– SARDI should improve collaboration with industry bodies, rather than

seeing them as competitors.

Citrus Australia South Australia Region – SARDI should strengthen collaboration with Commonwealth agencies,

Plant Health Australia, Hort Innovation, peak industry bodies, industry

leaders, HIAL and international organisations.



CSIRO – Outside of specific project areas, CSIRO does not have a strong

awareness of the SARDI research portfolio but welcomes

opportunities to increase its awareness.



– SARDI should collaborate with other state agencies to demonstrate

the relevance of its research to state government policy. SARDI’s

collaboration in the Goyder Institute for Water Research is an example

of this.

Flinders University – Given that food production is globalising, SARDI should strengthen

collaboration with national and international researchers. SARDI

should be a conduit for bringing best international research and

researchers to South Australia.

Food South Australia – Collaboration with Food SA could be strengthened. More interaction

will enable Food SA to learn more about the services provided by

SARDI and allow SARDI to learn more about what Food SA does.

– SARDI has not taken up an invitation to take part in Food SA’s team

meetings, nor did SARDI include Food SA in the Functional Food

Demonstration Project as a collaborator despite Food SA’s partnership

agreement with PIRSA.

– SARDI could focus more on the practical, commercial needs of food

companies; at times its interaction is very science focussed and does

not resonate with manufacturers.

– One of SARDI’s weaknesses is, at times, its ability to effectively

communicate and convey messages to industry. If public

presentations are required, support should be given to presenters to

effectively engage with the relevant audience.

Murray Darling Basin Authority – The following partners will be beneficial to SARDI: Commonwealth

Environmental Water Office, Commonwealth Department of

Agriculture and Water Resources, Commonwealth Department of

Environment, SA Water, DEWNR, regional natural resources

management boards, other basin state’s fisheries and environmental

research organisations, Indigenous Nations.



Riverland Wine

Industry is typically the forgotten or at least overlooked stakeholder. R&D projects are undertaken “for” industry, NOT “with” industry.

– SARDI should strengthen collaboration with industry, to ensure it

delivers research needed by industry. It should develop stronger

collaboration with peak industry bodies. As a result, SARDI would

better understand industry needs, industry would better understand

SARDI’s capabilities and value, research outcomes would be better

targeted and SARDI could be more confident its investments would be

well utilised.

South Australian Grain Industry Trust

(SAGIT)

A strong relationship exists between SARDI and SAGIT. The Trustees highly value the interaction and open discussion that exists on research issues.

– Maintain and strengthen relationship with SAGIT, and strengthen

relationship with growers.

The Australian Wine Research Institute. – Given SARDI’s South Australian mandate, national-level service

provision could be done more effectively through stronger partnerships

with organisations such as AWRI. As an example, the SARDI–AWRI

joint position in viticulture is a model that could be rolled out on a

broader scale.

The University of Adelaide – Too few SARDI research staff are nationally competitive.

Reinvigorating strategy for joint appointments between SARDI and

universities could help address the issue; many top researcher prefer

to be based within a university.

– Examples of good collaboration:

– With the UoA School of Agriculture, Food and Wine

– Spencer Gulf Ecosystem and Development Initiative

– Marine Innovations Southern Australia

Wine Australia

– SARDI participation in the Wine Innovation Cluster and links with

Flinders University, the University of South Australia and wine

companies are critical for success of research projects funded by Wine

Australia.

– SARDI could strengthen collaboration to include state agriculture

departments and universities external to South Australia that have

capability in viticulture, or access to new relevant technology.



Wine Grape Council South Australia – Roles and responsibilities of the various research agencies assisting

grape growers, including SARDI, AWRI, and the National Wine and

Grape Industry Centre, should be clarified. Understanding the point of

differentiation between the bodies would contribute to more effective

engagement with industry.

Major challenges and opportunities Ag Institute Australia – The national approach to research rationalisation has left gaps which

present an opportunity for SARDI.

– SARDI should set its own research priorities, be proactive in

commissioning projects with clear business cases and frame

outcomes in terms of benefit to industry and the overall economy.

– A major challenge for SARDI is to attract and maintain high quality

researchers in core areas, reflecting a decline in government support

for SARDI. Establishing research hubs may go some way to

addressing this area.

AUSVEG SA

Put simply, aside from select products in select windows, South Australia’s capacity to serve emerging Asian markets at volume is significantly less than competing countries. What we can do is export our technologies, our regulatory systems and our knowledge to teach emerging countries how to grow.

– Major opportunities in the horticulture sector include the pack house

(technologies such as packhouse automation, robotics and advanced

waste management) and the front office (managing operations and

labour).

– Emerging technologies such as field robotics is an important

opportunity; these will revolutionise the industry.

– There are opportunities to commercialise South Australia’s biosecurity

and food safety regulatory regime and research.

Citrus Australia South Australia Region – Major challenges for the citrus sector include cost of food safety and

traceability compliance, biosecurity, including pests and disease, water

security, and cost of implementing market access protocols.



– Research quantitatively demonstrating the benefits of environmental

water to the health of the environment, a key aspect of the Murray

Darling Basin Plan, present an opportunity for SARDI.

– Intellectual property and data accessibility are key challenges.

DEWNR operates under open data principles which can be at odds

with industry expectations and the commercial manner in which

SARDI has to operate.




Foundation

– A large productivity gap remains in broadacre farming enterprises

(grains & livestock).

– SARDI has a role in providing research capacity to drive strategic R&D

and adoption. There is a significant gap in the regions where private

providers tend to focus only on tactical RD&E

Flinders University

[The Great Australian Bight Research Program] moves SARDI away from research and development towards environmental consulting, which is a cramped, competitive and most importantly an intermittent field. The GAB program, in particular, highlights the dangers of engaging in projects where SARDI does not control the vital resource necessary to carry out the work, in this case a large open ocean research vessel … SARDI will have increasing difficulty obtaining time on the ship or will have to pay exorbitant rates for it.

– SARDI’s main challenge will be retaining focus. The Great Australian

Bight Research Program is an example of a project moving SARDI

away from research (its core focus) to the cramped space of

environmental consulting.

– SARDI’s major opportunity is in development of aquaculture in state

waters.

South Australian Grain Industry Trust – Attract funding from government and other sources against an

increasing cost of operation

– Attracting young, high quality researchers against a backdrop of

competition from the commercial research industry. Although SAGIT

has partnered with SARDI on a graduate placement program, SAGIT

sees its role as funding projects, not positions.

– Government ownership of SARDI offers integrity to the research; this

is particularly important in food safety and should be leveraged more

in international markets.



The Australia Wine Research Institute

The cultures and incentive structures of some of Australia’s RD&E institutions are expressed (albeit crudely) by Richard Feynman: Physics is like sex: sure, it may give some practical results, but that's not why we do it. Broadly speaking, since the RDCs control the investment, they set the agenda ... A material shift away from this client base and RD&E focus would require careful consideration – Australia does not have a strong culture of direct business investment in RD&E and many agricultural producers view their levy investment … as being the only investment they want or need to make.

– RDCs control the investment and set the agenda, which is largely

about pre-farmgate agricultural RD&E. Australia does not have a

strong culture of business investment in RD&E and a material shift

away RDC-funded research may be challenging.

The University of Adelaide – Animal welfare is a high priority area and stronger links with UoA

would enable SARDI to lead the nationally.

Wildcatch Fisheries South Australia

[SARDI] has staff with high capacity and quality, but they are not given the ability to deliver due to internal and structural failings on funding and resourcing.

– SARDI must secure adequate core government funding to underpin its

obligation to be the government’s service provider for fisheries

research. SARDI’s ability to deliver on fundamental research has been

substantially compromised in the past decade, leaving the commercial

fishing industry to fund research through the opaque PIRSA cost

recovery system. This has placed substantial strain on the relationship

between the industry and SARDI.

– Projects funded through cost recovery, the Fisheries Research and

Development Corporation or external sources are often delivered by

the same research staff, leading to projects being delayed. If SARDI

wishes to be seen as a partner worth investing in, it needs to change

its service delivery culture and focus on delivering against targets and

timelines.

– SARDI Aquatic Sciences is not seen as cost competitive and recent

attempts by industry to engage SARDI and PIRSA is bringing more

transparency have not been successful.



Wine Australia

As an example, in a call for research proposals in the field of digital technologies in 2015-16, Wine Australia became aware of several university research groups with expertise in novel sensor technologies [but not in viticulture] … In the absence of wine industry linkages, it was difficult to support those proposals in their own right.

– Opportunities for SARDI include new collaborations with other R&D

providers, including in the area of new and emerging technologies.

Researchers without exposure to viticulture may be unaware of the

applicability of the innovation in the wine industry, making it difficult to

support isolated proposals in their own right.

– Challenges include becoming more responsive during project

contracting. SARDI could seek more flexible delegations from the

South Australian Government and improve the performance of its

internal legal department.

– Other challenges include timeliness with project progress reports,

ensuring robust data and record keeping practices and succession

planning as senior researchers retire.

Wine Grape Council South Australia – Labour is the biggest cost input in winegrape production and SARDI

could help producers address the issue. It could, for example, partner

with the Australian Centre for Field Robotics to bring technologies

developed for grains and horticulture to the wine industry.

Q2: Services SARDI should provide

Increase private research AUSGVEG SA – SARDI should not increase fee for research within the horticulture

sector. Producers already pay R&D levies and there would likely be

limited appetite for fee for service research in the sector.

Citrus Australia South Australia Region – Increase fee for service research on a case-by-case basis, without

compromising researchers’ ability to focus on research.

Flinders University – SARDI should decrease its involvement in fee-for-service work. It

creates the appearance of bias and interrupts or ends long-term

strategic research directions.

– SARDI’s fee for service work may out-compete and overwhelm

enterprises, damaging the local economy.

– If SARDI wishes to undertake fee for service work it should spin off

private companies.



Riverland Wine – Increasing SARDI’s funding base generally (not just through private

research) would improve SARDI’s income risk management,

capabilities and capacity. It would also result in greater cross-

fertilisation of research, as well as improved career prospects SARDI’s

researchers.


(SAGIT)

– Research funding by government is important and should continue.

– Adopt fee for service where SARDI owns the IP or where private

industry does not seek to provide that service. Soil testing performed

by SARDI is a relevant example.


Association

– Private funding for research is increasingly difficult to attract.

Government has a role to provide leadership; pushing SARDI to rely

on private funding may present a risk of loss of critical mass.

The University of Adelaide – Pursue fee for service research if financially viable, but carefully

consider market needs and cost of providing services. Focus should

be on services SARDI delivers well.

Wildcatch Fisheries South Australia

If government will not invest to drive cultural change why would others invest in such change in a government agency?

– SARDI would need to improve its cost competitiveness and

transparency before offering its services under competitive funding.

The provision of more cost effective services would not be acceptable

if SARDI remains underpinned by the current opaque cost models.

– Existing research capabilities outside SARDI and government are cost

effective and efficient, limiting SARDI’s ability to compete.

Wine Australia – Wine Australia is supportive of SARDI diversifying its funding base.

The business model should take into account competitive neutrality

principles, cost-reflective pricing and the need to manage tension

between for profit and cost recovery projects.

Wine Grape Council South Australia – SARDI should not seeks to increase its reliance on commercial

income. Winegrape contribute to RDC funding through levies and are

likely to be reluctant to invest in further research.

Commercialising research Ag Institute of Australia – Commercialisation is complex and should be considered as part of

project planning.

AUSVEG SA – International commercialisation should be a focus due to South

Australia’s capabilities in areas such as biosecurity management.



Citrus Australia South Australia Region – Commercialising is a highly specialised field and not a core strength

for researchers. SARDI should partner to commercialise, while

ensuring clarity over IP ownership.

CSIRO – Return profit from IP and commercialised products to public good

research through a research agenda developed by an independent

board and through transparent communication with industry and the

public.

Flinders University – SARDI needs to be more involved in commercialisation.

– Current structure is too heavily branched with many researchers, but

not enough implementers and market economists. Instead, SARDI

should build integrated teams including researchers, implementers

and market economists.

Food South Australia – SARDI appears to have limited understanding of the

commercialisation aspect of the food industry and could use Food SA

as a conduit for this as was done through the Functional Food

Demonstration Project for example.

Riverland Wine – Organisations that have done commercialisation well, have typically

employed dedicated specialists who need to work closely with other

stakeholders to ensure a mutually beneficial outcome.

– Successful commercialisation may result in a broader income base.

However, SARDI should not become overly commercial, as this would

diminish its charter for delivering “public good” and industry

development in South Australia.

– In terms of adopting applied research, SARDI has no clear extension

capability or intent beyond the final report and possibly a presentation

or two to industry on the findings. Rural Solutions, SARDI’s sister

organisation under PIRSA, no longer has this capability either. This

lack of extension capability is a significant structural hurdle to industry

adoption and therefore return on the levy investment.


(SAGIT)

– SAGIT prefers that SARDI focuses on undertaking research to the

point of commercialisation and then release technology with

compensation for the IP. This ensures SARDI can focus on research

but generate funds to reinvest. The private sector is better placed to

disseminate new technology and products.




Association

– Commercialisation has a high risk of failure and should be pursued in

a balanced and cautious manner that does not compromise research

activity.

The Australia Wine Research Institute – If placing more focus on commercial-related outcomes, SARDI could

establish an industry-led or industry-controlled board and consider

formal joint partnerships with organisations, such as AWRI, with an

industry-first, semi-commercial culture and a national mandate.

The University of Adelaide – There may be opportunities for commercialisation. However, this

should be implemented with a robust framework, as part of a portfolio

of funding strategies and in collaboration with existing state research

commercialisation providers.

Wildcatch Fisheries South Australia – At present there is no incentive to work with SARDI as a commercial

partner. If SARDI wishes to build capacity in commercialising and

adapting applied research, there must be greater sharing of the

services used to underpin the research. Government must become a

funding incubator that invests in identifying and building the capacity to

service innovation research.

Wine Australia – Commercialisation would likely be better handled through private (or

spinoff) companies, which have a different risk appetite to government

enterprises and more freedom to invest the capital needed to take a

new invention or idea through to a commercial product or service.

– However, exceptions may exist. One example is the commercialisation

of a diagnostic service for detection of the grapevine pest ‘phylloxera’

SARDI is currently offering this service to industry on a commercial

basis.

Industry integrity systems AUSVEG SA – Industry integrity systems are a public good and underpin South

Australia’s clean, green image, ability to guard against pest and

disease, and safeguard confidence in agricultural industries. This is

also an export opportunity.

Citrus Australia South Australia Region – SARDI support for industry integrity systems protects competitive

advantage, and enhances reputation in export and domestic markets.

Flinders University – Food safety and biosecurity are key South Australia’s clean, green

image and must be a priority.



Riverland Wine – The ability to produce and promote SA as a producer of high quality,

clean and green produce and, while doing so, using the minimum of

chemicals for pest and disease control, is central to maintain South

Australia’s reputation for clean food. Additionally, the ability to access

many export markets is predicated on biosecurity compliance and/or

pest and disease freedom.

– PIRSA plays a major role in this and SARDI’s contribution through

research and diagnostics is a crucial element. Much of this work must

be seen in the light of “public good” as the state as a whole benefits

and the individual industries have some capacity to contribute through

the various industry statutory R&D levies. Without SARDI there would

be virtually no SA specific research work undertaken in these fields.


Association

– SARDI should support industry integrity systems (including

authentication and provenance).

The University of Adelaide

SARDI needs to ensure that it does nothing that compromises two of its greatest strengths—its independence and its impartiality.

– SARDI has a good understanding of the science and regulatory

context, with a degree of independence. SARDI must ensure it does

not compromise its independence and impartiality.

Wine Australia – SARDI’s involvement in biosecurity activities has been of great benefit

to the wine industry and Wine Australia strongly supports its

continuation.

Q3: SARDI structures and operations

Stakeholder engagement to

maintain research focus

Ag Institute of Australia – SARDI should maintain strong regional presence because this helps

engagement with producers, provides a network of R&D skills and is

important for regional development.

AUSVEG SA – SARDI needs an industry engagement division to feed industry needs

into research priorities.

– Individual researchers could be more open to collaboration with

industry bodies.



Citrus Australia South Australia Region – SARDI should communicate with stakeholders to determine needs and

then deliver the agreed outcome.

– More time spent on farms and packing sheds. Trial work should be

hosted by producers on site, which will help uptake of research

outcomes.


Foundation

– SARDI should strengthen its ties with industry-driven organisations

and regional groups. Extension officers enable better information flows

to industry groups.

Flinders University – SARDI can strengthen engagement and maintain focus by building

integrated teams that tackle problems from multiple perspectives and

in an integrated manner.

Food South Australia – Greater collaboration could occur if Food SA understood SARDI’s

forward planning of activities. Outside of one-on-one interactions,

SARDI has a tendency to work in a vacuum and stakeholders may not

know how they can interact with SARDI for better industry outcomes.

Establishing mechanisms for liaison with industry and Food SA would

be an advantage.

Riverland Wine – SARDI must, in conjunction with industry stakeholders, define and

build the capabilities and capacities that will best serve the

stakeholders and provide them with the support they require to

develop and flourish.

South Australian Rock Lobster Advisory

Council

– SARDI has a lack of presence in the regions and with grass-roots

industry.


Association

– Face-to-face contact is effective in the wine sector. Field days and site

demonstrations are also useful.

The University of Adelaide – SARDI should focus on selected industry-driven applied research

programs. Aligning too closely with priorities funded by the state

government or RDCs may result in missed opportunities.

Wine Australia – SARDI should continue to pay attention to scientific staff resourcing,

immerse new staff in industry activities and events, and seek

resources and delegations from government to improve

responsiveness and autonomy.



Non-traditional funding Ag Institute of Australia – SARDI’s public sector structure and funding model mean that it is

difficult for SARDI to become more entrepreneurial. SARDI would

need a different model.

AUSVEG SA – Greater engagement with industry and a willingness to put forward

joint proposals will lead to a greater share of RDC funding.

Citrus Australia South Australia Region – SARDI can attract non-traditional funding by showing it has a strategic

plan with the right resources and can deliver.


Foundation

– Non-traditional sources of funding could include banks, multinational

organisations (food, chemical and marketing companies), hedge funds

and philanthropic organisations.

Flinders University – SARDI should look for funding sources outside of Australia though

internationalising.

Riverland Wine – The driver for widening the revenue base is the development of

partnerships and long-term relationships. Industry peak bodies and

commercial entities are expert at identifying and prioritising industry

challenges and opportunities, which are also opportunities for SARDI

to provide services and solutions.

– Funding will typically be found if there is a sound business case for

carrying out the work and stakeholders themselves are likely to assist

in identifying potential sources, including direct investment.

South Australian Grain Industry Trust – Sufficient government funding must be retained to ensure that

maintains a high level of capacity in applied research.

– Ability to attract non-traditional funding will depend on SARDI’s

reputation in the community, the impact of the research and SARDI’s

role in the supply chain.

The University of Adelaide – SARDI is overly reliant on state and RDC funding. Diversification of

funding streams, e.g. through partnering and collaboration is needed.

– SARDI’s cost model does not meet university needs (e.g. including

overheads in grant applications is not permitted). SARDI’s

counterparts in other states (e.g. WA Fisheries, NSW DPI (are often

more attractive for collaboration.



Wildcatch Fisheries South Australia – SARDI should not be dependent on industry-based funding to maintain

its core capacity.

– Government should set a reasonable recreational resource access fee

to source funding from recreational fishers.

Wine Australia

Above all, a focus on continuous improvement, a demonstrable track record of scientific excellence, superior service delivery and maintaining industry relevance (on a national scale) will be vitally important in attracting funding.

– Selective partnering with universities, such as Australian Research

Council linkage grants. Fee for service activities may provide an

additional revenue stream.

Critical SARDI capabilities Australia’s Integrated Marine Observing

System

– A replacement research vessel for the RV Ngerin for oceanographic

work

– Maintain and enhance South Australia’s human marine science

capability, such as SARDI oceanographers and biologists (including

those on joint appointments with South Australian universities), vital for

producing IMOS data.

– Audience for the IMOS data includes university students, researchers,

and industry-research collaborations.

AUSVEG SA – Strong capabilities in production management issues such as

biosecurity, integrated pest management, pest and disease

diagnostics are fundamental.

Citrus Australia South Australia Region – SARDI’s key capabilities for the citrus industry are market access, pre

and post-harvest research, and pest control. SARDI should agree a

strategic plan with stakeholders.



CSIRO

SARDI is the main agency which retains a capacity to perform fish surveys in the SA section of the Murray-Darling Basin. These surveys are essential to evaluate the success of environmental flow initiatives in the Murray-Darling Basin… loss [of surveys] would impact very significantly on the broader management of the Murray-Darling Basin.

– SARDI’s field research teams offer broad geographic reach across

South Australia. Through partnering this increases the capacity of

other organisations and enables research that otherwise would not be

feasible.

– Retain capacity to perform fish surveys in the South Australian section

of the Murray-Darling Basin. Loss of this capability would have a

negative impact on the broader management of the basin, restricting

evidence available for determining the benefits of providing

environmental water.

– Services such as the Root Disease Testing Service deliver critical,

reliable and rapid service.

– Maintain the Nuriootpa Research Centre. It holds one of the two major

germplasm collections in Australia (key to developing new varieties)

and provides space for plantings of new wine grape scion varieties

and rootstocks.



– DEWNR and SARDI have a long history of successfully working in

partnership and of staff exchanges and secondments. The partnership

enables DEWNR and SARDI to respond to critical in a timely and

professional way.

– DEWNR values programs operating in partnership with SARDI, such

as Inland Waters, Goyder Institute for Water Research Projects and

Great Australian Bight Research Program. (Comprehensive list

provided in submission.)


Foundation

– SARDI needs to maintain (and increase) research capacity at the

regional level. The sector has become fragmented as the result of

PIRSA’s withdrawal.

Flinders University – SARDI should focus on providing better services to stakeholders and

making findings more accessible.

– Student–industry projects (such as Work Integrated Learning) are

hampered by SARDI’s template documentation which does not

necessarily consider Flinders University policy requirements.



Food South Australia – SARDI should be aware of capability within South Australia and

Australia for relevant services, such as the location and services of

testing laboratories around Australia.

– SARDI could also be a link for the industry in relation to the

development of functional food and interpretation of results.

South Australian Grain Industry Trust – Dissemination of research to the farming community is highly valued.

SARDI research is seen as being reliable and unbiased. Improving this

requires allowing researchers more time to interact with farming

groups.

The University of Adelaide

– Quality of research facilities at Roseworthy, Struan, Turretfield and

Minnipa is not on par with that available in other states and should be

improved.

– SARDI capabilities important to the School of Animal and Veterinary

Sciences include animal welfare science, production systems

(livestock and chicken) and veterinary diagnostic. Limited engagement

on aquatic sciences and fish diseases.

– Important services for the School of Agriculture, Food and Wine

include supply of soil mixes, quarantine services, steam sterilisation

and collaborative support.

– Broader work on climate change and enclosed horticulture are

underdeveloped areas.

Wine Australia – Wine Australia’s needs include SARDI’s viticultural and plant health /

plant pathology expertise, biosecurity linkages from field experience

through to a government / regulatory level, and the delivery of

extension and adoption services through knowledgeable, trusted

scientific staff.

Flexibility and responsiveness Citrus Australia South Australia Region – SARDI could improve responsiveness by communicating with

stakeholders and by spending time among producers to understand

their issues.





– Based on DEWNR experience, SARDI could consider:

– developing greater awareness of DEWNR policy objectives and

resource management outcomes

– facilitating access to SARDI scientists with specialist knowledge

sought by DEWNR

– developing a consistent costing model between internal and

external rates for fees and services (has been confused in the

past).


Foundation

– SARDI could work more collaboratively with industry and farmer-driven

groups through implementing more flexible purchasing systems and

contracting arrangements.

Flinders University – In some cases SARDI’s funding models are not conducive to

collaboration because of the requirement to include in budgets SARDI

based salary (and oncost).

– Collaboration with SARDI may be necessary because of its close

relationship with other government agencies (such as PIRSA) or

because SARDI controls the data (which, arguably, should be publicly

available).

– Access to data can be slow, and may depend on SARDI’s own

interests (including protection of its own interest).

Riverland Wine – Currently, the primary communication is between SARDI and Wine

Australia. Industry is not well consulted.

– SARDI should work closely with clients and potential clients. If SARDI

truly knew and understood the clients’ needs, particularly in the

medium and longer-terms, SARDI’s management could to plan for the

future with greater confidence.

South Australia Wine Industry

Association

– Review scope will be too narrow if it will not estimate the value of

research outputs in terms of knowledge, as well as commercial return

of investment.

– SAWIA has had relatively little interaction with SARDI at the

managerial level recently and is not aware of SARDI’s current

corporate strategic direction.



South Australian Grain Industry Trust – SAGIT sees SARDI as being highly responsive, for example in its

response to the Beet Western Yellow Virus infestation.

– Improvement could come through reducing administrative

requirements. However, SAGIT recognises this can be difficult in a

government organisation.

South Australian Rock Lobster Advisory

Council

– SARDI should improve its ability to respond to the media, reply to data

requests from industry and provide timely and transparent information

on program financials.

– SARLAC is concerned that SARDI is not cost competitive and is

undertaking a benchmarking exercise, including relative to private

service providers.

– There is a lack of ongoing and regular independent review of SARDI’s

programs and practices within the agency.

– Once industry has implemented recommendations arising from

SARDI’s research, SARDI should reflect this in its communications.

Wine Australia – There are opportunities to improve the responsiveness of SARDI legal

services to facilitate contracting obligations, which may require

changes to its delegated authority from government.

– SARDI could place additional attention to the prompt fulfilment of

project reporting requirements and financial acquittals.

Wine Grape Council South Australia – Finding information on SARDI’s work is not easy. Periodic reports on

the progress of research projects would be helpful, in addition to final

reports.

SOURCE: ACIL ALLEN BASED ON REVIEW SUBMISSIONS