Rural Research and Development Corporations

Commonwealth statutory RDCs are Australian Government entities with a board of directors appointed by the Minister for Agriculture, based on recommendations from a selection committee.

Commonwealth statutory RDCs, their enabling legislation and declared representative organisation(s) are below:

Industry-owned research and development companies are independent corporate entities with expertise-based boards. Industry-owned RDCs and their enabling legislation are below:

RDCs help drive agricultural innovation. They allow Australian government and primary producers to co-invest in R&D to improve the profitability, productivity, competitiveness and long-term sustainability of Australia's primary industries. These include agricultural, fishing and forestry industries. Both industry and government recognise that creating and meeting demand for Australian produce is essential to the competitiveness and profitability of our primary industries and provides benefits for the whole Australian community. The government-industry partnership model that supports the RDCs has been operating successfully for over 30 years.

On 11 October 2021, the National Agricultural Innovation Policy Statement was released. It highlights four long-term priorities for Australia’s agricultural innovation system to address by 2030. These priorities replace the Australian Government’s Rural Research, Development and Extension Priorities which were published in the 2015 Agricultural Competitiveness White Paper.

The four priorities are:

1. Australia is a trusted exporter of premium food and agricultural products by 2030.
2. Australia will champion climate resilience to increase the productivity, profitability and sustainability of the agricultural sector by 2030.
3. Australia is a world leader in preventing and rapidly responding to significant pests and diseases through futureproofing our biosecurity system by 2030.
4. Australia is a mature adopter, developer, and exporter of digital agriculture by 2030.

Investment in these priorities together with the Australian Government’s Science and Research Priorities and National Primary Industries Research Development and Extension Framework will ensure R&D investment is strategic, collaborative and targeted to improve profitability, productivity, competitiveness and preparedness for future opportunities and challenges.

The RDCs are funded primarily by statutory R&D levies (or charges) on various commodities, with matching funding from the Australian Government. To expand Australia’s rural R&D efforts, the government matches expenditure on eligible R&D, generally up to 0.5% of the determined industry gross value of production. RDCs are accountable to both industry and government.

Levies for R&D and marketing are initiated at the request of industry and are collected and administered by the Department of Agriculture, Water and the Environment. These funds are distributed to the RDCs to undertake R&D and industry services. The department’s levies webpage contains further information on the levy system.

The key performance and accountability framework for IOCs and statutory RDCs is set out in the funding agreements signed with the Commonwealth. The main function of a funding agreement between the Commonwealth and RDCs (which is required under legislation) is to specify the terms and conditions for expenditure of R&D and marketing levies and Commonwealth matching payments.

Individual funding agreements with RDCs outline what is expected of them. This includes expectations of performance and transparency, as well as accountability to levy payers, the government and the public. In 2019, the RDC funding agreements with all RDCs were renewed using a principles-based approach and cover a 10-year period.

The funding agreements make clear the expectation that RDCs govern their own business practices through their Boards and other governance arrangements.

The five performance principles in the funding agreements provide a framework to ensure RDCs appropriately spend levy funds and public money and focus on delivering R&D and marketing outcomes for their stakeholders.

The five performance principles are:

• Stakeholder engagement – Engage stakeholders (including industry representative bodies) to identify research, development and extension (RD&E) priorities and activities that provide benefits to portfolio industries.
• RD&E activities – Priorities and activities are strategic, collaborative, and targeted to improve profitability, productivity, competitiveness, and preparedness for future opportunities/challenges through a balanced portfolio.
• Collaboration – Strategic and sustained cross-industry and cross-sectoral collaboration that addresses shared challenges and draws on experience from other sectors.
• Governance – Arrangements and practices fulfil legislative requirements and align with contemporary Australian best practice for open, transparent, and proper use and management of funds.
• Monitoring and Evaluation – Demonstrate positive outcomes and delivery of RD&E (and marketing) benefits to levy payers and the Australian community in general, and continuous improvement in governance and administrative efficiency.

The funding agreements prevent the RDCs from using funds to engage in agri-political activity.

In 2021, the Australian government developed a package of documents to support the work undertaken by RDCs:

• The Guidelines for Statutory Funding Agreements outlines key performance indicators for each of the five performance principles outlined above.
• The Best Practice Guide to Stakeholder Consultation provides a set of guiding principles which apply to all RDCs; each RDC provided their own individualised guide.
• The RDC Knowledge Transfer and Commercialisation Guide provides guidance for the management of technology commercialisation to assist driving commercialisation out of the RDCs and bring in extra funding from private sources.

Legislation, regulations and individual funding agreements provide the framework for how RDCs operate.

The Primary Industries Research and Development Act 1989 and the Australian Grape and Wine Authority Act 2013 set out arrangements for the establishment of statutory RDCs and the preferred structure for the administration of their R&D program funds. These Acts, along with the funding agreements, set out the performance, reporting, accountability and industry consultation obligations for statutory RDCs.

The two Acts state that the Minister must declare at least one representative organisation for each statutory RDC. Declared industry representative organisations are listed in Statutory RDCs.

Statutory RDCs are also required to comply with the Public Governance, Performance and Accountability Act 2013. This Act is the cornerstone of the Commonwealth Resource Management Framework that governs how the Commonwealth public sector uses and manages public resources. It is an important feature of an accountable and transparent public sector and informs the daily work of Commonwealth entities and their employees.

The IOCs are declared by the Minister as an industry service body under industry-specific legislation. They are established under, and must comply with, the provisions of the Corporations Act 2001 which sets out the obligations of companies and their boards of directors.

The Minister for Agriculture is responsible for administering the legislation that governs the RDCs (known as enabling legislation) and has delegated some tasks to the department. The department assists the RDCs to adhere to their statutory and contractual requirements and advises the Minister on RDC-related matters. The Minister is ultimately accountable to Parliament.

In supporting the RDCs to meet the legislative requirements and comply with their funding agreements, the department:

• provides guidance on better practice administration and stakeholder engagement
• participates in annual performance meetings with each RDC
• assists the Minister to discharge statutory and parliamentary obligations, including providing advice on the operations of RDCs and their accountability of funds
• hosts regular seminars to promote information sharing and collaboration between government and RDCs
• ensures the RDCs have a framework to deliver R&D and marketing to underpin the profitability, productivity, competitiveness and long-term sustainability of portfolio industries
• administers the flow of levy funds
• implements R&D policies as directed by the Minister.