Rural research, development and extension investment in Australia

​​Niki Millist, Will Chancellor & Tom Jackson, September 2017

A $3.3 billion investment in innovation

Research development and extension (RD&E) is central to the competitiveness of Australia’s agriculture industry. Growth in investment pushed the value of RD&E funding in Australia to $3.3 billion in 2014-15. Funding for rural R&D increased from $2.6 billion ten years before, in real terms. This includes public and private investment related to primary production, sustainable resource use, agricultural inputs and the processing sector.

Public sector delivering the R&D building blocks

The public sector remains the largest overall source of rural R&D funding. Public funding for rural R&D increased from $1.4 billion to $1.54 billion (in real terms). This growth was driven by growth in funding from the Australian Government and universities, which offset a decline in funding from the state and territory governments. The public sector plays an important role in funding R&D particularly longer-term fundamental research.

Private sector funding boosting R&D investment

The private sector funding grew strongly over the ten years examined and now plays a greater role in funding rural R&D. Total private R&D funding increased from $912 million in 2005-06 to $1.46 billion in 2014–15 in real terms. Greater private funding stemmed from private firms increasing investment in their own R&D, with slower growth in contributions to the rural Research and Development Corporations (RDCs).

Based on recent trends in Australia and internationally, the private sector has the potential to play a greater role in Australian R&D investment. The private sector concentres on marketable technologies like those related to seeds or chemicals that are more likely to generate additional profits. However, growth in private sector investment is not guaranteed and will depend on both the expected return on R&D investment and the international competitiveness of our R&D providers.

Extending the ideas

Getting innovations out of the laborato​ry and in to the field and factory is also essential to lift producer efficiency. Total rural extension funding is estimated at a further $316 million in 2014-15. Just under half of this funding was provided by the private sector through farm advisors to boost farm profitability.

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