It is tempting to assume that the current funding problems in agricultural research only date back to the creation of AgResearch 20 years ago. They actually have their origins in the 1930s when Ernest Marsden set up the Department of Scientific Research (DSIR) and attempted to take over all agricultural research¹. He only partially succeeded, and although he got most plant research, the Department of Agriculture fought back and retained animals. DSIR scientists viewed themselves superior, were paid some 20% more (this later caused equity problems when they were integrated into AgResearch, compounded by relocation issues), most came from academic university departments and they conducted a lot of basic research.

In contrast, much of the animal research in the Department of Agriculture was centred on applied problems, the scientists were largely graduates of the two agricultural universities (Massey and Lincoln) and, with a couple of exceptions, laboratory facilities were pretty rudimentary (as late as the mid-1980s, not one molecular biologist was employed by what had then morphed into MAFTech!).

Despite their disparate nature, there was general acceptance that research in both organizations had made very valuable contributions to New Zealand. The DSIR solved the “bush sickness” problem that had stymied farming in the central plateau and the Ruakura Research Centre developed methods for combating facial eczema; there were also notable advances in embryology, artificial insemination, electric fencing, rotational grazing and plant breeding. Indeed, estimates were bandied around in the 1960s suggesting that DSIR divisions with successful projects were yielding an annual rate of return of around 20% on funding ¹.

However, by the 1980s, Rogernomics was cutting a swathe through farming subsidies and it was not long before the economists also began taking a hard look at the true benefits of agricultural research. The Department of Agriculture was the first to come under scrutiny. For the first time, an attempt was made to assess the true cost of individual research projects. This proved a bit of an eye-opener as, until that time, the researcher had got an enormous amount of support for “free”, e.g. experimental animals from government farms, farm labour, vehicles, statistical and computer support, secretarial services etc etc. The notions of full cost recovery and overheads were completely foreign and as late as the 1990s some scientists had never written a comprehensive grant application!

In fact, the whole Department of Agriculture was deemed too expensive, so four divisions were created, MAFQual, MAFFisheries, MAFCorp and MAFTech (the last encompassing both research and the farm advisory service) with separate budgets and modern managerial structures. What followed can only be described as years of shambles, low morale and restructure after restructure. All this is described with amazing frankness in a MAF document and also by Clive Dalton, a scientist at the coalface. Remarkably, science and scientists in MAFTech survived but morale was low and the road ahead was far from clear. One positive from this time was that more of the science funding was being distributed on the basis of properly written research proposals rather than old hoary research areas just being funded year after year without real question.

The DSIR structure remained isolated from these kinds of reforms for several years, but by the late 1980s, they, like virtually every other government department, became increasingly subject to new managerial and budgetary structures.

More importantly, but largely running under the radar at this time, were a number of economic studies that were going to have far more profound effects on agricultural research than the structural changes which were getting all the attention. Behind the scenes, Treasury and other economists had beavered away and concluded that the old assumptions about the rate of return on research funding were simplistic. For example, Hall and Scobie looked at everything that could possibly correlate with increased farming returns and, depending on the model used, concluded that a surprisingly small returns came directly from publicly funded research in NZ. Johnson reached the same conclusions and estimated that the annual rate of return on private research was much greater (around 2%) than that in the public sector (~0.1%). They concluded that a lot of the benefits actually came from the take-up of overseas research, but pointed out that the long lag periods in implementing research findings rendered their analyses uncertain.

So, even before the CRIs were formed in 1993, the agricultural scientist’s world was undergoing a radical change. First, properly written research proposals were becoming the norm, they had to be properly costed, and subject to competition and peer review. Second, the economic aspects of their proposals were scrutinised and estimates of the rate of economic return were required (all be they fanciful in most cases!).

The creation of AgResearch, took things a step further as we now had truly business structure, albeit one whose revenue was largely generated by the scientists acting as fundraisers with, initially, most of this coming from Public Good government funding and very little from other sources. The expectation was that, in time, industry research contracts, joint ventures, intellectual property and commercial spin-offs would supplement government funding.

Indeed, the expectation that AgResearch would move more and more away from government funding fitted in very well with the Treasury analyses that suggested more bang for the buck can be got from alignment with the private sector. Whatever the reasons, it is starkly clear, that government funding of AgResearch has steadily declined and, moreover, it has not been able to compete with other organisations for funds now administered by MBIE for increasingly applied projects. Hence, the latest crisis of a $5.3 million shortfall and a dramatic round of redundancies.

There seems little appetite in government to rescue AgResearch from this situation. After all, increased private funding of research is the aspirational thrust of the National Statement of Science Investment which fits in with “free-market” philosophies and a little “rightsizing” now and then! Over the years, AgResearch has not dealt well with these pressures, instituting redundancies, reorganisation, restructures etc that mirror all the mistakes outlined in the MAF document above, but even more so.

Compounding the problems, AgResearch does not seem to truly value their top scientists. As has been pointed out by others, they are the ones that raise most of the research funds. Unfortunately, AgResearch has lost a lot of its rainmakers. All of their top Dairy Scientists have gone to industry, the Wallaceville reproduction group is no more, Invermay geneticists left and formed a thriving private company, AbacusBio 15 years ago, and it looks as if even more scientists will leave if the Footprint plan goes ahead with Ruakura and Invermay campuses dramatically downsized.

And just to add to the misery, the concept of public good science, in which one has a friendly, cooperative and low-cost interface with the stakeholders, in this case farmers, plus the dairy, sheep and beef industries, has been largely destroyed. In the old days, part of the job description was, “an ability to talk to farmers”. Lots of those scientists have been made redundant. Nowadays, a lot of the staff have never been on a farm!

So what is the way forward for AgResearch?

1. Perhaps the first priority is to re-establish the organisation as an essential part of the farmers’ toolkit. Having your organisation championed to politicians by farmers is invaluable.

2. Related to 1, retain a credible presence in farming areas – the Future Footprint programme would effectively emasculate the presence of AgResearch in both the Waikato and Otago.

3. Look seriously at the overhead positions that are being funded. Some of the job descriptions defy reason. One lesson from the MAF debacle was that many managerial positions were created that added absolutely no value to the organisation and actually alienated science staff.

4. Delve in deeply into the assumptions made in the old economic analyses suggesting public funding yields low returns on research dollars invested. They really need to be revisited in a rigorous way.

5. If you must restructure, reorganise etc, do it with the input of your most valuable asset, your top scientists – for god’s sake, keep them onside.

We really must end these cycles of restructuring. Simon Upton thought he had done it in 1992 when he introduced the Crown Research Institutes bill, boasting that it brought to an end more than half a decade of science restructuring. David Lange with some prescience interjected, “Famous Last Words!”

References

1. R. Galbreath, “DSIR: Making Science Work for New Zealand,” VUP, 1998.