The Australian Sugar Industry Alliance (ASA) made up of the Australian Sugar Milling Council and Canegrowers have hired the Australian Electoral Commission, to conduct a vote for the formation of a new sugar Industry Owned Company, a dedicated, not-for-profit, research company called Sugar Research Australia (SRA).
The vote has not been directed by the Australian Government; however Minister Ludwig is allowing the industry to conduct a poll to test the response.
In early August, all cane farmers in Queensland and New South Wales and all milling companies will receive papers from the Australian Electoral Commission to vote in the Sugar Poll 2012.
If cane farmers vote yes, our iconic BSES which has been the world-leader in sugar cane RD&E for 112 years will soon cease to exist. Our government-backed research funder, the Sugar Research and Development Corporation (SRDC) would also be wound up. The assets of both companies would be transferred to a new company called Sugar Research Australia (SRA).
Levy Payers will not have a vote
ASA is claiming that levy payers will vote but that is only for setting the levy which is already required by law. This is crystal clear in ASA’s submission to Minister Ludwig.
“For Sugar Research Australia company proceedings, alongside all Members being advised of and able to attend and speak at a general meeting, a delegate based system is envisaged, similar to that operated by Australian Pork Limited, and also as understood by growers through arrangements for Queensland Sugar Limited.”
Members will be invited but only one delegate per region will vote.
This gives the impression that SRA would be a democratic organisation; however ASA’s proposal voting by members is a DELEGATE system, ONE PER MILL AREA, which would mean that large players would totally dominate the Board of SRA, its R&D plan, and the compulsory levy; and defend it against changes.
Money Wasted on consultants
ASA claims that they will make our RD&E more efficient but are they really qualified to say that? To date they’ve spent a truck-load and increased service costs to industry.
ASA has already spent over AUD one million on its proposal – mostly on consultants – that could have been spent on actual RD&E, rather that talking about it. If ASA gets its way, up to millions more could be spent which could have been spent on RD&E. How is this efficient?
Why would ASA want to do such a dramatic thing?
Some in the milling sector appear to see R&D as a cost rather than an investment. They believe that ASA does not have enough control over RD&E direction and funding. For them, the current system is too democratic and has the Federal Government’s involvement which requires wide consultation with industry stakeholders, including payers of the compulsory levy.
Why is Canegrowers backing the ASA proposal?
During the last decade, some mills have not paid their share of BSES funding, while BSES was committed to using its reserves to fund the BSES DuPont Joint Venture on genetic and other advanced technology. This commitment was agreed to by all stakeholders.
Some mills are using this situation to claim that BSES is not viable, yet it is these same entities who are failing to fund the BSES.
The Canegrowers Organisation has expressed that they are backing the ASA plan because the millers have agreed to equally fund R&D for three years.
Apart from serious flaws in the ASA plan, a miller commitment to fund R&D for three years is grossly inadequate, as the plan would take almost that long to fully implement; while a sugar cane variety takes eight to twelve years to deliver and variety improvement is the keystone of the Australian R&D program.
A short-term funding commitment is not sufficient to justify changes that effectively grant control over R&D to powerful milling companies for no clear advantage.
If ASA is so sure of its plan and its good intentions, why doesn’t it make a ten year commitment?
Cane farmers are concerned that if SRA is formed and there is no turning back, ASA will ask for another concession from farmers.
Has anyone asked the researchers?
During the process so far, sugar industry researchers have been largely left out of the consultation process and when consulted they have expressed a view that they were not listened to.
Wrecking ball to R&D
ASA’s plan means an end to;
Real regional input.
Local R&D needs being taken seriously.
Value adding – such as ethanol and biomass projects.
What can be done?
The simple answer is vote ‘no’. The current model would then continue and ASA would need to approve its funding.
ACFA and Associated Cane Farmers Groups Oppose ASA’s R&D Plan with a United Alternative
Some of the regions have tired of being pushed around by a ‘top- down’ power structure. They have voiced a need for system where the regions have a greater say in the varieties and other RD&E that they require locally.
A united group comprising the ACFA and other regional groups that share great concern about the ASA proposal, have proposed an alternative.
The elements of the alternative proposal are;
→ Keep BSES and SRDC intact and separate as now. This removes the conflict of interest by keeping the major R&D funder separate from the major R&D provider.
→ SRDC would have a long-term agreement to collect the BSES levy, guaranteeing the funding of BSES.
→ Optionally, SRDC would have a long-term agreement to collect the Productivity Services levy, guaranteeing the funding of Productivity Services.
→ This model would ensure that millers and farmers paid their equal share.
→ SRDC would administer the remainder of the funds as it currently does for competitive research grants to ensure that the best researchers receive project funding.
→ SRDC would consult with stakeholders as it currently does to form the most representative R&D plan.
→ In addition local productivity services would advise which R&D the local regions require and whether the R&D programs are delivering locally, where they are needed.
Get on with the job
The outlook for our industry is promising. This is a time to concentrate on building the outcomes and efficiency of our existing structures. This not a time to gamble on a ‘high-risk’ idea.
Our united plan places the guiding hand of R&D in the local regions.
Say no to the Brisbane takeover of R&D or say goodbye to regional input forever.