EXCESSIVE salaries for the heads of some rural research and development corporations cannot be justified, says TONY BURKE

Farmers want their research dollars to be well spent. It's my job to deliver on that.

Within my portfolio, much of the research is managed by groups known as the RDCs - the research and development corporations.

Six of these are statutory authorities, nine are industry-owned companies and one is a marketing-only body.

Between them, they collect $200 million from government contributions and $260 million from levy-payers, so the total amount of money going to these organisations is currently $460 million, on an annual basis.

As production levels go up, the matching contributions in turn go up and the levies go up as well.

Much of the work done by these organisations is absolutely critical.

You will not find me criticising the model, for two reasons.

The way the model works allows a direct engagement between the stakeholders themselves - the producers - and the scientists.

This guarantees two things:

That the science that is being funded for agricultural, fisheries and forestry purposes is considered to be completely relevant to the needs of producers.

With that sense of ownership you are much more likely to get the best information making its way from the lab to the farm.

I will say, though, that there is a level of frustration at a number of issues where I believe the model could work better and where progress has been slow.

For example, we don't want money spent on duplication, on obscene executive salaries, or on agri-political activity.

I've had a concern that a minority of R&D corporations are paying their senior executives salaries that I believe do not pass the test of credibility for use of taxpayers' money.

In April this year, I wrote to each of the RDCs asking them to meet public expectations in terms of executive salaries. There are a handful that have not come to the mark on that question.

We have one of these organisations where the chief executive officer earns more than half a million dollars a year and we have five earning more than the prime minister.

Of these five, three are organisations that employ fewer than 100 people.

I can't justify to a drought-stricken farmer that this is a good use of the compulsory levies they are being made to pay.

I can justify professional salaries that are required to do a professional job; the organisations that I refer to are run professionally.

But I cannot justify half a million dollars a year.

I have asked on different occasions for someone to explain to me why the responsibility taken on by people in these jobs is seen as being more important or more significant than the job of being prime minister of Australia.

No one has been able to come back with an argument that I believe is halfway credible.

I want to make sure that if we're going to have a system where farmers are paying levies, even in the worst of times, that they can see absolute efficiency in their levy dollars going to research and development, and to marketing.

Similarly, there has been frustration I have raised from time to time about the RDCs and agri-political activity, and once again I'm talking about a minority of them.

There is a story I can tell you about Australian Wool Innovation, where over the past two years I have had two different groups of people suggest that the body be wound up.

On each occasion, the groups have reflected the power base that had just lost the previous election.

And whenever they have been successful in an election, whoever has won the election unsurprisingly thinks the organisation is well-run, well-managed and the governance has no problems at all.

As long as we have a system where a significant amount of resources that are principally meant to be there for a research and development body are being used to fight campaigns, I can't see that we're providing the best possible value for levy-payers.

This is not the fault of the organisations. This is a legislative problem that they face.

These issues need to be resolved.

Next year, the Productivity Commission will conduct a review into the governance, efficiency, and duplication issues surrounding the R&D corporations.

The challenge is not one of the model itself.

But I believe the issue of getting the best possible value for money for levy payers from R&D corporations needs the rigour of a Productivity Commission review.

• Tony Burke is the federal Minister for Agriculture, Fisheries and Forestry. This is an edited version of a speech he gave to the National Press Club in Canberra last week.