Managing funds to grow Australian horticulture

Hort Innovation is one of Australia’s 15 Rural Research and Development Corporations (RDCs). While the Australian Government collects levies from primary producers across agriculture for investment in research and development, it does not invest these monies itself. Instead, it allocates the funding, alongside its own financial contributions, to the nation’s RDCs. It is then the role of the RDCs to identify, broker and manage investments on behalf of industry.

Hort Innovation is tasked with investing horticulture levies and Australian Government contributions into activities that support the productivity, profitability and competitiveness of Australian horticulture, and that support the strategic priorities of an industry.

These strategic levy investments are the core work of Hort Innovation, though the organisation also has a second, separate funding model involving strategic partnership funding.

Read more on how Hort Innovation invests in the Australian horticulture industry via the two funding models below.

Strategic levy investment

The strategic levy investment stream begins with Australian growers. They raise their levy and, if it is a statutory levy, it is collected by the Australian Government. The government has a Statutory Funding Agreement that it has entered into with Hort Innovation, which allows it to then pass the collected levy on to Hort Innovation. A voluntary (non-statutory) industry levy can also be collected via a Collective Industry Fund. Here, monies are collected not by the government but by a third party nominated by the industry, which then passes the funds on to Hort Innovation.

It is then Hort Innovation’s responsibility to work with industry to make strategic investments in R&D and, for some industries where nominated, marketing programs. All levy investments are carried out for the benefit of the industry from which the levy has originated, and involve advice from industry-specific Strategic Investment Advisory Panels. Read more about these on our consultation page.

Once money is spent, the Australian Government then helps share the costs of each R&D investment by making a contribution to the investment, using public money. Marketing levy investments do not attract the same contribution from the Australian Government.

Benefits of all investments then go back to the industry from which the levy was collected, to support increased productivity, profitability and competitiveness of the sector

Hort Frontiers strategic partnership initiative

A more recent addition, Hort Innovation’s second funding model involves the Hort Frontiers strategic partnership initiative. Hort Frontiers brings together strategic partners to invest in cross-sector, long-term initiatives that aim to solve major problems facing the future of Australian horticulture. This model is divided into funds representing key areas, which you can read more about here.

Strategic partners can be any entities that want to invest in the future of horticulture, including commercial businesses, research agencies, government departments and/or education institutions. Growers can also choose to become strategic partners by deciding to allocate some strategic levy money to specific initiatives they see benefit in. This is done upon advice from the relevant industry Strategic Investment Advisory Panel.

Hort Innovation’s role is to broker these partnerships and help manage the investments along the way.

The Australian Government is also a partner to the Hort Frontiers initiative and once investors are on board, it makes a contribution to the specific project. Levy industries that become a strategic partner for a Hort Frontiers initiative have the levy attract the same Australian Government contribution amount it would if invested in a strategic levy fund project.

Watch how it all works

Check out these two quick videos!

The first one explains the structure of Hort Innovation and how the two funding models work for the benefit of Australia’s horticulture industry.

The second video is all about how Hort Innovation works with industry to invest levies.