Federal Budget 2017: Regional Investment Corporation unmasked

Mr Joyce spoke about the RIC’s implementation today after the federal Coalition announced in the 2017-18 federal budget that it would provide $28.5 million over four years to establish the new commonwealth entity that’s due to open in 2018.

The RIC was an agricultural policy commitment announced by Mr Joyce in last year’s election campaign to be a new federal agency that will cut state bureaucracies and streamline the delivery of drought support loans and other financing, to relieve financial pressures on farmers.

It will also administer finance and funding for the $2 billion National Water Infrastructure Loan Facility.

The RIC will be established as a corporate Commonwealth entity - within the agriculture portfolio but separate to it - through new legislation to be introduced this year.

It will comprise a CEO and independent board consisting of three part-time members with appointments to be made based on recommendations made to Mr Joyce and Finance Minister Mathias Cormann.

Mr Joyce said ultimately the number of staff would be for the corporation itself to determine.

“I’d imagine by the end there will be 100 odd staff but that’s not going to happen overnight - it will happen as we build towards it,” he said.

Mr Joyce said he expected to have a whole range of people suggesting places that the RIC should be located.

But he ruled out basing it within his own electorate at Armidale, where the Australian Pesticides and Veterinary Medicines Authority (APVMA) is being relocated to from Canberra, as part of the Nationals’ controversial and broadening decentralisation policy.

“I want it in a regional town – I want it to be working as closely as it can with other financing facilities,” he said of the RIC’s potential location.

“I’m not going to put it in Armidale or New England - but I do want decentralisation.

“I think this is a multiple billion dollar organisation and there are a lot of good candidates for towns where it could be in.”

Speaking at the annual CropLife Australia budget breakfast at the National Press Club in Canberra today, Mr Joyce said the APVMA would combine with the expertise of rural science studies at the University of New England and the CSIRO at Armidale, in creating an agricultural centre of excellence.

He said the Rural Industries Research and Development Corporation had moved to the Charles Sturt University campus at Wagga; with Charles Sturt expanding on that move with an investment into research for rice, pig meat and poultry.

The Grains Research and Development Corporation had expanded its functions to Toowoomba, Dubbo, Adelaide and Perth, he said, and the Murray Darling Basin Authority is expanding its operations, as a part of the government’s decentralisation agenda, to Albury-Wodonga, Toowoomba and Adelaide.

Mr Joyce said arguably his portfolio’s key election commitment was for the establishment of this $4 b RIC.

“The RIC, as it will be known, will deliver national consistency,” he said.

“For example, those farmers in Western Australia unable to access our current 10 year 2.47 per cent farm business concessional loan will have the RIC to deliver this facility from July 1, 2018,” he said.

“This will provide real competition for other rural lenders such as the banks.”

The government issued a joint budget media release on the RIC from Mr Joyce and Prime Minister Malcolm Turnbull, saying the new facility would administer $2b in farm business concessional loans from 2018–19.

“We will be engaging with the agricultural sector to discuss the new loan settings prior to the RIC opening its doors in 2018,” it said.

“This government has made an unprecedented level of funding available for loans to support farm businesses, delivering more than $660m in concessional loans to over 1200 farm businesses - but we want to ensure that they can access that support as quickly, easily and consistently as possible.”

It’s understood discussions are already underway within government ranks on where the RIC may be based in regional Australia.

Current concessional loans will continue to be administered by state agencies unless farmers choose to refinance – and the RIC will administer any new loans, after it is formally established, but they will have a broader eligibility criteria.

The concessional loan funding will come from the $250m per year, over 11 years, allocated in the Coalition’s Agricultural Competitiveness White Paper.

Shadow Agriculture Minister Joel Fitzgibbon has accused Mr Joyce of pork barrelling in moving the APVMA to Armidale in his New England electorate despite repeated concerns raised by industry about the loss of specialist staff like regulatory scientists that conduct farm chemical application approvals.

The National Farmers’ Federation say the RIC’s board will need an understanding of rural and regional Australia and how farmers and agribusiness operated and commercial, finance, and legal skills.