Productivity = increased profits, does not add up

December 16, 2013 by Rose Trapnell

Australia needs to focus on profitability rather than productivity if it is to pull its agricultural sector out of its current downward spiral, a QUT economist has said.

Dr Mark McGovern of QUT's Business School said Australia's agricultural industry wasn't alone in assuming that increased production and productivity would automatically lead to increased profits but that assumption was wrong.

"Australia can't afford to be stuck with this 40 year old mindset any longer," he said. "Our thinking and our policies need to be turned on their head."

Dr McGovern, who is a member of the national Rural Financial Roundtable Working Group, said university research had previously anticipated the current economic problems facing the and universities could play a key part in developing solutions.

"Many advisors to government don't appreciate the real possibilities that exist to advance our industries," he said.

"We need to have much more direct and robust discussion about these matters.

"Expertise at the universities needs to be unlocked to enable a breadth and richness of dialogue. An overly narrow discussion must be avoided and the best opinions available should be captured and built upon."

Dr McGovern applauded Agricultural Minister Barnaby Joyce's announcement of the development of an agricultural white paper and said he looked forward to making a submission.

However, the rural debt crisis needed urgent action and cannot wait for 12 months of paperwork.

Dr McGovern said he would offer to host a roundtable at QUT as the university had hosted several significant events over the past 15 years.

"It's important to bring together key players to have frank and open discussions and canvass a range of options. A university such as QUT is an ideal host," he said.

"Just tinkering with the existing framework won't cut it any more.

"No mindset works forever."

He said the white paper initiative indicated the Government appeared to be getting serious about agriculture and hoped it would give the industry the proper attention that was long overdue.

He said the Government's recent decision not to approve the GrainCorp sale was the first sign that Federal thinking was moving.

"This stand is to be applauded, but more important and, at times, politically challenging decisions will need to be made if Australian agriculture is to find a new wave of prosperity," Dr McGovern said.

Explore further: RBA interest rate cut will be good for economy

Related Stories

RBA interest rate cut will be good for economy

April 30, 2012

The incoming acting head of Queensland University of Technology's (QUT) School of Business said a reduction in Australia's official interest rates would help the nation's manufacturing and tourism industries.

Farmers check out AgBot at Robotronica

August 15, 2013

Farmers in Brisbane for the Ekka are being encouraged to come to QUT's Gardens Point campus on Sunday August 18 to check out AgBot, a robot that is destined revolutionise farming in the future.

QUT develops software to reduce greenhouse gases

September 25, 2013

Technology developed at the Queensland University of Technology (QUT) in Brisbane aims to help Australia reduce greenhouse gas emissions across its agricultural landscape.

Recommended for you

Model shows how surge in wealth inequality may be reversed

July 30, 2015

(—For many Americans, the single biggest problem facing the country is the growing wealth inequality. Based on income tax data, wealth inequality in the US has steadily increased since the mid-1980s, with the top ...

Earliest evidence of reproduction in a complex organism

August 3, 2015

Researchers led by the University of Cambridge have found the earliest example of reproduction in a complex organism. Their new study has found that some organisms known as rangeomorphs, which lived 565 million years ago, ...

French teen finds 560,000 year-old tooth (Update)

July 28, 2015

A 16-year-old French volunteer archaeologist has found an adult tooth dating back around 560,000 years in southwestern France, in what researchers hailed as a "major discovery" Tuesday.


Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.