Senator JOYCE—When you close the biggest undercover facility in the southern hemisphere, what is going to be the alternative facility that takes its place?

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Mr Whelan—We are proposing to relocate that research capability to two sites. The first of those is in Townsville, where CSIRO, together with James Cook University, will be making a substantial investment in tropical science research and will also relocate some of that capability to our biotechnology facilities in Brisbane.

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Senator JOYCE—There has already been a $3 million upgrade on two labs in 2006. Do you think that it is quite profligate to update two labs for $3 million and then close them down?

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Mr Whelan—It is not something that we feel comfortable about doing at all. The research that we undertake in that facility is high quality. It has significant impact for the cattle industry in northern Queensland, as does the research that we undertake in all of the facilities that we have earmarked for closure as part of these decisions. However, we have a limited funding envelope and we are forced to make some priority decisions. Our process for determining what to reduce has been: can we reduce fixed costs and management overheads wherever possible to try to preserve research capability.

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Senator JOYCE—Do you think there is a strong link between an arbitrary nature of an efficiency dividend that is plucked out of thin air as a number and the reality that actually happens to our beef industry, one of our nation’s major exports? Do you think that this is a wise and prudent decision to make, especially in light of some of the biosecurity issues that are ever present in the north of our country?

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CHAIR—I think that question is asking for an opinion of the officer.

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Senator JOYCE—I will be more specific. Is the closure of this facility going to affect in any way our capacity for biosecurity and also livestock technology advancement for our beef industry?

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Mr Whelan—We will seek to minimise that impact. However, as Dr Garrett has already indicated, the organisation has been through significant programs of reform over the last five years to improve its efficiency. We spend more than $120 million a year on property costs. The vast majority of the rest of our costs are people’s salaries. There will be a consequence for the research that we do for the cattle industry as a result of these decision and we are seeking to minimise that.

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Senator JOYCE—Can you tell me some of the advantages of the Rendel facility and some of the programs that it is involved in at this point in time?

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Mr Whelan—I would need to get one of the other officers to answer that.

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Senator JOYCE—I just want to know what programs are going to be affected by this closure?

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Dr Garrett—Dr Joanne Daly is the head of our Agribusiness Division.

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Dr Daly—There are three broad areas of research that we do at the Rendel laboratory. One is around livestock in the environment, which has a strong focus on animal behaviour and also methane emissions under various diets. The second activity is quantitative genetics, and the third activity is food safety work, particularly around poultry.

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Senator JOYCE—Genetics is very important.

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Dr Daly—They are the three activities we undertake. We are not shutting them down; we are just relocating them.

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Senator JOYCE—There are very important issues there. How much does it cost to run the Rendel facility per year?

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Mr Whelan—I would need to take that on notice.

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Senator JOYCE—Your cuts all-up are around $64 million in CSIRO through efficiency dividends. In your view, has the Rendel facility since its inception in 1981 been an effective facility in dealing with issues with regard to the beef industry?

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Mr Whelan—Yes, it is well regarded by the beef industry.

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Senator JOYCE—In comparison to other types of research facilities—we had one down here recently that took two days, cost $2.6 million and was called the 2020 Summit—do you think you are an efficient organisation that is closely involved with the components of the beef industry? Do you have peak industry bodies involved with the Rendel facility?

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Mr Whelan—Yes, we do. We engage widely with stakeholder communities around all of our research, including the beef industry.

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Senator JOYCE—What is the real capacity to move the facility? The massive part of the Rendel facility is its capital infrastructure. I know you are talking about moving things to Townsville, but it is really not that simple. You cannot take the largest undercover cattle research facility in the southern hemisphere and put it on the back of a truck and take it somewhere else, can you?

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Mr Whelan—No, that is correct. What we are going to seek to do is to preserve as many of the research programs and the research activities as we can by relocating them to see if we can make savings in management overheads and fixed costs as a result of that. As you correctly point out, we are not going to be in a position to relocate the physical infrastructure to another site.

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Senator JOYCE—Has anybody offered to buy the facility from you?

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Mr Whelan—We will pursue the disposal of the site as part of the implementation of this program.

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Senator JOYCE—What could be the possible loss to the Australian taxpayer by the placing of this facility in mothballs and what is the current value of the capital outlay on this facility on the books?

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Mr Whelan—I would need to take a couple of those questions on notice, but I will seek to give you an answer. The facility is not currently fully utilised. A substantial part of the facility is unoccupied, and that is a matter of concern for us. We have sought to have other people co-locate onto the site. To date that has not been successful. I cannot speculate as to what demand there may be for purchasing the site or leasing it from CSIRO if that is the way we go. That is one of the things we will look at as we move forward with the implementation of these issues.

I would not want you to leave the hearing today thinking that this is an easy decision or somehow there will not be an impact. We do expect there will be a negative impact from the closure of this site, as we do from the closure at Merbein. What we are seeking to do is to try to minimise that.

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Senator JOYCE—Is Rockhampton the biggest beef production area in Australia?

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Mr Whelan—It is one of them.

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Senator JOYCE—Yes, it is. Minister, have you ever been to the Rendel facility?

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Senator Carr—No, I have not.

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Senator JOYCE—Can you tell us what it does?

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Senator Carr—I have had representations on the site and a number of members of parliament have drawn to my attention the importance of the facility. The simple fact of the matter is that these budget changes have been made as a result of decisions of governme