JHI must get business savvy

It’s no secret that research institutes are operating in challenging times.

Government funding has been reduced; future EU contracts are looking tricky; and the commercial environment is far from easy.

The collective of six institutes which work in the agriculture and food sector made their case for continued support to the Scottish Parliament this week and coincidently we’ve had a glimpse into the fortunes of the James Hutton Institute (JHI) and the Moredun Research Institute which focus on plants and animal diseases respectively.

Both institutes do outstanding research which underpins the current and future competitiveness of Scottish agriculture but, while the Moredun’s foundations are solid, the Hutton’s accounts are raising eyebrows.

Questions are being asked about increased salary costs, the overwhelming reliance on government funding, the lasting implications of the costly amalgamation, and falling income from the institute’s commercial arm, James Hutton Limited.

The Moredun, meanwhile, has been attracting hard cash through its commercial subsidiary, income from the far-sighted decision to invest in land and property on the outskirts of Edinburgh, and is living within its means by shedding staff.

JHI’s chairman has warned that capital expenditure is below what is required to maintain the institute’s infrastructure and there is an acknowledgment that it needs to reduce its reliance on Scottish Government research contracts.

The Moredun has always had strong farmer representation on its board and it is their shrewd business decisions that are now helping it withstand many of today’s pressures.

That practical business nous appears to have been lacking at JHI which seems to be gambling on getting a wad of cash through the Tay Cities Deal.

Cereals, soft fruit and potato producers in particular will be praying that bid is successful.