Farm groups back new drought support package

Farm groups back new drought support package


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Regional Development Minister John McVeigh, Deputy PM Michael McCormack and PM Malcolm Turnbull announce their new drought support measures in Forbes on Sunday.

Regional Development Minister John McVeigh, Deputy PM Michael McCormack and PM Malcolm Turnbull announce their new drought support measures in Forbes on Sunday.

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Questions on concessional loans and interstate planning

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Farm groups have praised the drought support package announced yesterday by the federal government at Forbes, NSW, with some reservations.

The announcement is the federal government’s second drought initiative in two weeks, and include the appointment of a Drought Coordinator.

Major General Stephen Day will work with the states, charities, donors and communities to facilitate drought assistance and to identify shortfalls in current assistance measures. 

To date, the federal government has focused on boosting social support services and encouraging farmers to invest in preparedness measures. Yesterdays announcement included $75 million for local community stimulus.

  • The cost of fodder storage facilities can now be deducted immediately, rather than depreciated over three years. 
  • The Drought Communities Program gets an extra $75m, with drought hit local government areas receiving $1m each for new works. 
  • More staff to speed the FHA applications process, and a reduction in the documentation requirements.
  • A $72m drought round of the National Water Infrastructure Development Fund will be issued.
  • The Great Artesian Basin bore capping program gets a $23.7m boost.
  • Farmer-specific weather and climate guides will be made more accurate with a $2.7m investment in the Bureau of Meteorology.
  • Borrowing limits on low-interest farm infrastructure loans will be doubled, from $1m to $2m while the total amount available for loan will be doubled to $500m a year.

National Farmers Federation president Fiona Simson praised the drougth package and said many of the new measures apply to all farmers irrespective of their finances.

"It's also great to see support forthcoming for our regional communities, who always do it tough when the farm sector falls on hard times," Ms Simson said.

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NSW Farmers president James Jackson welcomed the community funds and the new tax breaks that “recognise farmers are business people”.

“However, while low interest loans are helpful, there is a limit to the amount of debt that farm businesses can carry and still be in a viable position to fund the costs of restocking and replanting when the drought breaks,” Mr Jackson said.

“NSW Farmers calls on the Australian government to defer both loan interest and principle repayments until it rains, as has been announced by the NSW Government for loans under theFarm Innovation Fund.”

The government promoted its total drought support reached $1.8 billion, but this figure includes potential uptake of concessional loans which may or may not be issued.

Labor agriculture spokesman Joel Fitzgibbon said the new measures were too little, too late.

He criticised the government for failing to restore the Coalition of Australian Government drought reform process he established in 2013, but had since been abandoned by the Coalition.

Mr Fitzgibbon said the government had also neglected policy tp promote climate change adaptation which encourages farmers to adapt best practice regenerative methods to combat drought.

“The Turnbull Government should also stop exaggerating the dollar value of its drought response by factoring in the capital value of loans not likely to ever be lent,” Mr Fitzgibbon said.

“Labor will support the measures announced today but the Turnbull Government’s reactive, ad hoc and clumsy response to drought is no alternative to a coordinated, collaborative, science-based approach focused on climate adaptation.”

The government previously announced additional payments under the Farm Household Allowance, with couples getting two payments worth up to $12,000 and single households will receive up to $7,200. The asset threshold for the FHA will be reduced from $2.6m to $5m.

Mr Fitzgibbon said farmers should be given the option to take the $12,000 in one lump sum instead of two installments. 

The story Farm groups back new drought support package first appeared on Farm Online.

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