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Devil in the detail

01 May, 2013 04:00 AM
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7
 

DETAILS of eligibility and access to the federal government’s Farm Finance package will become clearer, and the cash delivered faster, once the Northern Territory and State governments agree with Canberra on how the scheme will be administered.

The federal Coalition and various farm groups have welcomed the new support measures announced on the weekend but they have also criticised the lack of detail.

The biggest vacuum is the lack of clarity on the eligibility criteria for individual farmers that must be viewed as viable but struggling financially under current conditions, including seasonal pressures and the forces of the high Australian dollar.

WA is seeking urgent clarification, where seeding is underway but those farmers who have struggled to get finance for planting this season’s crop are still unsure exactly what the government will provide and if it will benefit them directly.

WA Liberal Senator Chris Back said details of the package were quite unclear, including how many farmers would benefit, how its benefits would be dispersed and how farmers actually proved their viability.

The scheme’s key plank allows each State and the NT access to $60 million loans over two years from the federal government for providing concessional loans to farmers of up to $650,000 each.

A federal government spokesperson said a letter was emailed to State and NT governments on Saturday when the scheme was announced, asking for their support with administering low interest loans through State delivery agencies, like the Queensland Rural Adjustment Authority (QRAA).

The first step is for the States and NT to agree to administer the Farm Finance scheme and deliver individual loans to farmers under stress in their States.

After sign-up, the Commonwealth will discuss and finalise the eligibility criteria and guidelines with the NT and States, based on the severity of stress farmers may be suffering in the individual jurisdictions.

The government says it can’t say exactly how many individual farmers will benefit right now, because the number of eligible farmers, or how much they would actually borrow individually, is unknown.

However, the interest rates on the loans are expected to be well below the rates of commercial loans and devised by the State-based administration agencies, like QRAA.

QRAA has administered support schemes for flood affected primary producers and small business owners in recent years including cash grants and 4pc interest loans of up to $250,000.

The government isn’t expecting the States and NT to disagree to the new scheme but says the sooner they do agree and the finer details are devised the faster struggling farmers will be able to access financial assistance.

The State based administration facilities and delivery systems are largely lying dormant and waiting to be put into gear.

However, as of Monday evening, none of the States or the NT had provided a formal response to Minister Ludwig’s office.

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FarmOnline
Colin Bettles

Colin Bettles

is the national political writer for Fairfax Agricultural Media
Date: Newest first | Oldest first

READER COMMENTS

Flaming-go
1/05/2013 7:53:04 AM

QRAA offer sustainability loans up to $650k to buy first farms or improve productivity of existing farms. This is funded by the QLD governement. No fees and charges and current rate for 5 yrs 4.47%. Disaster funding is joinst federal state funding and current rates are 1.7%. Question: how will new lending be secured, will the banks release security to allow debt rescheduling? Also, $60 million to all states and NT how many primary producers are there in Tas compared to Qld, Vic & NSW is this equitable?
Top Ender
1/05/2013 8:57:19 AM

Going to be difficult for the NT, as unlike Queensland, don't have an existing body like QRAA to administer funding like this. So is the Federal Government going to aid the NT to set something like this up? Shouldn't think so! Let's face it, this scheme is aimed squarely at city voters and has little or nothing to do with aiding agriculture. It has always been easier to appear to be doing something than actually doing. Methinks the "Empress has new clothes"!
Genazzano
1/05/2013 9:48:29 AM

The drought is NOW, not in 2014. What a joke. Enhancing farm management deposits. Farm management deposits are an important risk management tool for primary producers to manage fluctuations in their farm income. The government proposes to increase the non-primary production income threshold from $65,000 to $100,000 so that more primary producers can access the scheme and diversify their income to help better manage variations in incomes. The government will also cut red tape to help primary producers keep track of their finances and reduce their administration fees. This measure will take 1/7/14.
pete
1/05/2013 11:46:22 AM

Top Ender - Spot on, Nice way to try and buy votes from people with some degree of sympathy for the primary producer. Flaming-go -Exactly right on the security. Any operation that is struggling with debt will be hard pressed to get any security to cover a loan. A bank will gladly take the government cash but i doubt would be willing to relinquish any rights with respect to preferences for securities should default occur.
Percy
1/05/2013 1:55:59 PM

This is only being introduced because Joe Ludwig as Minister for Agriculture along with his government is held so low in farmers esteem that some sort of sweetener is being introduced to try to win their votes. When will farmers realise they are no longer wanted in Australia under any Labor Government and barely acknowledged under a Liberal one. You are being sold out just like all our industry has already been. Go and join the dole queue like any other worker or manufacturer. The Greens would dearly love to turn your farms back into national parks.
angasb
2/05/2013 7:53:41 AM

Trust is an important aspect of farming. How could I ask for a loan on the basis of the current Federal Government fiscal management.
Top Ender
2/05/2013 8:17:51 AM

Right on Percy - maybe the government should be offering the money so that we can all be trained as Park Rangers!

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Whats changed your mind chelseaf ?
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wtf, you could lead the way by finding the item about the miraculous motor car, and giving us