STRUGGLING Victorian farmers look set for an anxious wait on financial assistance as State and Federal Governments wrangle over details of the Farm Finance package.
In a move that threatens to delay a release of funds, five governments (Vic, WA, Qld, NSW and NT) released a joint statement recently, which said Federal Government should pay administration costs for concessional loans.
The statement said the difference between the borrowing and lending rate of Federal Government money - 1.5 per cent - should "accommodate administration costs" while ensuring no financial gains were made from the loan arrangements.
Agriculture and Food Security Minister Peter Walsh said the statement was designed to engage the Federal Government into action.
"It's been over a week now and we still haven't heard anything," he said.
Victorian Farmers Federation (VFF) president Peter Tuohey supported the States move but said the failure to resolve financial issues was delaying the process for needy farmers.
"We've got dairy farmers in the South West, fruit growers in the North East and graingrowers in the North West of the State that urgently need funds to restructure existing loans," he said.
"The loans will provide cash flexibility to help producers manage farm inputs."
Rural Finance Corporation (RFC) chief executive Rob Goudswaard said the concessional loans, which could provide each farm up to $650,000, were expected to be effective on July 1, but extensive on-farm assessments needed to be conducted before funds were released.
"The logistics of assessments are the most time consuming aspect of providing loans," he said.
"The criteria for viable and productive businesses means administrators have to do credit assessments with farmers' financiers, which is an in-depth piece of work."
RFC previously administered concessional lending for producers affected in the 2011 floods, but Mr Goudswaard said Farm Finance packages would require more in-depth analysis.
"These concessional loan assessments will be a lot more intense than others have been," he said.
"With the floods all we had to do was check the damage had happened whereas now we have to look at all aspects of a business."
He said while initial discussions with the Federal Government had been positive, they had been given no indication of a time frame or cost of administering the loans.
Federal Agriculture Minister Joe Ludwig said the Gillard Government was committed to delivering support for under stress farmers "as soon as possible".
"To date there has been a disappointing response from the states. We have seen a lack of willingness from the Liberal and National States to recognise there are farmers struggling right now and the need to act without delay," he said.
"I am now considering all options available for the delivery of Farm Finance to help farmers."
Responding to suggestions the loans could be used by Federal Government for financial gain, a spokesperson for the Minister said the loans were being offered at rates below market value, which was standard practice.
"It's normal practice for the government to charge a rate slightly above the government bond rate to cover the risk of loaning money," the spokesperson said.
