Abbott set to bring drought support measures forward

Beef Central, 07/02/2014

Prime Minister Tony Abbott has announced plans to bring forward the introduction of an income support measure for drought-affected farmers currently not scheduled to commence until July 1.

National drought policy was changed by the Labor Government with the support of State Governments early last year, moving away from the long-running Exceptional Circumstances model toward a new system which is designed to help landholders prepare for dry times.

The change saw previous short-term support measures removed, however, since that time, the rapid and extensive spread of drought has left many producers in a dire position with dying stock, collapsed markets and no income to manage their way through the severe event.

Drought-affected farmers currently have access to income support under the new drought policy via the “Transitional Farm Family Payment”, which will be phased out on June 30, 2014.

Assistance under the TFF is paid at the Newstart Rate, which ranges from $452.30 to $542.10 per person per fortnight, depending on family status.

However farmers have stated that the eligibility criteria for the TFF is set to high to enable meaningful access, in terms of requirements for income and asset tests. The TFF is not available to any applicant and their partner whose total net assets, including farm assets and principle residence, exceed $1.5m. Levels of available income support reduce by half for anyone earning $62/per fortnight or more.

Under the new national drought arrangements, a new Farm Household Allowance payment is due to become available from July 1, 2014.

The allowance will also be paid at the Newstart rate, but is understood to include a more generous total net asset allowance of $2.5m and will be made available to eligible recipients for up to three years, provided their eligibility status does not change during that time.

Tony Abbott said it was important to bring drought assistance forward.

“The new system will essentially involve giving drought-stricken farmers much greater access to income support and that's what we're looking at and it was supposed to start on July 1, well, let's bring it forward," Mr Abbott said on ABC Radio yesterday.

Agriculture minister Barnaby Joyce is understood to be working on new assistance proposals to take to his 18 Cabinet colleagues next week.

Whether he can convince a majority to support more assistance remains the key question.

There have been mixed messages in the past week from senior Coalition figures in response to questions about whether more-Government support for drought-hit farmers is appropriate.

The Federal Government’s decision last Friday not to inject $25m to protect jobs at the Coca Cola Amatil-owned SPC Ardmona Cannery in Shepparton drew media speculation that the hardline economic ‘dries’ within the Abbott Government had taken a clear stand against government assistance to industry.

On Monday treasurer Joe Hockey appeared to continue the hardline stance with pointed public comments that the ‘age of entitlement was over’ and farmers needed to adjust to the regular swings and roundabouts that occurred in a tough country such as Australia.

But those comments were contrasted by statements by the treasurer yesterday that drought relief was a unique case and the Government would not treat "mum and dad" farmers the same way as businesses backed by multinational companies.

In comments quoted by AAP yesterday, Mr Hockey said it was wrong to compare the Government’s rejection of assistance to Holden or fruit processor SPC Admona with drought support for farmers, because the Government treated drought as an “entirely natural disaster".

National Farmers Federation president Brent Finlay said farmers prepared for drought in the course of their business operations as best they could, but there were some circumstances that went beyond what was possible to prepare for.

The current drought had been exacerbated by 2013 being the hottest year on record for Australia, combined with the lowest rainfall on record for many areas. For many farmers the drought has also come hot on the heels of a range of adverse impacts to their businesses including the high Australian dollar and the flow-on impacts of the 2011 suspension of live cattle exports to Indonesia.

Mr Finlay said the NFF had asked the prime minister to implement a broad range of measures targeted towards farmers, their families and their communities to cope with the current drought.

“We are not talking about handouts here. We’re talking about short-term assistance in times of extreme hardship, to viable farmers, to help them through these tough times,” said Mr Finlay.

“Factors such as rural mental health services and maintaining a strong rural workforce are needed in the short term, along with boosting income support and other farm business measures.”

“The package that is due to commence from July this year is primarily about assisting farmers to prepare for future droughts, so bringing that forward is not going to offer the level of assistance that farmers require right now,” he said.

NSW Farmers President Fiona Simson agreed that while the PM's interest in bringing forward the drought package was encouraging, the FHA was developed as part of a preparedness package and was not designed to support farmers in their current situation.

“We need to look at measures that will help farmers here and now. If we don't, we put at risk farm businesses, families and rural communities which in the longer term impact beyond the individual to the Australian economy.”

Ms Simson said that just like the millennium drought, government and industry needed to work together to develop measures that were effective and beneficial in the long term.

“Our farmers are some of the most competitive and efficient in the world and providing bridging support in these extreme conditions complements our long term viable industry,” she said

“Farmers in NSW have been proactive, they have been prepared for this drought but they need short term investment from the government to help them through this crisis until the drought breaks and food and fibre production returns to normal.”



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