Media Release

Agricultural finance forum update

13 November 2014

Progress on delivering key outcomes is well advanced following a meeting of agri-finance specialists and rural industry representatives for an extraordinary meeting of the Agricultural Finance Forum held on 23 September.

Minister for Agriculture, Barnaby Joyce, said the industry-inspired forum pulled together representatives from the banking and farm sectors to talk about the rural debt situation across the nation and agreed to pursue three priority outcomes.

"The forum agreed to begin sharing data on rural debt—this will help us to better understand the detail of this issue in rural Australia on a regional basis," Minister Joyce said.

"And so ABARES, the Australian Bankers’ Association, the Gulf Cattlemen’s Association, and the National Farmers’ Federation, have been working together these past weeks to share debt data specifically in the Gulf cattle country and in some of the worst drought-affected regions, such as north-western New South Wales.

"I expect the data report to be ready soon.

"The forum also recommended the government establish a working group to develop options for a nationally consistent farm debt mediation scheme. Farm debt mediation brings together a farmer and their bank so they can better negotiate strategies and options in the management of the farmer’s financial position, however current schemes vary from state to state.

"It is important that farmers understand their rights and responsibilities when negotiating with their bank thus a national scheme would provide much needed structure to the process.

"The working group has already held preliminary discussions and will have its first face-to-face meeting today.  I’ve asked this group to report back to me by mid-December. A national approach will help all farmers and their bankers access a simpler, more consistent system regardless of where they live and do business.

"The forum also called on the government to consider whether changes to the current concessional loans scheme are warranted.

"It is clear that some areas of the country—particularly in Queensland and New South Wales—are experiencing a one-in-one-hundred year drought event.

"My department has recently confirmed that there is close to $100 million that was not spent in the first round of the Farm Finance Concessional Loans Programme; that is the 2013–14 financial year.

"I have spoken with my government colleagues and asked my department to explore the possibility that these funds could be used to assist those experiencing a one-in-one-hundred year drought, with any potential new measure to complement the existing Farm Finance and Drought Concessional Loan programmes.

"There is no quick or easy fix when it comes to drought however this government remains committed to doing what we reasonably can to assist farmers, even with the difficult budget situation we currently face.

"The fact is this Coalition Government is delivering significantly more drought support measures – and more funding – to more farmers than the former Labor government ever did. There is a range of government support available to farmers in need right now, including Farm Household Allowance, Farm Finance Concessional Loans and Drought Concessional Loans, and the Rural Financial Counselling Service."

More information on assistance available from the Australian Government can be found at agriculture.gov.au/assistance.