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Wednesday, 8 November 2000
Page: 22528

Mr LAWLER (12:12 PM) —The key feature of this Farm Household Support Amendment Bill 2000 is the expansion and the retitling of the popular Farm Family Restart Scheme. Farm HelpSupporting Families through Change, will expand on the outstanding performance of its predecessor in providing a viable alternative for those farming families battling away on low incomes. This new version will not only extend support payments under the scheme until November 2004 but also provide $3,500 for retraining to those farmers and their spouses who have already qualified for the $45,000 re-establishment grant. It includes a requirement that farmers deemed non-viable, and therefore eligible for assistance, compile activity plans for the future. But most significant for struggling farmers in my electorate of Parkes in western New South Wales—and there are some struggling and there are some very prosperous ones—is the provision for greater flexibility in the period during which farmers wishing to receive assistance must complete the sale of their property.

Under the previous scheme, farmers were obliged to show their intent to embark on the off-farm assistance program by completing the sale of their holding within 12 months. Although the one-year time frame was responsible in spirit as a measure to prevent any misuse of funding support, the clause poorly served some farmers whose situation was in fact the most desperate. For some farmers in my region, years of falling commodity prices and a lack of income producing alternatives, interspersed with periodic drought, were the crippling influences—along with non-viable sized holdings—as efficiencies, international competitiveness and, therefore, price expectations changed.

Obviously, these factors cannot be eliminated simply by change of owner. As a consequence, the market demand for these properties is pretty half-hearted, to say the least. Perhaps where misfortune and an element of mismanagement were to blame, a prospective buyer might be found within 12 months who could see that the operation could be resurrected. But the incompetent farmer was the first to disappear long years ago during years of prolonged and increasing financial hardship. Those that remain have been doing their best in a losing battle against changing markets and a local landscape suitable only, in some cases, for raising sheep, and that cannot be adapted to more lucrative products finding favour in recent times with global consumers.

The chances of these farmers finding a party with sufficient capital who is willing to change places with the embattled owners or to invest in their unviable operation are scant at best. This shortcoming was identified by a rural counsellor operating in my electorate some time ago. I commend Cathy Sim from the Macquarie Rural Advisory Service for bringing it to my attention and to that of the minister. In these circumstances, under this new legislation, there will be scope for ministerial discretion in determining payment where the farm sale has not been completed within the allotted 12 months.

With these changes, I am confident that the Farm Help package will provide support for farming families looking to make a fresh start, so that they can do so confidently and with a minimum of stress, upheaval and uncertainty. These initiatives have already been shown to be an effective safety net for farm families if they fall into financial difficulties by helping farmers to plan for their futures, whether that be on or off the farm.

Since these initiatives began in December 1997, nearly 4,600 farm families have received income support. Nearly 4,700 professional advisory sessions have been attended and nearly 500 farm families have received re-establishment grants. Most importantly, Farm Help can be specifically modified to meet the requirement of each farm family situation. The program includes up to 12 months income support at the Newstart allowance rate, professional advice across a range of fields, including financial, legal, business, career or personal advice, and the re-establishment grant of up to $45,000 for those farmers who decide to leave farming altogether. The figure of $3,500 for retraining will provide the necessary skills through accredited training to equip farmers and their spouses for alternative careers outside agriculture. In an innovative step, the bill urges all Farm Help clients also to participate in the development of an activity plan which will help to provide them with a strategy that is tailored to their own particular circumstances.

To indicate that this funding is anything but a handout to the rural sector, and instead comes with an obligation on the part of both parties, the development and follow-up of activity plans will be compulsory for non-viable farmers receiving full support. The net assets threshold for the maximum $45,000 re-establishment grants will also be increased from $90,000 to $100,000. This will effectively increase the total grant payable to those farmers with net assets of $100,000 from $38,333 to $45,000. The grant total will be phased down by $2 for every $3 in assets above $100,000 and the grant will cease to be payable when assets exceed $167,500.

Unless my maths is wrong, this means that in the best case scenario, if a farm family acts quickly when they recognise that their equity is threatened, they can re-establish in town with up to about $167,000. An important point is that this grant and the rules surrounding it encourage consideration of this option and other options before equity is diminished to nothing. Importantly, it allows a farmer to leave the land with dignity intact. Further, it structures an approach to future opportunities which may otherwise be ignored in the trauma of the moment.

Under this bill, the deadline for income support applications under the Farm Help scheme will be extended from 30 November 2001 to that day in 2003, while payments for recipients will continue until 30 November 2004. These proposed amendments will serve to enhance the scope and quality of this government's support for struggling farmers and their families and thereby assist communities across rural and regional Australia. For many towns in my electorate and in rural areas throughout the nation, the prospects of tomorrow are tied to the farm prosperity of today. While these towns continue to remain surrounded by embattled primary producers who themselves are unable to start afresh, the economic stagnation has profound effects. This is clearly evident in findings released this week by the Australian Bureau of Agriculture and Resource Economics which noted the crucial link between farm spending in smaller towns and those towns' future. The report stated that any reduction in farmers' expenditure in small rural towns led to a direct and almost immediate population decline. The mantra is familiar to all of us who represent regional, rural and remote areas: lost jobs, lost opportunity, lost young people, lost services and, too often, lost souls.

With such a far-reaching and comprehensive scheme as this, people who wish to exit their circumstances and yet remain economically secure to reinvest in their community can do so. By freeing up the logjam of farm families caught between low income existence and lack of alternatives, this scheme offers a great promise for regional economies as a whole. There is little doubt in my mind that, given a fresh start, the industrious men and women from the land will transfer their efforts to more lucrative pursuits in diverse career fields. Many have skills that, in the emotional decision making time, they do not even recognise. They have skills that with a little effort can translate into a job driving a bus or truck, welding, consulting, counselling or in any myriad of small business opportunities. By easing the transition from the farm to another lifestyle this government is recognising and moving to alleviate the suffering of those farmers who, often through no fault of their own, cannot generate sufficient income to provide for their families. In doing so, this government will have also directly encouraged the business activity and the economic diversity so dearly needed in our rural communities.