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Wednesday, 23 October 2002
Page: 5721


Senator PAYNE (2:36 PM) —My question is to the Minister representing the Minister for Agriculture, Fisheries and Forestry, Senator Ian Macdonald. Will the minister outline to the Senate what actions the Howard government is taking to assist farmers who are facing hardship in drought-stricken parts of Australia?


Senator IAN MACDONALD (Minister for Forestry and Conservation) —I thank Senator Payne for that question. I know that members of her family are experiencing the impacts of drought, as Senator Payne comes from a farming background. There are many Australian families who are paying an enormous price, both emotionally and financially, due to the drought. As we all know, drought is an insidious, creeping, heartbreaking event over which human beings have little control. It is even a more bitter pill to swallow when we know that last financial year was a record year for our agricultural produce. It was valued at something like $38 billion last year. Just as things were going so well in country Australia, the drought comes along and wipes a massive $6 billion off farmers' incomes in this financial year—that is half a per cent off the national GDP. One of the things that the government has been able to do to mitigate the impacts of drought is to implement its Farm Management Deposit Scheme. That is a cash management tool that complements on-farm risk management— strategies like developing fodder and water reserves, financial planning and diversifying the production system. This Farm Management Deposit Scheme allows farmers to put money into farm deposits in good years and draw it out in bad years. As at 30 June this year, 43,400 farmers had invested over $2 billion in farm management deposits. The government will forgo income revenue to the extent of about $510 million as a result of that scheme.

On the ground relief from the drought is principally a matter for the state governments around our country. They should be looking at things like transport subsidies and specific grants but, when the drought becomes so exceptional as to be beyond the capabilities of the state governments, the federal government comes in under its exceptional circumstances drought arrangement. Federally, we have an income support scheme through Centrelink, and Centrelink do a marvellous job in administering that efficiently and well—as with everything Centrelink do. We also have a business support scheme that provides interest rate subsidies. We did want a more generous business support scheme. We wanted to be able to provide cash grants of $60,000 to farmers, but Mr Truss put that to the Labor states and, regrettably, not one of the Labor states has been prepared to assist the federal government in this additional business support for those impacted upon by drought.

Labor has fudged its responsibilities. We have been trying to improve the EC scheme, and we have announced some additional enhancements but, regrettably again, the Labor Party governments throughout the states have not been prepared to come on board with the Commonwealth. They refuse to make more generous cash grants. Accordingly, farmers are left without the support that the Commonwealth thinks that they should have. For example, in New South Wales Labor made farmers wait for six months after declaring the Rural Lands Protection Board areas in drought before they were able to access state help. We want to avoid that. We have changed the rules recently, and in Bourke and Brewarrina the first impacts of our new arrangements are already having good results. (Time expired)