The Australian Government is committed to building the sustainability of the agriculture sector and providing assistance when it experiences severe downturns during rare and severe climatic events.

We are all witnessing the devastation the current drought has caused.

It is the worst drought on record.

At present, more than 44 per cent of the country’s agricultural land has been Exceptional Circumstances (EC) declared.

That covers 63 regions, and a further 4 areas are currently being assessed for EC declarations.

If you pause to think about this, you will realise that several European nations could fit into an area that size.

Some regions are heading into their sixth consecutive year of drought, and more and more farm families are having trouble making ends meet.

To help farmers, small business operators and communities cope with deteriorating conditions, late last year the Australian government announced additional assistance measures and made existing measures easier to access.

These measures included:

• an extension of financial assistance to 2008;
• funding for social, emotional and financial counselling;
• assistance for farmers to get professional advice to manage during drought;
• funding for the Country Women’s Association to provide emergency family and community grants;
• The introduction of drought assistance mobile service units; EC interest rate subsidies and EC relief payments for agriculturally-dependent small business operators;
• changes to the eligibility requirements for EC Interest Rate Subsidies;
• an increase to the cap for EC Interest Rate Subsidies; and
• an increase to the cap and non-primary production income test for the Farm Management Deposits Scheme.

Since 2001 we have provided over $1.3 billion in assistance  and we have committed a further $900 million in assistance until 2008.

Now eligible small business operators will be able to access the same support that is already provided to farmers.

The Farm Household Support Amendment Bill 2007 (the bill) will let agriculturally-dependent small business operators access EC Relief Payments and access ancillary benefits, such as a health care card and concessions under the youth allowance and Austudy means test.

The bill gives effect to the current ex-gratia arrangements for small business income support, and changes legislation so that eligible small business operators can access the ancillary benefits.

It is important to note that not all small business operators in rural areas are eligible to access EC assistance.

A small business operator must be able to demonstrate that 70 per cent of their gross business income is derived from providing goods and services for the purposes of farming.

The bill outlines all the eligibility criteria that will determine whether a small business can access EC Relief Payments.

We expect the criteria will make sure assistance is provided to the small business operators most affected by the drought.

The Australian Government is aware that there are small business operators who can also be considered farmers.

Due to the extended nature of this drought, it is beginning to affect this group of people’s ability to make a living from their small businesses and their farm enterprises.

Under the current eligibility criteria for EC Relief Payments, these small business operators may not be eligible for assistance as a farmer, as their off-farm income is too high. 

Nor may they be eligible for assistance as a small business operator, as their farm assets may rule them out.

The bill will give support to  small business operators who meet both the small business and farmer qualifications, except that they do not derive significant income from the farm.

Specified farm assets and small business assets will be exempt from their assessment for assistance.

The bill will also give effect to two other pieces of legislation:

• the Social Security Act 1991 (the social security act); and
• The Age Discrimination Act 2004 (the age discrimination act).

Changes to the social security act will let eligible small business operators access concessions under the Youth Allowance and Austudy means tests that are already available for farmers.

Under these concessions, assets that are exempt in the Farm Household Support Act 1992 (the Farm Household Support Act) will also be considered exempt if a small business operator receiving EC Relief Payments applies for Youth Allowance or Austudy.

Both The Minister for Employment and Workplace Relations, and the Minister for Education, Science and Training, have agreed on these changes to the Social Security Act.

The Bill also brings into effect a section in the Farm Household support act that outlines that the rate of EC Relief Payments for small business operators is the same as that for farmers - and it is dependent on age.

The attorney-general has provided exemptions under the age discrimination act that let the rate of EC relief payments, for both small business operators, and farmers be calculated according to their age.

The bill makes a number of other changes to the Farm Household Support Act, to bring it into line with the Age discrimination Act.

Sections under the Farm Household Support Act that have age qualifications that don’t already have exemptions under the Age Discrimination Act,  will be removed when the bill is passed.

Conclusion

I would like to reiterate that the Australian Government has a strong record of providing assistance to the agriculture sector to manage the impacts of drought in rural and regional Australia.

And we remain committed to providing help whenever and wherever it is needed.

I have been out to these drought-affected areas In recent months and I can confirm that I have never seen a drought that is so harsh and so far-reaching.

I know that the prime minister has also seen how bad it is first-hand.

I would like to thank the farmers, small business operators, community and industry groups who have all contributed to the success of the Australian Government’s drought assistance measures.

My thanks also go to the Ministers and government agencies that have swiftly implemented the drought assistance measures announced in October and November 2006.

Passage of this bill will ensure that our drought assistance can reach those most in need.