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Wednesday, 3 November 1976
Page: 2262

Mr McVEIGH (DARLING DOWNS, QUEENSLAND) -I direct my question to the Minister for Primary Industry. Will the Minister advise what stage has been reached in planning the establishment of a rural bank?

Mr SINCLAIR (NEW ENGLAND, NEW SOUTH WALES) (Minister for Primary Industry) - There has been increasing concern among the rural community as a result of escalating costs and the declining returns that are generally available to it. The undertaking by the Government to implement a rural bank was made in the context of the resultant difficulties that rural producers generally found in trying to finance their operations on a combination of a bank overdraft, term funds advanced by one or other of those funds that are available through private banks and, perhaps, money available from other institutional lenders and hire purchase funds to which they are inevitably forced to resort in order to acquire farm machinery, farm vehicles and other equipment in the mechanisation of their farms.

The rural bank proposals are endeavouring to embrace a supplement to the availability of existing finance through existing lending institutions. The Bureau of Agricultural Economics has been charged with the responsibility of developing a current assessment of the rural finance situation, updating the original assessment made by it at my request in 1972. In addition, within the Government the Treasurer and I have had discussions with the trading banks. There have been interdepartmental discussions. We hope that we will be able to develop a proposition for consideration by those who are interested some time during the early part of 1 977.

The Government recognises and respects the concern of rural producers generally about the problems that they have in operating profitably under present cost escalation factors and their declining incomes. They see and we see a rural bank as being a very worthwhile supplement to existing lending institutions for that purpose. Accordingly the Government stands by its policy commitment and will proceed to the introduction of the appropriate mechanism for improved rural lending facilities as soon as possible, taking into account the various diverse avenues through which money is now obtained and the advantages of the longer term lending envisaged under the rural bank concept.

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