Barnaby pressures big four banks

18 Dec, 2014 03:00 AM
Agriculture Minister Barnaby Joyce.
We’re not going to sit idly by just let whole swags of people get kicked off their farms
Agriculture Minister Barnaby Joyce.

HE promised a rural debt roundtable in Canberra in late September would not become a bank bashing exercise, but Barnaby Joyce's political rhetoric since then has escalated dramatically.

Before, during and after the recent public meeting at Winton, Queensland, which ventilated issues over an expanding rural debt crisis, Agriculture Minister Barnaby Joyce has sought to publicly pressure the big four banks into managing farm debt more diligently.

His threatening tone also increased as political competition ramped up, with independent Queensland MP Bob Katter moving to “name and shame” any banks that foreclose on farmers facing debt issues.

But as the Australia and New Zealand (ANZ) Banking Group announced a 12-month moratorium on foreclosures last week, Mr Katter said he would start to “name and fame the good guys” rather than publicly embarrass banks for continued foreclosures.

“Every time you do sell up a farmer, we’ll name you,” Mr Katter said.

“To sell a property at the end of the dry season, before the wet season and before the Chinese and Indonesian markets kick in next year, it is a bastard act.

“From now on it’s name and shame and also name and fame.”

Watching the banks

This week, Mr Joyce told Fairfax Media the ANZ announcement, along with moves by other banks to improve foreclosure measures after the Winton meeting, worked “hand in glove” with the government’s other drought support programs.

He said the Coalition had implemented new policies allowing 4400 people to receive the Farm Household Allowance, and 430 people to receive concessional loans.

The government also recently announced an additional $100 million in concessional loans, at an interest rate of 3.21 per cent over 10-year terms, to support farmers in NSW and Queensland facing one-in-50-year and one-in-100-year drought events, he said.

“Now, ANZ called the moratorium, CBA (Commonwealth Bank of Australia) said openly they don’t intend to kick anybody off their place because of the drought and the other two banks are also very much on notice as to how people are treated,” he said.

“I’ll watch that space particularly closely. There is more we can do if we need to. I don’t particularly want to.

“I want the banks to manage it themselves and the signs I’ve been getting from them is that’s precisely what they’re going to do,” he said.

“But everybody knows the long-term future of agriculture is strong and therefore removing someone purely because of the drought would be a bad move.”

Evolution of a solution

It’s understood the banks are privately frustrated that the recent political rhetoric has downplayed improved interactions with farmers in recent years, around management of stressed assets.

At the September roundtable in Canberra, Australian Bankers Association (ABA) CEO Steven Munchenberg said different views existed about the actual level of rural debt and what that debt means, while reporting the current level is at $61 billion.

The meeting also resolved to restart the national rural debt mediation process that had been in place until last year but “fallen off the radar”.

“Different States have different processes that handle the mediation of debt and some of them are working better than others,” Queensland LNP Senator Matt Canavan said.

“It seems right and proper while we have this debt issue that we try to harmonise those and come up with the best model across the country.”

The roundtable occurred after Queensland graziers Barry Hughes and Rob Atkinson raised concerns about their industry’s future, with 70 per cent of the State drought-declared, and demanded a change of conversation between industry, banks and government officials.

A survey by the Gulf Cattlemen’s Association - which was also instrumental in making the Winton meeting a reality - showed a 28pc decline in property values had occurred since the live export ban in June 2011, coupled with a 22pc debt increase.

Mr Joyce acknowledged a combination of forces had contributed to the banks changing their position on foreclosures, not just the Winton meeting and his veiled threats.

“All things make up pressure,” he said.

Mr Joyce said Prime Minister Tony Abbott and Treasurer Joe Hockey were also concerned about the various issues at play.

He said the government was serious about the debt issue and “we’re not going to sit idly by just let whole swags of people get kicked off their farms”.

“That’s unacceptable and we’ve made that point abundantly clear,” he said.

“Obviously the Winton meeting brought the nation’s attention to this issue but I’ve also been working in the drought space consistently, since becoming the Minister.

“I’ve had three iterations of drought packages in one-and-a-half years. People will always complain that it’s not enough and I understand that.

“There’s always more you can do, but you do the very best with what you can, noting there was no drought policy when I arrived,” he said.

“Apparently, in the previous government, we’d had a miracle and all the droughts were over so I’ve had to create a drought policy, from the ground up.”

The roundtable chaired by Mr Joyce also committed to getting updated and accurate data on rural debt.

The subsequent ABA report showed that the number of farm properties in northern Queensland that are 90 days in arrears for payments on bank loans increased from 1.9pc in 2012 to 3.4pc in June 2014 – above the nationwide average of 3pc.

Colin Bettles

Colin Bettles

is the national political writer for Fairfax Agricultural Media
Date: Newest first | Oldest first


Bushie Bill
18/12/2014 9:54:18 AM

The banks are very foolish and make rods for their own backs by not telling this bluffing boofhead buffoon from buggering off.
Frank Blunt
18/12/2014 1:09:36 PM

Your the only boofhead that should bugger off Billy. The sooner the better. Every one here is so sick of your bile.
18/12/2014 1:31:09 PM

Barnaby has a snowflake's chance in hell. The banks own the Abbott government. Good things will only happen if Tony Abbott has the guts to stand up to the banks.
Bushie Bill
18/12/2014 2:36:00 PM

No boofhead politician has the right to direct or guide or dictate to the banking industry or to any other industry. If they do not like what the banks are legally doing and are entitled to do, they can change the Banking Act. Good luck with that, Boof et al (that means "and others", VeryDull).
Bushfire Blonde
18/12/2014 3:23:41 PM

Oh we have the learned Bush Basher Bill back again - he must have got his heavily subsidised Satellite Internet Connection going again. Apparently it is quite OK for his mates to have a social licence to a reasonable living but not the bush. The truth about any extra assistance that primary producers get is that the money ends up stimulating the regional economies - it does not end up in some tax haven somewhere. And the Government has every right to direct the banking sector because - THEY ARE THE GOVERNMENT. And the way BBB carries on, aren't we all fortunate that he is not part of it!
Bushfire Blonde
18/12/2014 3:28:50 PM

What I want to know is the details of what extraordinary things that the senior bankers are doing in order to justify the extraordinary remuneration that they receive. And why their shareholders are entitled to the large increase in bank dividends in recent times. Can you answer that one Bush Basher Bill?
Bushie Bill
18/12/2014 3:58:17 PM

That is easy, Bushie Blonde; they make money, far more than they are paid, for their shareholders. Bushie Blonde, if you really believe governments in Australia can do whatever they like because "THEY ARE THE GOVERNMENT", you really show yourself up as being totally ignorant of how the Australian political and government system works. Have you ever heard of the Constitution by any chance, or the division of power, Bondie? What about the High Court? Have you heard about it in your wanderings through the desert? Joh didn't have clue either. He was from Queensland. No more need be said, eh?
18/12/2014 6:34:37 PM

Maybe while he is at it he can ask the banks for a loan to plug the deficit….
18/12/2014 10:00:30 PM

I think it is great that these conversations are occurring however feel the focus is on who to blame rather than how to fix for the future. Responsibility lies in all corners, & until a collective approach is taken with buy in from all parties nothing will change. Have the people in greatest need received access to concessional loans? Was this the best use for these funds? Is QRAA the best agency to administer? Many have been turned down assessed as being "unviable" whilst their Banks continue to support. There are 2 sides to every story & sadly we often hear the worst. Minority v majority?
Peter T
19/12/2014 11:14:31 AM

Amy, why do we insist on trying to manipulate an outcome to "Fix the future". Meddling with natural processes is what I believe painted us into this corner. For so many years the effect of drought was not seen as a factor when borrowing money to buy a property. Once you were drought declared you got your interest paid. This can and did amount to millions of all of Australians money spent on poor risk managers. We all need to "Man up" stand on our own two feet and own this industry not play a sympathy card, shoe gazing asking what went wrong.
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