Debt roundtable set for spring

27 Aug, 2014 05:00 PM
Agriculture Minister Barnaby Joyce.
I can't promise the world, but I can promise to do my very best though
Agriculture Minister Barnaby Joyce.

A RURAL debt roundtable will be held in Canberra on September 23, Agriculture Minister Barnaby Joyce announced today, following Canberra meetings with concerned northern graziers this week.

Mr Joyce said he'd put out an invite to senior bank members to attend the roundtable to see if "we can get a fair understanding and a fair game plan to see how we deal with some of these issues in the north".

"I can't promise the world, but I can promise to do my very best though - let's kick off on September 23 and see where that show goes," he said.

Mr Joyce said he was organising a tour of western Queensland and NSW with Treasurer Joe Hockey in the near future to show him the drought situation.

He also said he was concerned banks are refusing to support drought assistance loans to affected farmers.

“The first thing I want to discuss with banks is we are getting reports back about certain banks not allowing people to take up drought loans and I worry about that,” he said.

“Without giving away names one bank in particular seems to be coming to our attention over and over again.

“I want to make sure the government’s drought package that we have in place is available to use and the banks are work with us in utilising them.

“The banks may not be happy with these concessional loans but other regulatory processes are being suggested that they’d certainly dislike more.”

Mr Joyce said he understood drought affected graziers wanted to revert back to the Exceptional Circumstances (EC) program.

But he said the problem was, “the States gave up on that and the federal government agreed with them”.

“EC support is gone and I was left in a position where I didn’t have a drought policy,” he said.

“The only drought policy I had was this interim farm family payment where only 450 people had taken it up.

“So what we’ve delivered now is, over 3000 people have taken up the farm household allowance and about 300 people are now getting concessional loans and money is going out for water and that’s vastly ahead of where we were.

“Can we do it better? Yes we can always do it better.”

Australian Bankers Association chief executive Steven Munchenberg said Australian banks have a long history of working with the agricultural and farming sector and in particular are very conscious of the particular issues faced by the northern cattle industry, which began over three years ago.

He said over that period, banks have been working with customers to try to find ways through the series of challenges that the industry has faced.

“Banks provide financial hardship assistance to their customers who may be experiencing financial difficulties,” he said.

“Banks work with their agribusiness customers to assist them manage their businesses and the volatility of cash flows which can be the result of prolonged drought, natural disasters, or changes in trade conditions.

“Banks also offer emergency relief packages.”

Mr Munchenberg said it was important to note that just because a loan was in arrears, it does not mean that a bank will move to repossession.

He said banks would first work with the customer to try to find a way to get the business back on track.

In Queensland, there will also be a mediation processes if the bank and customer can’t come to a suitable arrangement, he said.

“Repossession is the last step a bank will take and only occurs after all other options have been exhausted,” he said.

Queensland graziers Barry Hughes and Rob Atkinson took a no-nonsense message to Canberra politicians this week about the worsening social and economic conditions with 70 per cent of the State now drought declared.

Mr Hughes said the September 23 meeting was welcomed and he expected banks to attend - but it may come too late for some cattle producers dealing with debt and drought.

"It has to happen," he said.

"There is a huge number of people out there - up to 25pc I'm led to believe - people who are either in mediation or handing their keys over to banking institutions and it's going to be too late for some of those people."

Colin Bettles

Colin Bettles

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


Bushfire Blonde
27/08/2014 6:50:45 PM

Good on you Barry & Rob. May the Gulf Cattleman's Assn grow and grow and grow. This begs the question - Where are our Industry Representatives (supposedly) while these true Little Aussie Battlers are in Canberra trying to get a fair deal for those doing it tough?
27/08/2014 7:24:10 PM

I'm missing something. Farm household allowance, concessional loans and assistance to buy water - all taken up by several thousand farmers in NSW & QLD. On the other hand, NSW & QLD farmers combined are sitting on $1.5 billion in FMDs. Are you telling me no one receiving assistance has money stashed in FMDs?!! If several thousand farmers receiving assistance don't have FMDs, then who in blazes owns the $1.5 billion?
27/08/2014 7:47:45 PM

I can say with absolute certainty that Steven Munchenberg speaks with a forked tongue! A royal commission is long overdue into the behavior of banks and receivers in this country!
28/08/2014 7:27:50 AM

I think you better increase the tour area to all agricultural regions if you want to understand the farm debt issue
28/08/2014 8:23:34 AM

How about a class action against the Govt for the live export shutdown, middle east shutdown and now Russia. If farmers can get the money back we have lost because of intentional market destruction by successive Govt's most of us would be ok. It wasn't just northern graziers that were hurt by these actions it was all graziers. 3000 farmers is a drop in the ocean and they are the only ones eligible for assistance the rest of us have looked into assistance but aren't eligible for one reason or another. No one receiving assistance has FMD's, you wouldn't be eligible.
28/08/2014 8:25:32 AM

Geronimo; Several thousand other farmers, who haven't dug themselves into a debt hole they can't get out of. I'm not sure what the household allowance is, but I'll bet Australia wide there are several million people receiving something similar. You will note there are only 300 out of >200,000 farmers getting drought loans.
28/08/2014 8:30:04 AM

Geronimo: You will also note that FMD stands for Farm 'Management' Deposits. Their main purpose is to make sure the farm has money to restock and plant a crop when the drought does break.
28/08/2014 8:34:54 AM

With $3.2 billion sitting idle in FMDs I'm just wondering if there is a way of mobilising that money for the benefit of industry?
Bushfire Blonde
28/08/2014 8:51:29 AM

Before you make any more allegations about genuine Primary Producers Geronimo, you had better find out who has this alleged $1.5b put away in FMDs. I doubt whether you will find much belonging to the Northern Australian Cattle Producers and I very much doubt if those who have FMDs are eligible for Drought Assistance anyway. While you are at it, find out how many of the moneyed men (the Lawyers, the Bank Managers, the Financial Planners and the Valuers) have FMDs as a Tax dodge. I notice the CEO of the ANZ Bank bought a Winery a while back - I wonder if he has any?.
29/08/2014 5:17:03 PM

Thanks Blondie. Agree your comments. Instinct tells me there is something smelly going on with FMDs. Questions need to be asked. 80% of Queensland drought declared. So we presume producers in those areas have exhausted (or close to) cash reserves such as FMDs given the prolonged period. At the same time, there is $741 million in FMDs in Queensland. Who owns this money? 20% of Queensland's food producers own $741 million in cash??!! Banks need to come clean who is using FMDs.
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