RFCS review: 'worst possible timing'

21 May, 2014 04:00 AM
This is the worst possible time to be placing doubt over the Rural Financial Counselling Service

THERE’S a “collective shudder” running through rural Australia this week, says Shadow Agriculture Minister Joel Fitzgibbon, after the Coalition government announced a review into the Rural Financial Counselling Service (RFCS).

The RFCS was one of several ag-related programs listed for the scrap heap in the pre-budget Commission of Audit. But while last week’s tough budget avoided axing the highly regarded RFCS - which provides free financial counselling to farmers and rural businesses in tough times like droughts - Federal Agriculture Minister Barnaby Joyce this week said the program would be reviewed for the first time since 2004.

RFCS invaluable: NFF

In pre-budget warnings, National Farmers’ Federation (NFF) chief executive Matt Linnegar said he was “bothered” by several Audit recommendations, in particular cutting the RFCS.

Mr Linnegar said the RFCS returned “immense value to rural communities” given the agriculture sector deals with two and a half times the volatility of any other business sector, along with complicated taxation, regulatory and trading regimes.

“It would be cutting to the bone to get rid of that program,” he said.

Mr Joyce said in April he asked the National Rural Advisory Council (NRAC) to conduct a review of the RFCS, to ensure it was working effectively to support farmers and producers. A statement from the Minister’s office said it was a “business-as-usual review as part of routine governance processes”, and given it was 10 years since the last review “it’s timely to review the service now”. The NRAC is due to report to the Minister by September 30.

The Australian government provides grants to 14 not-for-profit organisations to employ suitably qualified rural financial counsellors, with about 120 financial counsellors currently working across Australia.

“Since 1986, the RFCS has been helping farmers, fishers and small rural businesses make business decisions, supporting them through farm debt mediation and helping them access sources of professional, industry and government assistance,” Mr Joyce said.

He said the department informed the RFCS of the review some time ago.

'Worst possible timing'

However, Mr Fitzgibbon warned the review could see the important program axed as per the Audit’s recommendations.

He said as Agriculture Minister in July last year, in recognition of the drought and other market issues facing the farm sector, his announcement of 17 additional full-time counsellors was “gratefully welcomed by farmers and rural communities around Australia”.

“This is the worst possible time to be placing doubt over the service and it follows the government’s failure to deliver on a key aspect of its drought relief package,” he said.

“The review certainly was not talked about prior to the election and will be a surprise to farmers and rural communities more generally adding to the uncertainty that the government may adopt the recommendation by the Commission of Audit, that rural financial counsellors be abolished.

“Barnaby Joyce suggests he can do nothing in agriculture until the completion of his White Paper yet when it comes to threats and cuts, there appears to be no need for delay.

“The review … at this time is cruel and insensitive and follows a range of new taxes and cuts which will particularly hit rural communities.”

Speaking to Fairfax Agricultural Media, NRAC chairman Mick Keogh said the current funding agreement between Commonwealth and States was due to expire in June 2015, and the review was part of the process of making a decision about future funding arrangements.

Mr Keogh said many agricultural related programs were “in the firing line” due to the Commission of Audit’s recommendations and the government’s tight fiscal environment.

“My understanding is there’s a pile of programs on the table at the moment that will be considered by government and the issue will be for industry to understand that and be able to respond to the importance and achievements of those programs,” he said.

“I don’t think we should be surprised about that in the era we’re in - it would be unusual if programs weren’t being reviewed or considered. For example, the government is yet to respond to recommendations in the Commission of Audit on matching dollar for dollar arrangements for agricultural R&D.”

Asked if the RFCS was a valued program worth continuing, Mr Keogh said, “that’s what the review is all about and we’re about to embark on the first day of that review in Adelaide tomorrow”.

Mr Joyce said via a spokesperson that he holds the RFCS program in the highest regard and without pre-empting the review’s outcome he wasn’t expecting anything other than praise from rural communities.

Review a worthwhile exercise

RFCS Western Australian chair Julian Krieg said the government’s review was a positive move to justify public expenditure on a worthwhile program that supports farmers and rural communities during critical times of need.

“For me, we need to justify government expenditure – so the review should not be seen as a negative,” he said.

“I’m confident the RFCS is doing positive things for farmers. It’s helping them to regain focus by getting an unbiased position of their actual financial position and I think that’s critically important.

“People are also linking this review to the budget and saying it’s just going to be another budget cut but I think it’s a positive thing to justify public expenditure.

“It reinforces the value of the program and helps the community be comfortable that the money being spent is well placed to help farmers get through these difficult times.”

Mr Krieg has been chair of the RFCS in WA for six years and says the organisation’s motto is “regain focus and find a solution”.

He said farmers do not want to be welfare recipients, “they want to be profitable businesses and the RFCS helps them to achieve that”.

“There’s a lot of emotion around the budget and some of the things being said are wrong,” he said.

“But the truth is it’s like a family household - if you’re spending more than you’re making you have to pull back a bit and find savings.”

  • More information on RFCS review
  • For more information about assistance measures call the Department of Human Services’ Farmer Assistance Line on 13 23 16 or visit www.daff.gov.au/agriculture-food/drought/assistance

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    Colin Bettles

    Colin Bettles

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


    Craig Alison
    21/05/2014 8:46:40 AM

    RCFS must stay........RCFS is probably the most respected group in SW QLD and if it wasn't for RFCS doing a majority of drought declarations out here, nearly all land managers who are eligible would not have received drought assistance
    western worrier
    21/05/2014 9:36:57 AM

    Right on Julian. A very clear summation of the program & its benefits. It is right to review & make sure that the best result is being delivered
    Got It In One
    21/05/2014 9:47:54 AM

    Craig - you're absolutely right. And that's why they want it scrapped. The government is trying to save money. They don't care about helping farmers. If the farmers don't apply for the support they are entitled to, the government can spend that money on something else ... like $50,000 lunches, perhaps?
    21/05/2014 11:52:46 AM

    RCFS I would like too think they are reviewing how to best help the RURAL community all the time.
    21/05/2014 1:51:29 PM

    What do these people pay their bloody accountants for?


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