NEW England MP Barnaby Joyce has vowed to flex his political muscle and push for a massive, multi-billion dollar bail-out package for debt-crippled farmers.
As the drought’s choke-hold on farming communities intensifies, Mr Joyce said he had no option but to “hit the emergency button” on distressed farm loans to avert a “complete and utter financial meltdown”.
He backed calls for a Rural Reconstruction and Development Bank to be established as part of the Reserve Bank to buy bad rural loans from the private sector at a discounted price.
It comes after Mr Joyce, in his capacity as Agriculture Minister, went on a three-day, fact-finding mission in his electorate and beyond last week to speak with farmers first-hand.
“So many people can’t pay their power bills, can’t get food on the table, can’t get cattle on trucks,” Mr Joyce said.
“They’re rightly asking questions and making the point that this is a natural disaster like a bushfire or an earthquake.
“It’s something you can’t plan for. They are totally and utterly under the pump and they can’t go back to their banks.”
He warned at least 10 per cent of Australia’s rural debt – some $70 billion – was unlikely to be repaid. Even if it rained tomorrow, he said, many of the region’s farmers would struggle to survive.
While a reconstruction bank could take years to establish, Mr Joyce will ask cabinet to also consider an expanded Farm Finance Package and financial support for fodder, water and day-to-day expenses.
“Why shouldn’t they get social security payments like everyone else that’s out of a job?” Mr Joyce said.
He said the drought was devastating the whole economies of towns in the New England and North West.
“There’s one store owner I was speaking to whose turnover used to be in the tens of thousands a month and I asked him how much he turned over last month and it was $180,” Mr Joyce said.
Inverell stock agent Scott Bremner said the drought situation in the region was “bordering on a national disaster”.
Cattle were selling for as low as 10¢ a kilo, he said, and it could take some farmers six to eight years to build back breeding stock.
“People are being forced to make decisions they shouldn’t have to because of the lack of feed and water,” Mr Bremner said.
“The abattoirs have a four-to-six week wait and it’s getting very awkward to find homes for cattle that don’t have a fat finish.
“Farmers are very proud people and they don’t like to ask for anything.
“We just need rain; it’s that simple.”
Treasurer Joe Hockey yesterday played down the prospect of a bail-out, saying farmers had to take the good with the bad.