Anne Webster (Mallee, National Party) Share this | Hansard source

It gives me great pleasure to support this bill and the amendments it will enact to the Farm Household Support Act. This bill is another step up in the government's range of assistance measures for farmers. Since its inception the farm household allowance has been a key mechanism to support farmers facing hardship, whether through floods, drought or other natural disasters. That is why the government has worked to continually improve this program—to make sure we are getting it right for farming families and to help more people where they need it.

Farmers have informed government about their views regarding policy approaches and targets. Indeed, I travelled with Minister Littleproud to meet with Millewa farmers to hear firsthand their struggles and issues through the current drought. They told us of specific gaps in the previous policy settings and asked for the ability to access support for agistment, restocking and replanting. Their ideas informed changes to government policy on agistment, restocking and replanting, which is now part of the Regional Investment Corporation funding criteria.

This farm household support bill is the next instalment of the government's response to the independent review of the Farm Household Allowance program. The review, commissioned by the minister for agriculture, David Littleproud, in 2018 and released in 2019, made a number of recommendations to government. After considering these recommendations and feedback from farmers and industry on the ground in Mallee, the government has made a suite of changes to the farm household allowance since 2019. These important amendments increase the maximum time a person is able to access the Farm Household Allowance program from four years over their lifetime to four years in every 10-year period. This change recognises that hardships faced by farmers are unpredictable and can last longer than in the past.

A one-off lump sum payment was introduced for farmers who have exhausted their four years of payment on or before 1 July 2020. From February this year, Services Australia has paid relief payments to over 1,100 people. In addition, the ability to earn money off farm was expanded and increased from $80,000 to $100,000. The assets test under the program was also simplified so that all assets—farm and non-farm—are now subject to a single net threshold of $5.5 million. Setting the bar at this amount responds to the fact that some farmers are asset rich but cash poor, thereby allowing greater flexibility for farmers with an extensive asset base in drought.

The rate at which the farm household allowance is paid has been set to a fixed amount and is no longer varied by the recipient's income. This change recognises that it can often be quite difficult for a farmer to estimate their income over a shorter period of time. It also provides certainty each fortnight by paying the maximum rate available. Furthermore, the activity supplement under the program was increased from $4,000 to $10,000. This supplement is payable for eligible activities, such as legal advice, training or study. The supplement has also been extended to include accommodation and travel costs associated with eligible activities. For farming families in Mallee, this is a very useful support.

The changes made to the program under the bill currently before the House build on those contained in previous amendments. The first of the changes under this bill removes provisions which give rise to business income reconciliation. Currently, a recipient's income estimate is reconciled annually using tax returns and financial statements. This process can result in the recipient incurring a debt if their annual income was above the estimated amount. This provision will be removed from the act, meaning farmers will no longer need to conduct an income reconciliation and will no longer have to worry about whether a debt is raised at the end of a year. This means the person's rate of payment will be more simply based on their current income. This change significantly reduces the complexity of the program and, when combined with previous changes to provide a single rate of payment for the farm household allowance, farmers will have greater certainty about how much they will receive fortnightly and annually.

The second set of amendments under this bill extends the 28-day time limit for conducting a farm financial assessment by a further 28 days, providing flexibility and appropriate time lines to identify the most appropriate person to conduct the assessment. Farmers that miss this window will no longer have their applications delayed or withdrawn. Taken together, these changes will significantly increase uptake of the program.

I have spoken to a rural financial counsellor from Mallee who believes these new changes will be a positive step forward and will be welcomed by farmers. I was advised that some farmers had been reluctant to engage with the program because of the business income reconciliation component. The possibility of overestimating income due to the sporadic nature farm income has was a risk for some farmers. The possibility of incurring a debt through this process has clearly been a lingering concern for many, and by removing this complex process from the program the changes will provide additional peace of mind to farmers engaging with the farm household allowance.

I believe that by addressing these barriers we could see significant uptake of the program. In Victoria there are approximately 6,200 people that are eligible for the program but have not yet applied. I am sure that some of these people will now consider applying due to the removal of barriers within the program. At the end of the day, we don't want our farmers to have to rely on programs like the farm household allowance, but if farmers need to make this choice the government is making sure there is a safety net for our primary producers that is easily accessible.

This safety net is so important, especially if the drought continues to worsen this year. This has been the case in my electorate, with large portions of the Mallee facing severe drought. The Wimmera has been one of the hardest hit in my electorate. I am assured by the Rural Financial Counselling Service that many Wimmera farmers have accessed these payments. I want to reassure all from my electorate that, if the drought continues to worsen, the government's response will continue to increase. It will step up. I have been working closely with Minister Littleproud, conveying the difficulties facing farmers in Mallee. I would like to thank the minister for his continued support throughout this difficult period.

This government, the Morrison-McCormack government, is working together to respond to the concerns brought to us by farming families and communities affected by drought. The government has taken a holistic approach in its response to this drought because we know that drought doesn't just hurt farmers, it hurts small businesses and the wider community as well. This is why the government has allocated an additional $50 million to extend the Drought Communities Program to another 52 local government areas, including Connewarre shire in my electorate. This funding is targeted at local infrastructure and other activities that provide employment for people whose work has been impacted by drought and to get money to flow through local shops and suppliers. It's also why we have committed another $82.5 million to the Drought Community Support Initiative through the Salvation Army or the St Vincent de Paul Society. This measure responds to the unprecedented demand from farming households under this initiative due to one of the worst droughts on record.

The Morrison-McCormack response to this drought has been multifaceted, and the farm household allowance is one of the most important pieces of the puzzle. The program has helped more than 13,700 farmers and their partners, paying over $406 million to these households. The farm household allowance exit survey, implemented in 2017, shows that almost 89 per cent of respondents felt that the allowance had improved their current financial circumstances. More than 50 per cent expected to stay on farm, with greater farm income and less debt. Clearly, the farmhouse allowance has made a difference for many farming households across Australia. I don't doubt that the amendments contained in the bill will improve the outcomes for farmers and farming communities further and continue to help farmers get back on their feet.

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