Wednesday, 27 November 2019
Farm Household Support Amendment (Relief Measures) Bill (No. 2) 2019; Second Reading
That this bill be now read a second time.
I am moving the Farm Household Support Amendment (Relief Measures) Bill (No.2) 2019 on behalf of the Minister for Agriculture. When dealing with drought and other impacts outside of the control of the individual, the Australian government's first priority is to support farming families. That was one of the key drivers for the creation of the Farm Household Allowance (FHA)—with strong bipartisan support.
Since the introduction of the FHA in 2014, over $375 million in fortnightly payments have been made to over 12,800 farmers and their partners. It is an income support payment for farmers and their partners experiencing financial hardship, regardless of its cause. There are lots of reasons why people claim the payment. Drought is certainly the single largest driver of widespread shortfalls in cashflow. Other people claim FHA because they had a poor crop, or they expanded their business and they are having trouble servicing the debt. There's a long list of reasons and there are systems in place to help each individual.
The government is continuing to support our farmers and their families that are doing it tough now, and into the future. It is important that our farmers and their communities have the right tools to improve their long-term financial circumstances.
The Farm Household Support Amendment (Relief Measures) Bill (No. 2) 2019 is the next step in the government's commitment to supporting farmers and their communities in challenging climatic conditions.
The bill supports the government's Drought Response, Resilience and Preparedness Plan and further implements the recommendations made by the review Rebuilding the FHA: a better way forward for supporting farmers in financial hardship.
The government has already made a significant change to the way income is assessed. For the first time, FHA recipients are allowed income from directly related businesses to be balanced against farm losses—and vice versa. Then we went a step further. Once those businesses are considered together, an outstanding loss of up to $100,000 can be used to offset income from other sources.
This bill builds on the new approach to income and seeks an all-or-nothing approach to fortnightly FHA payments. The FHA amount a person receives will no longer fluctuate. They will either receive the maximum owing to them, or their income will stop them being paid at all.
Our farmers and their families will no longer be distracted from improving their financial situation by different FHA payment amounts each time they're paid.
The bill also makes it easier for farmers to access the right person to conduct the farm financial assessment. Removing the requirement that this assessment must be conducted by a prescribed adviser provides flexibility on who can conduct the assessment. Farmers can continue to choose who does the assessment—an independent and trusted adviser.
Support for our farmers will not stop there. The bill increases the activity supplement to $10,000 over their lifetime. With this increase, our farmers and their families can focus on actions to improve their financial situation including finding alternative sources of income.
Recognising that it can be difficult for our farmers and their families to access training or advice near their home, the bill also extends the activity supplement to include reasonable travel and accommodation costs associated with the activities.
Finally, the bill makes the eligibility criteria for receiving FHA much simpler by having one asset test threshold. All assets will now be subject to a combined single threshold of $5.5 million net. Our farmers and their partners in financial hardship with diversified assets will be able to qualify for the FHA payment.
The government is committed to removing the requirement to undertake business income reconciliation and will introduce further legislation to remove this requirement. Ahead of this legislation, the Department of Human Services will not pursue debts or cancel payments.
The government will continue to listen farmers and their families and respond and step up as required. I commend the bill to the House.