Tuesday, 12 November 2019
Farm Household Support Amendment (Relief Measures) Bill (No. 1) 2019; Second Reading
I rise to speak on the Farm Household Support Amendment (Relief Measures) Bill (No. 1) 2019. Here we go again: debating changes to make it easier for our farmers to access financial support during times of hardship and, in the current circumstances, the drought. It is important for the Senate to note that some farmers and rural communities are going into the ninth year of drought on the eastern seaboard. The current drought is being spoken of as the worst drought in our history, at least since the time of European settlement.
It's not just our farmers who are hurting, but also people in rural communities everywhere. The drought is having an adverse effect on the economies in rural towns. When farmers have no income, then businesses in the towns suffer. This means that there's less employment and that everyone is impacted. There are towns in Australia that are facing the confronting prospect of running out of water. These are places like Stanthorpe, a significant horticultural region in Australia and one of our top five national producers of apples and summer-grown strawberries. Stanthorpe usually produces almost 75 per cent of the eastern states' tomatoes and capsicums, and it grows significant amounts of stone fruit, summer vegetables and wine grapes. Sadly, because of water shortages, planting and production of these crops have been drastically reduced.
The reduced economic activity in the horticulture sector alone is estimated at $100 million for the 2019-20 financial year. Stanthorpe is only one example of many towns dealing with the same challenges. They are losing skilled workers, and the Morrison government is offering very little hope. Even big communities, like Tamworth, Armidale and Murrurundi, all in the member for New England's electorate, are all too close to running out of water. In fact, Murrurundi did run out of water some time ago.
Of course, many of these communities are also suffering at the hands of terrible bushfires, and our thoughts are with those communities. This is the reality Australia is facing due to the function of a changing climate—a hotter climate, a drier climate, a climate which is causing high temperatures earlier in the year than we would normally expect and a climate which over time has produced a lot of unspent fuel sources in and around these communities. These communities are also facing extreme hailstorms, late frosts and massive dust storms. How farmers will manage these challenges in the future needs to be better understood. Challenging conversations need to be had. As stated earlier, Stanthorpe alone is expected to lose $100 million in economic activity. This is why the Morrison government's Future Drought Fund is confusing to most farmers. One hundred million dollars won't go far. Whilst extra funding into research is a good thing, everything this government is doing is moving too slowly—it is reactionary—and many farmers feel abandoned.
The bill currently before the Senate increases the maximum time a person is able to access the farm household allowance program from four years over their lifetime to four years in each specified 10-year period. It also introduces an expanded off-farm income offset, broadening the circumstances in which the offset can be applied and increasing the upper limit from $80,000 to $100,000. It introduces a one-off lump sum payment for recipients who have exhausted 1,460 days of the allowance by 1 July 2020, and the capacity for the minister's rules to prescribe further lump sum payments if required.
The amendments seem reasonable until they are looked at in detail. The maximum time on payment is currently set at a cumulative 1,460 days or four years over a person's lifetime. The bill expands access to the allowance program for eligible farmers and their partners to four years in every specified 10-year period, recognising that farmers can face more than one period of hardship in their lifetime. The next specified 10-year period will commence on 1 July 2024, meaning that, if you are a farmer who has been cut off the farm household allowance program, you can reapply in almost five years. Good luck to farmers currently still facing extreme drought conditions.
The expanded income offset provisions in the bill will increase the maximum offset amount from $80,000 to $100,000 per couple per financial year. This will allow the household allowance recipients, or couples where applicable, who have incurred a farm business loss to have their income reduced by $100,000 under the household allowance income test. This is an acknowledgement that many farmers need to obtain off-farm income. However, due to the challenges of living in rural and regional Australia, particularly in drought-affected areas, this amendment is modest in nature.
Sadly, many farmers were dismayed when the former agriculture minister, on 12 October, told farmers that they should need to seriously think: what are you doing with your life? His exact words were:
People who have not made a profit in the last 10 years really need to seriously think, what are you doing with your life? What are you doing on the land?
It's almost hard to find the right words to describe what type of politician would be so cruel to say this to farmers who are doing their best in extremely challenging circumstances but maybe it's best not to use the possible language that comes to mind in the chamber.
Now we get to the amendment that lacks coherent policy rationale and has left many farmers confused as to what they can expect over the coming 12 months and beyond. I want to touch on the relief payment, which is schedule 3. For those farm household allowance recipients who have been payable for 1,460 days of payment by 30 June 2020 inclusive, the bill provides for a one-off lump sum payment of $7,500 for a single recipient or $6,500 for a recipient who is a member of a couple, meaning couples receive $13,000. Additionally, schedule 3 provides the minister with a power to determine who may qualify for and the amount of future relief payments, meaning the government has left room to provide further lump sum payments to drought-affected farmers.
So what does this amendment actually mean for farmers in a practical sense? We know there are currently over 600 farmers who have been cut off the FHA and, for the past five months, have been expected to survive with no financial assistance from the Morrison government. Farmers and their partners will only receive the lump sum payment once this bill passes and then Centrelink process the payments. This could take another couple of weeks. Keep in mind that these farmers, who have not received any payments for almost six months, will receive a lump sum and then nothing again, except if the agriculture minister or ministers decide that maybe these farmers need assistance in the future.
How long will these farmers and their partners have to wait? Nobody knows. Under what circumstances will another lump sum be put on the table? Once again, nobody knows. This is a cruel policy decision by the Morrison government, supported, unfortunately, by the Nationals—that once strong, representative country party who no longer are. Farmers and their families need certainty. The Prime Minister; the Minister for Agriculture, Senator McKenzie; the Deputy Prime Minister; and the Minister for Water Resources, Drought, Rural Finance, Natural Disaster and Emergency Management need to be honest with those who are on farm household allowance. Will they continue to be supported, or should they take the advice of Senator McKenzie in her media release of 17 October? Senator McKenzie said:
A one-off drought relief payment of up to $13,000 for a farming family, and up to $7,500 for an individual is designed to help people determine whether they will be sustainable, should look at succession options or, in some instances choose to sell.
I stress the intentional language that it was a one-off drought relief payment, but there has been a bit of backpedalling since that media release.
Of course, the minister's fellow senior minister Mr Littleproud, the minister for drought, appears to think that no farmers would be kicked off the government's drought assistance payment after they had exhausted the four-year time limit. It appears that both senior ministers are confused by their legislation, and Minister McKenzie must clarify what farmers who have already been cut off FHA can expect. The minister should also acknowledge that many farmers and their families currently are receiving no financial assistance to put food on the table and pay basic bills.
Labor will be supporting the legislation before the Senate so as not to delay relief payments, but it urges the Morrison government to do a better job of understanding how its policies are impacting drought-affected farmers across Australia. On that, as I said, we will be supporting the bill. We want to get it through asap.
I rise to speak on the Farm Household Support Amendment (Relief Measures) Bill (No.1) 2019. The Greens will be supporting this bill, but there are some important things that need to be said about it. In particular, we need to stress at the outset that this bill is only a small part of what is needed to support vibrant, sustainable, healthy rural communities into the future.
Let's unpack what we're talking about. The farm household allowance payment is for farming families experiencing financial hardship for a range of reasons, including drought. It's received over a period of up to four cumulative years, giving time for farmers to adjust and get themselves on a sound financial footing, and it's paid at the same rate as the Newstart allowance. We know from years of inquiry and campaigning that the rate of Newstart allowance is not nearly enough, and here I want to acknowledge the work of my colleague Senator Rachel Siewert, who has campaigned tirelessly to make sure that the voices of people receiving income support are heard. The attacks of the government, in using robo-debt and refusing to take action on the clear evidence in front of them regarding the absolutely atrocious level of Newstart, are appalling.
In 2019, the report of the farm household allowance review panel recommended that the farm household allowance be decoupled from the income support system and that, instead, an approach centred on the needs of farmers be adopted. The Greens wholeheartedly agree that we need to continue supporting farmers experiencing financial hardship, but it would be remiss not to point out the government's odd and unexplained selectivity when it comes to income support. It's clear from this bill and from the government's new drought relief package that the government can understand that some Australians are doing it tough and need some extra support. The Greens agree. But why, I ask, is the government being selectively blind to so many other Australians needing help, including thousands, if not tens of thousands, of Australians living in rural and regional Australia who are suffering on Newstart?
It's clear that almost 715,000 Australians are struggling to survive on Newstart, on under $40 a day, and yet the government is silent about these Australians who are doing it tough. Everyone in this chamber understands that farmers are doing it tough and that they need support to weather times of drought or financial stress, but so are many, many more Australians. Why does the government give some people help and not others? Why is this government punishing some Australians while lifting others up? Why, according to the government, do some Australians deserve support and others do not? We have to stop treating income support payments like a political football.
This bill makes three changes to the farm household allowance. It introduces the expanded off-farm income offset with an upper limit that's now gone from $80,000 to $100,000; it allows people to access the farm household allowance four years in every 10, rather than four years in their lifetime; and it introduces a one-off lump sum payment for recipients who finish their full allotment of allowance by 1 July 2020 and allows the minister to make further one-off payments by regulation. They're all good things that the Greens support. But, returning to my theme that there is more to be done, I would like to take a moment to read from one particular submission to the committee inquiry on this bill. It is authored by Ms Michele Lawrence, Professor Robert Slonim and Ms Georgie Somerset, who were the reviewers appointed by government to review the farm household allowance. They support the specific measures in this bill but they highlight that there is more that has to be done. They say:
We do not believe that the proposed amendment addresses the systemic concerns underpinning the broader recommendations in our report.
Specifically, we urge the government through legislation to explicitly and forcefully recognise that farming households are small business owners, which is the fundamental and critically necessary step towards addressing farmers' and rural communities' longer term financial as well as personal and general wellbeing. Without this recognition, it is hard to imagine the current changes will be more than a temporary 'bandaid' solution and that long term viability prospects for smaller farm household businesses and rural communities will remain in severe jeopardy for the next drought, crop failure, price shock, flood, shift in international market conditions, technological change or any other recognised challenge for small farm household businesses' farm financial viability.
There you have it: the government's own reviewers have described the legislative response as a 'bandaid'. There is so much more to be done to support farmers, to address the drought and to act on climate change.
I'd like to note here that certain members of this chamber and the other place have been accusing the Greens of hating farmers and hating regional Australia. This is obviously a flat out lie. I want to make crystal clear that, when good legislation that supports the needs of our farming communities comes through this parliament, we absolutely support it. As I said, we will be supporting this bill, despite the fact that it doesn't go far enough. What we won't support is a government committed to ignoring what will worsen the drought and continue to make life harder for farmers across Australia—and that, of course, is our climate crisis, which is so real and so pertinent to us today. We won't support a government that turns a blind eye to the climate crisis that is supercharging the bushfires that we are seeing today in New South Wales—a government that ignores the repeated warnings of scientists, experts and firefighters that say that, if we don't quit coal and if we don't cut pollution, we are going to witness more unprecedented and catastrophic fires. We will not support a government that's had every opportunity to minimise the risk of these catastrophic fires but instead has done everything in its power to make bushfires more likely to happen, by governing over record levels of pollution, by being in the bottom three of the G20 for cutting and reducing pollution and for just passing legislation that's going to prolong the life of polluting coal-fired power stations. We will not support the legislation of governments that are doing these things. We will not support a government that is denying the climate crisis that we're in and, in doing so, is not protecting the people of Australia. And we will not support a government that uses moments of national devastation to take cheap shots, calling everyone who is concerned about our climate crisis and earlier fire seasons 'inner-city raving lunatics'.
People both in the cities and in rural and regional Australia are worried about their future. The amount of concern that has been expressed by the people who are suffering the impacts of these devastating fires we've been experiencing this week and who are saying to the government, 'Take action on our climate crisis,' makes that very clear. It is people both in the cities and in rural and regional Australia who are worried about their future. They are worried about the future of their children and their grandchildren.
The Greens make no apology for standing up to the government when they want to divide the community against one another. This should not be about politics. All of us in this chamber should be implementing policies that will best serve and protect everyone in Australia. While the Greens continue to be deeply concerned by a selective approach to income support—the fact that it's not providing support to everybody who needs it and that it is only a bandaid on what needs to be done—we will be supporting this bill today. Despite the consistent attacks by this government on the Greens for calling out that so much of the government's agenda—from the Future Drought Fund to the new drought relief package to this bill—is just treating the symptoms and not tackling the causes of so many of the struggles that farmers face, we'll be supporting this bill. It's absolutely critical that we provide timely relief to our farming communities, particularly those that are dealing with the devastating fires and our record-breaking drought. I commend this bill to the Senate.
I rise to speak on the Farm Household Support Amendment (Relief Measures) Bill (No. 1) 2019. Firstly, I want to address a couple of the issues that have been raised in the debate to date. Senator Sterle quite rightly pointed out that drought is not just about farmers and that we've got businesses and communities suffering right now. That is why, in our most recent drought announcement package, we also extended the no-interest—and then low-interest—loans to small agricultural businesses. It is the first time that recognition has been given to the fact that agricultural businesses fall foul of drought just as much as farmers do. Senator Sterle quite rightly pointed out that there are towns running out of water right now. He is right. There is nothing we can do immediately. Aside from offering funding to the states to help them put in pipes and bores, there's nothing we can do to change that. But there are communities that took proactive steps in advance of this drought. Orange in my home state is a case in point. They have actively put in measures to capture their stormwater, which is seeing them have water to get through the tough times. We need to encourage more communities to think outside the box, and this federal government is ready to stand with them and look at those solutions and get them underway. And that is what the Future Drought Fund is about.
We are the first ever government to look at long-term investment in drought resilience strategies, and we're willing to talk to any community and any state government to do so. For years we have been calling for a collaborative approach to building dams. And, yes, it is quite right for those on the other side of the chamber to point out that, while we've been talking about drought, we haven't built any dams, but we haven't built any because, to date, we haven't had a state willing to join with us on the path and get those dams built. We do now; we have New South Wales stepping up. They're prepared to come with us and build Dungowan Dam and upgrade Wyangala Dam, and get results. We have projects and proposals in place and ready to go in Queensland and we've got other drought funding projects ready to go in South Australia. We are very proud to be a government that is looking at the future, but this bill is not about the future; this bill is about the here and now.
We have a world-class agricultural industry and our government is working hard with the NFF and others to achieve the golden aim of a $100 billion agricultural industry by the year 2030, and we need our farmers to achieve that ambition, but right now our farmers are experiencing challenging times. In my home state of New South Wales, farmers in the north are facing the worst drought in living memory, and in my home region we are knocking on the door of the millennium drought. Supporting our farmers as well as rural and regional communities that depend on the agricultural industry remains our government's most urgent priority. The cyclical and unpredictable nature of farming in Australia means our farmers and primary producers face a range of unique challenges, and that's why we're moving this amendment today to help those in the industry who are facing financial hardship.
Since its introduction, in 2014 the farm household allowance provided over $365 million in fortnightly payments to more than 12,800 farmers and their partners. Senator Sterle noted that some have reached their time cap—that is, they've been on farm household allowance for four years and reached the end of their time cap—but what he didn't mention is that 5,445 of the farmers who were receiving farm household allowance were able to leave the program before their four-year time cap. That is because we have funded rural financial counsellors. We put people around the kitchen table with farmers to look at their business models and their forward planning and help them become self-sufficient again, and that's what our farmers tell us they want. However, the program gives income support to eligible farmers and their families to pay for basic household necessities while they make important decisions about their future. It also provides thousands of dollars to help with financial assessment and financial counselling.
As Senator Rice rightly said, these latest changes follow a review undertaken by an independent panel, led by Michele Lawrence, which also had extensive consultation. While I agree with Michele Lawrence that farms are small businesses, now is not the time to turn around and tell those small businesses that we're not going to support them in the midst of drought. After this drought finally breaks, we will be prepared to carefully look at longer term strategies. However, at the moment we need to make sure those farmers are still there at the other end. We have looked at the panel's report to government and we've implemented the changes to ensure this program remains fit for purpose and continues to meet its objectives of providing income support and assisting structural change. That's why we have extended the time cap in this amendment. Instead of four years in a lifetime, it becomes four years in 10 years, because we acknowledge that farmers often encounter more than one period of hardship in their lifetime. An eligible farmer or their partner will now be able to access the payment for up to four cumulative years in each 10-year period.
The other important aspect to this bill is the change to the income test. Many farmers run diverse business operations out of necessity. This is a very smart move for farmers who are taking action to be more resilient, more self-sufficient and prepared for drought and other impacts on their farm business. However, we know that when conditions are tough even our good farmers can find they struggle to make ends meet. This bill allows for a fairer assessment for those facing hardship to have their eligibility for the household allowance tested with their income and losses. For the first time, we will link farm enterprises with their directly related businesses. Income and losses will be considered together. This is a more generous setting than previous and current practice. If there is a net loss it can be used to offset any other income, like wages, interest and dividends from shares or investments. The offset has been increased from a cap of $80,000 to $100,000 per couple, recognising the businesses of many of our farmers, and single people can use the whole cap for themselves.
For the first time, farmers generating income from agistment can have that income considered against either the farm enterprise loss or the loss of a related business. It will broaden the scope of those who can claim the farm household allowance, and the offset will no longer be restricted to claiming the interest payable on a farm loan. An intergenerational loan, the broadened offset is available to all farm household allowance recipients involved within the farm business. That means that if mum and dad, as well as their son and daughter-in-law, are on a farm household allowance, and the farm business has a loss of $200,000, then each couple can use their offset to share in that loss. So that $100,000 limit applies to the person or couple, not just to the farm business. It also applies to people who are not life partners but business partners.
Many farmers who are exiting the farm household allowance income support have done everything they can to respond to their circumstances and are still enduring financial hardship. In recognition of the enduring nature of this drought that seemingly will not cease, we know that at moments like these those farmers need a little extra help and support to keep food on the table and to keep their businesses running. That is why we have implemented a relief payment to help make ends meet. Recipients on a single rate of payment will receive $7,500 and recipients on a partnered rate of payment will receive $6,500, or $13,000 per couple. We will deliver this payment within six weeks to those who are eligible, and that is why it is so important that this bill be passed today—so that we can get that money to where it is needed.
Farmers are exposed to a lot of risks that they can't control. The farm household allowance is designed to help farmers assess their position and to look at succession, or decide to sell up or decide to continue in business and work with their rural financial counsellor. The farm household allowance enables those farmers to take stock and to make sure that their business is fit for what their lifestyle and life requirements are. The suite of measures contained in this bill will strengthen the farm household allowance program, to ensure it remains fit for purpose. The first step to making it easier for farmers is to access the support they need. The government will continue to stand alongside farmers—indeed, alongside all those living and working in rural and regional Australia—as they experience the worst drought in living memory as well as the extraordinary hardship it brings. I commend this bill to the Senate.
I am pleased to rise in support of the Farm Household Support Amendment (Relief Measures) Bill (No. 1) 2019. Farming means a lot to our country, and farming means a lot to my home state of Queensland. And farming means a lot to me personally. I grew up on a family farm just outside Chinchilla on the Western Darling Downs, and I know firsthand both the importance of agriculture and the challenges and hardship that farming families face. The bush is always close to my heart, and I will take every opportunity in this chamber to stand up for our regions and for Aussie farmers who are doing it tough.
The Morrison government takes the plight of Australian farmers caught in the grip of drought, and now fires, very seriously. The government is on the front foot when it comes to assisting families and farming communities dealing with this awful drought. While this bill fits neatly into the government's three-point plan to fight the scourge of drought in this country by providing immediate support for farmers through the mechanism of the farm household allowance, these reforms are not just about drought. This bill will provide the first instalment of recommended changes to the Farm Household Support Act 2014 and the Farm Household Support Minister's Rule 2014 to extend the short-term safety net for farming families who sometimes must face more than one period of hardship in their lifetime.
It is disappointing to note that, despite significant hardship and natural disasters currently manifest in my home state of Queensland, the state Labor government and the ABC continue to vilify our farmers through punitive legislation and through unfair and vindictive coverage, respectively, and through a general disdain for their contribution and challenges. Whether they are playing politics with dams, shutting agricultural colleges or criminalising sensible land clearing for no other reason than to appease voters in the inner city, the Queensland Labor government has been at war with our farmers and rural communities from day one. It is pleasing to see that Deb Frecklington has committed to a new Bradfield scheme in recent days. Water, dams and irrigation are essential in Australia. This scheme will strengthen our regions and help farmers immensely.
The Queensland agricultural minister is based on the north side of Brisbane, and this tells you everything you need to know about how Labor feels about farmers. Agriculture is not an afterthought on this side of the chamber. Many Liberal-National members and senators live and raise their children in regional communities. Many of us grew up in small towns and on family farms. We care about these communities and we care about Aussie farmers.
Agriculture is one of Australia's biggest exports and one of our most important industries. Agriculture accounts for over 16 per cent of our exports. It is also important to note that, despite volatile markets and despite drought, fire and floods, agricultural production and agriculture exports have grown significantly over the last 20 years and will continue to grow under a Liberal-National government. Yet, despite the many positives, most people know—unless you have been living under a rock—that this cruel drought continues, and it's placing a huge strain on farming communities. Having recently travelled around remote and regional Queensland, it broke my heart to see how bad the situation is. It is especially tough when resilient farming communities must not only face a severe drought but also deal with a city-centric Labor state government which is largely deaf to their pleas for help. Families that have been on the land for generations are on their knees today, and it is impossible not to be moved by their plight or uplifted by their spirit. We have an obligation to help these honest, hardworking Australians, not ignore them or, worse still, disrespect them as nothing more than a lost cause.
Drought is a cruel but all too regular part of Australian rural life. There have been many severe droughts in our country since records began in the 1800s. All along the eastern seaboard, including parts of South and Western Australia, they are currently experiencing some of the lowest rainfall on record. The driest parts are the northern Murray-Darling Basin, especially in northern New South Wales and southern Queensland. While this crisis may not be unique, it is significant and we don't know when it will end.
When responding to a challenging situation such as drought, one possible option would be to let nature take its course and let those who have not managed the short- and medium-term challenges to simply fail and leave the land. Let me be clear: this is not an option for the Morrison Liberal-National government. This government is determined to do all it can, and then some, to help keep farmers and graziers on their properties so, when the drought does break and favourable conditions return, those farms and businesses have a viable platform for rapid recovery and future profitability.
This bill seeks to further strengthen the farm household allowance, which has been available to Australian farmers experiencing hardship since 2014. Over 5½ years of operation, this scheme has paid more than $365 million to over 12,000 needy recipients. We must ensure this support is ongoing, to meet the daily needs of farming families while they struggle with hard times, including but by no means restricted to times of drought. While the original scheme only provided cumulative income support for up to a maximum of four years over a lifetime, this bill will expand the farm household allowance by making it payable to farmers for a cumulative four years out of every 10.
Recognising the current predicament of our farmers and ensuring that we're responsible in how we manage the scheme, the 10-year period for this bill will be backdated to July 2014. This will help ensure that multiple periods of hardship do not lead to the loss of primary producers and threaten the viability of communities in our regions. This bill was drafted in consultation with an independent expert panel, which included farmers and an economist, which ensured that we listened to industry and also got the balance right in terms of ensuring that taxpayer funds were targeted appropriately. While drought may be a primary cause of rural hardship, this government understands rural and regional Australia well enough to know that it is by no means the only cause. This is why the allowance will not be assessed based on the reason why farmers need short-term help but will provide the assurance that help is available.
Another important reform covered by this bill is a loosening of the eligibility criteria, meaning more of those who are in need can access the allowance. Presently, the scheme only allows for a maximum off-farm income offset of $80,000 for people to be eligible. Given how capital intensive agriculture can be at times, this is too low to be a realistic threshold when assessing hardship. The offset cap will now be increased to $100,000 per couple, and a single person may claim the entire cap themselves. New eligibility criteria will also mean that any farm business running at a loss can now offset that loss against all other income, including wages and off-farm investment proceeds. The measures in this bill will also allow losses from primary production to be offset against any agistment income.
This bill will also broaden the minister's discretion around payments to ensure that those in need who may fall short on some criteria are taken care of. The Morrison government understands that regional Australia is about more than just cold numbers. Farming communities are organic. They comprise people and families, and they sustain a way of life essential to the economic strength and social fabric of this nation. In times like these when so many farming families face abnormal hardship, this bill will provide for a further relief payment equivalent to six months of a farm household allowance payment for any farmer who has used up their four years of cumulative income support in the current 10-year period and still suffers financial hardship despite doing all they reasonably could to alleviate the situation. The Morrison government will ensure that our struggling farmers are looked after and not left behind.
Those opposite may question the payments in light of recent and welcome rain in some regions. However, agriculture is not like other businesses. Should a drought actually end in some places—which is a big call in light of past disappointment—after so many years of hardship, pastures will take time to regenerate, herds will take time to recover and profits will take time to be realised. Rain does not flow straight into farmers' bank accounts. These amendments are projected to cost the budget some $47 million over the forwards estimates. This is a small price to pay to provide effective emergency relief to farming families. Strong regional communities and a strong agricultural sector have been the backbone of Australia's success since before Australia was Australia, and we must continue to do all we can to ensure they remain so.
Everything that city based Australians have heard about agriculture over the years is true. Every Australian family needs Australian farmers and graziers. When our farmers do it tough, we all suffer. Along with shelter and water, food and fibre remain our most basic human needs. We must listen to and support our farmers, particularly when times are tough. In the harsh Australian environment, farmers have always faced great risk and financial hardship, often due to factors beyond their control. However, those risks shouldn't be allowed to completely overwhelm future prospects if we want farming communities and the industries they represent to survive. This bill provides a safety net to assist Australian farmers and their partners to better manage the hardship that may come from prolonged, unfavourable climatic, economic or environmental conditions.
I'm proud of the record of the Morrison government in supporting Australian farmers and I back the Prime Minister's drought plan, which includes the measures outlined in this bill to improve the financial situation for farmers and their families facing financial hardship. I commend the bill to the Senate.
I stand as a servant to the people of Queensland and Australia. This Farm Household Support Amendment (Relief Measures) Bill (No. 1) 2019 is intended to introduce improvements to the farm household allowance payments scheme. It may provide some mild improvement in terms of relief, but it shows no understanding of the plight of the Australian farmers facing one of the nation's worst droughts in remembered history.
Dairy farmers have been forced to walk off their farms or to sell them for next to nothing. Our sheep and cattle graziers have been selling their breeding stock and, in some instances, been forced to shoot their starving animals. Grain growers have been seeing crops fail season after season and the land is parched and dry, with little change in sight. And what does the government do? Well, next to nothing. Rivers flow past farmers desperate for water when money-hungry investors have bought up the water rights and yet have no interest in farming. Water mismanagement has occurred on what some would say is a criminal scale, denying needy farmers access to life-saving water. The government has no national water plan. The government has no national drought-proofing plan.
Where is the new infrastructure? The government has failed Australian farmers by providing no leadership in preserving and protecting the men and women of the land. Where is the real support? Where are the guarantees that farmers can continue to farm the land, where many have lived for generations, and provide the necessary food to feed the nation? Will we have to import our basic food products—milk, dairy products, flower, vegetables, fruit and meat? Seriously, we are proud producers and exporters of all these things in the good times.
I have recently travelled all over Queensland and down into the Murray-Darling Basin to listen to farmers across these regions. What I hear are stories of tragedy where the government is failing these people who are the backbone of our nation. I have seen people who are in debt, savaged by the banks—who have acted like vultures—and with no help in sight. Where is the infrastructure which should have been built 20 years ago? Where are the dams, the new power stations, the pipelines and the road linkages and upgrades that will make access easier for farmers to get their produce to market and allow our farmers to weather the drought? Why does the government dither in providing the emergency assistance to lift farmers out of their dire positions? The tragic side of this is the unacceptable number of farmers who have taken their own lives because of the desperation they feel in losing everything. Many farming families' lives remain shattered in the dust.
I must digress for a minute to discuss how government, under the Liberal-Labor duopoly—Liberal-Labor-Nationals following a Greens plan—has really hurt farmers. There was the stealing of property rights initiated under the John Howard government in 1996 with Rob Borbidge, the National Party Premier at the time in Queensland, and then two years later with the Labor Premier of Queensland, Peter Beattie, and the Labor Premier of New South Wales, Bob Carr. They were stealing property rights with no compensation. All we ask for—and, again, we will keep asking for it until it happens—is restoration of those farmers' property rights or compensation. Restoration or compensation!
We want energy. That comes back to the original competitive federalism structure, in which states are responsible for electricity prices. Now we see a mishmash that is acknowledged—indirectly, but certainly clearly—by the government's so-called 'big stick' bill. The government created the mess and now the farmers are paying for it. We have farmers in northern, Central and southern Queensland who are refusing to plant fodder because they can't afford to irrigate it. They won't plant fodder in a drought!
One of the forms of assistance offered by this bill, though, is a change in the time frames for when a person is able to access farm household allowance. The change—from four years access over a lifetime to four years in each specified 10-year period—offers no significant immediate benefit, as the time to receive these benefits remains limited to four years of payments only. This scheme is unrealistic, and, during a major catastrophic drought, is unworkable. It shows the lack of understanding of the plight of farmers depending on this small allowance to survive, by those who wrote this part of the bill.
Why set up a time frame at all? People living in the city who receive Newstart allowance do not have a similar time limit attached to receiving their allowance. If a time frame is warranted, would it not be better to consider a period ending some years after the drought has broken? When farmers have destocked during a drought, it takes several years to rebuild numbers in their herd to reach a viable herd size.
The bill establishes the possibility of a lump sum payment for recipients who have exhausted the maximum farm household allowance payments by 1 July 2020, and allows for the minister's rules to prescribe further lump sum payments as required. The minister is going to be very busy considering individual applications, unless the rain arrives! This still is not a long-term solution to assist farmers in the future.
The bill also expands the off-farm income offset, with an upper limit moving to $100,000, up from $80,000. This will benefit those who are able to access the second income stream, but not everyone can. The real issue here is the lack of government leadership—to provide real relief to our farmers who have been crippled by the drought, and to provide real prevention, starting now, to prevent the ravages of drought when we have our next drought. And we will—just as this drought will end and the next cycle will commence, we will have another drought. Let's hope that the infrastructure is in place. There needs to be an overall strategy to ensure that plans are in place to support farmers long before a disaster like this unfolds again, and especially to prevent it. It's a pity this was not done 20 years ago. But the strategy is still missing. What is needed is a coordinated governmental response that will ensure continuity of support for farmers when the weather turns against them. Farmers of course are resilient and know that the weather will be either favourable or not. They plan for that. But dealing with a lengthy drought strains the best of plans.
Just a couple of weeks ago I was in northern Victoria, listening to farmers on the banks of the Murray River. I listened to a construction worker who came up and said that farmers are just not spending this time, because, although they have confidence that the drought will end, they have no confidence that government interference and suppression will end. They don't know where the government is going. They have no clue about the future. So they are not willing to spend any money, and so businesses in town and construction workers are not being supported. We need confidence amongst farmers, and that comes from knowing that government won't interfere as it has been.
The government is obliged to support the farmers the best way it can. This bill does go at least some way to achieve this, but much more needs to be done. I call on the government to formulate an Australian drought-proofing plan, including national water management and realistic social and monetary support for those affected by natural disasters—a solid plan, based on solid data and facts, aimed at meeting people's needs and our nation's needs.
This bill, the Farm Household Support Amendment (Relief Measures) Bill (No. 1) 2019, demonstrates this government's dedication to the needs of farming communities in rural and regional Australia. It is amongst a raft of support that this government has been and is committing to Australian farmers, families and communities. This bill amends the Farm Household Support Act and the Farm Household Support Minister's Rule to extend the FHA from four years of cumulative income support over a lifetime to four years of support in every 10 years. It's an important change. It will also increase the off-farm income offset. The settings for the offset are being relaxed, and the cap is being increased from $80,000 to $100,000. It will provide a relief payment up until 30 June 2020 for recipients who have exhausted or will exhaust their first four years of FHA.
As a veterinary surgeon, one of my former roles was to provide veterinary services to primary producers. These services included disease investigations, addressing production issues, reproductive improvement, animal welfare, farm biosecurity et cetera. All of these are designed to improve production and profit to the primary producer. The majority of this work does involve animal production enterprises, but often there are mixed enterprises also involving cropping and horticulture. In this role, I have seen many farmers affected by factors often totally beyond their control. We are well aware of the effect of natural disasters and cyclical weather events such as drought, floods and storms. There are also many other things that cause hardship and can lead to temporary loss of income. These can also include loss of market access and fluctuating prices.
I support Senator Roberts in his comment that farmers are being driven to suicide, and I have seen this firsthand for myself. But I disagree with the view that this government is not doing enough. The government is committed to supporting our farming communities to generate their own wealth and build strong, resilient livelihoods. We recognise that sometimes farmers encounter more than one period of hardship in their lifetime. This bill acknowledges this reality and provides an extended safety net. We have preserved the important principle that payments are time limited. We don't want to have farmers sitting on land that's unproductive forever. This provides tools for farmers and their partners to move the business to a more sustainable footing, or to sell or diversify, or to take other measures to make their farm profitable. An eligible farmer will now be able to access payment for up to four cumulative years in each 10-year period—so out of each 10 years there will be four years where they can access this payment.
An example of the importance of this is from my home in the Northern Territory. Mango production is the biggest horticultural enterprise there. Whilst it is a high-value crop, it is very sensitive to a range of environmental and market forces. It is an annual crop with a very short harvest season. Therefore, any extreme weather event occurring anywhere from flowering to picking can be devastating to the individual farm or to the region. Things such as early storms can knock off almost an entire crop. Fluctuations of hot and cold weather can prevent fruit from setting. The timing of the crop is also imperative. The NT has the first mangoes to market, thereby getting premium prices. If there is a weather event which leads to a late flowering, we then compete with Queensland producers, leading to poor prices for everyone. Extremely poor years are not that common, but, with the possibility of so many things that can go wrong that are totally outside of your control, it is almost certain that you're going to have more than four in your lifetime. This bill gives that little bit of certainty and security that, when you do, at least there'll be a safety net there.
Many farmers out of necessity, as we know, run diverse business operations, and it's a good thing to be more resilient and prepare for things such as drought, floods and other impacts on the farm businesses. We know that, when conditions are tough, even our very best farmers can find that they're struggling to make ends meet. This bill allows for a fairer assessment of those facing hardship to have their eligibility for FHA tested with their income and losses. For the first time, we're linking farm enterprises with their directly related businesses, and income and losses can be considered together. As I've stated, this offset has been increased from a cap of $80,000 to $100,000 per couple. Single people can use the whole cap themselves. For the first time, farmers generating income from activities like agistment, which is common in the Northern Territory, can have that income from the agistment considered against either the farm enterprise loss or the loss of another related business. This will greatly broaden the scope of people who'll be able to claim the FHA.
The offset will no longer be restricted to just claiming the interest payable on a farm loan. In the Northern Territory we often have intergenerational farms with two or even three generations involved in the farming business. If those generations suffer a loss, each couple can claim a share of that loss. It also applies to people who are not life partners but are business partners—important to us in the Northern Territory.
One of the things that we struggle with, certainly at the moment, is that many people, particularly down south, don't think of the Northern Territory as having droughts—after all, we get a wet season every year. Even many Territorians don't think of us as having droughts, but we do. Earlier this year half a million head of cattle were destocked off the Barkly region. Many of our most productive Barkly Tableland properties are just dust. Sure, some of those are owned by large companies and are not subject to these allowances and concessions, but many still are family-run businesses. I was on a station out of Alice Springs just last week where I spoke to a fourth-generation owner who's doing it pretty tough at the moment. They, like many, have off-farm income and related farm businesses operational to survive. Being able to offset this by an increased amount will mean a lot to them.
The issue has been raised in the press recently that farmers are coming off FHA and are essentially being thrown to the wolves by the government. This is certainly not the case. Many of them who are exiting their four years of FHA have done everything that they can to respond to the circumstances and are still going to be in financial hardship. At the same time, as we know, we're facing a very dry summer, horrendous bushfires and just devastating conditions in many jurisdictions. At moments like these our farmers need a little bit of extra help and support just to survive on a day-to-day basis, so farmers and their partners that have come to the end of their four years of FHA this year will receive a relief payment to help make ends meet—single people $7½ thousand and partners $6½ thousand, so a total of $13,000 between them. This will give them about six months of extra income support. The payment will be delivered in the next six weeks to those already eligible, and those who are still on FHA but will exhaust their entitlement on or before 30 June will be paid as they exit the program.
It is vitally important that we, as a government and a nation, provide support to our producers in times of need and hardship, and I commend this bill to the Senate.
I thank senators for their contributions to this debate on the very important Farm Household Support Amendment (Relief Measures) Bill (No. 1) 2019. We know farming is a long game. Support in times of hardship is part of what is needed to help farmers and their communities through these difficult times. There are times like now when widespread drought conditions impact on primary production and the livelihoods of our farmers and their families. That's why the farm household allowance was originally created with strong bipartisan support to make sure farmers doing it tough have the support they need. Since the introduction of FHA in 2014 over $365 million in fortnightly payments have been made to almost 12,700 farmers and their partners.
The changes contained within this bill not only allow eligible farmers to receive the payment every four years out of 10 and allow farm business losses of up to $200,000 to be deducted from other income, including agistment; it also allows the minister to create a rule to make drought relief payments, with the first in eligible pockets before Christmas. Let me be clear: the farm household allowance is not a drought measure; however, we fully acknowledge that many of the proud farmers who access farm household allowance do so because of drought. This bill will improve the financial situation of farmers and their families who are facing real financial hardship. It is the first step by the Australian government to implement the recommendations made in the independent review, Rebuilding the FHA: a better way forward for supporting farmers in financial hardship. Support for farmers and their families in drought-affected communities remains the government's most urgent priority. I commend this bill to the chamber.
Question agreed to.
Bill read a second time.