Farmers set for drought relief as Morrison government unveils new package
The Morrison Government is set to unveil a package for drought-ravaged farmers, who will receive interest-free loans of up to $500,000.
VIC News
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Drought-ravaged farmers will be handed interest-free loans of up to $500,000 as part of a package to be unveiled by the Morrison Government today totalling more than $1 billion.
Farmers and all other small businesses dependent on agriculture in drought-affected areas will be able to access the concessional loans immediately without paying any interest for two years.
After that, they will have to pay an interest-only payment from years three to five, and then pay the interest and principal loan from years six to 10.
Areas in Victoria eligible for the loans include East Gippsland, Swan Hill, Buloke, Mildura Swan Hill, Wellington, Gannawarra, Pyrenees, Yarriambiack, Latrobe and Strathbogie.
Prime Minister Scott Morrison said the loans would put money in the pockets of farmers to “keep their stock fed and watered, their staff and farmhands paid and their crops irrigated”.
“Interest free loans will make it cheaper for farmers to buy fodder, transport stock, build water infrastructure, agist cattle, mend fences or refinance existing debt,” the PM said.
“Farmers will not have to pay a cent for the next two years, and even after that, interest only on a discounted rate.”
Harvesting and shearing contractors, livestock transport providers, stock and station agents and agricultural equipment and repair providers will also receive the loans.
Concessional loans have already been available for drought-stricken farmers, but this is the first time they will be provided interest free for two years.
It is expected more than $1 billion in loans will be issued to farmers and small businesses over the next four years under the changes – compared to just over $200 million committed under the current system.
The loans will be announced by the federal government as part of a new major package – signed off by Cabinet yesterday (wed) – as the drought worsens across the country.
It will also include an expansion of the Drought Communities Program, which has provided more than 100 councils with $1 million each for relief projects that boost employment.
Six more local government areas will be added to the program at a cost of $6 million, while an extra $122 million be made available for those already receiving support.
A new $50 million discretionary fund will also be established to support additional councils when needed.
About $200 million will also be redirected from a regional fund to create a “special drought fund”, and up to $138.9 million for upgrades and maintenance of roads.
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Mr Morrison said the government’s drought plan – the third in a year – was “not to set and forget”.
“We also know the drought has been tough on small businesses that rely on agriculture,” he said.
“Rural communities can’t function without these small businesses, that’s why we are stepping in to provide this extra support.”
Water Minister David Littleproud yesterday said the announcement would include a “very significant” stimulus package.
In an interview with Sky News, Mr Littleproud suggested the government would not back a proposal by the National Farmers Federation for federal council rates relief, instead calling on the states to step up.