Noumi boss Michael Perich calls on Jim Chalmers to reinstate JobKeeper-like payments to accelerate flood recovery

Treasurer Jim Chalmers is facing calls to reinstate JobKeeper-like payments to support flood-affected industries.

Treasurer Jim Chalmers is facing calls to reinstate JobKeeper-like payments to support flood-affected industries as he warns Australians that now is the time for restraint and resilience ahead of the federal budget this week.

While state and federal governments have launched flood assistance packages, the support does not extend to businesses indirectly affected by the natural disaster, exposing a gaping hole in recovery efforts.

ASX-listed dairy and nutritional company Noumi – formerly known as Freedom Foods – has faced significant flood-related costs as it continues to process the five million litres of milk it collects from Shepparton farmers in central Victoria each week.

But the company cannot recoup some of the costs via a government grant or from its insurer, because its factory has not been inundated. Chief executive ­Michael Perich said he could not request price rises from supermarket chains.

“We’ve got roads that are under a state of repair, roads that are damaged going into our farms, so that is an issue,” Mr Perich said.

“Milk is an important product and it spoils very quickly if we don’t process it within a short time, within 24 hours. We have had to ship a lot of milk and there are a lot more increased costs around supply chain given the distance products have to go.

“And it’s important we get some support for that.”

Cows must be milked twice daily, requiring processors to complete lengthy freight routes to avoid flooded areas.

Australian Treasurer Jim Chalmers has for months been preparing Australians for a sober budget with no new cost of living support measures.

Another ASX-listed dairy processor, Bega Cheese, has been forced to divert millions of litres of milk from flood-affected farms in central Victoria to its factory in Koroit, almost 400km away in the state’s southwest. Earlier this year, it said the separate floods in northern NSW and Queensland would contribute to a $40m hole in its bottom line.

The Albanese government has put aside an extra $3bn for natural disaster recovery that will go towards flood relief measures such as emergency disaster payments.

“My government stands ready to provide whatever support is requested in co-operation with state and local government and in co-operation with local communities as well, to build resilience and to build support,” Prime Minister Anthony Albanese said during a visit to flood-ravaged Forbes in western NSW.

Mr Perich said that support needed to extend to bigger employers in flood-affected communities to help them recover from the natural disaster.

“Sometimes what we find is the government support doesn’t support some of these bigger, larger companies. Even though we are a large employer, we have large costs as well,” he said.

Mr Perich called for similar support to the JobKeeper payments the government made earlier in the Covid-19 pandemic, which extended to some of Australia’s biggest companies.

“Something like that (would work). You’re gonna have issues with increased cost with feed for the cows because of the flood damage. We were having good crops and now we’ve got a lot of flooded crops that may not get harvested so we’ve got a lot of increased costs.”

Dr Chalmers has for months been preparing Australians for a sober budget with no new cost-of-living support measures beyond Labor’s election promises of cheaper medicines and childcare, to ensure the government is working in tandem with the Reserve Bank to rein in inflation.

At the same time, the Treasurer says the government has been forced to make room for an extra $33bn in new spending on pensions and welfare payments, putting further strain on the nation’s finances.

He has acknowledged that the floods will hit the economy, estimating food prices to rise 8 per cent in the December and March quarters, bumping up headline inflation by 0.1 percentage points.

“There will be an impact on the economy and there will be an impact on grocery prices,” Dr Chalmers said last week.

Noumi CEO Michael Perich says the company’s factory can’t access insurance or government support to recover flood-related costs because it hasn’t been inundated. Picture: Tracee Lea

“We have seen this before, unfortunately, where we see prices in our supermarket go up and that’s what we’re facing again.”

But Mr Perich ruled out seeking price increases from supermarket chains to cover flood-related costs.

Mr Perich travelled to Shepparton last week from Sydney, where Noumi is working out how best to support farmers and retrieve milk from properties.

This has included travelling longer collection routes to dodge flooded areas, adding to fuel and freight costs. In the past week, Noumi’s efforts have resulted in less than 2 per cent of milk collections being dumped. Mr Perich said it was too early to calculate how much of a financial hit the company will take. “It’s very critical for us to be focused around the safety of our people and process the milk. That’s where our focus is at the moment,” he said.

“But we know those costs are going to come and it’s important to know that we have some ability to get support for that.”

Mr Perich was speaking as Victorian Premier Daniel Andrews declared the flooding was “far from over”.

“We are going to see more rain. We’ve still got many thousands of people who are in their homes. Their homes are full of water. (There are) others who can’t go back because they’ve left and are now cut off from their home,” Mr Andrews said.

“This is a very, very challenging time. There are still warnings in place. There are still some very serious challenges for us to rise to over the coming days.”

Insurance claims for damage from the floods that have lashed Victoria and NSW have lifted to 6350. according to Insurance Council of Australia data, up from 5193 reported on Tuesday.