$5bn drought fund won’t raid NDIS, Cormannvows

Mathias Cormann has guaranteed that a new $5bn Future Drought Fund will not drain revenue from the NDIS.

Farmers Tahna Jackson, left, and Tanya Cameron with the Prime Minister at the ­National Drought Summit yesterday. Picture: Kym Smith

Finance Minister Mathias Cormann has guaranteed that a new $5 billion Future Drought Fund will not drain revenue from the National Disability Insurance Scheme as Labor demanded the assurance as a key condition for its support.

Scott Morrison used the ­National Drought Summit in Canberra yesterday to unveil measures, worth $7bn over time, to drought-proof Australia, including a cash payment and voucher scheme to deliver an economic boost to struggling towns. They provide an ­additional $15.3 million for mental health services, $30m for charities, $50m in water infrastructure rebates and an online farm hub hosted by the National Farmers’ Federation.

The package also extended the drought communities program, which can provide up to $1m to eligible local governments. The ability to draw on the scheme was extended from 60 to 81 councils, for which the Prime Minister put the cost at $81.15m. Mr Morrison also said the extra $30m for charities would support at least 10,000 households and provide an economic boost to rural towns.

“This will see cash payments, but importantly vouchers,” he said. “Vouchers to meet basic needs such as food, personal products and utility bills so this support gets spent in the town.

“In those areas where vouchers are too difficult to run because of their remoteness or the complexities and logistics then cash support can be used in those ­communities. But this is about getting that assistance into the town and making sure the money is spent in the town.”

Opposition agriculture spokesman Joel Fitzgibbon said Laborhad not been consulted on the centrepiece announcement for a new $5bn fund to unlock $100m a year from July 2020 — a shake-up that will require legislation.

“We can support it in principle but we’ve not been given so much as a piece of A4 paper,” Mr Fitzgibbon said. “If the government was serious about this measure it would have consulted us. We’ll look at the detail when the government provides it. We also need assurances the government is not raiding NDIS money to fund it.”

The Future Drought Fund will receive an initial commitment of $3.9bn before growing to $5bn by 2028. Labor also raised concerns the cash was being redirected from the “Building Australia Fund”, which it established in 2009.

After the Coalition won office in 2013, it diverted money in the BAF from critical infrastructure to a newly created NDIS Special Savings Account to plug a gap in the scheme. Senator Cormann told The Australian the legislation to abolish the BAF never passed the Senate and that surging budget fortunes meant the funds could now be repurposed without affecting funding for the NDIS. He cited a $19.3bn improvement in the bottom line for 2017-18 and another $9bn bounce since the May budget.

NFF president Fiona Simson said the drought support was the “most comprehensive” yet provided by government, and farmers had a long-term commitment that it “won’t be made up on the run”.