Government and the rural sector

Governments and the agriculture sector must work together to increase the skills and self-reliance of farm businesses, industries and regions by:

a) introducing a consistent approach to government assistance for those facing viability problems or wishing to lift their business performance

b) retaining the Farm Management Deposits scheme as a key risk management tool, informed by analysis to confirm that it is meeting its objectives

c) introducing new and improved measures to develop better farm preparedness (including risk management strategies) to deal with market fluctuations and climatic extremes, while phasing out interest rate and other transaction based subsidies by the end of 2010.

Government response

Recomendation 13(a)
Noted.

The Australian Government continues to look at approaches to improve the flexibility and effectiveness of current government measures such as information/advice, training opportunities and income support, to support individuals, regions and industries during difficult periods. The Government is currently evaluating the Agriculture Advancing Australia (AAA) package to make sure AAA programes remain relevant and continue to help rural industries and producers adapt to changing circumstances.

Recomendation 13(b)
Noted.

An evaluation of the Farm Management Deposits (FMD) Scheme is scheduled to be completed before June 2008. The Government recognises that the FMD Scheme is an important farm risk management tool. Since its introduction in 1999, the scheme has encouraged around 40,000 primary producers to set aside approximately $2.4 billion to address future adverse financial circumstances.

Recomendation 13(c)
Noted.

The Government remains committed to building the ability and confidence of primary producers and industries to influence and manage change in their operating environment. The Government is currently evaluating the Agriculture Advancing Australia (AAA) package to make sure AAA programes remain relevant and continue to help rural industries and producers adapt to changing circumstances.

The Government supports an increased focus on drought preparedness and management to aid recovery. A reference group of key stakeholders is developing options for new and revamped initiatives to encourage farmers to adopt improved risk management strategies and options for more consistent Australian and state and territory government drought declaration processes, based on the National Agriculture Monitoring System (NAMS). The reference group will present the outcomes of this work to the Primary Industries Ministerial Council (PIMC) for consideration at its November 2006 meeting.

The NAMS is a significant new web-based tool available to farmers and governments to help them better understand and prepare for drought. The NAMS was developed primarily as an information retrieval and presentation tool for streamlining Exceptional Circumstances application and assessment processes. It also provides a more consistent national information base regarding the status of dry seasons and drought conditions. It is operational for broadacre industries and work is continuing to identify and develop data needs for irrigated and intensive agricultural industries such as horticulture and dairy.