Non-farmers need to understand that exceptional circumstance (EC) funding is not available for people who have had a couple of bad years. The strict eligibility test for EC support says it is only available for a one in 20 year event, and before they can receive it, farmers need to demonstrate their ability to run a viable farm. The idea is not to prop up bad farmers or poor farming practices.
Let’s not forget that farming is still a very important part of the Australian economy. Agriculture is directly worth 3-4% of GDP, contributes around $36 billion annually to the economy, and employs 330,000 people. But if you look at the total value through the chain, it’s 12% of GDP, and $100 billion per annum, and impacts 1.6 million jobs. Given its importance to the economic fabric of the nation, we believe it’s appropriate to support farmers through exceptional events.
Those who say assistance totalling $1 billion over five years for farmers in exceptional circumstances outside normal risk management is too much clearly haven’t taken into account the $100 billion that agriculture and its associated industries contribute annually to the Australian economy. It’s a very reasonable investment.
Further, we have taken large steps in recent decades to better prepare for and manage drought. Australian farmers do recognise Australia’s harsh climate. Here are just some of the measures now used to combat Australia’s lack of water:
- Drought resistant crop varieties
- New irrigation systems which let us target water where and when is needed.
- Raising the banks of dams which minimises evaporation.
- Laser-levelling is now common practice on irrigation properties, which helps minimize runoff.
- New cropping techniques. Instead of ploughing four or five times a year, we use conservation tillage techniques to protect the soil and minimize erosion.
- Satellite planting to match fertilisers to soil types
That’s why we reject claims that we’re trying to get everything we can out of the land and then looking for support as soon as there’s a drought.
Finally, in an ideal world, farmers would not need financial assistance. But it is worth noting that along with New Zealand, Australian farmers receive the lowest levels of support in any OECD country. The drought support payments are not about propping up an unsustainable segment of the economy. We do believe it’s appropriate to support farmers at this time to protect the productive capacity of our regions.