Programme 1.12: Rural programmes

Programme objective

This programme’s objective for 2014–15 was to: 
  • support eligible primary producers and small rural businesses with targeted assistance to manage adjustment pressures and remain viable in the long term.

Programme description

We manage several programmes to provide targeted financial assistance to primary producers and rural small businesses.

The Farm Finance Concessional Loans Scheme provided assistance for eligible farm businesses experiencing difficulties with debt. The scheme was available in all states and territories except the Australian Capital Territory.

The Farm Household Allowance (FHA) provides fortnightly income support to farmers and their partners for up to three years while they take action to address their long-term financial security. This provides time for recipients to develop self-reliance strategies and creates an incentive to make significant business decisions where a farm business may be unsustainable.

The Rural Financial Counselling Service (RFCS) provides grants to state and regional organisations to provide free financial counselling to farmers, fishers and small rural businesses suffering financial hardship that have no alternative sources of impartial support.

More information is available on​ the department's website.​​​

Table 13 Programme 1.12—Rural programmes—key performance indicators
Key performance indicator2014–15 targetPerformance
2014–15 ​​​2013–14 ​​​2012–13
Effective policies, programmes and regulations that contribute to enhanced productivity, profitability, competitiveness and sustainability Accurate and timely advice provided aMet
Work with the Rural Financial Counselling Service (RFCS) providers to acquit the funds in accordance with the relevant agreed governance documentation100% of funds acquittedMetMetMet
Provide effective support across rural Australia through the RFCS programme Support 14 service providersMetMetMet
Work with the RFCS providers to provide the services specified in the agreed governance documentation100% of services providedMetMetMet
Work with each of the states and the Northern Territory on the implementation and delivery of Farm Finance Concessional Loans Eligible farm businesses access funds for debt restructuring or productivity enhancement projects aMet
Current Farm Household Allowance (FHA) recipients have engaged in targeted education or training within 12 months of commencing payment 60% of recipients aNot met c
Current FHA recipients who have identified that they wish to remain on the farm, develop a business plan within 12 months of commencing payment 70% of recipients aNot met c
Current FHA recipients who have an impediment to participating in targeted education or business planning have engaged in an activity or activities to address that impediment within 12 months of commencing payment 80% of recipients aN/A d
Underpinning research, advice, forecast, projects, products and data services meet stakeholder expectations, and are delivered within agreed timelines85% bMetMetMet

a New performance indicator. b Client satisfaction as measured by an annual survey of ABARES clients. c These indicators were 'not met', as this was the first year of people's entitlement to the three-year FHA payment and the focus was more on ensuring compliance with meeting initial financial and reporting requirements. d This indicator is not applicable, as it was not included as a performance measure in the schedule finalised with DHS after the release of the Portfolio Budget Statements 2014–15.


Farm Finance Concessional Loans Scheme

Applications for the Farm Finance Concessional Loans Scheme closed as scheduled at the end of 2014–15. By 30 June 2015, we had approved concessional loans worth $178.4 million to 375 farm businesses. We are assessing applications received up to 30 June, and the final amount of loans provided under the scheme will be determined later in 2015.  

The concessional loans are for debt restructuring and productivity improvements. The types of loans offered varied between jurisdictions according the needs of each jurisdiction. Loan terms are for five years with interest-only payments required.  

The scheme is helping farm businesses alleviate debt stress and/or improve productivity and is creating a more competitive and profitable agricultural industry.  

Farm Household Allowance

The FHA was the Australian Government’s main contribution to National Drought Programme Reform. It commenced on 1 July 2014. All clients were successfully moved from the Interim Farm Household Allowance to the FHA by 30 September 2014. 

As at 30 June 2015, 5202 recipients had been granted assistance under the FHA.  

Reviewing delivery arrangements

In late 2014, we reviewed the Farm Household Allowance Protocol for Supporting Delivery. The protocol helps rural financial counsellors and case officers fulfil their roles and facilitates strong working relationships to support FHA delivery.

Our stakeholder survey found 92 per cent of respondents agreed the protocol is useful in supporting their work. The National Rural Advisory Council’s (NRAC) review of the RFCS also noted early feedback from counsellors and case officers indicating the protocol is working well.  

Delivering the Rural Financial Counselling Service

The Australian Government funds the RFCS in partnership with state governments. It is delivered by 14 state and regional organisations. In 2014–15, the programme assisted approximately 6900 farm businesses across Australia.  

We provided an additional $5.9 million over 2013–14 and 2014–15 to recruit, train and deploy an extra 17 full-time equivalent rural financial counsellors to respond to short-term demand generated by widespread floods and by rural debt issues.  

A trial to provide face-to-face services to clients in the Northern Territory was extended until 31 December 2014. RFCS counsellors from South Australia travelled to the Northern Territory six times during the trial. The RFCS recorded client activities for 22 farming businesses, including eight new clients. Counsellors continue to support these clients through phone contact and online meetings.  

Despite the small number of clients, the trial provided assistance to a significant percentage of Northern Territory farm businesses. In June 2015, we reached agreement with the Northern Territory Government to co-fund face-to-face services for the remainder of the funding round.  

Review of the Rural Financial Counselling Service

The NRAC reported to the minister on its review of the RFCS in September 2014.  

In February 2015, the minister reaffirmed the government’s commitment to continuing the RFCS and the intention to maintain its funding. He announced contracts for the 14 existing service providers would be extended to 31 December 2015, to allow time to implement NRAC recommendations ahead of the next funding round.  

Scientific and economic research

Understanding rural debt

ABARES researched rural debt following a meeting between the minister and representatives of the banking and farming sectors at the Agricultural Finance Forum in September 2014.  

In December 2014, ABARES published a report on farm debt in the northern Queensland gulf region, south-west Queensland and north-west New South Wales. The report included data from ABARES farm surveys an​d bank data on farm businesses experiencing difficulty in servicing loans. The report was developed in consultation with the Australian Bankers’ Association and the National Farmers’ Federation.  

The report has contributed to a clearer understanding of the extent of debt servicing difficulties among farm businesses and the limitations of currently published data on farm debt.  

The report Regional farm debt: northern Queensland gulf, south-west Queensland and north-west New South Wales is available on the department's website.  


Delivering concessional loans schemes

In 2014–15, the department managed three concessional loan schemes worth $700 million. Agencies in the states and the Northern Territory deliver these schemes, which are administratively complex because they are inter-related.  

An additional challenge is ensuring farm businesses apply for the best assistance available. Delivery agencies have been proactive in directing applicants to the most suitable scheme for their needs. 

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Last reviewed: 4 November 2019
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