Rural Sector Assistance: Marlborough & North Canterbury

Acting Agriculture Minister John Luxton and Social Welfare Minister Roger Sowry have announced the criteria for drought-stricken Marlborough and North Canterbury farmers to receive income support under the Rural Sector Assistance Programme.

Income support for those farmers who are unable to meet daily living costs in these drought-stricken areas was promised by Agriculture Minister Lockwood Smith on 2 February (Marlborough) and 11 March (North Canterbury).

The Rural Sector Assistance Programme is designed to provide farmers with an income to cover modest essential living costs during the immediate disaster recovery period. It is a special programme for farmers because unlike other self-employed people farmers are not able to leave their land and seek alternative income during natural disasters such as droughts. It was last activated for Hastings orchardists hit by hail storms in late 1996 and early 1997.

Farmers will be eligible only if they meet the following criteria:

- they were uninsured or underinsured for drought conditions;
- they have no assets unconnected with the farm which would be practical to realise;
- they have no "cash assets" connected with the farm that are realisable and below the Special Needs Grant cash asset limit of $737 for a single person and $1,228 for a married couple;
- the farm is in financial difficulty and is not producing sufficient income to meet essential living expenses - defined as $401 a week for a single person and $576 for a married couple;
- they have no significant income other than from the farm, with any income they or their spouse receive resulting in a dollar for dollar reduction to any assistance provided; and
- the farmer has decided to sell the farm, is actively considering the ongoing viability of the farm, or has evaluated the ongoing viability of the farm and is actively working towards the recovery of the farm as a viable business concern.

The ministers said cabinet had decided to exclude pastoral capital stock, or the proceeds from the sale of pastoral capital stock, from the asset criteria. "To include pastoral capital stock, or the proceeds from the sale of pastoral capital stock, would be to eliminate the possibility that the farms could return to being viable businesses in the future," they said.

Cabinet has also agreed to increase the weekly amount payable under the programme from 75% of the 1988 unemployment benefit rate to 75% of the current unemployment benefit rate. This means a married farming couple with children will be able to receive $195.71 a week.

The programme will be available for one year from today.

It is expected that 80 farmers in Marlborough and North Canterbury will be eligible, at an estimated cost of $690,000 over the next 12 months.

The assistance will not yet be available to farmers in the Hawke's Bay. Dr Smith will consider a Federated Farmers request for assistance for Hawke's Bay farmers upon his return from this week's Cairns Group meeting in Sydney. While Dr Smith is able to activate assistance for drought relief up to $100,000 without reference to Cabinet, he must seek Cabinet agreement for the Rural Sector Assistance Programme. Dr Smith will do so should he decide to meet Federated Farmers' latest request.