The Federal Government's new $10 million dollar drought
recovery loans scheme has tougher eligibility criteria than the current
drought relief available for South Australian farmers.
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Landholders will need to demonstrate they aree in a one-in-50-year or one-in-100-year rainfall deficit zone to be eligible.
The
drought concessional loans scheme, currently open to South Australian
farmers, has a one-in-10 and one-in-20 rainfall deficit criteria.
Manager
of rural finance at Primary Industries and Resources South Australia
(PIRSA) Ian Heinrich said while the criteria for the new drought
recovery package might be a hurdle, the effect the differing rainfall
requirements would have was marginal.
"Essentially, you'll find that there's not a lot of difference between the two,Mr Heinrich said.
"The
two programs are very different in that one's a 10-year loan and one is
a five-year loan and the actual purpose of them is different.
What is the difference?
The drought recovery loans are designed to help farm businesses replant and restock.
Loans have an interest rate of 2.71 per cent, with interest-only repayments available for the first five years.
Drought
concessional loans are a shorter-term scheme at an interest rate of
3.05 per cent, focused on restructuring existing debt and funding
drought preparedness.
Both schemes have a maximum loan amount of $1 million.
PAIRS indicated that despite poor uptake of the drought concessional loans in
South Australia, the Department was confident drought recovery loans
would be successful in helping farmers get back on their feet.
Thus
far, 60 businesses have made enquirers in the latest round of drought
concessional loans, 42 of them from the state's upper south-east.
In this round, one application and subsequent approval has been made for the loans.
Why opt for another drought loan scheme?
A spokesperson for
Federal Agriculture Minister, Barnaby Joyce indicated that the farming
community has asked for a longer-term concessional loan product and the
Government had listened.
"The Government recognizes farmers have
differing needs to manage and recover from drought, and established
these two concessional loan schemes for different purposes, with
different eligibility criteria, loan terms and interest rates", the
spokesman said.
The South Australian Agriculture Minister Leon Bigness's office indicated the State Government was eager for farm
businesses to apply for the new scheme.
"We want as many eligible farm businesses as possible to receive this help," a statement said.
"If dry conditions continue, I will continue to work with Minister Joyce to ensure support is provided."
Funding
for both the drought concessional loans and drought recovery loans has
come from the Federal Government, with PIRSA rolling out the programs
across the state.
