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Exit packages might help some farmers, but history shows the take-up is slim

By national regional affairs reporter Lucy Barbour, Wednesday November 6, 2019 - 08:31 EDT
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Grain grower Tony Flanery says drought policy should consider the needs of large-scale farms. - ABC

Would farmers walk from their life on the land for cash or kind, and would it make any darned difference?

These were the questions provoked by the .

As well as exit packages, the NFF called for immediate rate and payroll relief, taxation measures, payments for the education of isolated children and a feral pig cull.

But most focus was on its idea to consider 'exit packages' for farmers, so that those for whom drought had become too much, could leave the industry with dignity in tact.

The proposal is one that tugs at the national psyche because of the place farmers hold in the Australian self-image.

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Do farmers need help to leave the land?

The average size of the family farm is on the rise and despite drought, land values are high, investment has risen and farm operations have become more sophisticated thanks to new technology and scientific research.

"I think the days of the old family farm where you're a bit of a hillbilly organisation are long gone," said grain grower Tony Flanery from his farm at Galong, on the south-west slopes of New South Wales.

"If it gets to the point where people need to get out, on a large scale, something's seriously amiss."



But some farmers may not survive financially in this drought, given its length and the lack of forecasted rain.

Those farmers grappling with the difficult decision to leave are amongst a cohort the NFF wants to support in some way.

"If there are ways we can help people once they've made that decision, it's the right thing to do," NFF chief executive Tony Mahar said.

"It might help alleviate the stress and the anxiety and the grief that some people are facing."

NFF president Fiona Simson, in advocating for exit grants, has said .

The NFF wants "impediments or barriers" to exiting removed, and has flagged ideas such as stamp duty exemptions and succession planning policy.

Supporting farmers to walk away from their business

A tried and tested concept is paying farmers to leave their businesses and re-skill.

So-called re-establishment or rehabilitation grants have been around since the 1970s, and exit payments were a significant feature of the Howard government's response during the millennium drought.

Mr Howard concluded "most people would stay on the land", but offered those who simply could not carry on $150,000 to "exit with dignity and start a new life or activity somewhere else".

He acknowledged the packages were suited to farmers who would not be able to run a viable operation, even after the drought broke.

And he emphasised it would be "unthinkable if we did not have the bush in the future".

The government had, Mr Howard pointed out, a "special obligation to provide what has been the heart and soul of this country in many ways ever since it started".



Connection to the land keeps farmers from walking away

The uptake of exit payments has previously been slim, and academics argue that is because for many farmers, the choice to stay on the land is as much about lifestyle and family connections as it is about business.

"For the types of farmers that are targeted by exit grants, we're talking about people for whom money isn't probably the main reason they're in agriculture," said Linda Botterill, a professor of politics at the University of Canberra.

"They're in agriculture because they value their way of life, they're attached to the land and to the communities.

"They're very often second, third or more generation farmers. And they've got their social networks."

No amount of money, farmers will concede, is enough to compensate for the personal and emotional loss of leaving the land, a sentiment Boorowa agricultural supplies store owner Tom Corkhill echoed.

"They've been there for three, four, five generations so they're not going to walk away easy and at the same time, they don't want to see the land or the stock suffer," he said.



Mr Corkhill stressed the importance of keeping "our core young farmers" on their farms, while others described any loss of older farmers and their "wealth of knowledge of the land" as "tragic".

But some people have benefited from exit schemes and the assistance has helped them move on.

Frank Angus sold his dairy farm in Victoria's Gippsland to the State Government as part of a drought buyback scheme in the late 1990s.

"I came to Bairnsdale, got a job delivering gas around town, did that for 12 years, then I bought a one man business servicing fire extinguishers," he said.

"There is a sense of relief, of being unburdened by the farm. But then there is the sense of … feeling like you're letting the side down a bit."

Being free of debts and able to earn new money elsewhere allowed Mr Angus to buy a small hobby farm.

"I still get up in the morning and go for a walk around, just checking, because it's something I've done all my life," he chuckled.



When one farmer leaves, another can benefit

Exit packages can create opportunities for others, such as new or young farmers looking to enter the industry, neighbours keen to buy vacant properties and grow their own businesses, or corporate and city investors.

Some people fear corporate investment in Australian agriculture, particularly where communities feel their businesses, or the land, could be neglected.

But Mr Flanery said corporate investment was not necessarily a bad thing.

"A lot of smaller farmers are bothered by corporate investment but it really is corporate investment that holds up land values and without equity you've got problems," he said.

"You'd sooner see a Collins Street farmer employing people, and whilst they might compete with me for the neighbouring property, the fact is they're employing people and they invest in fencing, in water and infrastructure, and that raises the bar for everyone."



The and the ABC understands exit payments are unlikely to be part of it.

Mr Flanery is hopeful the Coalition will do more than just "topping up the funding". He wants policy makers to acknowledge that the family farm has changed.

"One of the biggest problems we've got in farming is that the better farmers, and I use that word advisedly, most of them have company structures, trust structures … and most of those structures are excluded from Government support packages," he said.

"And it's the better farmers that are going to keep on spending money and investing in the future of agriculture."


- ABC

© ABC 2019

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