Govt doesn’t give special treatment to drought-hit farmers

The declaration of drought and assistance to farmers has led to accusations that farmers get special treatment.

Federated Farmers’ President Bruce Wills says that isn’t so:

Talkback callers say small businesses cannot get government bailouts so why should farmers?  We agree with that statement 100 Percent.

Agriculture had state intervention in the 1970’s and 80’s and not only did it not work, it destroyed lives – something I was reminded of when talking to the Otago Daily Times’ Neal Wallace, who is writing a book on the Rogernonmics era.

It may be the curse of the ‘here and now’ but the late great Sir Peter Elworthy, when President of Federated Farmers, gave Labour the impetus to end subsidies.  This also means we cannot rock up to the Beehive when it stops raining to be given an envelope of cash so long as we give some ‘secret farmers handshake’.  That is fantasy.

It is not hard to Google Rural Assistance Payments via Work and Income and read the criteria. To the credit of most media that is what they have done. 

A RAP is the dole and as such is means and asset tested like any other benefit. For the avoidance of doubt testing includes trusts too.  One member of the media who called our comms team late on Friday believed there had been zero applications.  We will check that out.

Farm businesses are no different to any other so we don’t expect or want government to ‘bail us out’.  If you don’t believe me examine Vote Agriculture & Forestry from Budget 2012.

You will find the budget for Adverse Climatic Events, to provide recovery assistance in the aftermath of adverse events and to assist rural support trusts, is $526,000.  As a point of comparison policy advice to government ‘on the community and voluntary sector’ is some three times greater than the entire budget for Adverse Climatic Events.

This budget is also only unlocked by an adverse events declaration. Sadly it is getting a top-up because the last time drought was this bad was 1983.

Then again the rural support trusts who deliver services are run by volunteers on the smell of an oily rag.  These trusts are about supporting a community to help itself and it was that kind of ethos we bought to Christchurch with the Farmy Army.

As Katie Milne added in her blogger response, “you must be pretty heartless to say that because you are a farming family who has lost everything or pretty much close to it, that you must be banned from our social welfare safety net just because your occupation was farmer”.  The same safety net rightfully is there for Café owners caught out by the economy right through to lawyers falling on desperate times. . . 

The RAP is available only to those in the most desperate circumstance, the ones who’d get emergency assistance if they turned up at WINZ.

Any other help is directed at animal welfare and community assistance.

The latter highlights the fact that a drought hits businesses, not just farms but enterprises which support and supply them, across whole regions.

That is very different from an isolated business failure here or there, which is tough for those directly affected but doesn’t have nearly so wide an impact beyond them.

But this is community support. It is not provide a subsidy or direct financial help for individual farmers or their businesses.

New Zealand farmers were brought into the real world without subsidies in the 1980s and even during droughts they’d be foolish to want to go back there.

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19 Responses to Govt doesn’t give special treatment to drought-hit farmers

  1. Deborah says:

    The same safety net rightfully is there for Café owners caught out by the economy right through to lawyers falling on desperate times. . .

    This is not correct. A cafe owner’s assets are taken into account before any assistance is given. None of the business assets are protected. However, farmers’ business assets *are* protected.

    I don’t begrudge farmers the assistance, anymore than I begrudge the assistance given to other beneficiaries. However, I’d like to see them acknowleding that they are benefitting from the welfare system, even if they don’t get any money from it, because it is providing security for them. And I’d like to see the farmers’ party (National) stop targetting nasty rhetoric at other beneficiaries.

  2. Mr E says:

    Deborah,
    Farmers assets are protected by the Rural assistance payments. Really? You must jest. The payments are equivalent of the dole whilst the event is recognised. It puts food on the table for families that could starve during adverse events. Sure many famrers are relatively asset rich but often this asset cannot be easily accessed and during tough times families can go without.
    Do you think after the Chch earthquake the government should have ignored those in need? Surely not?

  3. Deborah says:

    So why aren’t they required to sell shares before getting assistance, as everyone else has to?

    The comparison with the Christchurch earthquake doesn’t work. That was a genuinely unpredictable event. However droughts are a well known and reasonably common hazard of farming, and prudent businesses ought to manage their finances in order to be to cope with such hazards. Other business people who don’t make reasonable provision for the risks in their industry lose their assets, and they may well lose their businesses. After that, they can go on the dole.

    Just to be very clear, I’m happy for farmers to be given some assistance, just as I am happy for other New Zealanders who have fallen on hard times to be given assistance. I would just like farmers to recognise that they are beneficiaries too.

  4. ploughboy says:

    the farmers that are likely to get assistance arnt going to be landowners.it will be contract milkers and lower order sharemilker in there early years of being self employed.eg the ones who cant borrow any more because they dont own assets and all there cash has gone into the startup of there job.

  5. TraceyS says:

    “So why aren’t they required to sell shares before getting assistance, as everyone else has to?”.

    Actually farmers do sell capital in these circumstances. They sell some capital stock to pay the bills. That is exactly what Deborah calls for – selling ‘ownership’ to keep afloat. It’s not like they are sitting back and saying “woes me, far too many cows and no way to feed them, and by the way bail me out because the family are starving”. But there is a limit to how far this can go.

    We were in this situation last year, for different reasons. When your whole business is on the line you sell what is readily saleable, for as good a price you can get, so you don’t have to default on the bank and make all your staff redundant. You can trade capital stock readily for money and spend it on expenses, and thus survive for the price of reducing your equity.

    Deborah, you are not seriously suggesting that ANY business owner is going to sell shares in order to pay the current owner’s groceries in a downturn, surely. With that sort of risk, how much would such shares be worth? And who in their right mind would buy shares in a sinking ship anyway? Opportunists only I suspect. Not good bed-partners for most farmers.

    One difference between a cafe in an economic downturn and a farm in a drought is this. When business conditions for cafes get tough, some will invariably close down and the custom will be spread out to those who ‘survive’. One farmer going into receivership is not going to help his neighbours’ business prospects one little bit.

    If a mystery strain of vomit-bug was to unexpectedly invade cafe kitchens in a wholesale manner, turning away custom and dramatically affecting a mass number of owners’ ability to feed the family, then I reckon the government would extend the same support without asking them to reduce equity before getting a benefit.

    On who is a “beneficiary” and who is not – everyone receiving WFF is undeniably one (in part), along with all the other types. So who cares whether farmers are being labelled this. Plenty of families getting WFF are loath to accept that label too.

  6. TraceyS says:

    The Green’s: A farmer’s new BFF….

    “The plight of our drought-stricken farmers throws into stark relief the reality of climate change; we can expect droughts to be more extreme and strike more often if we don’t take global action.
    Farmers, and in fact all businesses, need Government leadership both on cutting emissions and on adapting to the new climate.
    In Government, the Green Party will provide that leadership to help businesses thrive and to encourage green industries. We can’t afford the cost of inaction.”

    (http://www.greens.org.nz/sites/default/files/newsletters/greenweek-200313-web.html)

    CUTTING emissions AND adapting to the new climate. An oxymoron.

    I do hope the Greens will explain HOW to do this soon. In plenty of time for people to decide whether or not they REALLY want the Greens in Government.

  7. homepaddock says:

    If they were asset rich they’d be able to get credit. The ones who get RAP won’t be asset rich, they’re probably technically bankrupt. They’ll be deep in debt and not able to get more finance. Farms don’t sell overnight and anyone who qualifies for RAP would almost certainly end up still owing debts if they could.

  8. TraceyS says:

    It is immodest to suggest that humans exert such a level of influence on the climate as to cause one-off events such as this drought. My how we elevate our importance in nature! A fault of the mind no doubt.

    Anyone who is disinterested by ‘closed science’ should read this: http://www.sciencedirect.com/science/article/pii/S0921818112001658. I wish that I could provide the full article, but it is copyright.

    From the authors…

    “Ice cores show atmospheric CO2 variations to lag behind atmospheric temperature changes on a century to millennium scale, but modern temperature is expected to lag changes in atmospheric CO2, as the atmospheric temperature increase since about 1975 generally is assumed to be caused by the modern increase in CO2.”

    But the study showed that modern CO2 increases ALSO lag behind temperature increases, supporting the earlier studies of ice cores. In summary, warming appears to be driving increased measures of CO2, not the other way around, just as it has been for aeons. For confirmation, visit the reputable website above and look at the graphs yourself.

    So maybe we are not as important as we appear to ourselves. Bummer…

    According to some, seeing the “big picture” is more about narrowing the argument and deciding that things are settled rather than doing what science does best… go on exploring with wide eyes and an open mind in the same manner that some environmentalist explore their garden. Shutting down enquiry is the worst thing we can do for future generations.

  9. Viv K says:

    “It is immodest to suggest that humans exert such a level of influence on the climate as to cause one-off events such as this drought. My how we elevate our importance in nature! A fault of the mind no doubt.”
    Not heard about the Ozone hole then Tracey?

  10. TraceyS says:

    Sure. But that is a very specific effect. Warming and climatic effects are more general. I didn’t say we are not important, just not THAT important. If we only look to ourselves as the cause of climate changes, then we we will overlook other important things. You might think i am in denial, but I’m not. Humans influence the environment for sure. Evidence of that is all around us.

  11. TraceyS says:

    Did you have a look at the link I posted Viv?

  12. Viv says:

    Yes, I had a look at it, it doesn’t give credence to your claim that humans are being arrogant if they accept man made global warming. How about you check out the Prime Minister’s chief scientific advisor http://www.pmcsa.org.nz/climate-change ‘The world’s climate is influenced by a number of factors interacting in very complex and not entirely understood ways’. While written in 2009 it is relevant now.

  13. Viv says:

    By the way Tracey, what exactly do you think is happening to all the CO2 that is produced by the combustion of ever increasing amounts of fossil fuels? Maybe do a bit more basic science reading online instead of re-posting Green party links and getting indignant about them. I hope the Prime Minister’s science advisor is not too much of a greenie for you.

  14. TraceyS says:

    That link was provided to support my assertion that closed-science is bad science. I notice that you avoid making comment on the research findings. Why is that?

  15. TraceyS says:

    I guess the same thing that is happening to all the CO2 that ‘natural’ processes produce. Green Party exploitation of the drought situation in support of political causes needs to be pointed out. Exactly what they accused others of here http://www.greens.org.nz/press-releases/get-real-not-ge-about-drought-solutions.

  16. Viv says:

    ‘I guess the same thing that is happening to the CO2 that natural processes produce’ – you GUESS! For goodness sake, you want to debate climate science, you brought it up in this thread to have another dig at the Greens. My comment on the research you posted has been already made, it does not disprove man made global warming.

  17. TraceyS says:

    Guessing, questioning, wondering, hypothesizing etc… would science even exist with these processes? I doubt that it would. Everything starts from an idea, hunch, feeling and such like.

    To quote Einstein:

    “The important thing is not to stop questioning.”

    I’ll have a dig at the Greens if I want to. It seems to be quite acceptable for them to do it. They leave themselves SO wide open that I can only assume it is what they desire.

    That study does not disprove man-made global warming and I never said it did. It did not set out to disprove this. The authors accept that there is probably a small effect caused by human emissions.

    The study commenced with an assumption accordant with the source you provided:

    “… change in temperature is different in nature to past temperature changes. In particular, carbon dioxide concentrations are rising in advance of, rather than as a result of, the warming trend.” (http://www.pmcsa.org.nz/climate-change).

    This recent study found quite the opposite result. LOOK at the graphs Viv. It is plainly obvious that CO2 rise is tracking behind temperature rise. But I can understand why you would not want to accept that, because it doesn’t fit with your ‘beliefs’.

    I hope the Prime Minister’s Chief Scientific Advisor will read the article and consider reviewing the 2009 statement in light of the latest research, even if you choose to stick doggedly to old science. Unless, of course, you have some good reason to question the credibility of this latest research?

    Come on, provide ME with a link to a credible piece of research to the contrary. I am open-minded. But I want the facts.

  18. Viv K says:

    How about YOU write to the Prime Minister’s Chief Scientific Advisor and inform him of the new facts you have come across.
    I’m sorry, I don’t have the time to get into a battle of internet links with you. Accepting man made climate change and ocean acidification is not about “beliefs”, it’s not a religion.

  19. TraceyS says:

    Just one link would have been fine.

    I watch the literature and have access to a number of scientific journals, so I tell you what Viv, if I come across an article that counters these findings will promise to post a link here.

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