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National farm debt mediation scheme great news for farm businesses

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The Australian Small Business and Family Enterprise Ombudsman, Kate Carnell welcomed the agreement by federal, state and territory governments to enact a national farm debt mediation scheme.

“Fast-tracking the enactment of a national farm debt mediation scheme is great news for Australia’s farming community, the majority of which are small businesses,” said Ms Carnell.

“One of the recommendations in our 2016 Small Business Loan Inquiry was a nationally consistent approach to farm debt management as the current system lacks consistency across the country.

“Each state and territory deals with farm debt mediation in different ways – some are legislated and some voluntary.

“A nationally consistent approach will provide more certainty for farmers and help alleviate the economic and mental stress of constantly dealing with uncertainties in weather and market fluctuations; factors completely outside their control.

“We agree with Commissioner Hayne’s suggestion that lenders should offer farm debt mediation as soon as a loan is classified as distressed.

“Mediation should be a simple, non-confrontational first step. It should also be timely, efficient and affordable.

“We applaud commitment to immediate action on the preferred model and congratulate federal, state and territory governments for working together on this much needed scheme.”

Source: ASBFEO

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