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03 May 2018

Ombudsman supports NSW Farm Debt Mediation Amendment Bill

The Australian Small Business and Family Enterprise Ombudsman today said it is pleasing to see the proposed amendments to the Farm Debt Mediation Act by the NSW Government.

“One of the recommendations in our Small Business Loan Inquiry last year was that there should be a nationally consistent approach to farm debt management, and I continue to urge all state and territory governments to make this a reality,” Ombudsman Carnell said.

“These proposed changes will go a long way to alleviate the economic and mental stress of the Australian farming community, the majority of which are small businesses.

“Farm businesses are vulnerable to uncertainties in weather and market fluctuations; factors completely outside their control. And when farm businesses are stretched financially, it places enormous pressures on families and the broader community,”

“The inclusion of on-farm and offshore aquaculture and farm forestry in the definition of ‘farming operations’ is common sense, as they continue to expand to meet domestic and international demand.

“We encourage early mediation in all debt adversity and would suggest this change be supported by a targeted education campaign. The additional one mandatory invitation to mediate before the creditor takes enforcement action following defaults on a loan is appropriate.

“We welcome the extra time for farmers to respond to notices, particularly when experiencing physical and mental health issues. It is widely reported that when the bills start to mount up, farmers get more and more distressed and often don’t seek the support they need.

“Farmers are business owners and are vital to our economy.

“NSW is to be commended on the Farm Debt Mediation Amendment Bill 2018, and we suggest all states and territories also consider these proposed changes, as the current system lacks consistency across the country.”