Farm debt mediation a useful tool
17 June, 2019
Federated Farmers supports the Government’s decision to proceed with a Farm Debt Mediation Bill.
The proposed legislation will require creditors to offer farmers who default on payments mediation before they take enforcement action and it will allow farmers to initiate mediation.
“Federated Farmers is in favour of this,” Feds Vice-President and commerce spokesperson Andrew Hoggard says.
“Farmers are especially vulnerable to business down-turns as a result of conditions that are often outside their control, such as the weather, market price volatility, pests and diseases like Mycoplasma bovis. Farmers are also facing a raft of policy changes, including around freshwater management and climate change, and these could apply even further pressure.”
The agricultural sector has nearly $63 billion of debt and the Federated Farmers six-monthly banking surveys have shown that while most farmers are satisfied with their banks, satisfaction has been slipping and the number feeling under pressure has been rising.
“There is no substitute for good communication and we urge farmers and their banks to keep in close touch and build positive relationships in good times and bad, with or without farm debt mediation,” Hoggard says.
“Although we hope this legislated farm debt mediation won’t have to be used very often, it will have done its job if it helps banks and farmers find enduring and sustainable solutions before it is too late.
“Federated Farmers thanks NZ First for introducing a Members Bill on this last year, and now the Government for building on that Bill’s intent and transforming it into something which should be fit for purpose.”
Federated Farmers hopes the Bill attracts wide parliamentary support looks forward to submitting on it at Select Committee.