GUARDING AGAINST BAD SEASONS

Press, Volume CXIV, Issue 33680, 1 November 1974, Page 6

GUARDING AGAINST BAD SEASONS

The recent succession of weather-affected seasons has increased primary producer interest in protection against production losses through floods, snow storms, gales and droughts.

According to Mr T. E. Norris, senior investigating officer with the Ministry of Agriculture and Fisheries’ Primary Industry Section, farmers can do a lot to help themselves.

Good management, plenty of feed and water and a financial reserve to cover emergencies were a valuable start to offsetting the vagaries to which New Zealand’s weather was prone, he said. “Beyond this, Government recognises that farmers need assistance, no matter how willing they are to help themselves. Several schemes now in operation are designed for this purpose. “Specific financial assistance includes the Adverse Event Bonds introduced in this year’s Budget on the suggestion of Federated Farmers. The idea is based on a scheme which has been operating in Australia for many years, but the bonds are tailored to suit New Zealand conditions. “They are registered, non-transferable, interestbearing Government securities available through a Post Office Savings Bank for purchase by a farming entity — individual, partnership or company. Interest is at 3| per cent per annum, calculated on a daily basis and payable on the anniversary of purchase.” Adverse Event Bonds allowed farmers to put aside money in good yeans (free of tax) and use it when the weather turned against farming. Mr Norris said. Virtually all types of farming qualified. Dairy farmers, cattle

producers, sharemilkers, sheep farmers, pig farmers, stud-stock breeders, deer farmers, poultry farmers, vegetable growers, tomato growers, fruitgrowers, grain and seed producers, hop

growers, nurserymen, tobacco growers, grape growers, apiarists, mussel farmers, oyster farmers and fresh-water fish farmers were all eligible. “Bonds are tax deductible in the year of purchase, except that if the purchaser desires, bonds purchased up to six months after balance date can be claimed as a tax deduction for the previous year. There is no limit on the value of bonds which may be bought each year but the amount deductible for tax purposes is limited to 40 per cent of net farm income in any particular year.” Bond interest was assessable for tax purposes and, for individual taxpayers, qualified for the $2OO extra interest exemption, Mr Norris said. “Because Adverse Event Bonds are primarily intended as a self-help source of money in bad years, farmers in a declared adverse-event area can cash their bonds with full interest. Amounts paid out will be assessed for taxation purposas in the year of redemption. “Provision has also been made for cashing on death, bankruptcy, retirement from farming, sale of a farming enterprise, and in cases of hardship.” The provision of stock feed was also covered in the Budget, Mr Norris said. Farmers throughout New

Zealand could now obtain grants for establishing lucerne. “The grant rate is $25 per hectare, except in South Auckland, Auckland and Northland where it is $5O per hectare, on a maximum of 12 hectares per farm each calendar year. Grants are paid for the area by which lucerne planting*? at 31 December, 1974. exceed the area in lucerne at 31 May, 1974, and by which the planted area increases further during the year ending 31 December, 1975.

“To qualify for a grant a farm must be at least 40 hectares and a formal application, accompanied by a map showing lucerne areas on the farm, must be made to the local M.A.F. office.” Government assistance was also available to farmers who wished to increase their storage capacity for hay and grain, Mr Norris said. The subsidy was designed to help farmers conserve feed against emergencies.

Bona fide sheep, dairy, and beef farmers, including stud-stock breeders, were eligible, he said. “The rates of subsidy for hay barns are 40 cents per cubic metre of capacity with a maximum in any one year of $320, and for grain silos $3.08 per cubic metre of capacity with a maximum in any one year of $lB4. “Farmers should note the assistance is only available for extensions to existing hay barns, new hay barns and grain silos where construction was started on or after June 1, 1974, and is finished by June 30, 1976.”

To qualify haybarns and grain silas had to be permanent structures complying with local authority building by-laws, Mr Norris said. “Walls only” grain silos qualified provided the surrounding shed was of permanent construction.