Farmers ask for interest rates relief

Press, 8 June 1985, Page 21

Farmers ask for interest rates relief

PA Wellington Farmers want relief from interest rates. Federated Farmers has asked the Government in its Budget submission to freeze Rural Bank interest rates for settlement and development loans in the last three years at 10 per cent, and to let the bank defer repayments by efficient farmers in financial strife. “Current interest rates are having serious implications for the farm business,”

the submission said. “Because of the seasonal nature of farming, working capital is required to cover costs of inputs until a return is realised on production.

“Currently 24 per cent of dairy farmers’ expenditure and 16 per cent of sheep and beef farmers’ expenditure is on debt repayment.” Stock and station agents and banks should also take

a more sympathetic line with farmers in difficulty, it said. The federation expressed support for initial Government moves towards a mar-ket-led economy, but said it must still: • Make real cuts in spending. • Replace import licensing with a lower uniform rate of tariff. • Free the labour market. ® Ensure that the September wage round is based on an industry’s ability to pay and kept within the Government’s own guidelines. • Legislate for more competition in the market place. “While the farming community generally has supported intiatives taken by the Government, we feel the support will subside if other sectors of the community are not similarly exposed to the same competitive forces,” the federation said.

“Farmers believe that they have been treated unfairly, as the bulk of readily indentifiable assistance to agriculture has been removed while much of the assistance provided to other sectors remains intact.”

High inflation and interest rates made it increasingly difficult for farmers to see the good of Government policies and they were asking for positive results.