Farmers push for guaranteed loans

Press, 22 May 1986, Page 2

Farmers push for guaranteed loans

PA Wellington Federated Farmers is promoting a plan for the Rural Bank to guarantee seasonal finance for thousands of farmers, the "Dominion” newspaper reported. The proposal is designed to encourage financial institutions to keep lending to farmers. Dalgety Crown and Wrightson NMA recently shocked farmers with the announcement that they would have to cut lending from July 1, the start of the new farming year.

The federation is be-

lieved to be pushing the idea of a Rural Bank guarantee for seasonal lending at meetings of the Government’s working party on farm debt restructuring as well as discussing it with Ministers, the “Dominion” says.

The federation and the Rural Bank say that struggling farmers with a chance of long-term survival should receive Government backing for seasonal borrowing to carry them through the next year.

A Rural Bank spokesman said this need not cost the Government any

money. If the dollar and interest rates continued to fall, those farmers selected for a guarantee would probably not need bailing out, he said. The spokesman said debt restructuring measures would have to accompany such a scheme or it would achieve nothing. The president of Federated Farmers, Mr Peter Elworthy, said the Government should urgently provide a guarantee for farmers’ seasonal lending so that they could plan their next year with confidence.