The federal Agriculture Minister has been pressed on how much more farmers would have to pay for the land they already own if he is re-elected.
The Federal Government’s farm debt management strategy is designed to prevent farmers from being “stressed” over the future cost of farming, as it will allow the Government to borrow for up to three years.
Mr Morrison has previously indicated the Federal Government would be able to borrow up to $30 billion in the coming financial year, which could see a large part of the debt repayment plan covered by debt-servicing arrangements.
But this week he said the Federal debt management scheme would be a “key part” of the Government’s plan to reduce farm debt, even if it was not the primary source of the problem.
“The key part of our debt management is not debt but the land,” he said on Thursday.
Farm debt is a major source of debt for the Australian Government.
In the 2016-17 financial year $7.6 billion of farm debt was taken out by consumers, and another $1.2 billion was held by private debtors.
That means about $3 billion in debt was being held by the Federal government.
More than half of that debt was owed by farmers, which means it could be up to 10 per cent of farm revenue, according to the Treasury.
However, in recent months, the Federal Opposition has raised questions about the sustainability of the farm debt strategy.
Shadow Treasurer Chris Bowen said he was concerned the Government was “bailing out farmers and putting them at risk of default”.
“If it’s not about the future of the country, it’s about protecting a handful of big banks that have huge profits to make,” he told 7.30.
Labor’s environment spokesman, Adam Bandt, said farmers were “going through an unprecedented financial crisis” and urged the Government not to “fade away”.
Mr Bandt said the Government should consider reducing the farm surcharge, which he called a “sucker-punch” to farmers, but he also said it was a “slush fund” for banks to borrow.
He said the surcharge was a tax that farmers pay to the Federal Parliament, which the Government had to pass through to fund agriculture.
Opposition Leader Bill Shorten, who is also a farmer, told Sky News the surcharges were “incredibly unfair” and said it should be abolished.