Loan conditions 'hold back help'

Frustrated WA farmers have hit out at restrictions which prevent them buying chemicals, fertiliser or reducing debt using a long-awaited $50 million aid package.

Muntadgin Farming Alliance co-ordinator Jeff Hooper said yesterday the restrictions placed on the 4.5 per cent loans package were absurd.

The restrictions, devised by the State Government through the Department of Agriculture and Food WA, do not apply to farmers in other States where the Commonwealth-funded loans are already being rolled out.

WA also opted to cap the loans at $200,000 compared with $1 million in Queensland and the Northern Territory, and $650,000 in other States.

"The WA package has been butchered to the extent that I'm not sure it is even relevant," Mr Hooper said. "I fear the people who need it won't be able to get it, which is disappointing after waiting all this time."

Mr Hooper said this season's "ripping" grain crop allowed many farmers to reduce debt, but those who had missed out needed help just to start seeding in 2014.

He said the State Government and DAFWA's approach to allocating the loans was at odds with other States, where debt restructuring and expenditure on key farm inputs was allowed.

WAFarmers president Dale Park said the WA package was irrelevant to struggling farmers because of the restrictions.

Mr Park estimated up to 150 farmers, mostly on the eastern and northern fringe of the Wheatbelt, faced an uphill battle to secure carry-on finance.

WA Agriculture Minister Ken Baston said the package was designed to boost productivity, not for debt restructuring or to finance day-to-day operations.

The loans are available for broadacre, pastoral, horticulture, intensive farming and aquaculture businesses.

"It has been Government policy for some time not to be a lender of last resort," Mr Baston said.

"My experience in agriculture is that whatever you borrow, you eventually have to pay back. Having been through droughts myself it is a heartbreaking situation but it doesn't matter how much money we throw at some people, only rain will fix them."

Mr Baston said the State was forced to write off $11 million in bad debts under the Rural Adjustment and Finance Corporation before it was abolished.