CATTLE, dairy and sheep industry councils face tough questions over their future as Victorian farm groups flag cutbacks in their funding support.

The Victorian Farmers Federation has given peak industry councils notice that it intends to cut its funding support by 20 per cent for 2008-09.

And the NSW Farmers' Association has also advised that it may also cut payments to some councils by 20 per cent.

VFF president Simon Ramsay told The Weekly Times this week that VFF "can pay our bills" but was looking closely at getting value for members.

Mr Ramsay said the peak council representation based on state farmer organisation funding was unsustainable and that a restructure was badly needed.

Councils facing cutbacks from the VFF include Australian Dairy Farmers, Australian Vegetable and Potato Growers, Cattle Council of Australia, Australian Chicken Growers Association, Grains Council of Australia, Goat Industry Council of Australia, Sheepmeat Council of Australia and WoolProducers of Australia.

He said the VFF also notified the National Farmers' Federation that it was planning to cut its payments by 20 per cent in 2008-09. But the VFF is expected to wait for an outcome of an NFF review before making a decision.

The NFF is currently reviewing its fee and membership structure and is expected to report on its financial direction next month.

The VFF said it had warned peak councils of funding cutbacks over the past 12 months.

"This (the reduced fee payment) is supposed to be a catalyst for reform for national representation, across the board," Mr Ramsay said.

"It's about value for our membership, all our spending is going under the microscope."

The issue was the subject of robust debate at the CCA annual general meeting last week in Orange, NSW, and the direction for this group remains unclear.

VFF livestock president Ailsa Fox said the VFF would not become unfinancial with CCA until December 1, and that CCA had not decided how the VFF would be treated.

"The VFF has a strong desire to have national representation but we are asking if the money spent is the best value for members," she said.

NSW Farmers' Association president Jock Laurie said his organisation had also advised CCA and SCA that it would also cut its fees by 20 per cent.

NSW Farmers' Association was also "in discussions" with WoolProducers about a potential reduction in the fees it paid.

"We're getting to the point where we need to sit down with all the commodities and talk about funding," he said. "All state farmer organisations are needing to shore-up their own position, but at the same time we understand the need for national representation."