FARMING groups have slammed the Federal Government's decision to axe drought interest rate subsidies.
Minister for Agriculture Joe Ludwig today said as the last two areas, Bundarra and Eurobodalla in NSW, were to have EC declarations expire on June 30 it was the time review drought assistance.
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But farming groups have slammed the government for not having a drought plan alternative in place.
National Farmers Federation described the decision as "baffling" given no areas were likely to be drought declared in the near future.
NFF president Jock Laurie said there needed to be an improved drought policy but today's decision to ditch interest rate subsidies before a suitable alternative was in place was a bad move.
"For as long as the debate on drought reform has been raging, our position on interest rate subsidies has been clear. Interest rate subsidies for farmers can only be phased out once a suitable alternative, and an appropriate transition period, is in place."
Victorian Farmers' Federation president Peter Tuohey said the government's forecast of taking two years to develop a policy was too long.
"We need the government to act quickly, so farmers can prepare for the next drought," Mr Tuohey said.
"Farmers are now facing at least two years without a safety net to guard against exceptional circumstances. That's just not good enough.
"Scrapping the interest rate subsidies will not save the government any money, so why haven't they waited until there is a sound strategy ready to replace it?"
Queensland Farmers Federation head Dan Galligan said farmers felt "dudded".
"Reform requires the full range of recommendations to be implemented, not just one item with a budget focus," Mr Galligan said.