Cashflow in Drought

The Hon. N.J. CENTOFANTI (Leader of the Opposition) (16:52): I move:

That this council—

1. Recognises that access to cashflow remains a critical issue for regional businesses during this prolonged drought, as identified by the opposition, industry and the drought commissioner;

2. Agrees with South Australian farmers that the current Regional Investment Corporation (RIC) loan rate of 5.18 per cent is not 'low interest' as is the organisation's primary function;

3. Calls out the RIC for not fulfilling its obligated vision and purpose of supporting a strong and sustainable agricultural sector in Australia—which includes South Australian farmers doing it tough; and

4. Urges the state government to ensure that our farmers and regional businesses have access to genuine low and no-interest concessional loans during this continued period of hardship.

As I have said before in this place, no government can control the weather, but every government is responsible for the quality of its response when disaster strikes. It is true that some parts of our state have received good rainfall over the winter months. Those rains have brought a degree of short-term relief and, in some districts, a little optimism. But let us be clear: much more is still needed. This drought is far from over, and farmers right around the state remain deeply anxious about the season ahead.

In other regions, most notably the Riverland and the Mallee where I come from, rainfall has been minimal even through the winter period. In these areas, the hardship has only deepened. Crops have struggled to germinate, livestock feed is scarce and businesses that rely on agriculture are finding it increasingly difficult to stay afloat. ABARES has warned that in South Australia broadacre farm incomes are expected to fall by more than 40 per cent this year due to the drought and low yields.

Grain Producers SA has described the situation as 'critical and worsening by the day'. I have spoken with farmers who wake up every morning wondering how they will pay their staff, put fuel in their machinery or keep the lights on at home. One Riverland farmer told me: 'We are not asking for handouts. We just need a fair chance to get through this season so there's still a farm left for our kids.' This is not just about paddocks and livestock, this is about people. It is about their livelihoods, their communities and their mental health.

It is about the very future of regional South Australia, and at the heart of this crisis lies one simple, devastating issue: cashflow. Farmers and regional businesses can survive a dry year if they have cashflow. They can plan, they can adapt, and they can recover, but when the cash dries up, everything grinds to a halt, bills mount, creditors call and despair sets in.

Industry groups and the opposition have all consistently identified cashflow as the number one issue facing farmers today; in fact, the government's own drought commissioner has also identified cashflow as the number one issue facing farmers today and that without access to affordable finance, many simply will not make it through.

AgriFutures recently reported that more than 60 per cent of farmers surveyed ranked cashflow pressures as their top concern in 2025. That statistic alone should ring alarm bells for every single member in this chamber. This is why concessional loans are so vital. They are not a handout, they are not charity, they are sensible, practical tools to bridge the gap until better seasons return.

But let us be clear: the Regional Investment Corporation is failing in its purpose. Its very mission is to provide low-interest loans to support a strong and sustainable agricultural sector, yet the current RIC loan rate stands at 5.18 per cent. I ask: what farmer struggling to keep their business afloat in the middle of a drought would call 5.18 per cent low interest? The pastoralists and graziers association put it pretty bluntly when they said, and I quote:

At these rates, RIC loans are no different to walking into a commercial bank. They are simply not serving the purpose for which the organisation was created.

I note also that today the Prime Minister has announced widening the eligibility of the RIC funding to include significant environmental events, such as the algal bloom that is currently devastating South Australia. Clearly, both the state and federal governments have not been listening to what our farmers have been saying for some time now, that current RIC loans do little to assist them.

This is how out of touch with our primary industry sector these Labor governments are. At a time when families are desperate for relief, the RIC is offering little more than a standard commercial rate. It is not living up to its vision, it is not delivering for farmers, and in doing so it is undermining the resilience of our agricultural sector.

It is simply not good enough for the state government to stand back and say, 'Well, the RIC is a commercial body. It is out of our hands.' South Australian farmers do not care what level of government is responsible, they care about survival. The state government has a responsibility, indeed a moral duty, to step in where others are failing, and that means ensuring genuine, low and no-interest concessional loans are available to farmers and regional businesses in South Australia.

We know this can be done. Other states have acted. Queensland and New South Wales have both provided significant concessional finance during times of drought and natural disasters; yet in South Australia, we are told to wait, to wait for another announcement, another press release, another working group. Meanwhile, farmers are waiting too, but they are waiting for rain that may not come.

This is not only a regional issue, this is an issue for every South Australian because when farmers go broke, when regional businesses close their doors, the consequences ripple across the entire state, and in fact the entire nation and the entire economy. Our food supply is threatened, prices at the supermarkets rise, regional towns wither, young people leave and the economic backbone of this state is weakened. The South Australian Dairyfarmers' Association has warned that, and I quote, 'farm exits caused by financial stress during this drought will have generational consequences'.

Once farms are gone, they rarely return. Agriculture is one of South Australia's most vital industries. It underpins our exports, sustains our regions and feeds our families. To let it falter through inaction would be nothing short of negligence. What we need and what this motion calls for is leadership, leadership that recognises the reality of this drought, leadership that listens to farmers and industry groups, and leadership that provides practical solutions, not just spin and announcements. That solution must include genuine concessional loans, low and no-interest finance that gives farmers and regional businesses the lifeline they need to survive until better seasons return.

The drought is testing the resilience of our farmers, our regional businesses and our communities. They are doing everything in their power to adapt, to survive and to keep going, but they cannot do it alone. The RIC has failed to live up to its mission. The state government has the power to act and we in this chamber have the responsibility to stand with our farmers. This is not about politics, this is about people. This is about livelihoods, communities and the future of South Australia.

I urge members to support this motion to send a clear message that the parliament stands with our farmers and our farming communities, that we will fight for genuine concessional finance in their hour of need because if we fail them now, we do not just fail farmers, we fail South Australia. I commend the motion.

Debate adjourned on motion of Hon. I.K. Hunter.