John Cobb (Calare, National Party, Shadow Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

My question is to the Minister for Agriculture, Fisheries and Forestry. I refer the minister to comments he made at his 17 October summit with banks and farming organisations. He said:

… I have a high level of confidence now that before long we are going to see that—

interest rate cuts—

being passed on.

Given that the Reserve Bank has now cut interest rates since the summit, why have the minister and his government failed to get the banks to pass on the interest rate cuts in full to farmers, particularly on agricultural loans and overdrafts?

Mr Tony Burke (Watson, Australian Labor Party, Minister for Agriculture, Fisheries and Forestry) Share this | Link to this | Hansard source

I thank the shadow minister for his question. The government continues to say, as we have always said, that just as we expect interest rate cuts to be passed on as soon as possible to residential customers, so too do we have that expectation for Australia’s farmers and Australia’s small businesses.

The comments quoted were made by me at a summit held on a Friday when I had a high expectation that we would begin to see those cuts coming through. Most of the banks then went ahead with cuts on the Monday following that Friday, but the 75 basis points cut, which happened subsequently, has largely not been passed on at all to Australia’s farmers. When I addressed the Farm Writers Association, only last Friday, I again pressed the expectation, and I continue to make the expectation of the government clear to the banks, that just as we expect residential customers to receive the benefits of cash based products—obviously if it is a market based product then it is not based on the Reserve Bank cash rate—so too do we expect the same for Australia’s farmers.