RURAL RECONSTRUCTION SCHEME.

WESTERN AUSTRALIA.

RURAL RECONSTRUCTION

SCHEME.

No. 31 of 1977.

AN ACT to amend the Rural ReconstructionScheme Act, 1971-1973.

[Assented to 3rd November, 1977.]

RE it enacted by the Queen's Most Excellent Majesty, by and with the advice and consent

of the Legislative Council and the LegislativeAssembly of Western Australia, in this presentParliament assembled, and by the authority of thesame, as follows:—

1. (1) This Act may be cited as the RuralReconstruction Scheme Act Amendment Act, 1977.

(2) In this Act the Rural Reconstruction SchemeAct, 1971-1973, is referred to as the principal Act.

(3) The principal Act as amended by this Actmay be cited as the Rural Reconstruction and RuralAdjustment Schemes Act, 1971-1977.

Short titleand citation.

Act No. 17of 1971 asamended byAct No. 88of 1973.

Section 3amended.

No. 31.] Rural Reconstruction Scheme. [1977.

2. Section 3 of the principal Act is amended

(a) by inserting before the definition "Agree-ment" a new definition as follows

"a scheme" means a scheme establishedpursuant to section 6 of this Act; ;

(b) by deleting the definition "Agreement" andsubstituting a new definition as follows

"agreements" means the respectiveagreements between the Common-wealth and the State of which copiesare set forth in the Schedules to thisAct; ;

(c) by substituting for the word "Reconstruc-tion" in the first line of the definition"Authority" the word "Adjustment";

(d) as to the definition "farmer", by deletingthe passage "of a kind last referred to inparagraph (d) of Part 1 of The Schedule tothe first agreement", in lines twelve tofourteen of that definition, and substitut-ing the words "of which the Authority issatisfied that the shareholders are bonafide primary producers relying primarilyon the income of the company for theirlivelihood";

(e) by deleting the definition "Fund";(f) by deleting the definition "Scheme";(g) by adding after the definition "the second

agreement" the following definitions"the third agreement" means the agree-

ment between the Commonwealthand the State a copy of which is setforth in the Third Schedule to thisAct;

"the Rural Reconstruction Scheme"means the Scheme mentioned inparagraph (a) of section 6 of thisAct;

"the Rural Adjustment Scheme" meansthe Scheme mentioned in paragraph(b) of section 6 of this Act. .

1977.] Rural Reconstruction Scheme. [No. 31.

3. Section 5 of the principal Act is amended(a) by deleting the word "Agreement", in line

one, line seven, and line twelve, andsubstituting in each case the words "firstagreement"; and

(b) by deleting subsection (3).

Section 5amended.

4. The principal Act is amended by adding a added.n 53

section, to stand as section 5B, as follows—Third5B. (1) The third agreement is approved agreement

and the doing or performance of all such acts, approved.

matters or things as are necessary to give effectthereto is hereby authorized.

(2) Without affecting the operation ofsubsection (1) of this section, all acts, mattersand things that by the third agreement areagreed, directed, authorized or permitted to bemade, done or executed by or on behalf of theState, its authorities and instrumentalities or bythe Minister, or by any other person specifiedtherein, whether named as a party to the thirdagreement or not, are hereby sanctioned,authorized and confirmed. .

5. Section 6 of the principal Act is repealed andre-enacted with amendments as follows-

6. For the purpose of rendering financialassistance to persons engaged in rural industryin the State, there shall be

(a) a Rural Reconstruction Scheme asprovided for in the first agreement andthe second agreement; and

(b) a Rural Adjustment Scheme asprovided for in the third agreement. .

Section 6repeated andre-enacted.

TheSchemes.

6. Section 7 of the principal Act is repealed and riliniaolalidt7eandre-enacted with amendments as follows—

Administra-tion.


7. The corporation established pursuant tosection 8 of this Act is charged with the dutyof administering on behalf of the State

(a) the Rural Reconstruction Scheme; and

(b) the Rural Adjustment Scheme,

as the authority under the agreements. .

Section 8amended. 7. Section 8 of the principal Act is amended

(a) by deleting subsection (1), and substitutinga new subsection as follows-

8. (1) The corporation hithertoestablished by this Act under the nameof "The Rural Reconstruction Authority"shall on and after the coming intooperation of the Rural ReconstructionScheme Act Amendment Act, 1977, bepreserved and continue in existence as abody corporate under and subject to theprovisions of this Act by the name "TheRural Adjustment Authority", but sothat the corporate identity of the bodycorporate and its rights, powers,functions, duties and liabilities are notaffected otherwise than by virtue of theagreements. ; and

(b) by adding the following subsections

(4) A reference to The RuralReconstruction Authority, whether byuse of that name or a similar orabbreviated form of that name

(a) in a law of the State passed ormade;

(b) in any document or otherinstrument made, executed,entered into or done; or

(c) made in any other manner,

before the coming into operation of theRural Reconstruction Scheme ActAmendment Act, 1977, shall, unless the


context is such that it would be incorrector inappropriate so to do, be read andconstrued as a reference to The RuralAdjustment Authority.

(5) For the purposes of subsection (4)of this section the term "law of the State"means

(a) an Act;

(b) regulations, rules or by-lawshaving effect by virtue of an Act;and

(c) an instrument having effect byvirtue of an Act or of anyregulations, rules or by-lawshaving effect by virtue of anAct. .


(a) by deleting the words "the Scheme", in linetwo of subsection (1) and again in line twoof subsection (3) and substituting in eachcase the words "the Rural ReconstructionScheme and the Rural AdjustmentScheme"; and

(b) by deleting the word "Agreement", in linetwo of subsection (2), and substituting theword "agreements".

Section 15amended.

9. Section 16 of the principal Act is amended— g3IleCIIded6.(a) by deleting the passage "in a special

account in the Treasury a fund to be knownas "The Rural Reconstruction Fund" andthat fund", in lines two to four ofsubsection (1), and substituting thepassage "in the Treasury in separate specialaccounts two funds to be known respec-tively as "The Rural Reconstruction Fund"and "The Rural Adjustment Fund" andthose funds";


(b) by inserting immediately before the word"Fund", in line one of subsection (2) andagain in line fourteen of that subsection,the word "Rural Reconstruction";

(c) by deleting the words "the Agreement", inline three of subsection (2) and substitut-ing the words "the first agreement and inthe second agreement";

(d) by inserting immediately before the word"Scheme", in line six and again in linetwelve of subsection (2) the words "RuralReconstruction";

(e) by adding a new subsection, to stand assubsection (2a), as follow

(2a) There shall be paid into the RuralAdjustment Fund

(a) the payments made by theCommonwealth to the Stateprovided for in the third agree-ment;

(b) all moneys received from time totime for the repayment ofadvances made under the RuralAdjustment Scheme and interestfrom time to time paid on suchadvances; and

(c) all other payments that may belawfully paid into the RuralAdjustment Fund. ;

(f) by inserting immediately before the word"Fund", in line one of subsection (3), theword "relevant";

(g) by deleting the word "Scheme", in line twoof subsection (3), and substituting thepassage "Rural Reconstruction Scheme orthe Rural Adjustment Scheme, as the casemay be,";


(h) by deleting the word "Agreement", in linesix of subsection (3) and substituting thepassage "first agreement or the secondagreement, or under the third agreement,as the case may be,";

(j) by deleting the words "The Fund" in lineone of subsection (4) and substituting thewords "A Fund established pursuant to thissection"; and

(k) by deleting the words "the Fund", in lineone of subsection (5) and line three ofsubsection (6), and substituting in eachcase the words "a Fund establishedpursuant to this section".


(a) by deleting subsection (1) and substitutinga new subsection as follows

Section laamended.

18. (1) A person or company who or foprplications

which may be eligible as a farmer for assistance.

assistance under a scheme may apply tothe Authority for such assistance. ;

(b) by deleting the words "the Scheme", in linetwo of subsection (2), and substituting thewords "a scheme"; and

(c) by deleting the word "Agreement", in lineone of subsection (5), and substituting theword "agreements".


(a) by deleting the words "the Scheme", inlines one and two of subsection (1), andsubstituting the words "a scheme";

(b) by deleting the word "Fund", in line eightof subsection (2), and substituting thepassage "Rural Reconstruction Fund or theRural Adjustment Fund, as the case mayrequire,"; and

Section 19amended.


(c) by deleting the words "the Scheme", in thelast line of subsection (2), and substitutingthe words "a scheme".

Section 20amended. 12. Section 20 of the principal Act is amended

by deleting the words "the Scheme", in line five ofsubsection (4) and again in line five of subsection(8), and substituting in each case the words "ascheme".

Section 22amended.

Section 27amended.

Falsestatements.

13. Section 22 of the principal Act is amendedby deleting the words "the Scheme", in line six, andsubstituting the words "a scheme".

14. Section 27 of the principal Act is amendedby deleting subsection (1) and substituting a newsubsection as follows-

27. (1) A person who wilfully makes anyfalse statement or wilfully furnishes any falseinformation for any purpose under or in relationto this Act

(a) in connection with any applicationunder this Act or a scheme; or

(b) as to the amount or nature of anyassets belonging to such an applicantor in regard to any debt due by theapplicant or any claim against theapplicant or the estate of the applicant,

commits an offence.

Penalty: Two hundred dollars or threemonths' imprisonment. .

Section 28amended.

15. Section 28 of the principal Act is amended(a) by deleting the words "farmer who has

applied", in line one and substituting thewords "person that applies";

1977. Rural Reconstruction Scheme. [No. 31.

(b) by deleting the words "the "Scheme", inline two, and substituting the words "ascheme";

(c) by deleting the word "farmer", in line two,and substituting the word "person"; and

(d) by deleting the words "Any farmer orcreditor to whom such a request is madewho" in lines one and two of subsection (2),and substituting the passage "Where arequest is made pursuant to subsection (1)of this section, any person that".

16. Section 29 of the principal Act is amended— Section 29amended.

(a) by deleting the words "and the Scheme",in line five, and substituting the words "ora scheme"; and

(b) by deleting the words "the Scheme", inlines ten and eleven, and substituting thewords "a scheme".

17. The principal Act is amended by adding, at Eredduththe end thereof, the following Schedule— added.

Section 3.THIRD SCHEDULE.

AN AGREEMENT made the first day of January Onethousand and nine hundred and seventy-seven between

The Commonwealth of Australia (in this agreementcalled "the Commonwealth") of the first part,

The State of New South Wales of the second part,The State of Victoria of the third part,The State of Queensland of the fourth part,The State of South Australia of the fifth part,The State of Western Australia of the sixth part, andThe State of Tasmania of the seventh part.

WHEREASA. the Commonwealth and the States recognize that

there is need to provide assistance to personsengaged in rural industries throughout Australia inthe interest of those industries and of Australiagenerally;


B. Ministers of the Commonwealth and of the Stateshave agreed upon the Outline of Scheme for RuralAdjustment set out in the Schedule to thisagreement as constituting a Scheme under whichassistance of various kinds could be provided;

C. the carrying out of the said Scheme is dependentupon financial assistance being granted by theParliament of the Commonwealth to the States forthat purpose;

D. the Parliament of the Commonwealth hasauthorized the execution of this agreement by andon behalf of the Commonwealth and the provisionof financial assistance to the States as provided inthis agreement;

NOW IT IS HEREBY AGREED as follows:

I.—INTRODUCTION.

Operation of Agreement

1. (1) This agreement shall, as between the Commonwealthand a State, come into force when it has been entered intoby the Commonwealth and that State.

(2) Notwithstanding that all the States of New SouthWales, Victoria, Queensland, South Australia, Western Aus-tralia and Tasmania are named as parties to this agreement,this agreement shall operate as an agreement between theCommonwealth and each State in respect of which it hascome into force as fully and effectually as if the State orStates in respect of which it has come into force were theonly State or States named as a party or as parties to theagreement.

(3) In this agreement, each State in respect of whichthe agreement has come into force is referred to as a"State", and the expression "the States" means, exceptwhere the context otherwise requires, all of the States inrespect of which for the time being the agreement is inforce.

Performance of Agreement

2. The Commonwealth will provide for or secure theperformance by it and its authorities of the obligations ofthe Commonwealth under this agreement and each of theStates will provide for or secure the performance by theState and its authorities and instrumentalities of theobligations of the State under this agreement.


Interpretation

3. (1) In this agreement, unless the contrary intentionappears—"financial year" means a period of twelve monthsending on the thirtieth day of June:

"the Authority" means the authority or authoritiesof a State that has or have the administrationof the Scheme on behalf of the State and, ina case where there is more than one authority,refers, where the context requires reference toone authority, to the relevant authority of theState;

"the Scheme" means the scheme to be establishedand operated by a State in accordance withclause 4;

"the Treasurer" means the Treasurer of theCommonwealth.

(2) Reference in this agreement to a Minister of theCommonwealth or of a State shall include a reference toa Minister for the time being acting for or on behalf ofthe Minister referred to.

(3) In this agreement, except where the contextotherwise requires

(a) a reference to a clause refers to the relevantclause of this agreement;

(b) a reference to a sub-clause refers to therelevant sub-clause of the clause in which thereference appears; and

(c) the Schedule to this agreement shall be deemedto be an integral part of this agreement.

II—ADMINISTRATION OF SCHEME

State to operate Scheme

4. (1) Each State will, by using the financial assistanceprovided by the Commonwealth in accordance with thisagreement, establish and operate a scheme of financialassistance to persons engaged in rural industries in thatState.

(2) The Scheme shall consist of the forms of assistancedescribed in, and shall be operated in conformity and inaccordance with the general principles and the provisionsset out in, the Outline of Scheme for Rural Adjustmentcontained in the Schedule to this agreement, as amendedat any time in pursuance of sub-clause 9 (1).


(3) The Scheme shall commence operation on the firstday of January 1977.

Forms of Assistance

5. For the purposes of this agreement the various formsof assistance under the Scheme are referred to as follows:

PART A

(a) the assistance provided for in Part 2 of theSchedule—as debt reconstruction

(b) the assistance provided for in Part 3 of theSchedule as farm build-up.

(c) the assistance provided for in Part 4 of theSchedule—as farm improvement

(d) the assistance provided for in Part 5 of theSchedule—as rehabilitation

PART B

(e) the assistance provided for in Part 6 of theSchedule—as carry-on finance.

PART C

(f) the assistance provided for in Part 7 of theSchedule—as household support.

Allocation of Financial Assistance

6. (1) Subject to the provisions expressly made by thisagreement, the financial assistance that is to be madeavailable by the Commonwealth to a State under thisagreement for the forms of assistance referred to inparagraphs (a), (b) and (c) of Part A of Clause 5 shall beallocated between those forms of assistance in suchproportions as the Commonwealth determines afterconsultation with the State.

(2) A determination by the Commonwealth for thepurposes of sub-clause (1) shall specify a target percentagefor commitments on farm build-up and on farmimprovement which the State shall endeavour to achieveand a maximum percentage for commitments on debtreconstruction which the State may not exceed without theprior approval of the Commonwealth.


(3) The consultations referred to in sub-clause (1)shall extend to establishing by agreement between theCommonwealth and the State a firm program ofcommitments of financial assistance for each four-monthlyperiod during the year.

(4) If during a financial year either the Commonweatlhor a State informs the other that it considers theallocation of the financial assistance by the State or theprogram of commitments in respect of the year should bevaried, further consultations will be held between theCommonwealth and the State with a view to varying thedetermination by the Commonwealth for the purposes ofthis clause should the Commonwealth see fit to do so orvarying the program of commitments for the purposes ofthis clause as the case may be.

Interest rates for Parts A and C Assistance

7. (1) The rates of interest at which money is lent by theAuthority under the Scheme in providing the forms ofassistance referred to in Part A and Part C of clause 5shall be as determined by the Authority in thecircumstances of the particular case.

(2) The Authority shall have the right to review theterms of repayment, including interest rates, of individualaccounts at any time and shall exercise this right at regularintervals with the objective of the borrower beingencouraged to transfer to commercial credit as soon ascircumstances permit.

Administration Expenses

8. (1) The Commonwealth and each State shall bear theadministration expenses of the provisions by the State, ofassistance referred to in Parts A and C of clause 5 asfollows

(a) up to the amount in each year which isequivalent to 2 per centum in value of theapprovals for those forms of assistance in thatyear—by the Commonwealth and the Stateequally; and

(b) in excess of the amount in each year which isequivalent to 2 per centum in value of theapprovals for those forms of assistance in thatyear—by the State.


(2) The Commonwealth and each State shall bear theadministration expenses of the provision by the State ofassistance referred to in Part B of clause 5 in the respectiveproportions that assistance is for the time being providedby the Commonwealth and the State in respect of therelevant industry in accordance with the agreement whichestablishes the relevant proportion of the assistance inrespect of that industry referred to in sub-clause 14(2).

Amendment of Schedule

9. (1) The provisions of the Schedule to this agreementmay be amended from time to time by agreement betweenthe Ministers of the Commonwealth and of the States forthe time being responsible for the administration of theScheme.

(2) Where so agreed between the CommonwealthMinister and the Minister or Ministers of the relevant Stateor States, any amendments to the provisions of the Scheduleto this agreement may be made and take effect as betweenthe Commonwealth and one or more of the States withoutaffecting the operation of this agreement as between the;ommonwealth and a State the Minister of which has notso agreed.

III—FINANCIAL ASSISTANCE

Provision of Financial Assistance

10. Subject to, and to the performance by a State of, theprovisions of the Agreement, the Commonwealth will makefinancial assistance available to the States for the purposesof the Scheme.

kmount of Financial Assistance(1. (1) The amount of financial assistance to be madeavailable by the Commonwealth to each State for the formsof assistance referred to in Parts A and C of clause 5 duringa financial year shall be determined by the Commonwealthbefore the commencement of the financial year followinga meeting of Commonwealth and State Ministers which willreview the circumstances relating to the financial year andwhich will give due consideration to submissions made bythe States not later than the end of February last precedingthe financial year and will have regard to such othercriteria as the Commonwealth considers appropriate.

(2) The amount of financial assistance to be madeavailable by the Commonwealth to a State for the form ofassistance referred to in Part B of clause 5 shall bedetermined at the time the Commonwealth and the Stateagree that the provision of such assistance is warranted.

1977.] Rural Reconstruction. Scheme. [No. 31.

Advances

12. (1) The Treasurer may, at such time and in suchamounts as he thinks fit, make advances on account of thepayment that may be made by the Commonwealth underclause 14.

(2) An amount or part of an amount advanced by theTreasurer under this clause may be deducted by theCommonwealth from an amount that subsequently becomespayable under clause 14 or, if no further amounts willbecome payable under that clause, shall be refunded by theState to the Commonwealth at the request of the Treasurer.

Use of Advances

13. A State shall ensure that an amount or any part ofan amount advanced to the State and not refunded underthe last preceding clause is not used or applied except forthe operation of the Scheme.

Payments of Financial Assistance

14. (1) The Commonwealth shall, from time to time, atthe request of a State and subject to the provisions of thisagreement make payments to the State of the financialassistance to be provided to the State under this agreement:

(a) in respect of the forms of assistance referred toin Parts A and C of clause 5 in amounts equalto the expenditure by the State (other thanadministration expenses) in the provision ofthose forms of assistance; and

(b) in respect of the forms of assistance referred toin Part B of clause 5 in amounts equal to therelevant proportion of the expenditure by theState (other than administration expenses) inthe provision of that form of assistance.

(2) For the purposes of paragraph (b) of sub-clause (1)"the relevant proportion" means the proportion of the totalcost of operation of the form of assistance referred to inPart B of clause 5 as is from time to time agreed betweenthe Commonwealth and the State as being the proportion tobe provided by the Commonwealth.

Supporting Financial Evidence

15. (1) A State shall furnish to the Treasurer suchdocuments and other evidence to justify the making of anadvance under clause 12 or in support of a request by the

No. 31.] Rural Reconstruction Scheme. [1977.State for a payment to it by the Commonwealth under thelast preceding clause as the Treasurer may from time to timereasonably request, whether the request by the Treasurer ismade before or after the Commonwealth has made theadvance or a payment pursuant to the request by the State.

(2) Any statement of expenditure by a State furnishedto the Treasurer in connection with a request by the Statefor a payment under clause 14 shall be certified by theAuditor-General of the State or an officer authorised bythe Treasurer of the State as to its correctness in accordancewith the books and documents of the Authority.

Interest on Part A Assistance

16. (1) Interest at the rate for the time being applicableunder this clause shall accrue in respect of so much of eachamount that has been advanced or paid to the State inrespect of the forms of assistance referred to in Part A,of clause 5 as is repayable by the State under clause 17 andhas not for the time being been refunded or repaid to theCommonwealth, calculated from the date upon which theadvance or payment was made by the Commonwealth.

(2) The rate of interest referred to in sub-clause (1)shall be 7 per centum per annum but shall be subject torenegotiation and redetermination at an annual review ofthe scheme to the intent that, in the event that as at the1st day of January preceding the review there has been avariation of the long term bond rate of 20 per centum ormore of the long term bond rate as at the 1st day of January1977 or the 1st day of January when the rate of interest waslast redetermined, as the case may be, the rate applicableunder this clause (1) shall be redetermined having regardto the extent of that variation.

(3) A redetermination of the rate of interest undersub-clause (2) shall take effect on a date to be specified bythe determination.

(4) A reference in sub-clause (2) to the long term bondrate is a reference to the rate that is equivalent to the rateof yield to maturity of the long term loan of the loan raisingby the Commonwealth in Australia for public subscriptionlast preceding the date to which the reference relates.

(5) Interest that accrues under this clause prior to thedate upon which interest becomes included in paymentsprovided for in clause 17 shall be payable on the 15th dayof January and the 15th day of July each year.

1977.1 Rural Reconstruction Scheme. [No. 31.

Repayments with Interest of Part A Assistance

17. (1) Subject to the provisions of clause 20, each Stateshall repay to the Commonwealth 85 per centum of eachof the advances made to the State in respect of the formsof assistance referred to in Part A of clause 5 and notrefunded or repaid under clause 12 and each of the pay-ments made to the State under clause 14 and not for thetime being repaid, together with interest referred to insub-clause (3) of this clause by 34 half-yearly payments,that, subject to any variation resulting from a redetermin-ation of the rate of interest under clause 16, are equalin amount.

(2) The first payment under sub-clause (1) shall bemade on the 15th day of July of the fourth financial yearthat wholly occurs after the advance or payment wasmade by the Commonwealth to the State and subsequentpayments shall be made on each 15th day of January and15th day of July thereafter until the full amount of therepayment, including interest, has been paid.

(3) The interest to be included in payments referredto in sub-clause (1) shall be the interest that, in accordancewith sub-clauses (1) and (2) of clause 16, accrues in respectof the relevant advance or payment on and from the 15thday of January preceding the commencement of the fourthfinancial year that wholly occurs after the advance orpayment was made by the Commonwealth.

Repayments of Part B Assistance

18. (1) Each State shall, by way of repayment of theform of assistance referred to in Part B of clause 5 pay tothe Commonwealth by payments in accordance withsub-clause (3) the amount that is calculated by subtracting(b) from (a) where

(a) is the amount which is the relevant proportionof the principal and interest repaid to theAuthority by the recipients of that assistance;and

(b) is the amount which is the relevant proportionof the administration expenses of the Authorityin providing that assistance.

(2) For the purposes of sub-clause (1) "the relevantproportion" means the proportion of the total cost of theprovision of the form of assistance referred to in Part B ofclause 5 as is from time to time agreed between theCommonwealth and the State as being the proportion tobe provided by the Commonwealth.


(3) The State shall pay to the Commonwealth so muchas is from half-year to half-year calculated to be payableof the amount first referred to in sub-clause (1) byconsecutive half-yearly payment, the first payment to bemade on the 15th day of July or January that occurs afterthe first repayment of principal and interest made by arecipient of the assistance to the Authority and subsequentpayments to be made on each succeeding 15th day ofJanuary and July thereafter until no further amount ispayable by the State in pursuance of its obligation undersub-clause (1).

Repayments of Part C Assistance

19. Each State shall, by way of repayment of the form ofassistance referred to in Part C of clause 5, pay to theCommonwealth so much of that assistance and interestthereon as is recouped by the State in any year from therecipients of that assistance, such payments to be made oneach 15th day of January and 15th day of July nextsucceeding the receipt of those moneys by the State.

Prepayments by State

20. (1) In addition to making payments in accordancewith clause 17, a State may on the 15th day of January oron the 15th day of July in any year, after having given tothe Treasurer notice in writing of at least one month ofits intention to do so, pay to the Commonwealth an amountthat has been specified in the notice of the repayments thatremain to be made by the State under that clause.

(2) Interest shall accrue on amounts paid by a Statein accordance with sub-clause (1) at the rate that is forthe time being the rate of interest applicable under clause16 calculated from the date of payment and compoundedwith half yearly rests on each 15th day of January and15th day of July.

(3) When on any 15th day of January or 15th day ofJuly the payment by the State under clause 17, exceedsthe amount by which the unrepaid balance of the totalamount repayable under that clause together with interestaccrued on that total amount up to and including that dateexceeds the total of the amounts paid by the State to theCommonwealth in accordance with sub-clause (1) togetherwith interest accrued on those amounts up to and includingthat date under sub-clause (2), the State shall pay to theCommonwealth the amount of the second-mentioned excessin lieu of the amount due under clause 17 and no furtherpayments shall be required to be made by the State to theCommonwealth under that clause.


Financial Administration and Adjustments

21. (1) Each State agrees that in respect of the formsof assistance referred to in Part A of clause 5 the Schemeshall be operated by the State in such a way that theamounts received by the Authority in the course of theoperation of the Scheme could be reasonably expected toequal the payments of principal and interest which theState is required to make to the Commonwealth underthis agreement.

(2) Should a State certify that, without taking intoaccount its administration expenses, it has incurred lossesunder the Scheme in respect of the form of assistancespecified in Part A of clause 5 from circumstances beyondits control arising after the date of this agreement, theCommonwealth agrees to review the position with theState with a view to adjusting amounts payable to theCommonwealth by the State under this agreement to theextent of such losses.

(3) The provisions of this agreement in relation to thetimes at which payments are to be made by the State to theCommonwealth and the amounts of the payments that areto be made may be varied in such manner as is agreedbetween the Commonwealth and the State upon a reviewcarried out in accordance with sub-clause (2).

Audit

22. (1) The accounts, books, vouchers, documents andother records of a State relating to the operation of theScheme shall be subject to audit by the Auditor-Generalof the State.

(2) A report on the audits in respect of each financialyear shall be furnished by the Auditor-General of the Stateto the Treasurer as soon as possible after the completionof the financial year.

Other Financial Arrangements

23. Financial arrangements in connection with the Schemeother than those provided for in this agreement shallbe carried out as agreed from time to time between theTreasurer and Treasurer of each State.

IV—GENERAL

Review

24. The operation of the Scheme in relation to all of theStates will be reviewed from time to time as appropriateby the Commonwealth and the States in the light ofexperience in its administration.


Exchange of Information

25. The Authorities of the States and appropriate Com-monwealth officers associated with the Schemes for RuralAdjustment will meet together as appropriate and at leastonce in each year and exchange information on any matterspertinent to the Schemes.

Provision of Information and Review

26. The Authority will supply to the Commonwealth fromtime to time such information regarding the operation ofthe Scheme by the State as may be requested by the Com-monwealth and which is reasonably able to be suppliedby the Authority and will participate in periodic reviewsof the effectiveness of the Scheme.

THE SCHEDULE

Rural Adjustment—Outline of SchemePart 1—General Principles

(a) All agricultural, horticultural and pastoralindustries are included in the Scheme. It isrecognised that in particular circumstances someindustries may need additional special consideration.

(b) The general principle to be applied is to distributethe available resources as widely as practicable,but the over-riding objective is to help restore toeconomic viability those farms and farmers with thecapacity to maintain viability once achieved.

(c) It is expected that each administering authoritywill avail itself of the best available advice onagricultural technology and market prospects.

(d) Companies will not be eligible for assistance unlessthe Authority, having considered the shareholdingsand being satisfied that the shareholders are bonafide primary producers relying primarily on theincome of the company for their livelihood, con-siders it appropriate to provide assistance.

(e) In cases of assistance under the heading of debtreconstruction or by way of advances for carry-onexpenses, plant, livestock and property develop-ment, it is an essential part of the scheme thatadequate supervision of property management andthe financial affairs of the assisted farmer ismaintained. If the Authority deems it necessary,it may require that moneys receivable on account ofthe property will be received by the Authority orits agent or a body nominated by the Authority,payments within the approved budgets being madethrough normal channels.


(f) Repayment of advances made by the Authorityand interest due thereon will be secured by the bestand most appropriate security available, recognisingthat this may involve ranking after existingsecurities.

(g) A transfer of the property or any interest thereinbefore advances made by the Authority are repaidwill be permitted only with the consent of theAuthority, which will upon transfer, or upon suc-cession on the death of the borrower, have the rightto review its arrangements in respect of theproperty.

(h) The arrangements with the assisted farmer will besubject to regular review by the Authority fromtime to time. They may be terminated if the farmerceases to work the property personally, fails toobserve his obligations and undertakings underthe arrangements or if the Authority decides thatfor any reason he lacks reasonable prospects ofsuccessful economic operation. Otherwise thearrangements shall be terminable when theAuthority decides that his prospects of successfuleconomic operation are no longer dependent onthe extension of concessional finance. Upon term-ination of the arrangements, all debts will thenbecome due and payable.

(i) The eligibility of a farmer for one form of assistanceunder this Scheme will not necessarily be affectedby his having applied for or received another formof assistance under the Scheme.

(j) The rate of interest payable will be decided by theAuthority in the circumstances of the particularcase. The Authority will have the right to reviewthe interest rates on individual accounts at anytime and shall review the terms of repayment,including interest rates, at regular intervals withthe objective of the borrower being encouraged totransfer to commercial credit as soon as circum-stances permit.

Part 2—Debt Reconstruction

(1) Purpose

To assist a farmer who, although having soundprospects of long term commercial viability, hasused all his cash and credit resources and cannotmeet his financial commitments.


(2) Tests of Eligibility

(a) The applicant is unable to obtain finance onreasonable terms to carry on, from any othernormal source and is thus in danger of losingproperty or other assets If not assisted underthe Scheme.

(b) There is a reasonable prospect of successfuloperation with the assistance possible underthe Scheme, the prime requirements beingability to service commitments and to reach thestage of commercial viability within a reason-able time.

(c) Assistance is merited and the applicant'sdifficulties are not substantially due to circum-stances within his control.

(3) Nature of Assistance

The assistance to be provided may include wherenecessary:

(a) A re-arrangement and/or a composition of debtsto allow more time for payment.

(b) The negotiation of a concessional rate ofinterest for existing rates.

(c) Advances of additional funds for carry-onexpenses, livestock and further propertydevelopment.

(d) Where the State legislation so provides, aprotection order against any creditor who hasthreatened action for debt, to apply while theapplication is under consideration and subjectto such extensions as the administering Auth-ority may from time to time determine.

(4) Method of Operation

(a) A re-arrangement and/or composition may takethe form of the Authority advancing moneyto pay off in whole or in part the creditors,(whether or not the debts have been writtendown by the creditors under (b) below),excluding the Crown. There may be an arrange-ment by the secured or unsecured creditors topostpone repayments of principal and to refrainfrom taking action against the debtor for aspecified time. Composition arrangementsrequire the agreement in writing of creditors.


(b) The possibility of creditors, including theCrown, local authorities and public utilitiesbeing asked to defer or write off part of theirdebts should be considered. Creditors shouldnot be pressed to the extent that the availabilityof credit to rural industries is damaged.

(c) Additional funds advanced for carry-onexpenses, livestock and further propertydevelopment will be strictly limited to theminimum which the Authority considers isrequired to enable the farmer to carry on andfree himself from dependence on the Authority'sassistance within the term of the advancesmade to him by the Authority.

(d) In exceptional cases, advances for carry-onexpenses and livestock may be made to a farmerwho is not yet in immediate danger of losingproperty or other assets but who, in the opinionof the Authority, is likely to reach that positionwithout such assistance, such cases being testedstrictly against the remaining eligibility criteria.

(e) Where protection orders apply it is desirable toestablish a relationship with creditors such thatthe Authority is acting in combined interestsof applicant and creditors, secured andunsecured.

(5) LimitsThe Authority shall have discretion to determine:

(a) The terms and conditions of any loan it maymake up to a maximum repayment term of 30years. An initial period of freedom from repay-ments of principal may be allowed dependingon the circumstances of the case and theinterest rate to be charged.

(b) The proportion of debts paid off by advancesin any one case.

(c) The total of advances which may be made bythe Authority in any one case.

Part 3—Farm Build-up(1) Purpose

To supplement, without discouraging, the normalprocesses under which properties which do not havereasonable prospects of long term viability underexisting and prospective circumstances are amal-gamated with an adjoining holding or are sub-divided and the subdivided portions are addedto adjoining holdings, or to assist a farmer witha property too small to be economic to purchaseadditional land to build up his property to at leasteconomic size.



(a) The owner of the property to be purchasedwishes to sell or accepts that he is obligedto sell.

(b) The purchaser is unable to obtain the financeapplied for on reasonable terms from any othernormal source.

(c) The Authority is satisfied that the built upproperty will be of sufficient size to offer soundprospects of long term commercial viability.

(d) Where an application is made by an adjoiningowner for assistance under the scheme topurchase an uneconomic property, but there is apossibility of sale of the property to anotheradjoining owner who does not require assist-ance under the Scheme, assistance will be pro-vided only if the applicant's property would bebuilt up from an uneconomic to an economicsize.

(e) The term "adjoining holding" includes aholding which is within a reasonable workingdistance of the holding under considerationwhere there is no impediment to the two hold-ings being worked as a single unit.

(3) Nature of Assistance(a) The provision to the purchaser of finance to

assist the purchase of an adjoining holding orpart of an adjoining holding.

(b) Grants at the discretion of the Authority tocover, in whole or in part, losses sustainedfrom the reduction in value of assets which areeither not useful or less useful for the builtup property.

(c) Advances for carry-on expenses, plant, live-stock and property development in respect ofthe additional land where not available fromother normal sources.


(a) Normally a property will be purchased onlywhere arrangements have been made for anadjoining owner to take over the property orfor the property to be subdivided and the sub-divided parts added to adjoining properties.The Authority may purchase an uneconomicproperty in advance of arrangements having


been made for the property to be added to anadjoining property or properties where the pro-gram of farm adjustment could not otherwisebe achieved. The Authority may dispose ofsuch a property on commercial terms wherethe purchaser does not require or is not eligiblefor assistance under this Part.

(b) Where appropriate, the Authority could takethe initiative to encourage an adjoining ownerto purchase an uneconomic farm where theAuthority is aware that the owner of theuneconomic farm wished to leave the industryor accepts that he is obliged to leave theindustry; this applies particularly where it isunlikely that the appropriate purchaser orpurchasers will be able to purchase theadditional land unless the Authority providesassistance for the purchase.

(c) Since it is required that there must be reason-able prospects of successful operation of thebuilt up property, the Authority in consideringthe transfer price of land will have regard toits productivity value.

(d) Grants to cover losses on the write off ofredundant assets will be kept to a minimum.

(e) Where advances are made for carry-onexpenses, plant, livestock and property develop-ment, the advances will be strictly limited tothe minimum which the Authority considersis required to enable the farmer to carry onand free himself from dependence on theAuthority's assistance within the term of theadvances made to him by the Authority.

(f) While any advances by the Authority in respectof built up property remain unpaid, the transferof part of the built up property will not bepermitted if this would result in a property ofa size too small to be economic.

(5) Limits(a) The term of a loan by the Authority and condi-

tions of repayment of principal will be at thediscretion of the Authority up to a maximumrepayment term of 30 years. An initial periodof freedom from repayments of principal maybe allowed depending on the circumstances ofthe case and the interest rate to be charged.

(b) The total of advances which may be made bythe Authority in any one case shall also be atits discretion.


Part 4—Farm Improvement(1) Purpose

To assist the restoration of an uneconomic propertyto economic viability by improving the effective useof an existing farm without adding to its area.


(a) The existing farm has been, but is not now,viable and is of sufficient area and the proposedimprovements are of such a kind as to offersound prospects of restoration to long termcommercial viability if assistance under theScheme were provided.

(b) The applicant is unable to obtain finance onreasonable terms from any other normal source.


(a) Advances for plant, livestock, carry-on expensesand further property development intended torestore the economic viability of the farm eitherin the existing form of production or in anotherform of production which may be undertaken incombination with, or completely replace, theexisting form of production.

(b) Grants at the discretion of the Authority tocover, in whole or in part, losses sustained fromthe reduction in value of assets which are eithernot useful or are less useful because of thechanged pattern of farm operations.


(a) Advances made for the purposes of thisPart will be limited to the minimum which theAuthority considers is required to enable thefarmer to achieve the objective of theimprovement program.

(b) Grants to cover the write off of redundantassets will be kept to a minimum and will bemade only where the changed pattern of farmoperations is, in the opinion of the Authority,essential to the restoration of long termcommercial viability.


(c) While any advances by the Authority in respectof improvement for which finance is providedunder this Part remain unpaid, the transferof part of the improved property will not bepermitted if this would result in a propertyof a size too small to be economic.

(5) Limits

(a) The term of a loan by the Authority and theconditions of repayment of principal will be atthe discretion of the Authority up to amaximum repayment term of 30 years. Aninitial period of freedom from repayments ofprincipal may be allowed where circumstanceswarrant this concession.

(b) The total of advances which may be made bythe Authority in any one case shall be at itsdiscretion.

Part 5—Rehabilitation(1) Purpose

To provide limited assistance to those obliged toleave the industry where in the opinion of theAuthority administering the Scheme this isnecessary to alleviate conditions of personalhardship.

(2) Conditions of Eligibility

(a) The applicant's property must have beenpurchased by an adjoining owner who hasbeen assisted under the farm build-upprovisions to make the purchase or theapplicant must have been unable to secureassistance under the debt reconstructionprovisions because his property is assessed notto have sound prospects of long termcommercial viability; and

(b) Taking into account the financial position ofthe applicant after his property has been sold,he will suffer financial hardship which willbe alleviated by assistance under theseprovisions.


A loan on such conditions as to interest rate, if any,and repayment as are determined by the Authorityup to a maximum of $5 000 in any one case. Theloan may be converted to a grant at the discretionof the Authority.


(4) Method of OperationThe assistance will be available at the discretionof the Authority administering the Scheme.

Part 6—Carry-on Finance(1) Purpose

To provide advances for essential carry-on purposesin rural industries which it is agreed from time totime between the Commonwealth and State orStates are suffering a severe market downturn orsimilar situation (but excluding circumstancescovered by natural disaster arrangements).


(a) The applicant has reasonable prospects of longterm commercial viability having regard to hisasset structure, on the assumption of a marketrecovery to the long term trend.

(b) The applicant is unable to obtain carry-onfinance on reasonable terms from any othernormal source.

(c) Assistance is merited and the applicant'sdifficulties are not substantially due tocircumstances within his control.


Advances for essential carry-on expenses.


(a) In relation to the rural industries referred to inClause 1 of this Part, the Commonwealth andthe State will agree upon the terms and condi-tions upon which assistance is to be given tofarmers within those rural industries and theCommonwealth will thereupon publish a noticeto that effect in the Australian GovernmentGazette.

(b) Farmers within those rural industries whofulfil the eligibility requirements set out abovewill then apply to the Authority in their ownState for carry-on assistance.

(c) Assistance will be made available at the discre-tion of the Authority and will be limited to theminimum which the Authority considers isrequired to enable the farmer to carry on andfree himself from dependence on the Auth-ority's assistance.


Part 7—Household Support(1) Purpose

To provide assistance for up to one year to non-viable farmers having insufficient resources to meetliving expenses and who are in need of assistanceto alleviate conditions of personal and familyhardship while the farmer considers whether toadjust out of farming.

(2) Tests of EligibilityThe applicant is assessed as non-viable in the longterm, is unable to obtain financial assistance fromany other normal source and will suffer personaland family hardship which will be alleviated byassistance under these provisions.


(a) An advance provided for one year sufficient toraise the applicant's estimated future incomefrom all sources to the level of payment whichwould be applicable to him if he were eligiblefor unemployment benefits. An extension to twoyears may be allowed at the discretion of theAuthority in those cases where a demonstrableeffort has been made to move out of farming.

(b) Where it would take some time to assess anapplicant's entitlement, interim assistance maybe granted by the Authority as a loan at a levelof payment which would be applicable to himif he were eligible for unemployment benefitsprovided there is prima facie evidence of urgentneed and unavailability of alternative sourcesof finance.

(c) If the Authority subsequently determines thatthe applicant has a viable enterprise, theinterim assistance will be regarded as carry-onfinance.

(d) The carry-on finance would represent part orall of the finance to be provided under a Schemeoperative at the time and would be repaid underthe conditions pertaining to that Scheme.

(e) If the Authority determines that an applicantdoes not have a viable enterprise he will beeligible for household support assistance, andany interim assistance he may have receivedwill be regarded as household support assistance.

(f) Advances of household support assistance are tobe paid to the farmer at intervals decided bythe Authority, but not exceeding three months.


Prospective income for each period will beassessed by the Authority on the basis ofdeclarations made by the applicant. Eachapplicant's income situation is to be reviewedby the Authority, on the basis of declarationsmade by the applicant, when further advancesare to be made to him.

(g) Where a farmer obtains employment or hisincome is higher than allowed for by theAuthority when making an advance, the farmeris required to notify the Authority and repayany excess household support assistance he mayhave received.

(h) In the event of the Authority becoming awarethat an applicant has received more than hewas entitled to it may exercise its discretionin seeking repayment of the excess.

(i) At the end of the first period of six months forwhich a farmer receives household supportassistance the advances made to him may beconverted by the Authority to a grant.

(j) If the farmer adjusts out of farming withinthree years of the time he first receivedhousehold support, any advances made to himand not already converted to a grant maybe so converted by the Authority.

(k) If an applicant does not adjust out of farmingwithin three years after first receiving house-hold support assistance any advances made tohim and not converted to a grant will berepayable to the Authority, together withinterest accruing from the commencement ofthe advance, within a further period of sevenyears.

(1) A farmer who is eligible for household supportand who is prepared to adjust out of farmingmay, at the discretion of the Authority, receivein lieu of household support assistance a lumpsum payment of $3 000 less any householdsupport assistance paid to him prior to adjustingout of farming. Such payment is additionalto any other payments that might be availableto him under the Scheme.

For the purposes of these provisions a farmer isregarded as having adjusted out of farming when, inthe judgement of the Authority, he has effectivelydisposed of his productive resources.


IN WITNESS WHEREOF this agreement has been signedfor and on behalf of the parties respectively as at the dayand year first above written.

SIGNED by the Right Hon-ourable JOHN MALCOLMFRASER, Prime Minister ofthe Commonwealth of Aus-tralia, in the presence of

K. E. HEYDON.

SIGNED by the HonourableNEVILLE KENNETH WEAN,Premier of the State of NewSouth Wales, in the presenceof

D. G. DARLOW

SIGNED by the HonourableRUPERT JAMES HAMER,Premier of the State ofVictoria, in the presence of

K. D. GREEN

SIGNED by the HonourableJOHANNES BJELKE-PETERSEN, Premier of theState of Queensland, in thepresence of

I. I. MAYZE

SIGNED by the HonourableDONALD ALLAN DUNSTAN,Premier of the State ofSouth Australia, in thepresence of

A. L. McMAHON.

SIGNED by the HonourableSIR CHARLES COURT,Premier of the State ofWestern Australia, in thepresence of

B. V. JOHNSON.

SIGNED by the HonourableWILLIAM ARTHURNEILSON, Premier of theState of Tasmania, in thepresence of

R. GRIERSON.

MALCOLM FRASER

NEVILLE WRAN

R. J. HAMER

JOH. BJELKE-PETERSEN

DON DUNSTAN.

CHARLES COURT.

W. A. NEILSON.

RURAL RECONSTRUCTION SCHEME.

Documents

Transcript of RURAL RECONSTRUCTION SCHEME.