Rural communities and drought-hit farmers are set to receive a cash injection to keep businesses open, keep locals in work and boost rural economies as the drought continues to impact regions.

The Prime Minister said the Government’s next step of measures to combat the drought’s impact was ready to flow.

“We are stepping up our drought response once again to meet the increasing needs as the drought’s effects also step up,” the Prime Minister said.

“Since the budget we have already committed an additional $355 million to step up our drought response.

“This is money into the pockets of all those farmers and graziers who know they have a future, but are currently struggling to keep their operations running as the crippling effects of this drought continue to bite that we’ve heard from out on the ground. They are backing themselves and we are backing them to make it through to the better days that will be ahead.

“It’s not only farmers doing it tough in drought. Our next step in drought support also has an eye squarely on those communities feeling the strain as work dries up and spending in local stores slows down.

“There is no silver bullet to this drought. Each time we introduce further help we listen, we learn and we adjust our response because we know each community has different needs and priorities that need the resources and cooperation of every level of government.”

Deputy Prime Minister and Minister for Infrastructure, Transport and Regional Development, Michael McCormack, said the Government’s latest initiatives would deliver an extra $709 million worth of direct support.

“Communities across Australia are suffering the effects of the prolonged dry spell and today’s announcement is the next step in the measures to help ease the burden of the drought,” Mr McCormack said.

“This suite of measures go to the heart of what matters to these communities. From small businesses to primary producers, we are working with communities to take the pressure off one of the worst droughts in history.

“Not only is the Government continuing to respond as the drought progresses, but we are working on measures to assist in the recovery when the rains come, which includes the Government’s billion dollar investment in water infrastructure.

“By redirecting $200 million from the Building Better Regions Fund into drought communities and an extra $138.9 million into our Roads to Recovery initiative, we’re getting local projects and infrastructure work underway to keep finance flowing, trades in work and money rolling through local stores.”

Minister for Agriculture, Bridget McKenzie, said a new loans program for small businesses and making existing drought loans interest free for two years would deliver immediate support for everything from buying fodder to transporting stock and agisting cattle through to paying staff and purchasing new equipment. The Regional Investment Corporation’s mandate sets its interest rate just to cover administration and borrowing costs.

“These loans mean farmers and small business owners can do what they need to, right now at zero cost,” Ms McKenzie said.

“Farmers will not have to pay a cent for the next two years and we’ll keep assessing the program if the drought runs longer than that to ensure repayments are affordable.

“With $200 million worth of loans committed already, we estimate the new small business program and the changes to the Drought Loans for farms will see around $1.2 billion issued over the next three years that they can put to their priorities.”

Minister for Water Resources, Drought, Rural Finance, Natural Disaster and Emergency Management, David Littleproud, said the new measures will help boost rural economies.

“The package will boost local jobs and respond to individual community needs,” Mr Littleproud said.

“We’ve had strong demand on the Drought Communities Extension Programme and we’re extending it to six new areas.

“On top of the $1 million we’ve delivered to 122 councils we’ll make another $1 million available for those still in need.

“We’ve also set up a $50 million fund for council projects in drought-hit communities for things like community hall renovations and playground upgrades.

“This will boost rural economies with more jobs and more business for regional suppliers like the local hardware store.”

Mr Littleproud said the Federal and South Australian Governments had also struck a deal to secure up to 100GL of water for farmers to grow fodder, silage and pasture at a discounted rate.

“100GL will produce up to 120,000 tonnes of feed for animals on farms in drought,” Mr Littleproud said.

“This will help farmers maintain their breeding stock during the drought so when it breaks farmers can recover faster.”

Mr Littleproud said the Government had also released the Drought Response, Resilience and Preparedness Plan. The plan draws on the Drought Coordinator Major General Stephen Day’s report and the Government’s response, which has recently been released.