Financial Planning
Farmers should urgently access super: Advisers

Financial planners can help embattled farmers in drought stricken areas to urgently access their superannuation by lobbying the Federal Government for changes to super hardship policy.

Certified Financial Planners Julie Matheson and Peter Roan are proposing for an urgent six month amnesty on superannuation hardship rules as they fear the Government's relief package may not reach the farmers in time.

"Accessing just $10,000 from superannuation might be a lifesaver to stop the shooting of starving farm animals caused by drought," they said. The amnesty should be tax free and apply to the farmer and their spouse.

While the pair welcome Prime Minister Malcom Turnbull's amendment to the Farm Household Allowance (FHA), they said farmers need access to funds quicker as most areas are "suffering the worst drought in living memory."

The FHA pays a similar rate to the Newstart Allowance to support eligible farmers and their partners who are experiencing financial hardship. Currently, eligible farmers can currently receive the FHA for up to three years.

A Bill to extend the time limit for receiving the FHA from three to four years was introduced to Parliament on June 20.

Overnight on Twitter, Turnbull also said the asset threshold will also increase to $5 million, which means 27,000 families and single farmers who are currently not receiving the FHA will now be eligible. Fortnightly payments for those currently on the FHA will continue, he added.

Further, families currently receiving FHA will receive a lump sum supplementary payment of $6000 on September 1 and $6000 again on March 1 - totalling $12,000 of additional support over the year, Turnbull said.

To be suffering from financial hardship, farmers must have received Centrelink payments for 39 weeks.

Roan said the superannuation system has the means to allow early access to funds if the 39-week Centrelink red tape is lifted.

"Most farmers don't meet the income and asset tests for Centrelink, let alone wait another 39 weeks to feed their animals suffering in this most devastating drought in NSW," he said.

Matheson, a founding member of the Financial Planning Association of Australia (FPA), is calling on the 25,000 financial planners in Australia to lobby their federal member of parliament to support the proposal.

Rural financial counsellors, who provide free services to help people apply for the FHA, are few and far between, she said, adding that once farmers are back on their feet and the drought has broken, they can top up their super and plan for retirement.

Read more: FHASuperannuationCentrelinkFarm Household AllowanceFinancial adviceFinancial Planning Association of AustraliaFPAJulie MathesonMalcom TurnbullPeter Roan
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