Payment Rights

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The Dairy Structural Adjustment Program provided for three types of payment rights that were administered by the Dairy Adjustment Authority. All payments under this program are made quarterly over eight years until 2008.

Dairy producers qualified for a standard payment right if they could demonstrate that they had an interest at 6.30pm on 28 September 1999 in a dairy farm enterprise that delivered milk during 1998–99. They were also required to provide certification from an independent qualified financial adviser that they carried out a farm business assessment.

Exceptional events supplementary payment rights were granted to eligible producers who suffered a loss in production of more than 30% in 1998–99 as a direct result of a natural exceptional event. Exceptional events include storm, flood, drought and disease suffered by livestock.

Further, it was recognised there would be some producers in dairying in 1998–99 who did not meet the eligibility criteria because of sale or purchase transactions relating to their dairy farm in the period between 30 June 1999 and 28 September 1999. These producers could apply for an anomalous circumstances payment right.

The Supplementary Dairy Assistance program, announced on 21 May 2001, targeted people who were the most severely affected by price movements following deregulation, and people whose eligibility for payments under DSAP was unintentionally limited by that Scheme’s eligibility criteria. This program provided for two types of payment rights that were administered by the Dairy Adjustment Authority.

Basic and additional market milk payment rights were granted to those dairy producers who had been granted a payment right under DSAP and who delivered at least 25.1% market milk in 1998–99 and held an interest in a dairy farm enterprise on 21 May 2001.

The overriding principle for discretionary payment rights was to help those who were unintentionally limited in or denied a payment right under DSAP because of a significant event or crisis, or significant anomalous circumstance.

For an event or crisis to be considered as significant, it had to be clearly demonstrated that milk production was directly affected by the event or crisis. The event or crisis could include: illness; injury or death of a person; disease or death of dairy animals; drought; storm; flood or other natural event.

A significant anomalous circumstance related to a change or atypical feature in the ownership or management of the dairy farm enterprise prior to 28 September 1999, that affected entitlement to a payment right or the face value of a payment right under DSAP.

In addition, land lessors were considered for a discretionary payment right if they were granted a payment right under DSAP as a land lessor and passed a lease income test.

Discretionary payment rights were granted at the discretion of the Dairy Adjustment Authority.

As at 30 June 2003, the Dairy Adjustment Authority had made payments in excess of $711.7 million to eligible entities under the DSAP and SDA.

Further information on the programs administered by the Dairy Adjustment Authority is available on the Authority’s website www.daa.gov.au.

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