Dairy Structural Adjustment Program

• A re-establishment grant under the Farm Family Restart Scheme (now called Farm Help)
• A re-establishment grant under the Rural Adjustment Scheme or a rural partnership program

Dairy farmers, including sharefarmers, lessors and lessees were encouraged to make an application to the DAA for a Standard Payment Right during the three month registration period (which ended on 17 August 2000).

Standard Payment Rights for producers of market milk were calculated at the rate of 46.23 cents per litre, made up of a 37.27 cents per litre premium component and an 8.96 cents per litre non-premium component. Standard Payment Rights for producers of manufacturing milk were calculated on the basis of fat and protein content, with 8.96 cents per litre being the national average.

Payment of Standard Payment Rights granted to eligible dairy farmers commenced in the last quarter of 2000. Entitlements are based on deliveries of manufacturing and market milk in 1998/99. Payments will be made in quarterly instalments over eight years.

Exceptional events, such as a storm, a flood, drought or disease suffered by livestock, which directly caused a 30% or more drop in milk deliveries during 1998-99, may be taken into account by the Dairy Adjustment Authority (DAA). Affected producers were able to claim for an Exceptional Events Supplementary Payment Right based on the average milk deliveries for the three years 1995-96, 1996-97 and 1997-98.

All dairy producers, with the exception of those who have left the industry since 28 September 1999, or are the executors of deceased estates, were required to have certified by an appropriately qualified financial adviser that a farm business assessment had been undertaken by the producer. Farm business assessments were intended to ensure that producers were fully aware of the implications of the changed market circumstances on the cash flow and profitability of their dairy farm enterprises.

The detail of the farm business assessment will remain confidential to the producer and the relevant professional who verifies that the assessment has been completed. The DAA will not ask to sight or examine the assessment, however random audits may be undertaken..

Dairy producers could apply for an Anomalous Circumstances Payment Right if they had an eligible interest in a dairy farm enterprise on 28 September 1999, but that dairy farm enterprise did not deliver any milk during 1998-99. These producers must also have had an interest in a previous dairy farm enterprise during 1998-99 which did deliver milk to a company or other organisation during 1998-99, but at 28 September 1999, no longer held that interest in the previous dairy farm.

Any payment right under the Dairy Structural Adjustment Program was capped at $350,000 unless a qualified financial adviser certified that more than 70% of the producer's total gross income in 1998-99, or in the three years 1998-99, 1997-98 and 1996-97, was derived from the business of dairying.

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