Low-interest loans to help struggling farmers with debt branded a 'bandaid' relief solution Low-interest loans will be available under the Commonwealths farm finance package from Monday. DROUGHT-stricken farmers across the state will be given a cash boost from the Federal Government but industry leaders say it is a case of too little too late for some producers. Low-interest loans of up to $650,000 will be available under the Commonwealth's farm finance package from Monday to help farmers manage their debt. The initiative, which will provide $60 million over two years to debt-ridden farmers, comes more than two months after it was announced on April 27. It had remained stalled as the Federal and Victorian governments negotiated who was going to pay the administration costs. But Victorian Agriculture Minister Peter Walsh and his federal counterpart Joel Fitzgibbon announced this morning they had agreed on terms and the much-needed finance would be rolled out. Mr Walsh said the loans would help eligible primary producers manage their existing debt by taking the pressure off over the concessional period. "The autumn has proven especially tough for livestock managers and I am pleased the Commonwealth has been able to provide the concessional loans program as an avenue of support," he said. But Farm Power president Chris Gleeson said the loans would only serve as a "bandaid" for farmers. "It's only a short-term relief," he said. It's only $13,000 first up. That's not going to get them out of jail. The average farmer in the southwest lost $200,000 this year. He highlighted how in the time it took for the governments to sort out the relief, hundreds of cattle had perished and the pressure was too much for one south-western farmer who last week took his own life. Farmers from Victoria's southwest told the Herald Sun earlier this week how rising milk prices and a prolonged dry had left them struggling to feed cattle. Many producers said they were at their wits end and had been forced to cull hungry herds as they carried huge debts and could not borrow more money to buy hay and grains. There are about 1500 dairy farmers in Victoria's west, with some 4500 farmers - about three-quarters of the nation's farming industry - statewide. At least 35 southwest farms have been taken over by banks in the first half of this year as farming families become crippled by debt. Mr Fitzgibbon said the concessional loans will provide a boost for viable Victorian farm businesses who are doing it tough. "I know there are primary producers, particularly in Victoria's southwest and the Goulburn Valley, that are facing some hard times," he said. Reducing debt repayments in the short-term will help alleviate the pressure on Victorian farmers and provide them with breathing room to continue to run their businesses and support their families. Under the program, farmers could save up to $81,000 in interest repayments over the five-year concessional period. He said individual savings will vary on a case-by-case basis, with the $81,000 figure based on the maximum loan amount of $650,000 over the full five years using a realistic commercial finance rate of 7 per cent. Minister Fitzgibbon said Victoria was the second state to sign on and take advantage of the scheme after Queensland signed on yesterday. "Reaching agreements with all states and the Northern Territory is a high priority for the Australian Government," Mr Fitzgibbon said. The loans in Victoria will be administered by the Rural Finance Corporation of Victoria and the main focus will be debt restructuring loans. Farmers can make contact with the corporation to discuss eligibility from July 15. The starting concessional interest rate for the loans will be 4.5 per cent, which will be reviewed on a six-monthly basis and may be varied to accord with prevailing economic conditions.