A NSW Government website

NSW Government
Rural Assistance Authority

Frequently asked questions

The below questions and answers relate to the Drought Ready and Resilient Fund:

What is the objective of the Drought Ready and Resilient Fund?

The Drought Ready and Resilient Fund aims to increase the self-reliance, sustainability and resilience of NSW primary production enterprises to manage drought. The fund offers eligible farm businesses an opportunity to invest in their own drought preparedness and drought management activities including on-farm infrastructure works and business resilience, animal welfare and environmental activities.

How much funding is available under the Drought Ready and Resilient Fund?

The NSW Government has committed $250 million to the Drought Ready and Resilient Fund. Approved eligible applicants can apply for loans up to a maximum of $250,000 per annum. The availability of loans is subject to funds being available and no loans will be offered beyond the allocated funding.

Who can apply for a Drought Ready and Resilient Fund loan?

The Drought Ready and Resilient Fund loan is available to eligible sole traders, partnerships, trusts or private companies who operate in the primary production sector in NSW. To be eligible, applicants must earn at least 50% of gross income or at least $75,000 in one year from the primary production business, or be a bona fide primary production enterprise. Detailed eligibility criteria is provided in the program guidelines.

How much can I apply for and how long do I have to repay the loan?

A loan of up to $250,000 is available per application and up to 100% of the net, GST exclusive cost of the works can be borrowed. The maximum loan term is 10 years with monthly, quarterly, bi-annual or annual repayments of principal and interest.

What is the interest rate on the Drought Ready and Resilient Fund loan?

The interest rate applied to Drought Ready and Resilient Fund loans is determined on the date at which the loan is first drawn down and is fixed for the term of the loan. The current interest rate is published on our website.

How is the interest calculated and charged?

The interest rate on Drought Ready and Resilient Fund loans is fixed for the life of the loan and the rate is determined on the date the loan is first drawn down. Current rates are published on our website for reference. Interest is calculated daily and accrues from the first draw down of the loan with principal and interest repayments due as agreed (monthly, quarterly, biannually or annually). Repayments commence when the loan is fully drawn down or six months from the signed date of the acceptance of offer letter, whichever comes first.

What information do I need to provide with my application?

Applicants must provide a complete application form and a copy of the following documents:

  • last three years balance sheets and financial statements of your farm enterprise (these include profit and loss statements, stock trading account and depreciation schedules)
  • last three years individual taxation returns and a current listing of all assets and liabilities held by all individual members of a partnership or family trust, and individual directors and shareholders of all companies
  • the first page of your latest bank statement (for use when verify account details for any future payments)
  • Local Government Area rates notice
  • signed mortgagee consent form (if applicable)
  • Farm Business Resilience Plan (or equivalent) for your primary production enterprise
  • trust deed (if applicable)
  • monthly cash flow budget for the next 12 months.

Ensure that your documents are scanned individually as they will need to be uploaded to specific sections throughout the form. Please note that the online form has file size restrictions (approx. 20MB total). For each attachment, please ensure the file size is 2.5MB or less to avoid submission issues.

Are leaseholders eligible for Drought Ready and Resilient Fund loans?

Drought Ready and Resilient Fund loans are ordinarily available for primary producers who own and operate the business, and own the land (or are in the process of purchasing the land) upon which the farming occurs and where improvements are proposed.

However, a Drought Ready and Resilient Fund loan will be considered for a leaseholder where they:

  • have been leasing on that land for more than three years
  • have written approval from the landowner for the proposed works
  • can provide adequate security, and
  • can demonstrate an ability to repay the loan.

Do I need to have a Farm Business Resilience Plan to be eligible for a Drought Ready and Resilient Fund loan?

Yes, applicants must provide a copy of their farm business resilience plan or equivalent, which must be deemed suitable by the RAA. It should identify who prepared the plan and provide details of any consultation and advice sought (accountant, Rural Financial Counsellor, government advisor).

At a minimum, the plan should include information about the business (business structure; ownership; management; plant, equipment, and property), the current state of the business and goals (state of production and future goals and state of business and future goals) and detail relating to the future of the business, including a financial plan as well as a drought impact statement and strategies.

A template is available on our website to use when submitting your application.

Do I need to use a standard farm business resilience plan template?

No, we acknowledge that you may have already had a plan prepared and you are welcome to provide this if it meets the minimum requirements set out in section 7.3 of the program guidelines. If you do not already have a plan, you can use the template provided on our website as a basis.

What can a Drought Ready and Resilient Fund loan be used for?

Loans can be used to purchase a broad range of products and services, including the purchase and transportation of fodder and water, livestock feeding equipment, veterinary and animal welfare professional services, genetic banking, fencing and containment pens, shade structures, planting of trees, farm income diversification projects, pest and weed control, solar power conversion, soil conservation and earthworks, training and development, infrastructure repairs and maintenance as well as the purchase and installation of new on-farm infrastructure.

Eligible activities are listed in the program guidelines.

Can I claim for expenses incurred prior to lodging my application?

Yes, eligible expenses that were ordered, purchased or installed on or after 1 July 2023 can be claimed under the Drought Ready and Resilient Fund.

How long do I have to draw down on the loan once my application is approved?

The loan must be fully drawn down within six months of the date of receipt of the signed acceptance of offer letter.

The signed loan agreement must be returned to the RAA within one month to allow the RAA to register the security. Once registered, you will be advised via email that the loan is ready to draw down. This email will include the link to submit invoices online.

Can I use my loan across various purchases or projects?

Yes, when completing your application, you can provide an indication of various purchases and projects that you intend to use the loan funds for. Please keep in mind that purchases and projects must relate to the loan purpose you nominate when applying.

Can I use the Drought Ready and Resilient Fund to refinance debt?

No, the Drought Ready and Resilient Fund loan can't be used to refinance debt, however invoices can be backdated to 1 July 2023.

Can I apply for a Drought Ready and Resilient Fund loan if I've previously been approved for a Drought Infrastructure Fund (formerly the Farm Innovation Fund) loan?

Yes, if you're assessed as eligible and serviceability permits, you are able to take out a Drought Ready and Resilient Fund loan and a Drought Infrastructure Fund loan simultaneously. Please refer to program guidelines for further detail.

Will I incur break costs if I pay out my loan early?

Yes, break costs may be payable. This cost will be calculated at the time the contact is broken and will take into consideration the following:

  • total loan term
  • loan length remaining on your fixed loan contract
  • total value of the loan
  • the fixed interest rate applied to your loan
  • current fixed interest rates on offer through the RAA.

Can I use the Drought Ready and Resilient Fund to plant perennial pasture?

Yes, perennial pasture may be an eligible activity under the Drought Ready and Resilient Fund. The project would need to demonstrate practices that improve drought resilience by managing pasture diversity, with a focus on perennial species. This should be documented within the farm business resilience plan.

Can I borrow money for agritourism infrastructure?

The purchase or establishment of agritourism infrastructure will be considered on a case-by-case basis. The agritourism infrastructure would need to be located within the farm gate and will need to be documented within the Farm Business Resilience Plan to demonstrate how it will be used to build on drought preparedness and drought management activities.

Can I borrow funds for the purchase of livestock?

The purchase of livestock will be considered on a case-by-case basis. The purchase of livestock would be considered as an income diversification activity and would need to be documented within the Farm Business Resilience Plan to demonstrate how it will be used to build on drought preparedness and drought management activities.

Can I borrow funds for the purchase of equipment?

The purchase of equipment will be considered on a case-by-case basis. The use of the equipment would need to be documented within the Farm Business Resilience Plan to demonstrate how it will be used to build on drought preparedness and drought management activities.

What types of activities can I fund under "Income Diversification"?

Any income diversification activities within the farm gate can be considered under the Drought Ready and Resilient Fund. The justification for the diversification will need to be documented within the Farm Business Resilience Plan to demonstrate how it will be used to build on drought preparedness and drought management activities.

What security is considered to support a Drought Ready and Resilient Fund loan?

Loans are secured by a registered mortgage over land and not necessarily a first mortgage. Please note that a Deed of Priority will be required if you have an existing mortgage on the property. Alternate security will be considered on a case-by-case basis.

How is the Drought Ready and Resilient Fund different from the Farm Innovation Fund or the Drought Infrastructure Fund?

Compared to the Farm Innovation Fund and the Drought Infrastructure Fund, the Drought Ready and Resilient Fund:

  • has broader eligibility criteria, allowing a wider range of farm businesses access to the financial support (for example, the expanded criteria allows young farmers building their business to apply for the loan without having to prove eligibility as a ‘new entrant’)
  • allows for a wider range of activities and purchases using the funding, which are not restricted to on-farm infrastructure only
  • strengthens the link between funding and business resilience planning, with applicants required to prepare and submit a plan detailing how the funding aligns with strategies to prepare for, manage and recover from drought and other adverse events
  • has different loan terms, including the interest rate, loan repayment period and maximum loan amount.

How long do I have to apply?

There is no close date for the submission of Drought Ready and Resilient Fund applications, however, loans will not be offered beyond the allocated funding, therefore early applications are encouraged.

If approved, will a mortgage get taken over my property?

Yes, Drought Ready and Resilient Fund loans are secured by a registered mortgage over the land where the works are to be carried out. A Deed of Priority will be required if you have an existing mortgage on the property. Additional or alternate property may be considered. Your bank will need to sign and stamp a Mortgagee Consent Form to support your application. As part of the assessment process, the RAA will obtain title searches to confirm ownership of the land offered as security. The cost of the searches is charged to the applicant, whether or not they take up the loan.

How do I access the funds once approved?

Once you have been notified that your loan application has been approved, you will be asked to pay the applicable security and search fees and documentation will be sent to you for review and signing. Once signed documentation has been returned to the RAA and security has been registered, your loan will be set up in the system and the RAA will send you an email with instructions on how to access funds by submitting a claim request. Upon approval of your claim request, payment will be processed to your nominated bank account. Please note that the RAA will not pay to any suppliers directly.

Is GST included in any payment received?

No. The GST component of any invoice received can be claimed on completion of your Business Activity Statement (BAS). The RAA will not issue a Recipient Created Tax Invoice (RCTI) on payment of the funds and you should retain the ‘Payment Advice’ that is forwarded as a record for taxation purposed.

How does the RAA protect itself against fraud?

The RAA has a strong commitment to fraud prevention, detection, and response. Making a fraudulent application, including providing false or misleading information is a criminal offence which carries a maximum penalty of two years imprisonment, or a fine of $22,000, or both. The RAA will also attempt to recover any assistance received as a result of fraud. More information can be found on the Fraud and Corruption Prevention page on our website.

Where can I seek assistance with my application?

  • Rural Financial Counselling Service:
    If you are experiencing any issues completing the form, free confidential assistance is available from your local Rural Financial Counselling Service (RFCS). For more information, visit the relevant website or call:
    Southern and Central Region: 1800 319 458
    Northern Region: 1800 344 090
  • Translations:
    If you need assistance with interpreting or translating, please contact Multicultural NSW on 1300 651 500 or email languageservices@multicultural.nsw.gov.au.
  • Rural Assistance Authority (RAA):
    If you have any further questions regarding programs being delivered via the Rural Assistance Authority, please contact the team on 1800 678 593 or at rural.assist@raa.nsw.gov.au.