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Press Releases

Coalition Government divests Rural Finance Corporation and invests in regional Victoria

Friday, June 06, 2014

  • Rural Finance Corporation divested as part of the 2014-15 State Budget 
  • $400 million return to be invested in infrastructure to build a better regional Victoria

The Victorian Coalition Government has signed a heads of agreement for the sale of Rural Finance Corporation (RFC) business to Bendigo and Adelaide Bank (Bendigo) for a net return of approximately $400 million.

Treasurer Michael O’Brien and Deputy Premier Peter Ryan said the Victorian Coalition Government was satisfied that the conditions of the agreement, combined with Bendigo’s extensive experience and positive reputation for rural finance, meant that this was the right opportunity for this divestment.

“RFC has a proud history as a government-owned agribusiness specialist lender in Victoria and together with Bendigo and Adelaide Bank, have a wonderful cultural fit in terms of community banking that serves rural and regional Victoria,” Mr O’Brien said.

“Following a comprehensive review and a market process, the Coalition Government has determined that RFC customers, and broader regional communities, will benefit from these two organisations joining forces.

“RFC customers will now have access to not only existing products and services, but the broader banking service of one of the country’s most respected, community-based banks.

“In the conditions of this sale we have also ensured that non-commercial programs such as Young Farmers Finance Scheme, Natural Disaster Relief and Recovery Arrangement programs will all be maintained on the same terms,” Mr O’Brien said.

Mr Ryan said that the announcement was a win for Victoria’s diverse rural and agribusiness sector which would get better and more convenient access to RFC products and services, as well as regional Victoria generally as the proceeds were invested back into regional communities.

“The Coalition Government has made sure customers and staff will be looked after in this change of ownership,” Mr Ryan said.

“RFC staff will be employed by Bendigo on the same or better conditions, and there will be no forced redundancies.

“Customers will also benefit from this decision. RFC currently has 11 shop fronts and when the transition is complete, RFC customers will have access to 276 Bendigo Bank branches right across the state.

“Combining the business’s current products with those of a private bank will create a one-stop shop so regional customers can access more banking products and services.

“Today’s announcement also means that the Coalition Government can boost our investment in job creating infrastructure projects in regional Victoria, such as the historic Murray Basin Rail Project,” Mr Ryan said.

Net proceeds of the RFC divestment will be earmarked for investment in new productive infrastructure in rural and regional Victoria.

Mr O’Brien said the sale is expected to be bolstered by the Commonwealth Government’s asset recycling initiative.

“The Commonwealth’s financial incentives for the recycling of state assets into productive new infrastructure will further support our record infrastructure investment program,” Mr O’Brien said.

“We are about to embark on a significant infrastructure program and the proceeds of this divestment, together with the Commonwealth’s contribution, will be invested directly back into new job-creating infrastructure.

“We welcome the Commonwealth Government’s asset recycling initiative, which has been an influential factor in the decision of the Victorian Coalition Government to divest RFC.

“The most productive use of these funds is not sitting in the State’s books, but to have it invested into productivity enhancing infrastructure in rural Victoria, that will create jobs and boost our regional transport and export capacity.

“The value attributed to RFC by Bendigo and Adelaide Bank reflects the high quality of the RFC business. I wish to thank and pay tribute to the RFC board, led by Chairperson Sonia Petering, and its staff, led by Chief Executive Officer Rob Goudswaard, for their outstanding work which has helped to build the RFC business into what it is today,” said Mr O’Brien.

Key conditions placed on the sale include: there will be no forced redundancies of employees and employees will be offered employment with the new owner for a minimum of three years and on no less favourable terms and conditions; RFC products and brand are to be maintained for a minimum of three years; and offices or branches in the current 11 locations operated by RFC are to be maintained for a minimum of three years, including its head office in Bendigo.

RFC ownership will transition to the Bendigo and Adelaide Bank from early to mid-July 2014, pending APRA approval.

Media contact: Les White 0409 805 122 les.white@minstaff.vic.gov.au (Deputy Premier)

Funding to support community resilience

Friday, June 06, 2014

Deputy Premier and Member for Gippsland South Peter Ryan is encouraging local councils, community groups and business associations to apply for up to $110,000 through the Victorian Coalition Government‟s Resilient Community Program.

Mr Ryan said the Coalition Government‟s $1.5 million Resilient Community Program would assist regional and rural communities to build their capacity to tackle hazards including bushfires, floods and storm surges.

“Communities throughout Gippsland face unique challenges and a „one-size-fits-all‟ approach is not appropriate – in fact, some communities face multiple hazards throughout the course of a year,” Mr Ryan said.

“The Resilient Community Program, which replaces the Fire Ready Communities Grants program, provides funding for community-led projects to assist residents to better prepare for, withstand and recover from natural disasters and other hazards.

“It is local people who know what it takes to make their communities safer, better informed and more prepared to tackle the impact of these hazards.”

Mr Ryan said the Resilient Community Program would provide funding for:

  • Community-led projects in high risk communities that establish shared responsibility for all hazards;
  • Education and engagement activities – to help the community understand risks and take an active role in emergency management; 
  • Community-led local risk and hazard workshops; and
  • Programs that develop community leadership and support emergent leaders to help build resilience in communities.

Mr Ryan said funded projects would build community confidence to share the responsibility of handling emergencies with the government, community and business sectors.

“The Fire Ready Communities parent program has funded a number of local community projects over the past two years, programs which will continue to be funded under the Resilient Community Program,” Mr Ryan said.

Local councils, community groups and business associations that are interested in applying should contact the Department of State Development, Business and Innovation office on 5174 9233.

RYAN: REINSTATE DROUGHT FUNDING

Friday, June 06, 2014
The Brumby Labor Government’s ‘wait-and-see’ approach with drought funding has gone on long enough and assistance to Victorian farmers must be reinstated immediately, Shadow Minister for Regional and Rural Development and Leader of The Nationals Peter Ryan said today.

Mr Ryan said the government’s decision to cut funding on 1 July to a range of drought support programs including the municipal rate subsidy, drought health services and community support program and the apprenticeship retention program, was not in line with the Federal Government’s exceptional circumstances program.

“The Federal Government still classifies the whole of Victoria as a drought-affected region, and will do so until 30 June 2010, yet the Brumby Government cut funding to 10 of the 13 drought response programs across Victoria on 30 June this year,” Mr Ryan said.

“Rainfall during July and August was well below average in most regions across the state, meaning Victorian farmers are still suffering greatly from drought.

“Even with good spring rain it will take months if not years before the benefits of that rain are realised. The Brumby Labor Government must show some heart and commonsense and reinstate drought assistance measures immediately.

“Worried farmers are regularly voicing their concerns over their municipal rates for the current financial year.”

Mr Ryan said some farmers were eligible for subsidies of $4,000 to $5,000 in 2008 but with the funding now cut and with little money coming in, many are simply unable to pay.

“These farmers need some certainty and I call on the Premier and Agriculture Minister to act now to give farmers certainty, not make them wait until October,” Mr Ryan said.

Mr Ryan said by cutting these programs the Labor Government had also failed to recognise that drought is just one of the many issues facing Victorian farmers.

“Farmers are not only suffering with drought, they are being hurt by the world economic crisis, as well as difficulties in marketing their produce against highly subsidised products from the United States and Europe, particularly in the dairy industry,” Mr Ryan said.

“Surely, after 10 years of drought conditions the Brumby Government should have the framework in place to effectively administer a system of drought assistance funding which would provide ongoing support for farmers already struggling to survive.”

COALITION POLICY CLEAR - DROUGHT FUNDING MUST REMAIN

Friday, June 06, 2014
A Victorian Liberal Nationals Coalition Government would reinstate drought assistance programs slashed by the Brumby Government, Shadow Minister for Regional and Rural Development and Leader of The Nationals Peter Ryan said today.

Responding to a challenge by Agriculture Minister Joe Helper to provide the Opposition’s drought policy, Mr Ryan said the answer was simple – under current drought conditions, all drought assistance measures would be available to Victorian primary producers.

“The Coalition strongly opposed the Brumby Government’s decision to cut funding to 10 of the 13 drought response programs across Victoria on 30 June this year,” Mr Ryan said.

“It is both illogical and callous of Premier Brumby to do such a thing, given farmers, families and small businesses are suffering from drought and are now at their wits’ end.

“When almost the entire state is exceptional circumstance-declared by the Federal Government, it is wrong for the State Government to turn its back on rural communities.”

Mr Ryan said Coalition policy would be to reinstate all of the following 13 drought response measures:

• Catchment Management Authority Drought Employment Program

• Community Drought Communications

• Drought Apprenticeship Retention Bonus III

• Drought Extension Support

• Drought Health Services and Community Support

• Drought Response for Community Sport and Recreation Program 2009

• Extending the Case Management Approach to Supporting Farmers through Drought and Adjustment

• Increased Demand for Exceptional Circumstances Drought Assistance

• Municipal Rates Subsidy

• On-Farm Productivity Improvement Grants

• Regional Infrastructure Development Fund – Small Towns Development Fund

• Regionally Significant Synthetic Surfaces Program

• Water Rate Rebates for Irrigators

LABOR HALVES DROUGHT SUPPORT

Friday, June 06, 2014
The Brumby Government’s drought assistance package won’t be enough to enable farming families to withstand the fallout of more than a decade of drought, Shadow Minister for Regional and Rural Development and Leader of The Nationals Peter Ryan said today.

“The Premier and Agriculture Minister today revealed drought support measures have been cut by almost 60 per cent, from $115 million in 2008 to $47 million this year,” Mr Ryan said.

Under the 2009 drought support package:

• Water Rate Rebates have been reduced from $57.8 million in 2008 to $9 million; and

• $9 million will be spent on municipal rates subsidies compared to $15 million in 2008. The subsidy has been reduced from 50 per cent to 30 per cent.

Mr Ryan said the government had scratched the CMA Drought Employment Program, which received $10 million in 2008, and dropped the Small Towns Development Fund, which Labor committed $10 million to last year.

“The $38 million in new drought support measures will be beneficial but more support is still needed,” Mr Ryan said.

“Recent rain across parts of regional and rural Victoria has provided the prospect of relief for drought-stricken communities but the drought is by no means over.

“As the State Labor Government itself says, these communities remain under enormous pressure and in many cases it will take years for the flow on effects to be realised.”

Mr Ryan said the Labor Government’s annual approach to drought assistance funding was insensitive and poorly-thought out.

“Premier Brumby should have announced this package on July 1. Instead his government cut funding for 10 of 13 drought assistance programs,” Mr Ryan said.

“These communities have since faced an anxious wait for nearly four months during which drought counsellors and other support teams have packed their bags and left town because of a lack of job security.

“There was no reason for this delay – it caused unnecessary hardship and grief for drought-stricken farmers, families and businesses.

“What the government does not seem to understand is that no one makes money out of these packages. Rather, the funding serves the necessary purpose of getting families over the financial hump during very difficult times.

“Cutting this year’s program by almost 60 per cent is simply not fair,” Mr Ryan said.