History of Drought Policy and Programs

​Drought policy in the middle of the 20th century focused on attempts to ‘drought proof’ agriculture through the expansion of irrigation. In 1971, government policy shifted to recognise drought as a natural disaster, enabling support for those affected to be provided under the joint Commonwealth-state Natural Disaster Relief and Recovery Arrangements.

In 1989, drought was removed from these arrangements and a review undertaken, which determined that previous drought policy was poorly targeted, distorted farm input prices and worked as a disincentive for farmers to prepare for drought. The response to this review was the National Drought Policy, announced in 1992. The objectives of this policy are to:

  • encourage primary producers and other sections of rural Australia to adopt self-reliant approaches to managing for climate variability
  • facilitate the maintenance and protection of Australia’s agricultural and environmental resources base during periods of climatic stress
  • facilitate the early recovery of agricultural and rural industries, consistent with long-term sustainable levels.

  • The 1992 National Drought Policy
    Please note this document contains references to programs that are no longer available.

Under the National Drought Policy, a number of assistance programs were introduced, including the Rural Adjustment Scheme, which offered grants and interest rate subsidies and the Drought Relief Payment, which provided income support for farmers within declared Exceptional Circumstances (EC) areas. In 1997 these programs became the EC Interest Rate Subsidy and the EC Relief Payment.

The current definition of ‘exceptional circumstances’ was developed in 1999. For an event to be declared an exceptional circumstance, it must:

  • be rare and severe, that is it must not have occurred more than once on average in every 20 to 25 years and must be of a significant scale
  • result in a rare and severe downturn in farm income over a prolonged period of time (that is, greater than 12 months)
  • not be predictable or part of a process of structural adjustment.

Other programs were also established under the National Drought Policy between 1996 and 2000, including the Farm Management Deposits scheme, the Rural Financial Counselling Service, FarmBis and FarmHelp. FarmBis and FarmHelp were discontinued in 2008.

A range of other support programs, not directly associated with the National Drought Policy, are also available to farmers through the Australian and state and territory governments.

For more information contact the Australian Government Department of Agriculture and Water Resources​ by phone on 02 6272 3232 or email Media.