Disaster payments won’t be saving grace, says lender

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Published: April 15, 1999

Major lenders don’t expect the new farm income assistance program to help many farmers.

When asked how much the Agricultural Income Disaster Assistance program will help farmers this year, the manager of lending services for Credit Union Central in Manitoba replied, “I don’t think an awful lot, quite frankly.”

Art Budd said the program does not contain enough financial relief to cover farmers’ losses from 1998.

John Nicolson, manager of agricultural services for the Toronto-Dominion Bank, said a farmer’s income has to slide 40 to 50 percent from the three-year average to get significant help from the program.

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“The floor is too low,” said Nicolson, explaining most farmers’ income did not drop that much.

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The timing of the program means farmers won’t know whether they qualify or how much they stand to receive before they nail down their spring operating loans, said Nicolson.

“AIDA does not help and will not help any of our clients get funds,” he said.

Barry Smith, of CIBC, said the program may be bankable for some farmers, but not for many of his clientele: “I don’t think many farmers will qualify for AIDA.”

John Murphy, vice-president for agricultural banking at the Royal Bank, said he expects payouts will be relatively small. When farmers considered results from the entire year, 1998 proved not to be all that bad.

“Most of our customers are fairly well-diversified,” said Murphy.

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Roberta Rampton

Western Producer

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