The National Water Infrastructure Loan Facility will allow loan recipients to make interest only payments for up to the first five years, and have a further 10 years to repay the principal and any additional interest.

The concessional loans will only be available to state and territory governments. 

Victorian Farmers Federation (VFF) president Peter Tuohey said Victoria had “a long list of water infrastructure projects which will improve our state’s water security and boost agricultural opportunities.”

“We welcome the government’s commitment to assisting state governments in commencing investment in these projects,” he said,

The VFF also welcomed the additional $7.1 million funding for the Rural Financial Counselling service, which will extend services provided across the country for a further four years.

Other measures to benefit rural areas include $15 million over four years for a carp control programme.

The rural initiatives also included a two year pilot program to improve access for farmers to training and information about co-operatives collective bargaining and innovative business models, with the costs being met from existing departmental resources

Cuts to rural funding included savings of $9.2 million to the Managing Farm Risk Programme, with a means test limiting eligibility to farm businesses with annual revenue of less than $2 million.

An extra $2 million will be raised annually from changes to agricultural levies from July 1, 2016, including:

- a mandatory levy of $0.50 per tonne on all hay and straw prepared for export, replacing a voluntary levy;

- an increase in the Emergency Plant Test Response Levy for growth of private plantation logs.

National Farmers Federation president Brent Finlay said it was “delighted to see the tax burden on small business eased – with a 2.5 per cent tax cut for small companies, an increase to the tax discount for unincorporated entities, and more generous deduction rules.”

However the NFF joined the VFF in criticising the government for increasing the tax on backpackers working on farms, saying there were thousands of farm businesses and rural communities as well as industries such as tourism that relied on the backpacker workforce.