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Farm Debt Mediation Scheme

Purpose of the scheme

The Farm Debt Mediation Scheme helps farmers and other primary producers struggling with debt. The scheme uses neutral and independent mediators to help farmers and their creditors work through debt issues.

The aim is to provide a negotiation process that is:

  • structured
  • confidential
  • impartial

    This will help farmers and creditors to agree on how to proceed.

    Under the Farm Debt Mediation Act 2019, secured creditors must offer mediation before taking any debt enforcement action against farmers and eligible primary production businesses. Farmers can ask for mediation at any time.

    The mediation scheme aims to promote the long-term viability and resilience of farm businesses. This will also help the primary sector as a whole. Helping farmers manage financial stress promotes positive mental health and resilience in rural communities.

    Benefits of Farm Debt Mediation

    The Farm Debt Mediation Scheme creates a safe environment for farmers. It gives them a chance to talk constructively with creditors as they work through debt problems.

    There can be a significant power imbalance when farmers deal with creditors. Mediation creates a more level playing field.

    The scheme allows parties to explore options for turning things around. If it cannot save the farm business, it can allow farmers to make a dignified exit.

    Lenders view it positively as it provides a transparent process for working through debt issues.

    The Farm Debt Mediation Scheme ensures that qualified and competent mediators are delivering services. It promotes a consistent, quality-led approach to the mediation process for all parties.

    For mediation organisations taking part, the scheme provides a new, standardised process.

    Eligibility for the Mediation Scheme

    The scheme is open to people involved in a primary production business. This includes any business that mainly produces unprocessed materials. This can be through agriculture, horticulture, aquaculture, or apiculture. It includes sharemilkers.

    Types of loans covered

    The scheme covers debts owed by a primary production business in connection with primary production activities. This includes loans secured against:

    • farmland
    • farm machinery and livestock
    • harvested crops and wool.


    The scheme doesn't apply to:

    • lifestyle farming
    • forestry
    • mining
    • wild harvest fishing
    • the hunting or trapping of animals.

    The scheme excludes any business that primarily provides materials or labour as a service to the primary sector.

    Implementation of the Scheme

    The Ministry for Primary Industries (MPI) administers, promotes, and monitors the scheme. It is responsible for:

    • evaluation and reporting
    • setting rules
    • approving mediation organisations (which oversee mediators)
    • making sure farmers are connected with mediation services
    • connecting farmers to other financial support where needed.

    The Farm Debt Mediation Act 2019

    The Farm Debt Mediation Act 2019 was enacted on 13 December 2019. The Act came fully into force on 1 July 2020.

    MPI has systems and processes to:

    • approve mediation organisations which can authorise farm debt mediators
    • ensure there are enough mediators with the skills to provide farm debt mediation services.

    The scheme was consulted on widely. People from the farming, lending, and mediation sectors contributed to the scheme's design. A range of people made submissions on the legislation as it went through Parliament.

    The Farm Debt Mediation Act 2019 act NZ Legislation

    Find out more

    Government media release: New scheme for financially distressed farmers

    Policy and design decisions (from December 2018)

    Cabinet paper

    Cabinet paper Appendix 1 – Parties consulted

    Cabinet paper Appendix 2 – Detailed design of the Farm Debt Mediation Scheme

    Regulatory impact statement

    Cabinet Economic Development Committee – Summary

    Cabinet Economic Development Committee – Minute

    Legislation design decisions (from June 2019)

    Cabinet approval

    Regulatory impact statement

    Key themes from targeted consultation and final policy approvals