This report sets out the Productivity Commission’s interim findings and recommendations on the effectiveness, efficiency and appropriateness of Part 3 of the Future Drought Fund Act.

The Future Drought Fund (FDF) continues the policy shift, from in-drought assistance to building resilience to drought before drought occurs. The FDF can play an important role in protecting Australian agriculture and regional communities from the effects of a changing climate.

Drought is just one of the risks from climate change that farmers and agricultural communities face. The FDF should more explicitly recognise the need for resilience to climate change, not just resilience to drought.

The governance arrangements for the FDF are appropriate. However, processes can be simplified, while strengthening oversight of delivery outcomes.