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Improving drought resilience in Northern Murray-Darling Basin farming communities: Is forecast-based financing suitable?

Author

Listed:
  • Atifa Asghari

    (Monash University
    Bureau of Meteorology)

  • Yuriy Kuleshov

    (Bureau of Meteorology
    Royal Melbourne Institute of Technology (RMIT) University
    The University of Melbourne)

  • Andrew B. Watkins

    (Bureau of Meteorology)

  • Jessica Bhardwaj

    (Monash University
    Bureau of Meteorology)

  • Isabella Aitkenhead

    (Monash University
    Bureau of Meteorology)

Abstract

A trend towards drier conditions during the April to October ‘cool’ season across southern Australia has been observed in the past few decades. Frequent and prolonged droughts have a significant impact on the financial stability of affected farming communities. Forecast-based Financing (FbF) is a novel proactive aid approach that provides support measures to increase resilience during the window between drought early warnings, and the actual onset and intensification of drought. Using the Northern Murray-Darling Basin as a case study, we investigated whether FbF combined with a user-centred Integrated Early Warning System (I-EWS) for drought has the potential to increase the drought resilience of Australian farming communities. This study shows that farming businesses most impacted by drought have three common factors: (i) lower levels of business management skills, (ii) lower levels of pre-drought preparedness during non-drought periods, and (iii) slower responses when the intensity of drought increases. The results suggest that FbF in its current form is not recommended for a market economy such as Australia, as forms of direct assistance may have adverse long-term effects through disrupting the market itself and may not encourage farm operators to regularly assess and adapt their drought management strategies. Results also suggest that providing farmers, service providers, and all levels of government with tools that incorporate a user-centred I-EWS for drought can improve overall decision-making before, during, and even after drought. This change from a reactive to a proactive approach to managing drought impacts can be a highly effective form of increasing the drought resilience of farming communities.

Suggested Citation

  • Atifa Asghari & Yuriy Kuleshov & Andrew B. Watkins & Jessica Bhardwaj & Isabella Aitkenhead, 2021. "Improving drought resilience in Northern Murray-Darling Basin farming communities: Is forecast-based financing suitable?," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 109(1), pages 1221-1245, October.
    • Handle: RePEc:spr:nathaz:v:109:y:2021:i:1:d:10.1007_s11069-021-04876-6
    DOI: 10.1007/s11069-021-04876-6
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    References listed on IDEAS

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    1. Productivity Commission, 2009. "Government Drought Support," Inquiry Reports, Productivity Commission, Government of Australia, number 46.
    2. Ben Edwards & Matthew Gray & Boyd Hunter, 2009. "A Sunburnt Country: The Economic and Financial Impact of Drought on Rural and Regional Families in Australia in an Era of Climate Change," Australian Journal of Labour Economics (AJLE), Bankwest Curtin Economics Centre (BCEC), Curtin Business School, vol. 12(1), pages 108-131.
    3. David P. Rogers & Vladimir V. Tsirkunov, 2013. "Weather and Climate Resilience : Effective Preparedness through National Meteorological and Hydrological Services," World Bank Publications - Books, The World Bank Group, number 15932.
    4. Unknown, 2005. "Trends in Australian Agriculture," Commission Research Papers 31903, Productivity Commission.
    5. Productivity Commission, 2005. "Trends in Australian Agriculture," Research Papers 0502, Productivity Commission, Government of Australia.
    6. Jessica Bhardwaj & Yuriy Kuleshov & Andrew B. Watkins & Isabella Aitkenhead & Atifa Asghari, 2021. "Building capacity for a user-centred Integrated Early Warning System (I-EWS) for drought in the Northern Murray-Darling Basin," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 107(1), pages 97-122, May.
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    Cited by:

    1. Alex Dunne & Yuriy Kuleshov, 2023. "Drought risk assessment and mapping for the Murray–Darling Basin, Australia," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 115(1), pages 839-863, January.
    2. Isabella Aitkenhead & Yuriy Kuleshov & Andrew B. Watkins & Jessica Bhardwaj & Atifa Asghari, 2021. "Assessing agricultural drought management strategies in the Northern Murray–Darling Basin," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 109(2), pages 1425-1455, November.
    3. Jessica Bhardwaj & Yuriy Kuleshov & Andrew B. Watkins & Isabella Aitkenhead & Atifa Asghari, 2021. "Building capacity for a user-centred Integrated Early Warning System (I-EWS) for drought in the Northern Murray-Darling Basin," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 107(1), pages 97-122, May.

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