by Andrew Tillett

Hundreds of millions of taxpayer dollars for drought-stricken farmers is warranted in recognition that people in the bush do not enjoy the same level of subsidised public services as cities, the nation's peak farmers' group says.

The federal government announced an extra $190 million to help rural communities, taking its drought relief spending to almost $600 million.

Travelling to Trangie near Dubbo in western NSW, Prime Minister Malcolm Turnbull said farmers would get up to $12,000 extra to help them buy food and pay bills as their incomes dry up.

The money will go to farming households already claiming Farm Household Allowance, a payment worth $16,000 a year and the agricultural equivalent to the dole.

The eligibility criteria for the allowance will also be relaxed by raising the cut-off for farm assets – which includes the value of landholdings and machinery – to $5 million. Up to 8000 households are now expected to benefit.

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"That's obviously a lot of money [the $5 million threshold] but the reality is, farmers who are providing the human capital for this massive industry, one of our most important industries, are sitting on assets from which in the drought they cannot generate any income at all," Mr Turnbull said.

Other assistance measures announced on Sunday include $5 million for the Rural Financial Counselling Service, which will help an estimated 19,000 farmers potentially eligible for the allowance but yet to apply for it, $11.4 million for mental health services and $15 million in grants for not-for-profit community groups.

The government has already provided $386 million in drought relief as well as concessional loans, and Mr Turnbull promised further measures would be announced.

NFF president Fiona Simson rejected criticism that taxpayers money was being used to keep unviable farms alive.

"Australian agriculture is one of the least subsidised in the world. It gets less than Kazakhstan," Ms Simson said.

"We're competing against farmers who are highly subsidised."

She likened drought assistance to the subsidised services people in the city enjoyed, such as public transport and access to better health and education opportunities.

"I think it evens the scale a little bit because of what people in metro areas take for granted.

"I find it extraordinarily frustrating that when the government puts packages out, there is discussion that farming is a weak industry and the government is doing something wrong to support people."

Ms Simson also defended the use of farm management deposit accounts, which allow farmers to bank up to $800,000 in the good times to help them through the bad.

Government figures show $6.6 billion was sitting in the accounts by the end of the June quarter. While the figure traditionally spikes in June as farmers rush to deposit money before the end of the financial year, Ms Simson denied farmers in need were not drawing down on their savings.

She said the overall pool had been rising after the limit was increased to $800,000 and deposits from farmers enjoying good conditions more than offset than those making withdrawals

With more 99 per cent of NSW, half of Queensland and large swathes of Victoria and Queensland drought-affected, Mr Turnbull said the Bureau of Meteorology believed it was the worst drought since 1965.

"It's a very volatile and often capricious climate and Australian farmers are resilient, they plan for drought, they are good managers but it can become really overwhelming," he said.

"Some farmers are in absolutely diabolical situations."

During his visit, Mr Turnbull comforted a rural charity worker, Edwina Robertson, who broke down talking about the "dire" conditions facing families in the bush. "It's worse than anything in the media you are seeing in the media, it's far worse," she said.

Opposition agriculture spokesman Joel Fitzgibbon said more should have been done for farmers sooner and accused the government of not planning to help farmers adapt to climate change.