"I was determined to have something to do and something I could do independently of any organisation. Redundancy gave me a kind of energy to do something I could do well, on my own, and I still had the discipline of working," she said.
Farrell (63) grew up in Oamaru in a household filled with reading.
"I had a lot of books, a lot of songs, a lot of words poured into me when I was a very small child - just any old songs, and no judgements made about high and low literature. Anything went - comics, everything. [My father] was omnivorous and he trained us to be omnivorous and I think that's the important thing, to gradually develop a taste of your own."
The way books and reading became part of her life is told in her autobiographical novel, Book Book (2004).
She was encouraged and praised for writing as a child and grew up with the idea that everybody had a gift - hers was for writing - and with that came an obligation to use it.
"Perhaps also that feeling that, as someone who was working class, that suddenly you were given access to a university. That was presented as an enormous privilege, and we knew it was a privilege even when we were little and it was called `the Opportunity'. So you felt this enormous sense of privilege and along with that went a certain degree of obligation. You had an obligation to your parents, who hadn't had the same opportunity."
Farrell came to the University of Otago in 1966 but felt intimidated by Dunedin.
"Looking back it possibly seems odd, but at the time I was a working-class girl from Oamaru and Dunedin seemed hopelessly sophisticated and quite terrifying," she said.
"I didn't get my courage up until I got to Toronto. Everything seemed equalised and the place was filled with people from other places. It was very freeing."
After graduating from Otago in 1968, Farrell and her husband went to Oxford for three years, then lived in Toronto for five years.
It was experiencing an explosion in theatre and film and, while there, Farrell did a master of philosphy degree in drama. She also worked for Holt Rhinehart, writing children's stories set in Canada with Canadian female characters.
"I got into the idea of writing from a nationalist and feminist perspective and that these things mattered. You couldn't keep importing stories from somewhere else," she said.
On her return to New Zealand, she taught drama at Palmerston North Teachers' College. As there were few New Zealand plays, she decided to write them herself, winning a Bruce Mason play-writing award in 1983.
About the same time, she had a poem published and won a short story contest in Manawatu's Evening Standard.
In 1991-92, now separated from her husband, she was awarded a residency at Canterbury University, met her second husband and joined him on Otanerito on Banks Peninsula, where he runs an accommodation and tramping business - she disappears into a hut in the paddock when the house is full of people, she says.
Since then she has been a full-time writer, and so far has published six novels, two volumes of short stories and three volumes of poetry, as well as numerous plays, including Chook Chook (1992), one of Playmarket's most frequently requested scripts.
She has also won numerous awards and residencies. Her first novel, The Skinny Louie Book, won the 1993 New Zealand book award for fiction.
In 2007, she received the Prime Minister's Award for Literary Achievement in Fiction, worth $60,000; in 1995 she was the Katherine Mansfield Fellow in Menton, France; in 2006 she gained the inaugural Rathcoola Residency in Donoughmore, Ireland; and this year she is the Burns Fellow.
It would be difficult to manage financially without grants and awards, she said, as her novels sell about 8000 copies and it takes two years to write one. She also writes radio plays and for the School Journal to help make a living.
"It would be lovely to have a huge readership, but I think the main thing is staying true to what you want to say and wait for the readers to come to you, really. I'd like to be able to carry on doing what I'm doing as long as I can - to keep having ideas and following them."
She says she feels compelled to write.
"It's just a feeling of being dragged into it, and a feeling of excitement at some sort of detail - of something someone said or something I've read in a newspaper. I have this feeling of getting hold of a little thread, and if I very steadily and quietly follow it along and write down important things that happen and stay true to that, it turns into a novel.
"But compulsion is what drives you through, because for me it takes two years to write a novel. I have multiple drafts and a lot of time thinking."
Her next book, The Broken Book, is being published in November. It's non-fiction, about walking, with poems interleaved, she said.
She is also working on a play, an adaptation of a Ngaio Marsh story, and has written River Lavalle, a libretto for a work by Mozart Fellow Chris Adams that they hope will be performed in November.
She is also working on a "tapa book", a notebook given to poets by the Auckland electronic poetry centre, which she intends to publish. It will be called The Burns and be about her experience of the Burns Fellowship year and rediscovering Dunedin, which she had known since childhood.
"It feels different coming back as a grown-up. Places change and I've changed, so I want to discover how it is now."
And when she has those things out of the way, she will start on a new novel, she said. It was to have been about a small-town community disrupted by a murder, but instead of the murder, the disruption is going to be an earthquake, something she knows at first hand.
She was back in Christchurch to finalise a contract for a book on the September earthquake when the destructive February one hit. Her flat in the centre of the city was destroyed and she has had to return four or five times to meet assessors and insurers.
"It's taken me a while to feel I'm here. I've been bouncing back and forth until about a month ago."
