Farm machinery subsidies are progressing slowly - where exactly is the problem?

This year, China's agricultural machinery purchase subsidy policy has undergone major adjustments!

Compared with previous years, the subsidy scope has been expanded and the subsidy categories are more concentrated; the subsidy process is more streamlined.

However, at present, many provinces have seen subsidy fund usage rates of less than 50%, and last year's fund disbursement has yet to be completed, so policy implementation is progressing relatively slowly.

What is the reason?

Multiple factors in Hubei have slowed subsidy progress

As of August 10, Hubei Province had implemented 650 million yuan in subsidy funds, accounting for 57.1% of the total funds, subsidizing 161,000 units of various agricultural machinery and benefiting 73,000 households. But compared with the same period, the progress was relatively slow.

Reasons:

1. The subsidy scope was narrowed, and machinery urgently needed in some mountainous areas was withdrawn from the subsidy scope;

2. The subsidy amount was reduced, making it less attractive to machinery buyers;

3. Punishment of enterprises that violated rules and regulations caused some buyers to misunderstand the subsidy policy, increasing the difficulty for agricultural machinery departments to explain it to applicants;

4. Subsidy processing was not convenient enough.

In addition, falling prices of some agricultural products also restrained farmers' enthusiasm for buying machinery.

Measures taken:

1. Treat accelerating implementation and settlement progress as an important task for agricultural machinery purchase subsidies.

2. Closely align with farming seasons and provide open subsidies for key machinery.

Guangxi's subsidy implementation progress is lower than expected

As of July 26, Guangxi had used 267 million yuan in national subsidy funds, accounting for 54.65% of the full-year 549 million yuan. National subsidy fund use and settlement were 267 million yuan and 7.32 million yuan respectively, far below the levels of 280 million yuan and 194 million yuan in the same period last year; 31.94 million yuan in regional subsidy funds was used, accounting for 70.98% of the 45 million yuan in regional subsidy funds. Guangxi's overall progress in implementing machinery purchase subsidies was relatively slow.

Reasons:

1. Some localities did not attach enough importance to it, and subsidies for some subsidized machinery were suspended after complaints.

2. Some subsidized machinery production and sales enterprises operated irregularly, and the overall implementation and settlement progress of machinery purchase subsidies was relatively slow.

Measures taken:

1. Carry out subsidy work for deep loosening and land preparation operations by agricultural machinery to expand the use of national subsidy funds;

2. Fully mobilize enthusiasm for purchasing machinery;

3. Strengthen supervision and provide good services.

Observation

Policy and implementation need a running-in period

This year, the Ministry of Agriculture and the Ministry of Finance issued the "Guiding Opinions on the Implementation of Agricultural Machinery Purchase Subsidies from 2015—2017," adjusting subsidy recipients, scope, procedures, and other aspects. But grassroots agricultural machinery departments failed to quickly adapt to the new policy, mainly reflected in:

1. Subsidy operations in various places actually lagged behind subsidy policy;

2. Solutions to new problems derived from policy adjustments were still being explored.

Judging from the situation in each province, there are two main reasons for slow subsidy progress: changes in subsidy scope, and contradictions between the setting of subsidy amounts and the needs of machinery buyers.

Expand subsidy scope and provide open subsidies for key categories

From 2015—2017, the scope of machinery subsidized by central government financial funds was compressed from 175 categories in 2014 to 137 categories.

The subsidy scope highlights key areas——leaning toward accelerating full mechanization of major crop production such as grain, cotton, oil, and sugar, improving the policy's direction and precision.

Open subsidies for key categories——focusing on subsidy priorities, promoting full mechanization of production; simplifying procedures, and preventing rent-seeking.

For local agricultural machinery departments:

1. Combine regional characteristics and planting models, introduce suitable machinery, and do good publicity and demonstrations to mobilize enthusiasm for purchasing machinery;

2. Communicate and coordinate with financial departments to accelerate subsidy progress.

In addition, factors restraining the effectiveness of subsidy policy also include:

Cumbersome processing procedures, irregular corporate operations, poor product quality, poor after-sales service awareness, and inadequate supervision.

“All existing problems will affect the subsidy process, and these must be solved through the joint efforts and cooperation of local governments, enterprises, and agricultural machinery service organizations.