The reform of the three agricultural subsidies will be rolled out nationwide by the Ministry of Finance in 2016
According to a message on the Ministry of Finance website, the Ministry of Finance and the Ministry of Agriculture recently issued the "Guiding Opinions on Adjusting and Improving the Three Agricultural Subsidy Policies" (hereinafter referred to as the "Guiding Opinions"). Officials from the Ministry of Finance and the Ministry of Agriculture revealed that in 2016, the reform of the agricultural “three subsidies” will be rolled out nationwide on the basis of summarizing pilot experience and further improving policy measures.
When discussing the main content of this improvement, the relevant officials of the two departments introduced that the main content of this adjustment and improvement of the agricultural “three subsidies” policy is divided into two aspects. First, adjust 20% of the comprehensive agricultural input subsidy funds nationwide to support appropriately scaled grain operations. In light of the decline in the prices of agricultural production inputs, each province, autonomous region, municipality directly under the Central Government, and municipality with independent planning status shall adjust 20% of the funds from the comprehensive agricultural input subsidies allocated and issued by the central finance, plus the pilot funds for subsidies to large grain growers and the incremental funds of the agricultural “three subsidies,” to be used in a coordinated way to support appropriately scaled grain operations. The support targets are operators of appropriately scaled production and operation of major grain crops, with emphasis placed on new types of business entities such as large grain growers, family farms, farmers' cooperatives, and agricultural social service organizations.
⟦NL> Second, select some regions to carry out pilot reform of the agricultural “three subsidies.” In 2015, the Ministry of Finance and the Ministry of Agriculture selected 5 provinces, including Anhui, Shandong, Hunan, Sichuan and Zhejiang, and the provinces selected some counties and cities to carry out pilot reform of the agricultural “three subsidies.” The main content of the pilot is to merge the agricultural “three subsidies” into “agricultural support and protection subsidies,” with the policy objectives adjusted to supporting the protection of cultivated land fertility and appropriately scaled grain operations.
The officials also stated that 80% of the existing comprehensive agricultural input subsidy funds, plus the direct subsidies to grain farmers and the crop improved seed subsidy funds, will be used for the protection of cultivated land fertility. The subsidy targets are all farming farmers who hold contracted rights to cultivated land, and farmers receiving subsidies must ensure that cultivated land is not left fallow and that land fertility is not reduced. Subsidy funds must be linked to cultivated land area or sown area, and the boundaries of subsidy policy must be strictly observed. No further subsidies shall be given to cultivated land that has already been used as livestock and poultry farms, forest land, contiguous grain fields converted to facility agriculture land, cultivated land requisitioned (occupied) for non-agricultural purposes and other cultivated land whose use has changed, as well as long-term abandoned land, and cultivated land in the “compensation” area under the balance of occupation and compensation system whose area and quality do not meet farming conditions. At the same time, farmers' awareness of strengthening the protection of agricultural ecological resources must be mobilized, they must take the initiative to protect land fertility, and they must be encouraged to return straw to the fields and not burn it in the open. This part of the subsidy funds will still be provided by direct cash subsidies to households.
The 20% of existing comprehensive agricultural input subsidy funds, plus the pilot funds for subsidies to large grain growers and the incremental funds of the agricultural “three subsidies,” shall, in accordance with the requirements for unified adjustment and improvement of policy, be concentrated on supporting appropriately scaled grain operations. Other regions may also, according to local conditions, independently select some counties and cities to carry out pilots by referring to the policies and requirements of the pilot regions, but the scope of pilots shall be appropriately controlled. In 2016, the reform of the agricultural “three subsidies” will be rolled out nationwide on the basis of summarizing pilot experience and further improving policy measures.