Comprehensively deepening rural reform to unleash new vitality in rural development
Since the Third Plenary Session of the 18th Central Committee of the Party, the central authorities have issued a series of guiding opinions and pilot programs concerning rural reform, and the comprehensive deepening of rural reform is being steadily advanced. At present, China's economic development has entered a new normal, and agricultural and rural development faces very complex new circumstances and needs to respond to unprecedented new challenges. Compared with the problems encountered before, the new challenges facing agricultural and rural development are more severe and more complex, with many institutional and mechanism-related factors intertwined, at once mutually causal and mutually constraining, and mutually superimposed and amplifying their effects. To adapt to the new normal of economic development and solve the difficult problems of “agriculture, rural areas, and farmers,” the fundamental way out lies in reform. The 2015 Central Document No. 1 made further arrangements for comprehensively deepening rural reform around adding vitality to rural development.
The two-tier management system based on household contracted management and combining unified and separate management is the greatest institutional achievement of rural reform and has strong inclusiveness, openness, and vitality. The 2015 Central Document No. 1 emphasized that it is necessary to uphold and improve the basic rural management system, uphold the dominant position of farmer household management, and accelerate the building of a new type of agricultural management system. First, it is necessary to guide the standardized and orderly transfer of land management rights, innovate land transfer and standardized management methods, actively develop moderate-scale operation in multiple forms, and raise the degree of farmer organization. This is not only a realistic choice for solving the difficult problem of “who will farm the land” but also an inevitable requirement for advancing agricultural modernization with Chinese characteristics. Second, it is necessary to actively cultivate new types of operating entities such as specialized large households, family farms, farmer professional cooperatives, and industrialized leading enterprises, encourage the development of farmer household family farms of appropriate scale, guide farmer professional cooperatives to broaden their service areas, and guide farmers to invest land management rights as shares in cooperatives and leading enterprises. As of the end of November 2014, there were already 877,000 family farms, 1.267 million farmer cooperatives, and more than 120,000 leading enterprises nationwide. Developing moderate-scale agricultural operation must be suited to local conditions and advanced prudently, and must both adapt to the process of urbanization and the scale of rural labor transfer and meet the requirements of progress in agricultural science and technology and improvement of production methods. At the current stage, key support should be given where the scale of land operation is equivalent to 10 to 15 times the local average contracted land area per household and where farming income is equivalent to the income from local secondary and tertiary industry employment. It is necessary to prevent tendencies that depart from reality, violate farmers' wishes, and one-sidedly pursue excessively large-scale operation. Guiding the orderly transfer of land management rights must proceed from the actual situation of local agricultural labor transfer and, even more, must respect farmers' wishes. It must not become a “Great Leap Forward,” must not use coercion or command, must not use arbitrary administrative direction, and must not set rigid targets or force promotion. The lawful rights of farmer households to contracted land must be effectively protected. Whether management rights are transferred, how prices are determined, and what form is chosen should be decided independently by the contracted farmer household, and the proceeds of transfer should belong to the contracted farmer household, so that farmers become active participants in and true beneficiaries of moderate-scale land operation. Third, it is necessary to encourage industrial and commercial enterprises to develop modern crop cultivation and livestock breeding suited to enterprise-style operation, agricultural product processing and distribution, and agricultural socialized services. For industrial and commercial capital leasing farmer households' contracted land, there must be strict access thresholds and regulatory measures, management must be strengthened, and problems such as land abandonment, “running away,” and harm to farmers' interests must be avoided. It is strictly forbidden to arbitrarily change the agricultural use of land for “de-agriculturalization.” Fourth, it is necessary to improve the agricultural service system and help farmers reduce costs and control risks. It is necessary to do a good job in pilot work on innovation of the socialized service mechanism for the entire agricultural production process, and in accordance with the requirements of “covering the entire process, comprehensive supporting facilities, and convenience and efficiency,” accelerate the building of a new type of socialized service system with diversified entities, specialized services, and market-based operation, providing farmers with low-cost, convenient, and all-round services.
As a foundational institutional arrangement, the rural land system bears on the overall situation of agricultural development, farmers' income growth, and rural stability. The 2015 Central Document No. 1 emphasized that, on the premise of ensuring that the nature of public ownership of land does not change, the red line for cultivated land is not breached, and farmers' interests are not harmed, rural land system reform must be advanced prudently and steadily in accordance with the unified arrangements of the central authorities. At present, many new challenges are faced in the land expropriation system, the rural collective operating construction land system, and the rural homestead system, and new contradictions and new problems that cannot be avoided or evaded have appeared in the field of the rural land system. At present, the central authorities' guiding opinions on pilot reform of rural land expropriation, market entry of collective operating construction land, and the homestead system have already been issued. The reform of these “three plots of land” involves adjustments to important laws, adjustments to major interests, and improvement of important rural systems, and a single move affects the whole body. First, steadily advancing the pilot reform of the “three plots of land” must strictly implement the land use control system, strictly observe the overall land use plan and urban and rural construction plan, truly respect farmers' wishes, fully reflect farmers' interest demands, and make the fruits of reform benefit the broad masses of farmers. Second, steadily advancing the pilot reform of the “three plots of land” must also pay attention to the systematic nature and completeness of reform and to close linkage with related fields such as the household registration system, fiscal and tax systems, rural finance, and social security, promoting them in a coordinated way and forming synergy. Third, in carrying out pilot reform of the rural land expropriation system, it is necessary to strictly define the scope of land for public interest, narrow the scope of land expropriation, establish a mechanism for distributing land value-added returns that takes into account the state, the collective, and individuals, reasonably raise individual returns, and improve reasonable, standardized, and diversified safeguard mechanisms for farmers whose land is expropriated. Fourth, in the pilot reform of market entry of rural collective operating construction land, it is necessary to improve the property rights system for rural collective construction land, accelerate the confirmation, registration, and certification of rural collective construction land use rights, grant rural collective operating construction land that conforms to planning and land use control the functions of transfer, lease, and shareholding, establish and improve market trading rules and service supervision mechanisms, and explore the establishment of platforms and systems for public trading of rural collective construction land. Fifth, in the pilot reform of the homestead system, it is necessary to protect farmers' homestead rights and interests in accordance with the law, reform the method of obtaining land for farmers' housing, and explore new mechanisms for farmers' housing security. The 2015 Central Document No. 1 especially emphasized that these three pilot reforms must be implemented by category. They must be strictly limited to approved pilot counties (cities), ensuring closed operation and controllable risks, and summarizing and improving while piloting, so as to form replicable and promotable reform results. Non-pilot areas must not blindly compare themselves or act without authorization. Advancing rural land system reform must have steady steps and solid implementation, striving to advance step by step and make progress while maintaining stability.
Rural finance is an important force supporting and serving the development of “agriculture, rural areas, and farmers.” At the end of 2014, the national rural loan balance was 19.44 trillion yuan, up 12.4 percent year on year; the farmer household loan balance was 5.36 trillion yuan, up 19 percent year on year; and the agricultural loan balance was 3.4 trillion yuan, up 9.7 percent year on year. In recent years, various new types of agricultural operating entities have developed rapidly and have very urgent demand for financial services. However, due to various reasons, most new types of operating entities still face the problems of difficult and expensive financing, which restricts their further development. In addition, the problem that ordinary farmer households' credit needs have long been unmet remains very prominent. On the whole, rural finance is still the weakest link in the entire financial system and cannot meet the development needs of accelerating agricultural modernization. Advancing reform of the rural financial system, encouraging and supporting financial institutions to broaden financing channels, innovate financing methods, and provide diverse financial products, and guiding rural financial institutions to optimize resource allocation and improve service functions are important aspects and institutional safeguards for enhancing the capacity and level of rural financial services. The 2015 Central Document No. 1 pointed out that it is necessary to actively adapt to rural realities, agricultural characteristics, and farmers' requirements, and continuously deepen reform and innovation in rural finance. It is necessary to comprehensively use policy measures such as fiscal and tax measures, monetary credit, and financial supervision to push financial resources to continue tilting toward “agriculture, rural areas, and farmers,” ensuring that the total amount of agricultural credit continues to increase and the proportion of agriculture-related loans does not decline. Recently, relevant departments clearly continued the pre-tax deduction policy for loan loss reserves for agriculture-related loans of financial enterprises, which will provide stable tax policy expectations for financial institutions carrying out “agriculture, rural areas, and farmers” business and effectively ease financing difficulties for “agriculture, rural areas, and farmers.” It is necessary to continue implementing a lower reserve requirement ratio for rural financial institutions to strengthen their financial strength; continue to increase support for relending and rediscounting under credit policy support to guide rural financial institutions to expand lending to “agriculture, rural areas, and farmers.” In order to enrich the entities supplying rural finance and effectively meet rural financial demand, the document, targeting the operating mechanisms, business models, and coverage scope of various financial institutions, put forward specific guiding opinions on giving play to the comparative advantages of financial institutions and strengthening services for “agriculture, rural areas, and farmers,” encouraging commercial finance to innovate financial services for “agriculture, rural areas, and farmers,” supporting policy finance to increase credit lending to “agriculture, rural areas, and farmers,” actively exploring effective ways to develop a new type of rural cooperative finance, and prudently carrying out pilot mutual fund cooperation within farmer cooperatives. It is necessary to strengthen inclusive rural finance, optimize the layout of county-level financial institution outlets, and promote full coverage of basic rural financial services. In accordance with the requirement of separating the three rights of ownership, contracting rights, and management rights of rural collective land, it is necessary to do a good job in pilot mortgage guarantee loans for contracted land management rights and farmers' housing property rights. Innovation is the driving force and source of the development of the modern financial service industry. The 2015 Central Document No. 1 encouraged financial institutions to innovate rural financial products and service methods, broaden service areas, and provide more convenient and efficient financial services to entities demanding rural finance, including developing government-supported financing guarantee and re-guarantee institutions for “agriculture, rural areas, and farmers,” supporting banking financial institutions in issuing special financial bonds for “agriculture, rural areas, and farmers,” encouraging qualified agriculture-related enterprises to issue bonds, supporting pilot financial leasing of large agricultural machinery and tools, and encouraging improvement of financial services for new types of agricultural operating entities.
To comprehensively deepen rural reform, it is necessary to innovate and improve rural governance mechanisms. It is necessary to explore effective forms of villager self-governance suited to local conditions, expand pilot villager self-governance with the villager group as the basic unit where there is actual need, and continue to do a good job in pilot villager self-governance with the community as the basic unit. At present, it is necessary to further standardize the duties of the village “two committees” and the procedures for village affairs decision-making and management, improve the institutional design of the village affairs supervision committee, and improve the mechanism for villagers to effectively supervise village affairs, ensuring that supervision is practical and useful.
The 2015 Central Document No. 1 also proposed that it is necessary to advance reform of the rural collective property rights system, explore effective forms of realizing rural collective ownership, and innovate the operating mechanism of the rural collective economy. It is necessary to deepen reform of water conservancy and forestry, actively explore various forms of water rights transfer, and promote intensive and economical use of water resources; advance comprehensive reform of agricultural water prices, establish a precise subsidy system for agricultural water use and a water-saving incentive mechanism, establish and improve the strictest system for protecting forest land and wetlands, and accelerate various reforms such as state-owned forest farms, state-owned forest areas, and the collective forest rights system, comprehensively unleashing the vitality of forestry development. In addition, the Central Document No. 1 emphasized that it is necessary to comprehensively deepen the comprehensive reform of supply and marketing cooperatives, promptly formulate supply and marketing cooperative regulations, and build supply and marketing cooperatives into a nationwide backbone force providing comprehensive services for “agriculture, rural areas, and farmers.” It is necessary to accelerate research and issuance of policies and measures to advance the reform and development of agricultural reclamation, deepen reform of farm enterprise operation, reclamation area groupization, and equity diversification, and innovate the industry guidance management system, the enterprise market-oriented operating system, and the farm management system.
The 2015 Central Document No. 1 emphasized that, in comprehensively deepening rural reform, it is necessary, in accordance with the overall arrangements of the central authorities, to improve top-level design, do a good job with pilot experience, continuously summarize and deepen it, strengthen supervision and implementation, ensure that reform makes progress and achieves results, and further stimulate the vitality of rural economic and social development.