Farmers' Health Insurance and the Old-Age Farmers' Allowance are a farmers' social security system born of compromise under Taiwan's particular political environment; they can be regarded as a social policy tool of the Republic of China aimed at farmers. The Farmers' Health Insurance originally provided maternity, health, disability and funeral benefits, of which the health benefits have since been replaced by National Health Insurance; yet the Farmers' Health Insurance still suffers from long-term losses. As for the Old-Age Farmers' Allowance, the payments are subsidised from official budgets by the special municipalities (NT$2,000, half of the original NT$4,000) and the Council of Agriculture (NT$5,000 or NT$7,000, being half of the original NT$4,000 with further top-ups), amounting to roughly NT$50 billion, about half of the Council of Agriculture's budget over the years.

Such political bidding wars lack long-term, stable corresponding sources of funding, and many people who are not actually engaged in farming receive the payments; these people are usually buyers who hold small plots of farmland and farmhouses and who collude with contract-farming operators to feign agricultural production in order to slip through the reviews. This situation has been entrenched for a long time. It has also led the Pension Reform Committee to declare that this will soon become the focus of the next stage of discussions.

At the National Affairs Conference, the Council of Agriculture pointed out: "Farmers are the target of the next stage of pension reform; a system will be planned to guarantee farmers' lives after retirement, and the future plan is that the longer one farms, the more one receives... At present the government issues the Old-Age Farmers' Allowance through official budget allocations under a benevolence-grant system... some farmers have also reported that the current Old-Age Farmers' Allowance of NT$7,256 is still insufficient to guarantee economic security in later life... In the future, on top of the existing Old-Age Farmers' Allowance, a farmers' welfare system will be established so that farmers, when young and in a better economic position while farming, pay more, and the longer they farm the more they pay, so that in old age they can receive higher benefits and have a more secure later life."

This is basically a correct and pragmatic direction, but given the injustice of historical factors, the interlinkage between agricultural structure and farmers' social policy, and the differences in farmers' command of land as a means of production, reform of farmers' insurance must inevitably align with the policy goals of agricultural development and move towards "Farmers' Retirement Pension Insurance" or, provisionally, "second-generation farmers' insurance"; letting retirement support gradually move from welfare allowances towards a portable occupational pension insurance (reducing year by year the fiscal burden of subsidy-based benevolence grants), establishing an income-replacement function, and at the same time having second-generation farmers' insurance take over the fragmented benefit responsibilities of the current Farmers' Health Insurance.

The way out should not be to have the National Pension Insurance - which protects the weak with the weak, is riddled with problems, and focuses on a supplementary nature (meaning groups without fixed income) - take over the retirement support of farmers who have an occupational identity; still less should it be to use the still-under-discussion, not-yet-settled Grand National Pension Insurance (meaning a basic pension jointly borne by all nationals, including military personnel, public servants and teachers, workers, and the unemployed) to deny agriculture's status as a production occupation in which labour brings reward.

At the same time, farmers would also be forced to pay Farmers' Insurance premiums for 15 years before joining the Grand National Pension Insurance (because Farmers' Insurance is a supplementary social insurance that excludes participants from joining other social insurances), only then to receive a meagre pension in old age. Not only that, but the Grand National Pension Insurance also provides special benefits for farmers, which is likewise unfair to other occupations. Just imagine: if an individual farmer has not yet finished paying farmers' insurance and becomes disabled or suffers a misfortune, he or she can no longer join the National Pension Insurance. Whether it is the National Pension Insurance, a pension at the bottom rung of social security, or the basic pension system of the Grand National Pension Insurance, neither should ignore professional agriculture as a special form of labour.

In short, if the conversion of farmers' insurance into national insurance is forced through, farmers will lose the income support tied to their occupational characteristics, the farmer-land connection will be ignored, and the policy tool of agricultural structural adjustment will be abandoned. Conversely, only by perfecting the functions of second-generation farmers' insurance, improving agricultural structure, and releasing agricultural budgets for research, development and guidance can farmers' incomes be effectively raised and farmers' general ability to pay premiums strengthened; only then can a retirement life with an ample material foundation be provided for farmers.

Farmers Are a Profession, Not Beggars: The Unjust Historical Factors

Before discussing the issues of agricultural retirement support and agricultural income, we must first look back at how social and economic structures have acted upon farmers' occupational development. This includes the injustices of industry-agriculture development, health risks and industrial trade, so as to lay the foundation for the later discussion of "why farmers deserve second-generation farmers' insurance".

Taiwan's economic development of using agriculture to nurture industry is an indisputable historical fact, and over the long term it has also been the main reason for lowering agricultural income and driving farmers off the land. Wu Yin-ning, in her book Where Is Jianghu, mentions that the Nationalist government, through various agricultural price policies and tax policies, squeezed nearly NT$10 billion in income out of Taiwan's farmers over ten years, to pay for American aid goods that the United States dumped on Taiwan under the banner of free trade. As a result, rural areas whose agricultural productivity was rising gradually declined along with the take-off of the national economy; this in turn released the cheap labour needed by the industrial sector.

She gives more concrete examples: in the past, farmers were burdened with tax bills and loan items of every description (land tax, surcharges levied with the land tax, fertiliser-for-rice exchange, house tax and household tax, defence surcharge, consolidated income tax, water charges, membership fees), through which this exploitative relationship can be examined.

On the other hand, the government at the time, through "agricultural extension", "instruction" and "loans", drew farmers into becoming consumers in the agricultural input market, gradually shifting the management of agriculture towards industrialisation and reductionism; even the "productivity gains" of the Green Revolution came at a considerable price. The Green Revolution raised productivity at the expense of farmers' health; farmers who stood barefoot in the fields and directly breathed in pesticide sprays (especially in the 1970s and 1980s, when pesticides were widely applied but awareness of protection was low), and the health risks caused by the exposure of farming as a long-term occupation, cannot be underestimated.

Right up to the period around Taiwan's accession to the WTO, news of farmers swallowing pesticides to commit suicide was still occasionally heard. Since Taiwan's economic take-off, there has been no shortage of farmers who killed themselves over poor harvests, land or old-age support issues; this is nothing other than farmers who, because of external forces or old age, could no longer carry out productive labour, leading to insufficient old-age support and an inability to fight for or struggle towards it, ultimately drifting to the edge of ending their own lives. Just imagine how ironic it is that farmers use the very resources of production to end their own occupation and their own lives.

The above exploration of the history of agricultural development is not meant to create a pitiable image of the old farmer for the world to mourn and pity. Rather, we need to see from these historical factors how the farming occupation has been suppressed; and what kind of policy a state owes such an occupation in order to provide the material life needed for retirement.

That is, only by facing squarely the fact that farming is an occupation, and one that was suppressed in a history whose lessons are not far behind us, can we lay the foundation for discussing how the current policies of Farmers' Health Insurance and the Old-Age Farmers' Allowance (broadly, farmers' social policy) should have their retirement pension and social insurance functions taken over by second-generation farmers' insurance (Farmers' Retirement Pension Insurance), and how it should be matched with agricultural structural policy and adapted to diverse forms of agricultural labour in order to provide social insurance services.

A Shaky Foundation Makes the "Ground" Tremble: The Council of Agriculture Should Treat Second-Generation Farmers' Insurance as a Policy Tool for Improving Agricultural Structure

Agricultural structure refers to the ratio relationships formed among the effective combination of production factors in the agricultural sector (land, labour, capital, etc.), the effective operation of agro-industrial social organisations, and advances in technological development. Since the formulation of European agricultural policy, efforts have consistently been devoted to improving agricultural structure (structural improvement), using policy tools to help farms adjust to an "optimal farm size" and raise productivity.

So-called agricultural structural policy tools include manpower training, preferential policy loans, farmland mobility (Mobility), and improved production and marketing, among others; most importantly, through these policy tools the government can stabilise, for new and incumbent farmers, the various resources in factor markets and product markets, promote reasonable structural change and improve production conditions, so as to raise income and increase productivity.

Therefore, when discussing the direction of farmers' insurance reform, we should not take the short-sighted view of looking only at a simple retirement pension; rather, we should give equal consideration to the interlinkage between agricultural structure and farmers' social policy. Moreover, the root of all agricultural problems lies in nothing other than the influence of the land system, and so the government should not ignore the importance of the "farmer-land" connection to policy: on the one hand, farmers' labour depends on the land, the land determines agricultural production; land is the farmer's most important means of production, scarce in resources, and monopolised in the spatial market (it is impossible to grow two farmers' crops in the space of the same plot).

On the other hand, the foremost foundation of agricultural structure is the adjustment of land property rights (ownership rights, farming rights) to increase the input of production factors and promote productivity gains. Therefore, when dealing with farmers - whose main mode of operation is self-employment and family farms, who bear the risk of depending on the weather, and who shoulder the tasks of national land use and caring for the land - and their corresponding farmers' insurance, the "farmer-land" connection should be correspondingly linked with the tools of "farmers' social policy and agricultural structural policy". It is not appropriate to have labour insurance (workers have employers who bear profit-and-loss responsibility, and do not command the scarce means of production that is "land") or national insurance (for the unemployed) take over this task; only then can farmers' insurance and care be tightly tied to the land system to strengthen policy effectiveness.

West Germany was quite successful in coordinating farmers' social policy with agricultural structural policy tools, which should be attributed to the provisions of the Act on Old-Age Assistance for Farmers (Gesetz über eine Altershilfe für Landwirte), which provided farmers' pension insurance (Rentenversicherung) and various subsidies and allowances attached around social insurance, including old-age assistance for farmers, farmland transfer pensions, farmland transfer bonuses, care allowances for agricultural and forestry employees, production abandonment pensions, farmers' health insurance, farmers' accident insurance, pension premium subsidies for farmers changing occupation, and premium reduction subsidies, among others.

In short, farmers pay a unified premium (but poor farmers are subsidised by the government according to income level), and the insurance body pays old-age allowances (the amount of the pension benefit depending on seniority level and marital status) as the support for farmers' retirement and as a tool for manpower deployment; this is then matched with farmland policy to issue corresponding policy allowances (farmland transfer bonuses, production abandonment pensions), while employees in the agricultural industry (especially family farms with a low degree of corporatisation) enjoy care allowances for agricultural and forestry employees.

At the same time, the German government policy-wise induces farmers not to divide up the land, gives preferential treatment to a single heir inheriting the farm, provides subsidies for agricultural school education, and strengthens the matching of farmland leases for those leaving farming; by this means farm sizes are not reduced, or the land is leased and made mobile for agricultural production, and the age profile of agricultural practitioners is renewed. Optimising the allocation of land and human resources in agricultural structure through farmers' retirement insurance is the spirit of German farmers' retirement insurance most worth learning from.

Taiwan's current farmers' social policy, however, is not integrated with agricultural structural policy, with the result that the Council of Agriculture "completely lacks" any active tool for adjusting agricultural structure with which to respond to the development of the various sectors.

In the past, the Republic of China's land reform divided Taiwan into a smallholder system of family farms, and the entire western plain mainly relied on the rice economy and part-time vegetable growing to feed whole families. But as times changed, farm plots that were too small meant that some farms, because of insufficient land scale, could not invest in, rent or cooperatively use large agricultural machinery. Over the long term this leads to stagnant growth in farmers' incomes, which gradually cannot match the incomes of workers in the secondary and tertiary industries, so that farmers change occupation and leave the land, selling land to survive.

And amid the problem of excess loans tied to local politics, the Legislative Yuan, on the eve of the election in the 89th year of the Republic of China (2000), carried out a major revision of the Agricultural Development Act, opening up farmland for farmhouses in order to rescue local farmers' associations buried under mountains of bad debt; what came with this was a doubling of farmland prices in the suburbs, and the scourge of farmland being unable to circulate effectively for more than a decade.

To thoroughly solve the unreasonable conversion and re-designation of Taiwan's farmland (and the related issues of farmhouses on farmland, farmland fragmentation, farmland loss, farmland pollution, and deterioration of the production environment), it is not enough merely to regulate farmhouse standards and stress that the right to use farmland comes with responsibility for its use; in the long term, it is even more necessary to make the area of farmland in production flexibly mobile, develop the use of machinery at scale, guide new farmers into agriculture, and raise incomes in the agricultural sector, so as to bring about changes in agricultural structure and the development of agricultural modernisation.

Therefore, how to regulate the limited resource of farmland from the legal and policy sides is no longer something Taiwan's current farmers' social policy (which consists only of Farmers' Health Insurance and the Old-Age Farmers' Allowance) can intervene in or influence.

Yet Taiwan cannot wholly replicate other countries' legal frameworks for agricultural insurance. Policy planning units must have further basic data and detailed discussion before it is possible to plan a second-generation farmers' insurance scheme suited to the present stage. This includes several necessary considerations:

• Retirement age:
  At present there are roughly more than 1.2 million insured persons under farmers' insurance, of whom the largest groups by age band are those aged "70 to 79" with 310,000 people and "50 to 59" with 250,000 people. However, according to Council of Agriculture statistics, the age band at which Taiwanese farmers' average productivity is highest is around 65, so the age at which elderly farmers can apply for a pension should be extended to advanced old age, and handled together with a leaving-farming bonus.
  
• Calculating premiums by nature of work:
  It is suggested that second-generation farmers' insurance should calculate months of seniority on the basis of the fact of agricultural labour input, and apply three fixed premium rates according to "full-time and part-time farmers holding land", "full-time and part-time tenant farmers renting land", and "long-term and short-term agricultural and forestry employees"; and grant reductions according to their characteristics, for example producers holding land enjoy natural disaster reductions, tenant farmers enjoy tenancy premium allowances, and long- and short-term employees are included in a dedicated employee account. The various full-time and part-time farmers may then, according to the nature of the crop - grain, flowers, fruit trees, vegetables and other special crops - enjoy further policy-based reductions or subsidies. At the same time, second-generation farmers' insurance should no longer determine participation in farmers' insurance according to whether one is a member of a farmers' association or not, but should determine it on the basis of the fact of labour and production income; it should also work with the revision of the law on farmland being used for farming to establish a sound agricultural mapping database to track production conditions.
• Integrating "fallow and leaving-farming policy tools" with "Farmers' Retirement Pension Insurance" to improve agricultural structure
  Through bonuses for leaving farming (elderly farmers exiting production) and entering farming (new farmers entering production), the Council of Agriculture can move towards optimal farm size, giving structural policy support to profitable (development-type) farms and guiding loss-making (shrinking-type) farms either to profitability or out of production, and, in conjunction with Article 18 of the Agricultural Development Act, amending the farmhouse provisions so that farmland tenancy and sale return to pricing based on productivity and location; improving agricultural structure can then show results.
  
  
• The Council of Agriculture of the Republic of China did once, in 2012, promote a production abandonment bonus (a leaving-farming allowance), but without integration with farmers' social policies such as farmers' insurance and the Old-Age Farmers' Allowance, it could not induce elderly farmers to give up production and release their only farmland, forcing farmers to keep holding on to their land. If a farmer holding only one plot of farmland applies for the leaving-farming allowance, the elderly farmer loses eligibility for the Old-Age Farmers' Allowance. This shows that farmers' social policy and agricultural structural policy must maintain close linkage and legal coordination.
  
• Therefore, in future adjustments to fallow (production abandonment) and leaving-farming (farmland transfer, leasing, matching, retirement mortgage) policy, there must be close coordination with the qualifying conditions for benefits under Farmers' Retirement Pension Insurance. Attention must be paid not only to how to balance fairness between tenant farmers and landholding farmers; at the same time, note must be taken of whether the farmland environment they hold has deteriorated (factories, farmhouses), whether it has undergone land readjustment, and whether the land has ever been partially or wholly expropriated, before the amount of the leaving-farming allowance can be assessed.
• Parallel calculation of benefits under the old and new systems:
  We should learn from Germany, where pension benefits are calculated according to the number of years of contributions; all farmers' pensions should be calculated in parallel under the old system of the current farmers' insurance and Old-Age Farmers' Allowance (with an exit mechanism set up) and the new system of second-generation farmers' insurance (premium income and initial reserve fund input).The old-system portion is similar to the original Old-Age Farmers' Allowance, continuing the budget-supported benevolence-grant system of the Old-Age Farmers' Allowance, and then paid by farmers' insurance in proportion to insured seniority (the calculation of benefit amounts should also float with reference to the consumer price index); in addition, if elderly farmers hold farmland, they may also give up production and receive a bonus or rent. Add to this the new-system farmers' insurance, which includes maternity, sickness and injury, disability, physical and mental disability, funeral benefits, work injury and other benefits, as well as new-system old-age pension benefits calculated in proportion to seniority (the calculation of benefit amounts should be based on insured seniority).As a social policy directly related to farmers, the Old-Age Farmers' Allowance also has a retirement support function; farmers' insurance and the Old-Age Farmers' Allowance are themselves issues of old farmers' retirement support that must be handled together. If they are hastily placed into the National Pension Insurance, a benevolence-grant system requiring official budget allocations will still be needed to care for old farmers who have no other social insurance. It would be better, in the new reform system, to set up a separate account and, in conjunction with structural policy, obtain the land released by old farmers. In this way, on the premise of caring for old farmers, the Old-Age Farmers' Allowance can be phased out institutionally, promoting the mobility of farmland farming rights.
• Pension population structure
  At present the number of insured persons under farmers' insurance is about more than 1.2 million, with those aged 60 and over and those under 60 each making up half; 630,000 people receive the Old-Age Farmers' Allowance (after years of reviews excluding the wealthy, exit-and-entry controls, the supplementary principle of farmers' insurance, and the requirement of 15 years of paid seniority, 75,000 people have been excluded); such a population structure is an opportunity within a crisis. According to Lu Nian-qing's earlier calculations, Taiwan's optimal farm size is roughly above 2.5 hectares; with industrial and commercial development, regional characteristics, and differences in climate, species and technology, the optimal farm size in each region today must be higher than this figure.Therefore, fewer people engaged in agriculture but an expanded production area is absolutely a reasonable direction for agricultural development, and will promote moderate mechanisation among smallholders, so that income performance need not lag behind the income level of the industrial and commercial sectors. Until such time as farmers now over 60 gradually lose their productive capacity, the profitability of young and middle-aged farmers will also gradually rise because they can obtain farmland in the factor market and expand their scale; for agriculture as a whole this is positive development. Farmers' insurance therefore not only has a social insurance function but also shoulders the task of improving agricultural structure; it should not be discussed as part of the National Pension Insurance.

The land question is the eternal root of the agricultural question; the government has a responsibility to build farmers' insurance suited to agricultural labourers whether rich or poor, tenant or owner-farmer. The eligibility for second-generation farmers' insurance should not be determined simply on the basis of the current land-centred approach, but should be determined on the basis of actual agricultural labour, and should be an exclusive, portable, transferable-seniority occupational pension. Within this, land property rights (land ownership rights, farming rights, tenancy relationships) are the key targets of farmers' insurance determination and social policy; among widely differing family farms and employed farms, the Council of Agriculture must be able to grasp data on and adjust the means of land production, and must not abandon the policy tool of agricultural structural adjustment, "farmers' social policy".

Only by working with the Organic Agriculture Promotion Act, the Agricultural Basic Act and other legal sources that can be expected in future, to perfect and regulate the direction of agricultural industry development and the agricultural structure that underlies it, can we take account of both "agriculture as industry" and "agriculture as labour", provide an appropriate material foundation for agricultural development, and lay the cornerstone of agriculture as an occupation for Taiwan's smallholder farming.

The Council of Agriculture Should Take Up Again the Agricultural Structural Policy Tool That Is Second-Generation Farmers' Insurance, Which Is Still Effective

In the live broadcasts of the eighth meeting of the Presidential Office's National Pension Reform Committee and the ninth meeting, apart from the Council of Agriculture, none of the pension committee members' discussions went straight to the core. The age profile of farmers' insurance insured persons is on the high side, concentrating the risk of accidents such as physical and mental disability and death, and leaving finances unbalanced. The Old-Age Farmers' Allowance has also seriously affected the agricultural development budget. The direction of farmers' insurance should aim at taking account of both "farmers' old-age economic security and the farmland transfer system". It should also help young and middle-aged farmers expand to a reasonable scale and acquire the corresponding knowledge and machinery; on this point, Wu Shao-wen's election platform has already put forward quite good views. As long as we have a good retirement support system, elderly farmers need not worry about suddenly losing income and selling land to build farmhouses, but can instead rent out or sell their land to new producers who need it.

In fact, farmers do not need benevolence-grant-style favours; what farmers need is a reasonable, fair social policy that conforms to legal norms. Yet in the face of the historical factors of past injustice, election bidding wars and the lack of a retirement support system, we will inevitably need time to rebuild a second-generation farmers' insurance that can gradually become financially independent and has the function of a structural policy tool. Farmers' insurance should not be abolished; being a farmer is a profession, one that must be treated seriously and that works in cooperation with the land. At a time when military personnel, public servants and teachers are not being incorporated into national insurance, there is no reason whatsoever for farmers' insurance to be incorporated into national insurance either. To break away from farmers' insurance is to break away from the particularity of this occupation, and to deny that agriculture is an occupation that can support a family and be passed on.

Taiwan's agriculture is the typical "small production" spoken of by Marxists; such small production is considered backward and conservative from the standpoint of large-scale production agriculture (capitalist agricultural enterprises and communist peasant communes). To put it more plainly, some may criticise Taiwan's rice economy as inefficient and riddled with problems; but this is the reality of Taiwan's agriculture, and Taiwan's farmers rely on their own labour to raise a family and earn a living on the edge of extreme poverty. Setting aside the future debate over the industrial imagination of whether Taiwan should move towards smallholder development-type agriculture or corporate-aggressive agriculture, both require the support of farmers' insurance and agricultural structural policy.

A sound agricultural development policy system cannot lack a "Farmers' Retirement Pension Insurance" that brings economic fairness and social security, so as to strengthen the income-replacement function, strengthen the occupational insurance benefit function, and strengthen farmland mobility, and thereby truly attract young and middle-aged farmers to boldly commit to production. Only by improving the constitution of agricultural structure can Taiwan's agriculture raise its productivity and fairness, can it be a way of taking responsibility for the development of new agriculture and the agricultural value chain, and can it truly lay the material foundation needed for national food security.

Written at a time of heated debate over pension reform and a change of chairperson at the Council of Agriculture; we really have only this one chance to remake farmers' insurance into a policy tool that combines retirement support with improving agricultural structure.