The central government will carry out a major reform of agricultural subsidy policy.

From the "target price" subsidy pilot project, to the integration of the "three subsidies" (improved seed subsidies, direct subsidies for growing grain, and agricultural materials subsidies) into "agricultural support and protection subsidies", and then to the adjustment of fishery oil price subsidies. China's agricultural subsidy policy at the central level is undergoing a series of major reforms.

According to an expert close to the Ministry of Agriculture, at present, there are more than 50 kinds of agricultural subsidy programs at the central level in China. In the following reform of agricultural subsidy policies, the vast majority of agricultural subsidy policies will be greatly reformed and adjusted. The "target price" subsidies, such as those concerned by the industry, will be extended from soybeans and cotton to the three staple grains, while the "three subsidies" integration pilot will be implemented nationwide in 2016.

At present, China's agricultural subsidies basically implement the "GSP", and the general direction of the next step of reform will be tilted towards large grain growers, grain growers and other new types of agricultural operators. To put it simply, the state will subsidize those who farm the land and who grow grain. It is not like now, as long as you contract farmland in rural areas, you can enjoy all kinds of subsidies for planting land and grain.

However, judging from the pilot project of "target price" subsidies launched by the relevant departments for cotton and soybeans last year and the pilot project of integrating the "three subsidies" implemented this year, there are also some problems and contradictions in the new agricultural subsidy reform. The contradiction of the "target price" subsidy is that, theoretically, the reform is in the right direction, but it is difficult to operate in practice, even raising the cost of the subsidy; the problem brought about by the integration of the "three subsidies" is that many farmers who own contracted land are planning to raise farmland rents.

The expert analysis close to the Ministry of Agriculture said that although there are some contradictions and problems in the two pilot reforms of "target price" subsidies and the integration of "three subsidies", however, it is right that the whole agricultural subsidy reform is tilted towards large grain growers, new agricultural operators and large-scale operation, and it is necessary to accumulate experience from some pilot areas in the future. In order to carry out a major reform of the entire agricultural subsidy policy.

The malpractice of GSP

At present, all kinds of subsidy policies implemented by the central government on agriculture are mainly implemented in the form of "GSP". For example, since 2002, the state has successively implemented subsidies for improved varieties, direct subsidies for growing grain, comprehensive subsidies for agricultural materials and subsidies for the purchase of agricultural machinery (referred to as "four subsidies"), as well as since 2004, the policy of minimum purchase price of grain and temporary purchase and storage of major agricultural products (referred to as "market support policy") has been introduced. These policies have played an important role in increasing farmers' income.

Han Changfu, minister of agriculture, said at the national two sessions in 2014 that in 2013, the "four subsidies" alone, the central government's direct subsidies to farmers reached more than 160 billion yuan. In the implementation of the "market support policy", the central finance for grain farmers, land farmers, for rural farmers, the total amount of subsidized income paid is even more huge. If you add in other various kinds of agricultural subsidies, the annual subsidy to agriculture by the central government has already exceeded 1 trillion yuan.

The "four subsidies" and the "market support policy" have been implemented for more than a decade, and many contradictions and problems have been exposed. The main problem with the "four subsidies" policy is that as long as they are farmers with policy-oriented contracted land, regardless of whether they grow land or grain, each mu of land can basically receive a state subsidy of about 90 yuan a year. As a result, after receiving the subsidy, some farmers turn to work in the city, while those who rent land to grow grain do not enjoy the subsidy for growing grain.

The contradiction in the "market support policy" is that the state has raised the minimum purchase price of major agricultural products year by year, and now the prices of domestic major agricultural products, including the two, are much higher than the international prices. on the other hand, the grain reserves of the state cannot be sold due to various reasons, resulting in distortions in the entire domestic grain market, grain and oil processing enterprises complain incessantly, and the state finance is also seriously damaged.

In addition to the "four subsidies" and "market support policy", various contradictions and problems have emerged in the agricultural insurance subsidies, agricultural products processing subsidies, fishery diesel subsidies, animal husbandry seed subsidies and other agricultural policies implemented by the state in recent years. A more consistent view in the industry is that the subsidy method of the GSP should be greatly reformed as soon as possible.

At the two sessions of the National people's Congress this year, Zong Qinghou [Weibo], deputy to the National people's Congress and chairman of Hangzhou Wa Group, put forward a proposal that the state should change the agricultural subsidy method of the "GSP" as soon as possible, so as to reduce the heavy burden on the state's finances. at the same time, it can also benefit the real main body of grain and land cultivation.

The aforementioned experts close to the Ministry of Agriculture told the Economic Observer that many of the motions and proposals put forward by the deputies to the National people's Congress and the National people's Congress in recent years have suggested that the agricultural subsidy policy of the "GSP" be reformed as soon as possible. The National Development and Reform Commission, the Ministry of Finance, and the Ministry of Agriculture have also conducted a large number of investigations, and on this basis, they have successively launched pilot "target price" policies for cotton and soybeans, the integration of the "three subsidies" pilot projects, and the adjustment of fishery oil price subsidies. A broader reform of agricultural subsidy policy is expected to begin in 2016.