Research Reports
Evaluation of Direct Payment Scheme on Less Favored Farming Area in Korea
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AuthorKim, Taegon
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Publication Date2009.08.01
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Original
The purpose of the study is to propose a way to reform the direct payment scheme on less favored farming areas to improve the policy effect on maintaining farming activity and on expanding the multi-functionality of farming in less favored area. The suggestion for reform incorporates various opinions from farmers, researchers, policy administrators, related associations and others.
Considering it has been six years since Korea started the direct payment scheme on less favored areas, we believe it is about time to gather up the problems associated with the scheme and run an interim evaluation. As is the case in the EU and Japan, direct payment is not a free lunch but should be a conditional payment with cross compliance. To conduct an interim evaluation, it is necessary to run a careful survey on how much the scheme is strict as well as practicability of on-site inspection of cross compliance. We also need to verify the relevance of policy beneficiary, unit price of payment, village common fund, and its relation with another direct payment schemes and farmland act.
The survey was fulfilled for randomly chosen 1 or 2 Eup or Myeons (Eup or Myeons are subdivisions of a county) and villages from 6 counties in 5 different provinces. We selected 6 counties where the direct payment on less favored areas is pretty common. The list of inquiries includes statistics on farming and direct payment in the region, current or future activities using a village common fund, and the problems associated with direct payment scheme.
We grouped the issues associated with the direct payment scheme into 7 categories and suggested a reform direction for each issue. They are purpose of scheme, index for determining the beneficiary, administration classification (Beobjungri or Hangjungri), definition of eligible farmland, lease farming, village common fund, and cross compliance inspection. We proposed to include reinvigorating the local economy as well as farming encouragement in the purpose of the scheme. For deciding beneficiary, we might as well consider population density or the decrease rate of population along with the currently used gradient and usage level of farmland. In order to minimize the case where a village with similar conditions is excluded from the scheme, we need to consider changing the administration classification from Beobjungri to Hangjungri. We suggest to include tentatively lease farming in the list of beneficiary eligible for payment. For village common fund, we proposed to widen the scope of relevant use and simplify the procedure. We approach the issue of cross compliance in two directions. One is to reinforce education to farmers to make them better understand the scheme. The other is to increase the labor force running the scheme at Eup or Myeon offices.
As the multi-functionality of farming in less favored (mostly hilly) areas is emphasized for environmental and natural resource values, direct payment in less favored area sheds more light in advanced countries including EU and Japan. Cross compliance is simplified but reinforced with thought on practical applicability for farmers and officers. When the suggestions we made from the study are incorporated in reforming the scheme, it will make a better contribution in reinvigorating the local economy and encouraging farming while compensating the disadvantages of farming and living in less favored conditions.
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