쌀소득보전직불제의 효과와 개선방안

Abstract

The rice income compensation payment program was introduced in 2005 to stabilize the income of farmers in consideration of the fall in rice prices. The positive effect of the program was the stabilization of farmers' income, regardless of falling rice prices, to within 97.0%~110.2% of target prices. However, the program also had negative consequences. First, it led to a greater variability of rice prices set by producers, thus contributing to income instability. Moreover, this instability worsened over time for larger cultivation areas, which defeated the purpose of the program. Second, the delayed decrease in cultivation areas was a factor that accelerated the oversupply of rice. Due to the increase in production cost since 2010, the rate of decrease in cultivation areas was quickening compared to the period before the implementation of the program. As such, the program contributed to the oversupply of rice only to a limited extent. Third, the program deepens the inequality caused by a difference in farming scale, and has no significant impact on income levels. There is a greater income disparity between large and small farms because the program has been designed to be more beneficial for those who have larger cultivation areas. The program fails to significantly raise income levels since the amount of direct payments is less than 10% of total income. The government is trying to introduce a production adjustment policy to keep rice prices higher than the equilibrium price, but this policy is expected to involve high costs. The rice income compensation payment program requires fundamental improvements as it is currently associated with various adverse effects. There is a need to give serious consideration to the lowering of target prices, and to attain income stability by providing direct payments based on farming households. The program should be designed such that funding does not exceed the total payments of the base year, and a reserve fund should be established to reduce inequality and moral laxity among farmers. In addition, payments can be made to encourage efforts in environmental preservation.