Effects of the debt relief act
Problems with financial liquidity do not bypass farmers.
The solution to such problems was debt relief act (act on debt restructuring of entities running a farm) entered into force in November 2018. On its basis, two institutions were indicated to which farmers are to ask for help in situations of loss of financial liquidity. We are talking about the Agency for Restructuring and Modernization of Agriculture (ARMA) and the National Support Center for Agriculture (KOWR). Each of these institutions is to support farmers in two ways. ARMA, firstly, provides farmers with aid in the form of subsidies to the interest rate of restructuring bank loans, and secondly – loans to repay debt. On the other hand, KOWR guarantees the repayment of restructuring bank loans, and also takes over debts in exchange for the transfer of ownership to the State Treasury.
According to the data provided by ARMA, it received 59 applications in 2021. Only 6 of them received a positive opinion. This represents 10% of all submitted applications. The situation is similar with applications submitted to the KOWR. Out of 208 applications submitted to the KOWR by the end of last year, only 25 were approved. This is only 12% of all requests.
Representatives of the Ministry of Agriculture and Rural Development (MRiRW) explain that formal errors in the applications submitted to ARMA and KOWR are the basis for their rejection. In turn, according to farmers, the documents are too complicated. This makes it difficult to prepare applications on your own. Farmers do not conceal that they are disappointed with the scope of the support provided.
It is worth recalling that we have already mentioned the issue of restructuring support addressed to farmers several times.