How to improve FADN efficiency in the field of economic analysis Tomaž Cör Belgrade, 15th-16th September 2016

Use of FADN data Farmers for their own purposes; Agricultural Advisory Service; Start of the strategic farm management; Universities and other research institutions (models) Statistical Office; MAFF; Strategic analyses, Monitoring and Reporting.

Do you know who this is?

Why Monitoring and Evaluation of RDP and how? Importance of knowing if our policy or in our case Rural Development Program is going the right way - by using CMEF Common Monitoring and evaluation framework). A key-tool for programming, monitoring and evaluation is so-called “Intervention logic”, which establishes the causal chain from the budgetary input, via the output and the results of measures, to their impact. The intervention logic guides the progressive assessment of a measure’s contribution to achieving its objectives.

Intervention logic

Why indicators? Indicators are used as a tool to assess different effects on particular level (output, result, impact): how far the expected objectives have been achieved by measures or whole programme indicators should be specific, measurable, available/achievable in a cost effective way, relevant for the programme and timely available indicators can not always be filled with quantitative statistical data; in some cases, indicators might also include qualitative assessments or logical assumptions Indicators are common (proposed by EC) and additional/national. Each MS can define additional indicators due to program’s specialty or monitoring improvement.

Types of indicators? Baseline indicators: important reference points. Input indicators: they refer to the budget or other resources allocated at each level of the assistance. Output indicators: they measure activities directly realized within programs. Result indicators: they measure the direct and immediate effects of the intervention. Impact indicators: they refer to the benefits of the program both at the level of the intervention but also more generally in the program area.

Data gathering Data sources: statistical data (SORS) approved applications by different measures (IT support; AAMRD) economic and other results: FADN reports (holdings), accountancy reports-AJPES (enterprises) and other reports impact assessment of different measures on economic operations of beneficiaries cooperation with other institutions (Agricultural Institute, Environmental agency, DOPPS - BirdLife Slovenia)

Economic indicators One of the most important objectives of the RDP is increase of competitiveness. Result indicator for competitiveness is Productivity -Gross value added on Annual working unit (GVA/AVU). It is important to assess, how is/was productivity meliorated by the invested grunts. If we want to do that, we have to know the value of the same indicator before and after the investment on single farm level. Formula to calculate GVA: GVA = output - intermediate consumption.

Economic indicators In Slovenia, farmers are not obligate to do any kind of bookkeeping so it was quite an important question, how to measure this. Possibilities for economic indicators (GVA, GVA/AWU) Estimations on the basis of gross margin (Statistics) Not precise, a lot of speculations - but cheap. Introduction of some kind of bookkeeping. Precise but demanding - legal base needed.

“Compulsory” farms For this purpose we have invented so called „Compulsory FADN farms“ – farms that received investment grants from RDP. Since previous programming period “Compulsory” farms have to start with FADN accountancy when they received the letter from paying agency, that their application for the grants has been excepted. In new RDP FADN data is used also for preparation of the business plans – if the business plans are based on FADN or two sided bookkeeping, the applications get additional points at the evaluation, so they have advantage.

“Compulsory” farms Legal basis for introduction of FADN to the recipients of RDP investment money was first in natoinal RD regulation and then also in public tender documentation. 30 days after the approval of application the applicants should start with FADN accountancy. For at least 5 years after receiving the money they should send every year standard FADN results in the electronic form (1 excel line) to the FADN unit at the Ministry of Agriculture, Forestry and Food(MAAF).

“Compulsory” farms MAFF EC, DG Agri arround 2000 individual farms Accountancy offices Kranj, Ptuj, Ljubljana, Celje, Maribor, Nova Gorica, Murska Sobota, Novo mesto MAFF EC, DG Agri Agency RS of Agricultural Markets and Rural Development arround 2000 individual farms

“Compulsory” farms “Compulsory” farms are responsible for collection and processing of the data!!! Agricultural Advisory Service is available for help. Farms can process data by themselves or they can hire accountancy office to do that for them. Standard results for one year should be sent to the FADN Unit at MAAF by the end of March next year. The price for processing the data at the accountancy office is between 200 and 250 €.

Calculating the indicators Calculation of economic indicators from Standard Results: Taking the data on farm level and compere it to data before the investment (from application documentation), so we can assess if the investment was justified and according to business plan. GVA (SE 310), AWU (SE 010), income... Calculation on national level GVA/AWU, income of supported activity

Conclusions It is important to know, where you are and where are you going with RDP. Economic indicators for farms are difficult to access without any kind of bookkeeping. FADN results can be very good source of the economic data, both for preparation of business plans and annual reports. Legal basis for this kind of FADN data use should be prepared.

Thank you for your attention!