11.3 Alternative Funding and Delivery

Diverse directions have been taken and multiple means of payment (public and private) have emerged as governments have opted for alternative financial and delivery arrangements to pay for and deliver public sector agricultural extension services. Extension provision is often multi-institutional and organized in ways that are not necessarily independent.

Where the public sector provides extension, the alternative funding arrangements include:

 

1. General tax-based public funding for agriculture, including funding of agricultural extension services, that is, the traditional public sector mode of funding extension.

2. Commodity tax-based public funding this is through Para fiscal tax, for example on an agricultural commodity such as coffee, as in El Salvador.

3. Fee-based public funding, in which fees are charged, usually to large farmers for extension service, for instance in Mexico's grain rich northern region.

4. Contract-based commercialization of public services, whereby contract-based arrangements are made between farmer and public sector extension services, as in New Zealand.

Where the private sector provides extension, the alternative funding arrangements include:

 

1. Government revenue-based vouchers, provided to farmers who then contract with private sector agents for extension information provision, as in Chile.

2. Public credit revenue-based coupon schemes attached to agriculture loans, obligating the farmer-borrower to use a percentage of the loan for extension advising purposes.

3. Membership and fee-based, including commodity tax-based funding, whereby farmers pay membership and service fees, and the private organization (e.g., a chamber of agriculture) also receives funds through a public cess or par fiscal tax charged on agricultural commodities, which funds are then transferred to the private sector organization; the private sector then provides the extension services - although public sector officials generally sit on the chamber's governing board.

4. Membership fee plus commercial sponsorship by groups of input suppliers, where farmer groups are provided non advisory, educational extension services by a consortium of privately employed agricultural consultants with partial financial support from rural sector commercial sponsors - such groups can operate on a large scale, with coordinated extension objectives

5. Privatization, whereby provision and, eventually, agent salary payments are shifted to a farmers' association or another private entity.

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This Learning Resource was Created by the Regional MSc AICM Program at the Haramaya University RDAE Department with Support of AgShare Project.