From two activities - "The support for the farming counseling" and "The training" the amount of EUR 73.7 million has been anticipated for. Currently, in PDRA (2007-2013) only for the activity within the range of Axis 1. "The utilization of counseling services by farmers and forest owners" the subsidy has been established to amount to EUR 437.5 million. The purpose of the study refers to the presentation of the situation of the farming counseling in the light of new Commonwealth and national regulations. It has been hypothetically assumed that the rang and significance of the farming counseling will increase in the course of the implementation of the Rural Development Program 2007-2013, which additionally introduces the possibility for commercial counseling companies to be established.

The essential contribution to problem financing of consultancy services have brought Pabich A, Kania J. and others scientists.

Research methods

As research methods were used general logical knowledge methods (the analysis and synthesis), the abstract-logic method, the comparison method, the monographic method.

The main part

The aspect of financing of consultancy services

The access of farmers to consultancy services was supposed to be facilitated by a special activity of PDRA entitled "Making use of consultancy services by farmers and forest owners". In general it was assumed that each farmer obtaining the direct subsidy shall have the right to use the constancy services within the scope of this activity. Taking into consideration the regulations of the European Union it was established that the level of the support shall be related to the size of the agricultural holding. The activity shall also take into consideration the specificity of the Polish agriculture. The subsidy shall amount to 80% of the qualified cost falling for the consultancy service, however not more that the equivalence of EUR 1500 per the holding within the whole period of the program. Within the scope of the above mentioned financial limit, the beneficiary shall be authorized to use the assistance many times, accordingly to the established catalogue of services. Consultancy services are burdened with certain specific properties referring to the fact that the farmer shall pay for 20% of the services and additionally the tax on goods and services (VAT). Financial regulations of EU state that aid instruments in the form of VAT may not be executed from public funds. Under PDRA 2007-2013 this activity was addressed to 400 thousand farmers for the initial total amount of EUR 437.5 million [PDRA, 2007]. As a result of the reform of the Common Agricultural Policy of 2003 the manners of supporting the agriculture sector by EU have been changed, and the rules have been strictly related to area subsidies. Direct subsidies became strictly dependant on the farmer's meeting of a number of requirements called cross-compliance requirements. The rules of cross-compliance were divided into three areas, whereas the A area covering aspects of environmental protection and the identification and registration of animals, became valid on 1^st January 2009. The B area referring to the requirements within the scope of public health, the health of animals and plants became binding in 2011 and the third C area covering the requirements concerning the wellness of animals will be binding since 2013. Cross-compliance requirements are not new phenomena in our agriculture, as the farmer already previously was obliged to observe certain established rules of good agriculture practice under the national jurisdiction. However, the new element refers to the relation of the observance of requirements with the amount are payments obtained by the farmer [the adjusting of agricultural holdings, 2009].

Advisors who provide services subsidized from public funds are obliged to assist farmers with the implementation of standards and cross-compliance requirements into agricultural holdings. Advisors must demonstrate good knowledge of regulations related to the rules of the provision of consultancy services and manners of the substantiating of advisory work. Other requirements refer to the directional higher education, completed course in the filed of cross-compliance concluded with a written exam and permanent increasing of professional qualifications during courses. In the process of the provision of consultancy services, apart from public units of the agricultural consultancy, according to new legal regulations, licensed private commercial entities may be established for the purpose of the intensification of processes taking place in rural areas. The Establishment for the Agricultural Consultancy has the obligation to control private consultancy entities which have obtained the accreditation and assist farmers with adjusting of holdings to the requirements of EU [the regulation of the Ministry of Agriculture and Rural Development, 2008]. Thus, starting form 2008, a new formal possibility of establishing commercial consultancy companies of a private character has been introduced. Such companies shall reinforce, by personnel, public counseling facing a difficult task related to the challenge of the meeting of cross-compliance requirements. Until the end of 2009, approximately 60 entities authorized to offer consultancy services were established in Poland and they were granted the accreditation of the Minister of Agriculture and Rural Development. The majority of consultancy companies offer the activity on the scale of the whole country. Moreover, the consultancy services may be provided by Agriculture Chambers which have at their disposal the cadre of 118 persons.

Cross-compliance instruments have not been reflected in the Polish jurisdiction in the form of the regulation, but only in the form of general execution regulations referring to the Regulation of the Council (EC) of 2003. Additionally, references to the necessity of the observation of cross-compliance are presented in PDRA with the presentation of certain activities. Thus, the scope and efficiency of the introduction of cross-compliance requirements are not dependent exclusively on the efficiency of advisors themselves, but it is the other way round, the responsibility falls on a farmer who is a beneficiary of the system of direct subsidies. The obligation of the farmer refers to active participation in all stages of the implementation of consultancy services, including the elaboration of the plan of the adjusting of the holding to the criteria of cross-compliance, rendering of documents for the purpose of their evaluation, as well as the providing of necessary information [The adjusting of holdings, 2009].

Thus, for the purpose of enabling advisors to develop effective consultancy services, under PDRA 2007-2013, a special activity entitled "The use of consultancy services by farmers and forest owners" has been launched. The introduction of the activity was justified by difficult, for a majority of farmers, process of the adjusting to EU requirements. Thus, it is worth to analyze established financial conditions defined in appropriate provisions. In total, the amount of expenditures for that activity has been planned to amount to EUR 437.5 million, out of which EUR 350 million shall refer to public spending (80%) and EUR 87.5 million shall refer to personal expenditures (20%). PDRA has established that 600 thousand farmers (42.8%) will be able to make use of the consultancy services. The criteria of the access to the activity of "The use of consultancy services by farmers and forest owners" regulate that each farmer who makes use of the direct subsidy (1.4 million farmers) may use the consultancy support. No reservation has been introduced that the primacy in the access to the activity shall be given to farmers who obtain appropriately high level of direct subsidies (in EU at least EUR 15 thousand). As it has been mentioned, the subsidy amounts to 80% of qualified costs falling for the consultancy service, however not more than EUR 1500 (over PLN 6000) per one agricultural holding within the whole program. The above mentioned means that 20% of costs (EUR 300) of consultancy services shall be covered by the farmer, which costs are increased by 22% of VAT, which consequently considerably increases the cost of the fee covered by the producer up to 42% of qualified costs (up to EUR 660, with the exchange rate of PLN 4 per EUR 1, namely PLN 2640). Taking into consideration that the total amount of the subsidy in conversion into Polish zlotys (PLN 4 per EUR 1) amounts to PLN 1 750 million, it is expected that farmers will participate in that process, in relation to VAT, at the level of PLN 385 million, which assumption is difficult to be met and thus unreal [PDRA, 2007].

In fact farmers may deduct VAT, but only 1% of farmers in Poland implement generally binding provisions on VAT. The others refer top so called "lump sup farmers", who add 5% of the net sales price to the price of sold products - which is paid to the farmer by the purchaser of products. The thesis that not all means of the financial support anticipated for this activity will be fully used is confirmed by the novelization of PDRA presented by the Ministry of Agriculture and Rural Development to the European commission in 2009. The total cost of the activity of "The use of consultancy services by farmers and forest owners" was reduced from EUR 437.5 million to EUR 272.5 million (by 37.7%). Public spending for that purpose was reduced to as similar degree from EUR 350.0 million to EUR 218.0 million. The share of farmers participating in this process dropped from EUR 87.5 million to EUR 54.5 million, which shall be perceived a s positive phenomenon - with regard to the cost lowering - for the development of rural areas.

In Polish conditions, farmers have got used to the fact that consultancy services are provided free of charge both with regard to the agricultural holding as well as with regard to the conducted trainings and courses. To the contrast, the activity of "The use of consultancy services by farmers and forest owners" has been presented as the "service", for which VAT shall be paid, which constitutes a serious drawback of this activity. As it is known VAT tax may not be covered from EU funds or public funds. As the justification of the above said it has been stated that the criteria of the access are favorable for famers and the consultancy assistance refers to the transferring of the knowledge related to the observing of the Commonwealth regulations and thus the service does not have the investment character, whereas the obtained complex evaluation of the holding will protect the farmer against the excluding from the financial support within the scope of the Common Agricultural Policy.

The regulation of the Ministry of Agriculture and Rural Development has defined the types of consultancy services for farmers as well as the fees for those services. Consequently, the complex evaluation of the agricultural holding with regard to the meeting of the cross-compliance requirements in case of the crop production the fees have been established to amount to PLN 1200, whereas in case of the livestock production to PLN 2200. The evaluation of the agricultural holding with regard to the meeting of safety rules and hygiene at work, respectively PLN 150 and PLN 300. The regulation of the Ministry of Agriculture and Rural Development was issued relatively late, as after almost a year and a half since the beginning of the introduction of the of the new PDRA, and the collection of application even later, as after almost two and a half years [the regulation of the Ministry of Agriculture and Rural Development 2008]. Those factors for sure have an impact on the low level of the utilization of the financial support for consultancy services which is presented by the below presented table.

Table. The number of decisions on applications and the utilized amount of the subsidy for consultancy services in PDRA 2007-2013

The source: The system of executive information of ARiMR

In the campaign of 2009 agricultural institutions and organizations submitted 8220 applications for the provision of consultancy services, out of which 7491 (91.1%) received a positive opinion. The applied amount of the subsidy in the amount of PLN 26.6 million was reduced to PLN 24.4 million (91.7%). A considerably worse situation was faced in the course of the campaign of 2010. For 2266 submitted applications the number of issued decisions amounted to 127 (5.3%), whereas the applied amount of the subsidy dropped from PLN 11.6 million to PLN 0.5 million (4.1%). In total in the period of the discussed years the amount of PLN 1.2 million was in reality was disbursed which constitutes only some percent of the amount planned for that activity.

Consultancy services have not been limited to one activity in PDRA 2007-2013 related to the "Use of consultancy services by farmers and forest owners". The consultancy assistance shall be provided with regard to 22 activities presented in PDRA 2007-2013 with a specific consideration of three activities included in Axis 2. that is "Agricultural and environmental programs". "The support for farmers operating on areas with unfavorable conditions" as well as "Foresting of agricultural areas". Every year 1% of agricultural holdings will be subject to the review whether they meet the cross-compliance requirements. The above mentioned shall mean the necessity to conduct such a review in case of 14 thousand of agricultural holdings in PDRA 2007-2013. It is planned to cover 200 thousand of agricultural holdings with agriculture and environment programs. The support for agricultural holdings operating on areas with unfavorable conditions is planned to cover 750 thousand farmers and 52 thousand of forest owners [PDRA 2007].

Over the recent years, in majority of EU countries the systems of agricultural consultancy have been adopted which have been formed under EU legal regulations of 2003. In most cases a mixed model of the state-private consultancy has been adopted with numerous modifications stemming from the specificity of a given country. In Poland, apart from state institutions an option has been introduced for the accreditation of private entities providing consultancy services under the activity of PDRA 2007-2013. The model of private and state partnership adopted in case of the consultancy may constitute the guarantee of efficient supporting of farmers with their becoming authentic partners in the common agricultural policy. This model at the current stage of the development of consultancy means a dominating position of the state entity in the form of agricultural constancy establishments. The regulation issued by the Minister of Agriculture and Rural Development on 2008 on the accreditation of private consultancy entities directed the new companies to one activity of "The use of consultancy services by farmers and forest owners" and limited the time of their operation up to 31^st December 2015. Such an orientation of private consultancy entities of the commercial character makes it difficult for them to adopt the strategy of operation in a longer time perspective. Advisors were given the task of the operation for the increasing of the level of agricultural income, increasing of the market competitiveness of agricultural holdings, supporting of the balanced development of rural areas as well as the increasing of the level of professional qualifications of farmers and other inhabitants of rural areas.

However, consultancy functions have been oriented mainly on the agricultural and environmental activities and especially activities related to the meeting of cross-compliance requirements. They were presented with the support instrument in the form of the activity of PDRA of "The use of consultancy services by farmers and forest owners", which in present conditions with the participation of farmers themselves in costs of those services may not meet its basic goal and assumption.

According to the data of the Main Statistical Office, advisors in their mission of providing of consultancy have been supported by 31.9 % of the total amount of farm producers (42.1% farmers using direct subsidies) whereas the most considerable interest in consultancy services was demonstrated by holdings with a large scale of production covering the area from 50 to 100 ha.

Agricultural consultancy establishments have at their disposal a concrete organizational potential and the cadre of experts and they are better and better prepared to meet the mission of the introduction of agricultural innovations. At the current stage of the agricultural constancy private companies which only recently have been obtaining the accreditation and try to develop their companies are in a worse situation. They shall be assisted so that the idea of the public and private partnership may become the reality.

Final remarks