Farm Machinery Rental Budget Slashed by 5.3 Billion Won After Transfer to Local Governments

Beginning this year, the budget allocation method for the farm machinery rental program, which includes farm machinery rental offices, integrated mechanization in major production areas, and replacement of aging farm machinery, has been transferred from the central government to local governments. The stated aim was to increase autonomy in line with local conditions.

According to the 2026 Implementation Guidelines for Agriculture, Food and Rural Affairs Projects released by the Ministry of Agriculture, Food and Rural Affairs, the farm machinery rental program budget, based on national funds, fell by 5.3 billion won from 53.9 billion won in 2025 to 48.6 billion won in 2026. The budget reduction did not occur evenly, and counties and cities with weaker finances suffered larger cuts. In effect, the result of leaving decisions to local autonomy has returned as a gap between regions.

The 5.3 Billion Won Shadow Cast by Local Transfer
Previously, the Ministry of Agriculture, Food and Rural Affairs directly selected the number of offices and the local governments eligible for support, then allocated national funds. Under the system changed this year, the total amount is allocated to cities and provinces, and then cities and counties draw up their own budgets autonomously. The matching structure itself, in which 50% comes from national funds and 50% from provincial, city and county funds, remains in place. What has changed is the accounting and deliberation procedure. 

Baek Seung-kwon, an official in the ministry’s Advanced Agricultural Materials, Equipment and Seeds Division, explained, “The farm machinery rental program was adjusted from the Special Account for Agriculture and Fisheries to the Special Account for Balanced National Development,” adding, “When it was under the Special Account for Agriculture and Fisheries, the ministry reviewed the budget for the following year’s projects, but under the balanced development account, the budgeting method has changed to a form in which each local government is given autonomy within a ceiling and the ministry matches the budget proposed by the local government.”

As a result, if a local government does not choose this project, the allocated national funds themselves are not executed. The responsibility for securing the budget has also been transferred to local governments.

Autonomy Gained, but Fiscal Capacity Limited… Concerns That Regional Gaps Will Become Entrenched
The 10 cities and counties above were selected from among local governments with an average fiscal self-reliance ratio of less than 10% (based on the original 2026 budget, %) that had this budget allocated in 2025. (If selected in order of lowest fiscal self-reliance, many had no allocation in either year.)  An analysis of the original budget (main budget) for farm machinery rental operations found that one location had no original budget allocated at all for 2026, and three had reduction rates exceeding 60%. Although it is difficult to apply this uniformly to all cities and counties, the tendency for fiscal capacity to determine project selection is clear.

An official from local government A, where this year’s farm machinery rental program budget was sharply cut, said, “It was not reflected in the original budget this year, but it is expected to be reflected in a future supplementary budget.”

However, it should be noted that these figures are based on the original budget. Even if the program is omitted from the original budget, the budget may be revived through a supplementary budget during the year. In that case, the project does not disappear, but the burden on the field remains because early-year project planning and equipment orders are delayed by about half a year.

Of course, some local governments may have applied for as much related funding as they needed, but experts are raising concerns that such gaps could become structurally fixed. Jeong Seon-ok, president of the Korean Society for Agricultural Machinery and a professor at Chungnam National University, pointed out, “Capable local governments may be able to create exemplary cases, but there may also be places where projects are run in a distorted way depending on political advantages and disadvantages,” adding, “The central government must also prepare complementary measures for this.”

Farm Machinery Budget Pushed Aside by the Logic of Power
The transfer of allocation authority to local governments means that farm machinery budgets now compete at the same table with other local projects. It is a structure in which they vie for limited resources against welfare, culture, and regional development projects.

Seo Il-hwan, head of a counseling office at the Ganghwa-gun Agricultural Technology Center, said, “Budgets are often continuously used by the departments that have already been using them, making new entry difficult,” adding, “The agricultural sector is often excluded depending on the interests of local governments, or pushed aside by budget competition between departments and the logic of power.”

In urban-rural mixed cities, where the share of the agricultural budget itself is not large, this competition works even more unfavorably.  Since Cheonan City allocated 550 million won in 2022 for farm machinery rental projects, repairs, and equipment support, no such budget has been allocated even once through 2026.

Cheonan City Council member Ryu Je-guk, who has continuously raised the issue of the farm machinery rental program budget and staffing, said, “As an urban-rural mixed city, Cheonan City made many efforts from 2007 to 2010, including securing national funds, introducing farm machinery rental offices, and establishing a farm machinery team,” but added, “Currently, Cheonan City’s agricultural budget accounts for only 4% of the total budget.”

Rental Offices Depleted by a Revolving Door of Contract Workers
The more fundamental problem is staffing. According to Kang Jin-seok, a professional career officer at the Yongin Special City Agricultural Technology Center, Yongin Special City has only one regular employee in charge of farm machinery. It has been found that some local governments lack regular staff to such an extent that it is impossible to secure new projects and budgets.

Kang said, “Demand surveys are conducted for rental equipment at agricultural machinery rental offices nationwide, but as equipment increases, staffing should also be secured; in reality, that is not the case, and after professional career officers (formerly special-status officials) retire, hiring itself is not taking place.” He added, “Most subsequent hires are contract workers, and even when industrial-position staff perform the work, they are transferred elsewhere after two to three years, repeating a vicious cycle.”

The instability of the staffing structure is not limited to certain regions. President Jeong Seon-ok diagnosed, “Most personnel in charge of rental programs are contract workers, so their status is unstable and their position within the organization is low,” adding, “The workload is heavy, but working conditions are poor, and field personnel are being depleted. It is urgent to raise job satisfaction and guarantee stable status.”

Some point out that the issue goes beyond treatment and is a variable that determines the success or failure of the program. Jeong emphasized, “New tasks to address, such as the spread of smart farm machinery and agricultural work safety, continue to increase,” adding, “Whether local government projects succeed or fail will depend on establishing smart farm machinery teams or divisions linked with existing rental program work and securing capable personnel such as extension officials and regular employees.”

Calls for legislation are also emerging from the field. Kang said, “The parts concerning staffing in the guidelines of the Agricultural Mechanization Promotion Act should be legislated,” adding, “A bill should be prepared so that regular employees can be assigned for continuous operation and rental offices can be operated on a team basis.”

Importance of Farm Machinery Rental Grows Amid Aging and Labor Shortages… Central Government Attention and Local Government Incentives Needed
As the importance of the farm machinery rental program grows further amid aging and labor shortages, criticism is being raised that thorough management and supervision by the government and local governments are needed following the transfer of related budgets to local authorities.
Council member Ryu Je-guk emphasized, “As aging deepens, farm machinery rental will inevitably lead to outsourced farm work,” adding, “The government’s continuous interest and management are needed for the farm machinery rental program, which is most essential for farm households.”

An expert on mechanization of upland farming said, “Recently, the government has been transferring many projects to local governments, and I agree with the basic direction,” but added, “However, the central government lacks a strong drive to raise the mechanization rate of upland farming. I hope new projects will be prepared that can provide strategic support through the development and expansion of excellent models. Along with smooth operation at the regional level, areas needed nationwide should be promoted as differentiated projects.”

There were also opinions that incentive mechanisms to draw active participation from local governments are urgently needed. President Jeong Seon-ok proposed, “Local governments will move only when staffing and organizational requirements are reflected in the evaluation indicators for central government projects such as the selection of smart agriculture development districts,” and regarding the staffing issue, “It is urgent to build a system that can continuously secure excellent personnel in connection with local high schools or nearby universities.”

In response, Han So-ja, an official in the ministry’s Advanced Agricultural Materials, Equipment and Seeds Division, explained, “Support for the ‘Integrated Mechanization Project in Major Garlic and Onion Production Areas’ began in 2022, and virtually all major production areas have already received support,” adding, “Existing rental offices have also been expanded to some extent, with 493 nationwide, so local governments did not make additional requests.” Regarding the interpretation that the transfer of budget allocation authority to local governments caused the cuts, she stated, “It cannot be concluded that securing the budget became difficult because of the transfer work.”