Global Trends in Extension Privatization

Extension has been, and still is, under attack from a wide spectrum of politicians and economists over its cost and financing. As a result, Extension Systems have had to make changes, by restating the system's mission, developing a new vision for the future, and formulating plans for the necessary transition to achieve the desired change.1

At least three scenarios have been suggested by government and farm organizations2 with regard to privatization of Extension:

1. Public financing by the taxpayer only for the kinds of services of direct concern to the general public.

2. Direct charging for some individual services that produce direct return in the form of improved income, with the possibility of differential rates for specific situations or target groups.

3. Mixed funding shared between public and private professional association contributions for services, with delayed return or collective services, such as applied research, training of farmers and agents, and improvement in Extension methods and tools.

These methods of privatization are typical in France, the United Kingdom, and the Netherlands. In France, nearly three- quarters of the total resources for the operation of the system are collected at the farm level through direct payment, voluntary fees from farm organizations such as cooperatives, compulsory fees levied in the form of taxes on a variety of products, or land taxes collected by Chambers of Agriculture.

The British system promotes direct payment by users without privatization of extension services. The public agency responsible for research and extension, the Agricultural Development and Advisory Service, is responsible for such tasks and relies on government employees to carry out the work. The novelty of the British approach is a system of charging for certain services, on a time-cost basis, that were previously offered free and financed by tax revenues.

The Dutch system is being implemented and won't be fully in place until 2004. Under this system, transfer of the responsibility and funding from the public to the private sector has been limited to about half of the extension staff, with the remaining half still budgeted and managed by the Ministry of Agriculture. The extension field agents to be transferred will be retrained and offered the possibility of working in a privatized structure established and managed by the Dutch farm organizations, although the total number of field agents is expected to decrease slightly. Research services and regional coordinating services between research and extension will remain under government control and will continue to provide free services.

These examples from Europe suggest that the privatization of agricultural advisory services is widespread, but that it will have different impacts depending on the policy adopted. In the case of France, the change was motivated by a political decision to develop self-supported agricultural advisory services as a major tool to promote self-management by a large majority of farmers. However, the main reason behind the trend toward self- financing relates to budgetary problems. In most countries, the relative share of national resources earmarked for agriculture has been steadily decreasing. This downward adjustment of budget allocations to agriculture is a result of a decrease in farm population and the declining political leverage of the agricultural vote.

An international perspective helps us understand and appreciate the present institutional re-evaluation and evolution occurring in the U.S. Cooperative Extension System. As this brief introduction suggests, the reasons underlying the critical attack on financing the system aren't only a national phenomenon, but part of larger forces for change operating internationally.

1. Futures Task Force to the Extension Committee on Organization and Policy, Extension in Transition: Bridging the Gap Between Vision and Reality (Blacksburg: Virginia Polytechnic Institute and State University, 1987).

2. M. LeGouis, "Alternative Financing of Agricultural Extension: Recent Trends and Implications for the Future," in Agricultural Extension: Worldwide Institutional Evolution and Forces for Change, W. M. Rivera and D. J. Gustafson, eds. (Amsterdam: Elsevier Science Publishers, 1991).