Reaping the Benefits
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As the Chinese government draws up a long anticipated program to allow farmers the freedom to transfer their land use rights， thousands of farmers in an area in Heilongjiang Province known as Beidahuang， “the great northeastern wilderness，” China’s largest grain production base and its biggest cluster of State-owned farms， are fighting to reclaim their land.
Covering an area of 56，200 square kilometers， Beidahuang now has 43.2 million mu （6.9 million acres） of farmland across 113 State-owned farms， most of which were founded by local farmers in the early 1980s at their own expense. However， in the mid-1990s， local State-owned farms reclaimed the land under a program of “intensive farming，” requiring the farmers to pay extortionate contract fees to work the same land they had been farming for years.
In contrast to ordinary State-owned farms， which only impose charges on crops produced， the Beidahuang farms are an isolated community operating under a system similar to the “planned economy” system that China began to abandon when it embarked on its program of Reform and Opening-up in 1979. Endowed with its own social and political bureaucracy， the Beidahuang system has left farmers with no control over their livelihoods： their farms.
Given that the farms insist that contract fees are necessary to cover their own administrative costs， it seems that until the system is reformed， Beidahuang farmers may continue to suffer under a heavy burden from which farmers across China were released long ago.
From State Workers to Independent Contractors
Though known as one of the world’s three largest areas of fertile black land， Beidahuang had remained entirely unexplored until the Communist Party of China founded the People’s Republic in 1949. Responding to Chairman Mao’s call to develop the plain， millions of retired soldiers， college graduates， young intellectuals and farmers flocked into the wilderness， and began working to turn it into a massive expanse of fields.
The campaign gave rise to a new term， “farm workers，” referring to those who the central government assigned to work on land under the control of local State-owned farms.“The farms took full responsibility for profits and losses， and we earned fixed wages，” Yang Zhiguo， a farmer from Daxing Farm in Beidahuang， told NewsChina. “It was like working for a large State-owned enterprise[SOE] whose business was farming the land.” Yang is one of a group of 13 farmers who planned to hire a Beijing lawyer to help reclaim their land from the State.
According to Yang Zhiguo， their status as State employees ended in the early 1980s when the farms， hit by the three-year famine （1959-1961） and the Cultural Revolution（1966-1976）， were caught in so dire an economic crisis that they were on the verge of closure. Inspired by the household contract system， a rural reform program in action at the time， the farms encouraged their workers to support themselves by developing barren land at their own expense.
With their income stream cut off， swathes of farm workers like Yang Zhiguo piled all their remaining cash into the arduous task， working day and night to cultivate barren land. Numerous domestic media reports have revealed the difficulties these pioneers endured farm worker Jiang Baogui， for example， told our reporter that he and his peers had to daub grease all over their bodies to protect against swarms of mosquitoes. Due to the lack of drinking water， they were forced to quench their thirst from drainage gutters， causing widespread illness. Many families lived in abject poverty for years， and were forced to survive on scraps.
According to media reports， between 1978 and 2010 the area of farmland on the plain increased by around 10 million mu （1.7 million acres）， with hundreds of household farms springing up. Nowadays， Beidahuang is known as “China’s great granary，” producing over 20 billion kilograms of grain per year， amounting to one thirtieth of the country’s total.
Initially， the farmers’ hard work was rewarded. Sun Guosheng， another Beidahuang farmer， told Southern Weekend that farmers could earn 30，000 yuan （US$4，760） per year by farming their own land in the mid-1980s， a shocking figure compared to their former wage of around 480 yuan （US$76.20） per year.
In 1994， the central government issued a new document on agricultural development， further encouraging self-funded cultivation by allowing them to transfer and inherit the right to use land they had cultivated.
In 1995， the Heilongjiang Reclamation Bureau， the government body responsible for the administration of the Beidahuang farms， issued land use permits to farmers who had developed land themselves， and in an official document guaranteed these rights for no less than 20 years， a period that could be extended to 50 years at most.
Rights Lost
The following year， the farms took away these permits for“renewal，” but never replaced them.
“We even paid 20 yuan （US$3.20） each for the new permit， but they told us that the permits had been replaced with an annual contract system，” Yang Zhiguo told NewsChina.
Since then， farmers have been made to pay annual “contract fees” to work the land they cultivated themselves， which have risen every year. According to Yang Zhiguo， he had to pay over 2，500 yuan （US$416） per acre of farmland， almost twice the price in 2009. Based on the old land use permit agreement， farmers only had to pay around 500 yuan （US$83） for an acre of self-cultivated land.
“Including expenditure on seed， fertilizer， pesticides， electricity， water and labor， I spent about 8，100 yuan [US$1，350] per acre of land. Given that each acre yields 2，400 to 3，000 kilograms of grain， which sells for 2.7 yuan [US$0.45] per kilogram， I earn very little， and I lose money in poor harvest years，” Yang Zhiguo told NewsChina， revealing that many Beidahuang farmers， including himself， are heavily in debt.
“Even if [the farms] have the right to raise the contract fees on their own land， why also charge for the land we cultivated ourselves？” Yang added. According to the Heilongjiang Province Land Resources Bureau， in 2001 the Daxing Farm where Yang works had 420，000 mu（69，190 acres） of farmland， 60，000 mu （9，884 acres） more than it had in 1994. “That extra 60，000 mu was the land that we farmers had developed ourselves. Why did they take it back without compensating us？” Yang asked.
“Half Enterprise， Half Government”
Addressing the farmers’ complaints， Liu Changyou， president of Beidahuang Group， a publicly listed company controlled by the Heilongjiang Province Reclamation Bureau， argued that all land in China is owned by the State， and that State-owned farms are obliged to maintain and increase the value of their land. “The former [lower] price was not in step with the current market rate， and much of the land that was outsourced [to the farmers] was done so without a unified standard，” he said.
Due to the poor living conditions and remoteness from any neighboring settlements on the State-owned farms in the Beidahuang area， they were consolidated into a “half-enterprise， half-government” entity equipped with its own health care， education， infrastructure and public service facilities， with the nine farm administrations under the Heilongjiang Reclamation Bureau operating as a county-level government. However， different from ordinary counties where expenditure on social functions is included in the State budget， Beidahuang farms had to support themselves.
This helps explain why Beidahuang farmers have since been forced to pay increasingly high contract fees， while all other farmers in China are exempt from agricultural tax and fees for working on the land assigned by their local collective （generally the authorities in the village where a farmer lives）.
A bill shown to NewsChina by Zhang Guirong， another Beidahuang farmer who came to support Yang Zhiguo’s appeal， showed that besides contract fees， she had also been made to pay an array of extras， including fees for water conservancy， paddy field construction，road construction， public services， residential construction， forestation and even parking fees for agricultural machinery.
In the name of “scale and intensive farming，” the farms also mandated that farmers buy heavily marked-up and often low-quality seed， fertilizer and farming machinery， all of which had to be purchased directly from the farms themselves. Farmers caught violating the farm’s regulations suffered heavy fines.
The farms even took control of the farmers’ finances， borrowing money from banks on their behalf， but imposing their own fees before delivering the money to the farmers. “These were known as ‘prepaid contract costs，’ meaning we had no way to negotiate， even in case of a natural disaster，” said Yang Zhiguo.
“Because it was first built by retired generals and soldiers， the Beidahuang area has always had a military-style ethos. Some of the management policies [in the area] are truly unreasonable，” an official from Heilongjiang Reclamation Bureau， who asked not to be named， told NewsChina.
“But despite the [rising] contract fees， the farms still cannot afford the huge cost of employees’ social insurance [including that of farmers]， and various social infrastructure and services，” he added.
Since the late 1990s， however， various domestic media outlets and experts on the Beidahuang system， such as researcher Jiang Wei， have been investigating the methods by which annual contract fees are calculated， but officials have consistently refused to reveal any details.
Although administrators argue that the contract fees are determined at staff representative meetings， Jiang Baogui， a member of the petition group of 13 farmers who also acts as one of these representatives， told our reporter that these meetings are entirely ceremonial over half of those in attendance are government leaders.
In recent years， the Beidahuang farms have once again come under fire for their huge expenditure on urbanization， forcing farmers to live in apartments built around farm headquarters， which are generally located far from their farmland. To enable them to access their farms in the area’s cold winters， many farmers have had to buy cars， putting themselves even deeper in debt.
Failed Reform
The increasing burden has provoked more and more farmers to join the group petitioning against the reclamation of their land and the unreasonable charges imposed on them. However， given that Beidahuang has its own independent public security and judicial systems， no department within the system has accepted their petition. When they attempt to take their complaints to higher-level government de- partments or the State Council， they are usually intercepted on the way， and many are detained by the local police.
Yang Zhiguo and the other 12 farmers of Daxing Farm thus changed tack， moving to sue the local government who authorized the farms to issue land use permits， in an attempt to circumvent the self-contained Beidahuang bureaucracy. In November last year the local court dismissed the case for the second time， and rejected the farmers’ appeal on the grounds of a lack of evidence， but Yang told NewsChina that he planned to continue appealing， since the land he cultivated is， in his own words， “more important than [his] life.”
Yang is not alone. Bo Yi from Qixing Farm， for example， has been petitioning for 17 years， forcing him into bankruptcy and to divorce his wife. Yu Deqing from Longzhen Farm told researcher Jiang Wei that if he could not claim his land back， he would “jump off the Tian’anmen Gate.”
According to Jiang Wei， those who refused to pay would be ordered to cease production or even removed from their farm’s employee list， leaving them with no State-recognized identity.
“According to Beidahuang’s official website， they are centralizing scattered farmland and family farms for scale and intensive farming， but this does not mean that the [State-owned] farms have the right to‘merge’ or seize the farmers’ land using their administrative power， as was the norm in the Planned Economy era，” wrote Jiang Wei in his investigative report into the Beidahuang farm system.
In fact， as early as 2005， China’s national petition bureau had issued a document warning of the growing number of Beidahuang petitioners， concluding that： “Beidahuang farmers have been given neither the right to use collectively-owned land， nor the freedom to work as they please on the land they have contracted. This is authoritarian and coercive.”
In the wake of several field investigations， the government made efforts to reform the system by stripping social functions from the farms and transferring them to neighboring counties， only to find that local governments complained that they could not afford the additional cost.
An alternative method would be to reduce administrative bureaucracy by merging similar farms. However， since many farms are under the jurisdiction of different government departments， few are likely to relinquish their vested interests and rights.
Now， the Beidahuang farm system remains a tough question， and will be an important test for China’s latest round of reform two much-vaunted goals of which are the clarification of farmers’ land use rights and the restructuring of SOEs. Given the new leadership’s pledge to deepen reform， it may now be time to test their resolve.