A blow to farmers' hearts - €20 million evaporates

Farmers have been sounding the alarm since Wednesday noon, contacting „Agrobitė“ editorial office about calls from National Paying Agency (NPA) specialists. They said that there was no money left in the measure „Investments in agricultural holdings“, which is said to amount to – 20 million euros, and that therefore there was a threat that farmers would not be able to pay the suppliers of equipment and construction contractors who had helped the farms with the implementation of the projects.

According to the current rules, the funds are to be transferred to the farmer's account no later than 30 days after the submission of the payment request.

„Agobitei“ has received calls from farmers about projects ranging from tens of thousands of euros to several hundred thousand euros. The intensity of support here ranges from 40 to 60 %.

Farmers could receive up to €80,000 in support, plus soft loans, increasing the amount of support to €500,000 per project.

Farmers were told by NMA specialists that farmers could apply for a delayed disbursement of funds through the Strategic Plan, but that the funds would not reach them before January or February 2026. If the situation is left as it is, then the disbursement of funds for projects would be delayed by at least six months.

In addition, the control period will be extended by practically a year, which will come back to farmers in the form of additional bureaucratic burden for the NMA in the form of inspections and the submission of additional documentation.

„The state has committed to providing support, but we are now actually committing to everything, having believed the promises of the government, enshrined in the documents?“ – rhetorically asked more than one farmer.

But farmers are wondering what they should do now, as some of them should have paid for equipment and construction services in October. This means that such a default by the state will come back to the farmers first through loss of reputation – many will be seen as unreliable customers, some will damage long term relationships.

On the other hand, farmers will automatically become debtors, their credit history will deteriorate, making it difficult for them to get even credit to cover their current debts, which have come to them as a "dowry" of defaulted state obligations for the weddings to which they have been lured.

Lawyers advise farmers not to accept any request from the NMA to postpone payments, as they would be accepting by default the reputational damage and the ensuing reputational consequences. Whether these events can otherwise be considered as "force majeure" is still open to question.  

It is still difficult to say why the NMA has run out of money, as it is not the one who allocates it. The Minister of Agriculture approves the orders and rules for financing the measures. Obviously, Andrius Palionis, as Minister of Agriculture, hardly put his finger on the decision to announce this measure („Investments in agricultural holdings“), but it is likely that, as Deputy Minister, he would have been aware of the seriousness of the situation, as he worked in the team of the former Minister for Agriculture, Ignas Hofmanis. It is also likely that the measure in question was announced during the ministry of Kazis Starkevičius, as the farmers are talking about a measure announced in 2024.

Some farmers refer to the measure „Investments in agricultural holdings (simplified procedure) (2024 I)“ when applications for it were opened on 7 October 2024, six days before the new parliamentary elections, which took place on 13 October2024.

Others claim that it is the measure "Investments in tangible assets" (operational area "Support for investments in agricultural holdings" under simplified implementing rules) of the Lithuanian Rural Development Programme 2014-2020, which was announced in November 2024.

In any case, „Agrobitė“ will contact both the Ministry of Agriculture and the NMA for detailed clarification.