The NIK audit also revealed sporadic and ineffective cooperation between the Agency for Restructuring and Modernisation of Agriculture (ARMA) and national parks in terms of information exchange on subsidies for agricultural land leased in those parks. As a consequence, applicants could use the land without signing agreements and without paying rents but at the same time apply for subsidies with ARMA. NIK identified some entities in Warta Mouth National Park which were subsidised by the Agency with over PLN 15 million in 2015-2019. The law was changed last year to eliminate that practice.
NIK also pointed to the absence of indicators to evaluate environmental effects achieved thanks to those subsidies. NIK recommended that the Minister of Agriculture and Rural Development should define such indicators.
Agricultural land in national parks
NIK verified how agricultural land of the State Treasury was managed in 7 national parks from 2015 to 2020 (first half). All in all, the land of this type occupied nearly 22 thousand ha at that time. Biebrza National Park – had the biggest area at its disposal (10.2 thousand ha), and Drawa National Park had the smallest (from 0.4 thousand ha).
The agricultural land in national parks, nearly all of which belongs to the State Treasury, is excluded from standard agricultural management, and its maintenance results from the protection of ecosystems and valuable habitats. Most frequently it is leased under an agreement which defines how it may be used, what protective measures should be taken and what is not allowed.
In 2015-2019, lease rents represented stable revenue for the audited parks. They reached (including penalties and interest) nearly PLN 48 million – from about 535 thousand in Drawa National Park to over PLN 17 million in Biebrza National Park. On average lessees paid for 1ha from PLN 378 in Biebrza National Park to PLN 932 in Kampinos National Park. Not all of them paid their liabilities, though.
A company which signed an agreement with Kampinos National Park did not pay over PLN 327 thousand for 2015. Finally, the park administration terminated the agreement and started to enforce its receivables, first by way of court proceedings and then enforcement proceedings. It proved ineffective and in January 2018, the case was filed to the court and a year later to the prosecutor’s office. During the NIK audit, the proceedings were still pending.
In two national parks, liabilities due to unpaid lease rent made up a big part of revenue under lease agreements. In Biebrza National Park:
- in 2015 - about 19% revenue
- in 2019 r. - nearly 147% revenue, or over PLN 4.5 million. The Park recovered about 35% those amounts.
In Narew National Park:
- in 2015 - 0.3% revenue
- in 2018 - 110.4% revenue, or more than PLN 757 thousand. The Park recovered about 32% those amounts.
In two other audited parks, overdue amounts were paid as a result of measures taken by the administration.
The national parks verified if lessees acted in accordance with signed agreements. In 2015-2019, in case of identified irregularities, penalties were imposed only on two audited parks. In case of Biebrza National Park which leased the biggest areas of agricultural land, they exceeded PLN 900 thousand, whereas in Warta Mouth National Park it was only about PLN 700. Other parks were smaller so it was easier to supervise the leased land on a constant basis as well as to send admonitions to unreliable lessees.
In all parks audited by NIK, the scope and frequency of field inspections enabled proper supervision of leasing. NIK found only single irregularities, concerning e.g. improperly documented inspections.
In the audited period, the national parks’ administrations did not lease all of the agricultural lands under their management. Reasons included difficult access to those lands, also caused by some environmental projects. Another issue was related to tenders based on which lease agreement are concluded. In 2019, r. in Narew National Park 560 ha (i.e. more than a half of the area leased a year before) was not leased due to unsettled tenders.
Why do not parks manage agricultural lands on their own? The parks’ administrations explain that this is not very profitable for parks, and their financial, personnel and equipment capacity is limited.
On the other hand, lessees of agricultural land in national parks may seek support with ARMA which grants subsidies as part of the joint agricultural policy. In case of local farmers signing agreements with parks, thanks to leasing they may not only claim subsidies but also graze cattle or sheep on the national park area and obtain hay.
Tenders with a breach of law
An agreement to lease agricultural lands of the State Treasury, managed by national parks can be signed as a result of a successful tender, or negotiations, if the two subsequent tenders are not settled. NIK has shown that the administrations of six audited national parks, when selecting lessees in 2015–2020, breached provisions of the ordinance on tenders and the Environment Protection Act.
NIK filed a report of possible criminal activity concerning the tender on agricultural land in Biebrza National Park in 2018. Two persons were admitted to the tender despite unanimous objection of the tender committee after it turned out that they incorrectly completed and submitted the registration forms. Finally they won the tender and signed a land lease agreement as the committee decided to take a decision consistent with “the director’s will”. Following NIK’s report, the prosecutor’s office started to investigate the case and accused the tender committee members of not complying with their obligations and the park director with exceeding his powers. NIK identified irregularities in tender procedures in six out of seven audited parks.
Bieszczady National Park was one of four parks where NIK auditors identified irregularities related to tender bonds. In 2015, one of notices of tender for agricultural land in Bieszczady National Park stated that the minimum lease fees would exceed 77.7 thousand and the tender bond was established at PLN 1250, which was 1.6% of the said amount, although in accordance with applicable law it should range from 5% to 20%. Besides, in two cases, after some bidders won the tender but failed to conclude the lease agreement, they had the tender bond returned against the law, and the park lost PLN 2100.
All of the audited national parks took efforts to prevent the conflict of interests. In 2013, Biebrza National Park introduced the “Code of Professional Ethics for the Employees of Polish National Parks” under which neither employees nor members of their closest families, nor persons related to the park employees by business activity could participate in lease tenders.
In Drawa National Park, fraud prevention amounted to employee supervision by the system which monitored the use of company cars. This is where NIK auditors identified the conflict of interests – one of wildlife conservation circuits was supervised by a nature conservation officer, being at the same time the lessee of land located in that circuit.
Big plots not for small farm owners
The NIK audit was related among others to long-term conflict between the national parks’ administrations and local famers, owners of small and medium farms protesting against the organisation of open tenders for lease of huge plot complexes, of several hundred hectares.
The NIK audit revealed that six of seven national parks had no information about the type of business activity run by land lessees. The parks’ directors explained that the reason was the absence of a relevant requirement in the ordinance on tenders.
An analysis made by Bieszczady National Park showed that every year about 30% of the park’s agricultural land was leased out to limited liability companies which declared running agricultural activity. The remaining 70% of land was leased out to local farmers running their own farms (breeding sheep and cattle) and individuals who declared their interest in tenders and presented certificates of their agricultural qualifications.
In March 2019, in Biebrza National Park, local farmers protested against the tender for agricultural land. They accused the administration among others of dividing the land for lease into too big complexes, which entailed the need to post high tender bonds.
In relation to the farmers’ protests, in January 2020 the Executive Board of the National Council of Agricultural Chambers moved to the Minister of Climate to enable the lease of land in national parks under closed tenders, in which only local farmers could participate. In 2019, the Ministry started works to amend the Environment Protection Act in that respect. NIK has been informed in the Ministry of Climate and Environment that the project is to be presented to the government this year.
Agropiracy
Another issue was the use of agricultural land in national parks without agreement and without paying lease rent, while obtaining subsidies from ARMA.
The biggest number of such cases were identified in Biebrza National Park. The following areas of land were used there illegally in subsequent years:
- w 2015 – 48 ha,
- in 2016-2019 – from 148 ha to 265 ha,
- in 2020 (until 20 October 2020) – 6.5 ha.
In that situation, since 2017, the director of Biebrza National Park made deals with farmers where they – in return for using agricultural land without agreement - committed to paying specific amounts for the benefit of the park. All in all, 55 deals for 438 ha were made but their number was falling down every year. In four cases, as no agreement could be reached the park director filed the case to the court.
The NIK audit showed, though, that the parks could not take effective measures in case of farmers using their lands without agreement as they had no access to data from the Agency for Restructuring and Modernisation of Agriculture.
The director of Biebrza National Park requested ARMA for information on subsidised lands of the State Treasury managed by the park and for the data on persons who applied for subsidies for those lands. The Agency refused to provide the data, referring to the personal data protection law. Biebrza National Park received information on the agricultural lands only following intervention in the Ministry of Environment.
It turned out that about 800 plots of land covering the total of 2.8 thousand ha used without agreement with Biebrza National Park applied for subsidies. In 2017, the park director filed to the prosecutor’s office four reports of suspected criminal activity concerning the extortion of payments. In January 2019, the director informed the Chief Conservation Officer in the Ministry of Environment that using agricultural land without agreement also has an adverse impact on the environment. Until the end of the NIK audit the director of Biebrza National Park did not receive the Ministry’s response in that matter.
Other parks also had that problem. In Warta Mouth National Park there were some entities which in 2015-2019 received subsidies from ARMA exceeding PLN 15 million for using lands owned by the State Treasury without signing agreements with the park.
The issue of non-contractual use of agricultural land was to be solved by amending relevant provisions of law. In line with those changes the application for agri-environment climate payments should include a declaration specifying the basis on which lands in a national park are used. It is too early for comprehensive evaluation of the amendment. However, according to NIK, the example of Biebrza National Park, where the area of identified cases of non-contractual use of lands went down from over 200 ha to 6.5 ha, points to positive results of the law changes.
There is still an issue of information exchange about – allocated subsidies on the one hand, and leased plots of land on the other. That is why, NIK has recommended that the Minister of Agriculture and Rural Development should ensure effective cooperation in that matter between ARMA and the national parks.
Subsidies
In 2015-2019, ARMA paid the total of nearly PLN 412.5 million of financial support for agricultural lands located in the areas of all 23 national parks:
- due to direct payments:
PLN 256.5 million (up to 56.1 thousand ha),
- as part of agri-environment climate payments:
over PLN 112 million,
- as part of ONW payments: over PLN 43.5 million.
The financial aid from ARMA per 1ha totalled PLN 1479 on average, of which 27% were agri-environment climate payments.
The NIK audit showed that before issuing decisions to grant direct payments and agri-environment climate payments, ARMA properly conducted administrative audits and site inspections. Irregularities were related mainly to delays in issuing decisions to grant payments. The delays mostly resulted from the IT system breakdowns.
According to NIK, granting payments to national parks and landscape parks helps upkeep and maintain valuable environmental habitats which came into being following centuries-old agricultural use.
However, NIK has pointed to the absence of indicators that would help evaluate environmental effects achieved thanks to the said subsidies.
NIK agrees with the European Court of Auditors that such indicators need to be developed. They would help evaluate the impact of joint agricultural policy on biological diversity, including the population of protected animal species.
Recommendations
to the Minister of Climate and Environment:
- to aim at immediate completion of works on draft act on changing the Environment Protection Act and other acts, concerning the expansion of solutions defining the manner of conducting a tender for managing agricultural properties administered by national parks;
to the Minister of Agriculture and Rural Development:
- to make sure that ARMA cooperates effectively with national parks in terms of exchanging information and performing statutory tasks related to leased agricultural properties qualified for subsidies as part of the joint agricultural policy;
- to define, against the following programme and financial perspective of the EU for 2021-2027, indicators concerning environmental effects of programmes for the development of rural areas conducted in national- and landscape parks;
- to consider placing information on the manner of calculating agri-environment climate payments as part of promotion and information materials on the website of the Ministry of Agriculture and Rural Development;
to the ARMA President:
- to strengthen supervision over issuing decisions to grant direct payments and decisions to grant agri-environment climate payments to make sure they are issued on a timely basis;
to directors of national parks:
- to ensure proper conduct of tender procedures and negotiations for property management by national parks, concerning in particular the lease of agricultural lands, and training of national parks’ employees in that area.
