Agri Food 2010 Committee

Main Recommendations

17. Developing Competitive Full and Part-Time Farming

Full-time farm numbers will decline as the larger scale requirements for a viable income in a more open market are felt, while part-time farming is likely to rise rapidly. In addition the number of older farmers will decline if appropriate policies are put in place. These changes are likely to give rise to a situation eventually where we will have approximately 20,000 full-time farmers, 60,000 part-time farmers and a transitional group of about 20,000 by approximately 2010.

Agricultural policy must be framed with a full understanding of the differing needs and capacities of farmers in each of these categories and in the light of the challenging environment which farmers will face in the future

17.1: Improving Cost Competitiveness in Major Enterprises

• Irish agriculture is relatively competitive in the short term, but, in the longer term, remuneration is insufficient to reward the non-cash factors including family labour.
• Our response to this situation must involve a determined drive to improve competitiveness by:
• improving efficiency on existing farms, in particular through investment in physical and human capital;
• improving farm structures; and
• developing and implementing new and improved technology through research and advice.
• A national competitiveness action programme should be adopted with actions and specific performance targets on structural reform, cost efficiency improvements, research and technological change, and education and training requirements.
• The action programme should include provision for the collection and publication on a regular basis of key competitiveness indicators, with appropriate international comparisons.

17.2: Encouraging Land Mobility and Early Transfer

• Only a minute proportion of land is sold each year, and 19% of land is still farmed by holders aged over 65 despite the incentives for early transfer.
• Tax incentives should be introduced for family leasing by over 55s, where the lessor is a participant in the early retirement scheme.
• The first £2,000 of lease income should be exempt from the means test for the non-contributory old age pension and other social welfare benefits.
• The possibility should be examined of introducing a retirement scheme to replace disadvantaged area payments to farmers over 65. A working group should be established for this purpose.
• The Committee favours the complete abolition of stamp duty for young-trained farmers, and notes that this is included in the Programme for Prosperity and Fairness.
• Options for new farm ownership and operator structures, including partnership and share milking, should be examined to encourage the participation of young trained people in agriculture.

17.3: Improving Scale in Dairy Farming

• Prudence dictates that we should prepare ourselves for the most radical outcome to the review of EU dairy policy, including the possibility of quota elimination sometime after 2008.
• The minimum viable level of dairy production in 2010 will be at least 70,000 gallons. Given that less than 3,000 farmers were at this level in 1999, considerable consolidation of quota will be required. About 13,000 dairy farmers have the potential to succeed as commercial dairy farmers, provided that they are able to access additional quota.
• The Committee welcomes the announcement of the break in the land-quota link as a valuable first step in freeing up quota access for commercial, and potentially commercial, dairy farmers.
• It will be necessary and desirable to move to a fully open market for quota well in advance of the elimination of quotas by the EU, should that arise.
• Specific measures should be put in place to assist smaller dairy farmers who have the potential to become viable. Such measures might include the type of action proposed by the County Clare Partnership Dairy Action Research Programme.

17.4: Encouraging Productive Investment

• Irish agriculture is still significantly less capital intensive than most other EU countries but there has been an exceptionally high level of investment on Irish farms in recent years.
• Investment will remain a key concern for full-time farmers in the period to 2010 and part-time farmers also have special investment needs and a high propensity to invest.
• Public funding in support of farm investment should be provided but should be carefully targeted at:
• farmers with low household income, who are below 55 years of age, or have an on-farm successor and
• farm investments that produce clear ‘public good’ benefits.
• Labour saving investment by part-time farmers should be recognised as productive and valid. Public subsidy schemes should treat part-time and full-time farmers equally in all respects.

17.5: Changing Agricultural Education and Training

• There will clearly be different demands for agricultural training from full and part-time farmers.
• The fundamental overhaul of agricultural training currently being undertaken by Teagasc, and receiving detailed consideration by the task force on agricultural education and training, should be pursued urgently and subject to continued monitoring in light of future requirements.
• The Committee endorses the progress being made in the integration of agricultural training with mainstream education, and recommends that it should be subject to the same standards and certification procedures. This will require close co-operation between DAFRD, Department of Education and Science, Teagasc and the other bodies involved.
• Consideration should be given to strengthening the training conditionality for development and other grants, as recommended by the ESRI.

17.6: Providing Equal Access to Schemes

• The present variety of on and off-farm income conditions applicable to different schemes is potentially confusing, and is in some respects unfavourable to part-time farmers.
• The Committee recommends the introduction of one standard income assessment for all schemes. The assessment should be based on income from all sources without distinction between them.

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