Farm Ireland
Independent.ie

Thursday 18 January 2018

Getting new blood into farming sector must be the key priority

John Shirley

Who is going to be farming the land of Ireland over the coming decades? Agriculture minister Simon Coveney has prioritised land mobility as one of the challenges of his term in Government.

Getting more land under the control of active farmers will be key to hitting the ambitious Food Harvest 2020 expansion targets, he has argued.

Of course land mobility, succession, inheritance etc, is not a new subject. Land ownership has always been fraught with emotion.

Predictably enough, opinions and priorities vary with age and circumstance.

Apart from the need to drive on with farm output, land availability is getting new urgency from the bulging numbers of agricultural college students coming through the system.

And while I do not wish to dismiss the merits and wisdom that come with age, Irish farming needs the drive and enthusiasm of the youth.

At the latest count only 5pc of Irish Single Farm Payment recipients are under 35, while 28pc are over 65.

Surveys show that despite this high age profile, over 50pc of 55-plus year old farmers have no identifiable successor. This is not a healthy demographic profile.

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The whole area seems to be clouded by a lack of clarity. How many farm families have actually sat around the table and discussed the succession issue? Not many, according to advisers in this area. Where it has happened it's mostly the family mother who takes the initiative.

Recently I attended two meetings that discussed the issues of land access and succession. A meeting in Tipperary, organised by Macra na Feirme and the Guild of Agricultural Journalists, concentrated on dairying.

The second meeting, held at Teagasc Grange, under the auspices of the RDS, concentrated on drystock farming.

At both meetings farmers at or approaching the standard retiring age spoke openly and candidly about their personal and family situations.

The Tipperary meeting also featured young men fired up with the hunger to become significant milk producers but without the land base and quota to achieve their dream.

expectations

I found some of the expectations of the younger group to be unrealistic.

In both cases, but especially with the substantial RDS drystock farmers, the next generation children had received Celtic Tiger inspired third-level education and were now settled into good careers outside farming.

Such people might like the idea of owning land but they are not for coming back and getting down and dirty into farming.

I reckon that many farm children have had life too easy to take on the hard work and daily farm grind.

Could it be that a lot of land will come available over the next couple of decades? Many dairy farms have been going since quotas came in 1983 and they also want to ease out.

Not everybody is equipped to become a successful farmer. I often think of two widows who I came across about 25 years back.

Both farm-owning widows had rented out the land while their sons completed their education.

In case one, when the son came home the mother handed over the complete farm. He borrowed heavily for machinery and some buildings but fairly quickly ran into banking problems which culminated in the sale of part of the farm.

In case two, the returning son was given part of the farm to work while the mother continued renting the remainder. This provided her with a continued income.

When the son proved his bona fides on part of the farm he was, in stages, given responsibility for the lot. This son turned out to be an excellent operator and has since bought more land.

This was a case of the rashness of youth needing a steady hand.

The concept of partnership is being pushed for dairy farmers, by offering extra stock relief and higher access to grants. According to Macra, there are about 600 dairy partnerships in operation. Tax incentivised long-term leases offer the best mechanism to mobilise land into the control of active efficient farmers.

The tax-free rental incomes are €10,000 for five-year or six-year leases, €12,000 for seven-year to nine-year leases and €20,000 for 10 years and higher.

This concession is paying dividends, with over 3,000 long-term leases in place. There is criticism that within-the-family leases don't qualify for tax concessions, but Macra argues that encouraging leases within families only delays farm transfer.

The challenge for partnership/ leases/share farming is that bringing in new technology will increase the profits from the land to facilitate an income for both landowner and farmer.

This is happening on the ground with good tillage farmers, some of whom have scaled up dramatically with leases and partnerships, leasing or share farming arrangements.

Up until very recently the income from drystock farming was simply too modest to facilitate divvying it out.

Now, with higher beef/lamb prices, plus the example of the BETTER beef and sheep farms, there is the possibility of extending collaboration in drystock farming.

structures

From a cursory look at the scene, it appears as if there are landowners who are willing to do deals with young active farmers if the structures are right and if the two parties have trust and confidence in each other.

There is scope for Minister Coveney to put the right structures in place. But there is also need to identify possible partners. A type of dating agency to match up retiring landowners with wannabe young farmers is required.

One farmer at the RDS gathering spoke eloquently about the need for succession farm planning within the family, for fairness across the family and about how the retiree must have both sufficient income and life interests or hobbies to sustain oneself.

One issue came up time and again and should be addressed by Minister Coveney. The break up of family farms following marriage breakdown. Some sort of pre-nuptial arrangement addressing this issue is urgently needed if farm hand-overs are to be encouraged.

Indo Farming