By Matt Dempsey
The agricultural colleges and UCD agricultural faculty may be full to bursting point, but that does not hide the stagnation in Irish land ownership and use.
There are too many changes happening in world and Irish farming to pretend that the present structure is satisfactory. From an Irish perspective, the most fundamental change is the abolition of dairy quotas. While dairy markets are wobbling at the moment, our greatest strengths are our dependence on grass and low reliance of high price grain and protein.
Current price levels for beef and sheep are already driving expansion and breeding stock retention. Co-ops well removed from the dairying heartland, such as Connacht Gold, are expecting and planning for a minimum of a 20% increase in milk output.
In world terms, there seems to have been a shift in the relative price of basic foodstuffs. Whether it is spurred by increased demand for Western type foods in the Far East or increased use of corn in ethanol programmes to replace expensive oil is not the issue – a shift is taking place. Volatility will still be a feature but the base is higher.
The tradition of land ownership and the attachment to family land is too great to be overturned. In any event there are considerable benefits to the current system, which gives a social stability and structure to rural areas. But farming is a commercial business. It is also one that needs young, energetic, well-trained people to become involved when they can make an impact. Less than 7% of our farmers are under 35 years of age – 45% are over 55. In such an environment, Irish farming needs to re-examine if it has a legislative structure that is fit for purpose. Many existing rules have a stultifying effect on the development of our most competitive sectors.
Up to the last budget, we have had a tax system that actively discriminated against the lifetime transfers of agricultural land. Our national stocking rate is well below the level of seven years ago, our tillage acreage is static.
The IFA lobbied and succeeded in getting significant tax exemptions on income from leased land, but even this is riddled with anomalies and people are wary about leasing in an environment where the Single Farm Payment system is under such fundamental review.
One major anomaly is that when a farmer goes into a limited company, which more farmers are actively considering, the significant tax exemption is no longer available to the farmer he had leased land from.
We need an overriding focus on elements such as tax and regulatory structures, leasing, partnerships, inheritance, Single Farm Payment and herd number allocations, to let this expansion take place. Its not a question of what the agricultural sector needs, its a question of what is the most effective framework that will let agricultural output expand and let people work, to the national advantage, in an industry in which they have been trained and educated.
The Department have rightly set up a group to look at sensible arrangements that should be put in place to encourage partnerships. But, in present circumstances, more is needed.
We need a blueprint on how we want to land use to develop in Ireland. Ideally, such a group should have a broad remit and come up with conclusions and recommendations before the present CAP reform talks conclude. Only the minister can initiate such a policy review.