As the financial security of Ireland’s older farmers continues to hang in the balance, with a final decision on CAP income supports yet to be made, one of the country’s leading pension experts believes more could be done at national level to encourage greater land mobility.

Anne Kinsella, senior research economist with Teagasc’s Rural Economy and Development Programme, has contributed to the report of the Commission on Generational Renewal in Farming, published last September by Agriculture Minister Martin Heydon.

However, 11 months on, Anne says she has received no update on the implementation of recommendations made in the report regarding pension provision, chief among them a generation renewal payment of up to €25,000 for older farmers upon transfer of their land to a younger farmer.

She says pensions have to be one of the main pillars on which succession is built, but that misconceptions regarding what pension entitlements farmers have is a huge issue that must be addressed.

Low income

“There is ignorance out there, which goes against the tide when it comes to farmers. The one thing that came from the EU CAP Network, who visited Ireland earlier this month, was the recognition that farmers in Ireland are very knowledgeable when it comes to their farms. Schemes, carbon footprints, they know it all, but when it comes to pensions there seems to be a huge lack of understanding and a lack of awareness,” she says.

“The average income of a farmer comes in at €40,000 when dairy farmers are included, but if you look at the average income of a sheep or a suckler farmer that can be as little as €12,000. If you have a low income, you find that PRSI contributions become a very large percentage of that income, so the reasoning that the contributions are low doesn’t apply. If it’s a choice between putting food on the table or paying contributions, the choice is easy – you provide for now.”

However, in the absence of contributing towards a pension, many farmers are under the illusion that they will automatically qualify for a non-contributory pension from the State, which as Anne explains is not necessarily the case.

“Farmers are means tested for a pension if they haven’t made PRSI contributions and they don’t realise that, so that’s when their assets are taken into account,” she adds.

“Older women are in a particularly vulnerable position. When they got married, the marriage ban was in place and they couldn’t work outside the home and they are at the age now where they have worked on the farm all their lives but have no PRSI contributions and their husbands probably don’t either. They will both be means tested for the State pension and if they have more than 15 acres, they won’t qualify, unless they hand the land over to a successor.

“The 15 acres is based on the asset value, but that is probably less now given the price of land has increased in some parts of the country. So, by the time people are asking questions, it’s too late.

“Thousands of farmers don’t qualify for any State support in their old age and that’s why you have them farming into later life. They need to farm to survive.

“You’re talking about a few thousand people, but they are people who have worked hard all their lives. They aren’t just a statistic; they have made agriculture what it is in this country. Nobody is looking after them or looking out for them.”

While the farming community waits for the generation renewal commission report to be realised, Anne says there are other ways older farmers could be supported that would be easy and inexpensive to introduce.

“I can’t see subsidised pensions for farmers being introduced, given the economic situation and money being taken away from agriculture,” she reasons.

The EU Commission is asking me to do more research but I can’t do that without funding. I think an interesting one to look at is Austria, or some of the smaller countries where they have family farms

“I don’t know how they are going to provide money for pensions, but that being said, if they are serious about land mobility and making land available for younger people, something has to be done.

“The Rural Social Scheme is a great example of a model that could be adapted to support farmers secure pensions when they reach retirement age.

“I was involved in the RSS review last year, where suggested changes are already being piloted, but this is a scheme that would have huge benefits for farmers reaching retirement age. Unfortunately, a lot of farmers out there won’t engage with it as they see it as a ‘farmer’s dole’ and there’s an attitude that those who are on the scheme aren’t farmers at all but are on social welfare.

“Yet if they are on RSS, they get their PRSI contributions paid for them so that’s a win-win. You’d bring more farmers into the PRSI net by simply renaming the scheme to something with fewer social welfare connotations. It’s just getting past that mindset and convincing farmers that they are the ultimate winners on this scheme as they get protection in terms of their future pension entitlements.”

Beyond Ireland

Anne also believes that the only way to move the contentious issue of farm pensions forward, is to look beyond Ireland to similar countries in the EU.

“We don’t know what is going to be introduced under the new CAP, but we do know that in Ireland a lot of farmers work beyond retirement age,” adds Anne.

“The EU Commission is asking me to do more research but I can’t do that without funding. I think an interesting one to look at is Austria, or some of the smaller countries where they have family farms.

“The OECD is seriously looking at this space and I have made a presentation to them, but they don’t provide funding for projects. They asked me to present at their Farm Level Analysis Workshop that was held last March, but there is another meeting toward the end of this year and they have asked me back to that. I know it increases the knowledge at a European level and these reports do drive change – but it takes time. Somebody that was 60 when I completed the report on Sustainable Transition of the Rural Economy Through Generational Renewal, which fed into the report of the Commission on Generational Renewal in Farming, is now of pension age.”

Anne is hopeful, however, that a changing mindset among farmers of all ages will help drive the changes needed regarding farming pension provision. She says what she saw at Grange 2026 has given her cause for optimism.

“Things will only change organically, through succession inheritance schemes and transferring the family farm clinics. I was actually surprised at Grange this year the number of farmers who came up to engage in conversations about succession and inheritance and a lot of them had successors with them.

“To see so many younger farmers coming through the gates is very positive, they are the ones who need to know to start their PRSI contributions now. If you had tailored information booths or one-to-one clinics at events like that, even if you caught 10 or 20 people, it would be great. I don’t think you’re going to get farmers walking into their accountants or solicitors making financial plans and thinking about their pensions until it comes to that critical time when they have to do it.

Things will only change organically, through succession inheritance schemes and transferring the family farm clinics

“If there were information sessions held on a regular basis, that linked in with some other forum, like discussion groups for farmers, more general talks about retirement planning, it would help take the stress out of it. We all have to make plans for the future and we all have to engage in these discussions.

“I’d like to look at other small businesses, like publicans, butchers, small shops to see what their pension provision is. A lot of them are in similarly bad financial situations as well. They can’t afford to make PRSI contributions and they’re just about surviving on the small incomes they make.

“I think in rural Ireland if it wasn’t just about farmers, but small business owners, you’d get a broader sense of the situation.”