The Murphy family in Lee Valley, Coachford, Co Cork, decided to use a partnership model in their succession plan.

“We felt it was a failsafe way of my parents being reassured that they weren’t signing the farm over to me and hoping for the best,” Donncha Murphy said. He is the fifth generation of his family on the farm and is in partnership with his parents Con and Mary.

“I was introduced to the business while my parents were still involved. I was basically a trainee from the partnership side. They were getting 66% of the profits and I was getting 33%.”

Donncha went into partnership with his parents when he was 25 in 2004. He said it’s like being the “future of the business, but on trial”.

The land was then signed over to Donncha in 2013 and the Murphys have a joint herd number. The profit sharing has now reversed, Donncha is getting 66% of the profits while his parents receive 33%. Con Murphy is 67 and drawing the pension.

“It’s important that there are strong accounts that can be shown to parents,” says Donncha. “Sometimes children expect that when they get the farm that it’s a cash cow. Equally, the parents have to understand the cost of living and raising a family, so they may have to lower their expectations. A good profit monitor helps there.”

The Murphys are milking 150 cows. “We are at the threshold of what you call a one-man operation, with the mother and father still active. To go to the next stage I would be taking on a full-time man and going to over 200 cows. I’m slow to move because you’re taking on more debt.”

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Providing for retirement in succession planning