It is no secret that an increasing number of farmers are taking up off-farm jobs.

Teagasc director Frank O’Mara gave the details at a Nuffield gathering in Belfast with over 43% of farmholders having an off-farm job; dairy farmers – unsurprisingly – are well below this figure, tillage and dry stock farmers significantly above.

It is also worth noting that this figure does not include farm spouses so the percentage of farms with an off-farm income is increasing continuously or, to put it another way, the number of farms supporting a family solely from farm income is in long-term decline.

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This is the backdrop to the public questioning by the EU Commission on what is an active farmer, on whether an older farmer with a State or private pension should be eligible for EU payments and what is likely to attract a new generation into farming, be it full or part-time.

Teagasc has done a lot of work in this whole area with detailed fact sheets on each of the major enterprises but we have little or no information on the economies of scale that apply in Irish farming.

How much does it cost to produce a litre of milk on a farm with 500 cows versus one with the average 100? Theoretically the larger farm with a rotary parlour and efficient feeding equipment should have a lower cost of production per litre.

One of the confusing aspects of Irish farm income calculations is that family labour is counted as free, so any farm with paid labour is assessed on what is really a different basis.

Similarly those with 1,000 acres of tillage should be able to spread their machinery and other costs over a much larger tonnage than their smaller neighbours and so potentially, produce grain at a lower cost.

Teagasc has done some work on the dairy side that shows cost per litre is highly related to grass management and utilisation and if grass utilisation becomes less efficient as herd size increases, then profitability suffers and cost per litre produced increases.

The same details are not so clear on the tillage and dry stock side. The key question of course is if and when the information becomes available, what should be done with it?

Farm viability

Should EU payments go to those who need them to live decently and to preserve farm viability or to those who will use them most efficiently, in other words to the most efficient farmers who are most likely to use them to further expand their farming business.

The definition of farm viability is a low bar – an income equivalent to the minimum wage plus a return of 5% on non-land assets.

We are already seeing a kickback against larger operators receiving large payments but if scale efficiencies are operating in Irish agriculture, we should have the details so that at least policy choices can be developed on the basis of facts as well as political and economic reality.