Agricultural Subsidies

“At 38% of the budget, European taxpayers send more than €58billion to farmers each year – a shocking amount if one considers that farmers only make up 3% of the EU’s total population and are responsible for no more than 6% of its GDP.”

  • According to the CSO there are 137,500 Farms in Ireland in 2016 on 4.5 Million hectares (Mha). 
  • Of these 92,720 on 4 Mha were classified as Large Farms in 2017 – defined as having a Standard Output (SO) of over €8,000. 
  • 43,600 on 0.5 Mha were classified as Small Farms having a SO under €8,000.

1. If farmers can receive their current CAP payments as Payments for Ecosystem Services this would increase the income of Large beef and sheep farmers as follows (based on 2018 figures):

  • Cattle rearing farmers would increase from an average income of €8,318 to the subsidy of €13,109.
  • Other farmers would increase from an average income of €14,408 to the subsidy of €16,257.
  • Sheep farmers would increase from an average income of €13,769 to the subsidy of €18,812.
  • Tillage farmer income would remain the same.
  • Dairy Farmers would no longer be subsidised by public funds.

2. When Small farms transition to payment for ecosystem services this could potentially increase the income of small land owners from approx. €3,000 to €5,500. 

3. In Ireland a total of €1.07 Billion of subsidies would be allocated to payment for ecosystem services.  €730 million in subsidies would be paid to the remaining 37,720 farmers providing a subsidy of €19,350 on conversion to plant based agriculture.

4. We would recommend that no CAP payment should exceed €50,000 per farm.  “Only 1.4% of Irish farmers get payments over €50,000 but they account for almost 10% of all such payments.”  This would allow the distribution of €180 million to smaller farmers.  Very large profitable farms should not be subsidised.

How is it possible that Payment for Ecosystem Services can increase the incomes of the majority of farmers?

To answer this question you need to understand that most beef and sheep farmers in Ireland operate at a loss.

Level of Subsidies for Large Farms in 2018

On average Large Beef and Sheep Farms operate at a substantial loss.

Over 100% of Large Beef and Sheep Farm income comes from subsidies.

Level of Subsidies for Small Farms in 2015

If the Owners of Small Holdings could keep their subsidies for Payments for Ecosystem Services their income would basically double. 

Family Farm Incomes on Large Farms in 2018

Average Income for Beef and Sheep Farmers is 22-38% of the Average Industrial Wage.

44% of Large Farms Earn under €10,000

Distribution of Income for Large Farms in 2018

44% of Large Farms Earn under €10,000

It is difficult to understand how farms can be losing so much money so we have included the below tables to show the income and costs for a sample large beef farm in 2018 and for average small farms in 2015.

Average Large Farm Income and Costs – including subsidies (Direct Payments)

Average Small Farm Income and Costs – including subsidies (Direct Payments) for Cattle and Sheep Farms in 2015

Average income for small farmers is under €3000.