Tony Killeen
Question:15 Mr. Killeen asked the Minister for Agriculture and Food the position regarding trends in farm incomes since 1990 to date; and if he will make a statement on the matter. [14720/04]
View answerThursday, 20 May 2004
Questions (16)
Written answers
From 1991 to 2002, the latest year for which data is available, family farm income, as measured in the Teagasc national farm survey, increased from €7,686 to €14,925, a rise of 94%. A similar trend is also seen when the average income per farm is measured. In the period 1991 to 2002 this indicator rose from €11,332 per farm to €18,117, a rise of 60%, while the average income per family work unit has risen from €8,221 in 1991 to €17,149 in 2002, an increase of 109%.
It should be noted that farming is a cyclical business that is dependent on a number of factors and these can result in fluctuations in income from year to year. Looking at trends in farm incomes since 1990, aggregate farm income, operating surplus, increased substantially between 1990 and 1996. There was a decline from 1997 to 1999, mainly due to the effects of the BSE crisis in the UK, the collapse of the Russian market in 1998 and weather related difficulties in 1998-99.
Following these declines, the farm income situation improved in 2000 and again in 2001. Aggregate farm income rose by 6.4% in 2001 despite the difficulties caused by foot and mouth disease, following an increase of 10.1% in 2000. The year 2002 was a difficult one for farming; aggregate farm income fell by 8.1% due to a combination of bad weather, lower levels of cattle slaughterings and lower output prices for many commodities. By contrast, the year 2003 was a good one for farming. Aggregate farm income increased by 4.9% to €2,589.5 million. This increase reflected improvements in the cattle, milk and cereal sectors.
To underpin the financial stability of the sector, my Department operates a range of measures including market supports and direct payments aimed at supporting farm incomes. In 1990 direct payments accounted for 23% of aggregate farm income; since the MacSharry CAP reform in 1992, direct payments to farmers have risen and by the late 1990s they accounted for 50% of aggregate farm income. In 2003 direct payments of €1.6 billion contributed almost 63% of aggregate farm income. I have vigorously pursued one of my main goals of supporting farm incomes by maximising the level of direct payments to farmers, ensuring that the EU Commission utilises all available management tools to support the markets and by providing the best possible development framework for the sector.
The composition of the farming sector has altered in the time period since 1990. According to figures from the Central Statistics Office, in 1991 73% of farmers were full-time and 27% were part-time. By 2002, 58% of farmers were full-time and 42% were part-time.
One of the interesting points in the measurement of farm income is that there are a series of indicators that can be used in its calculation. In the 13 years from 1990 to 2003 aggregate farm income, operating surplus, rose from €2,093.5 million to €2,589.5 million, an increase of 24%. However, the breakdown of farm income figures using other indicators shows more substantial increases reflecting the rationalisation of farm labour, greater productivity and smaller farm numbers. Indicators of income per farm family, per farm and per family work unit show healthier increases and more progressive trends.