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Opening Address by Teagasc Director, Professor Gerry Boyle at the Farm Buildings

Good morning ladies and gentlemen. You are all very welcome to Kildalton Agriculture and Horticulture College, here in south Kilkenny.

Good morning ladies and gentlemen. You are all very welcome to Kildalton Agriculture and Horticulture College, here in south Kilkenny.

This farm buildings conference is particularly timely as many of you and your fellow farmers embark on major on-farm building projects. This is a critical year for farmers intending to complete building work under the Farm Waste Management Scheme by the deadline at the end of this year.

The scale of investment is unprecedented with over €1.5 billion being invested in 2007 and 2008 in new and upgraded farm facilities. That’s five times the levels of investment in 2004 and 2005.

This investment in new facilities provides an important opportunity to address issues on your farm. The need for safe, environmentally friendly, animal welfare compliant, and durable buildings and facilities is a reality today. The requirements to meet acceptable criteria in cross compliance and REPS is clear and no one can be in doubt but that the bar is being raised higher in terms of animal welfare, health and safety and environmental practices.

Labour retention and efficiency of labour is related to the quality of facilities on the farm. Staff and younger farmers require good working conditions if they are going to stay and they will benchmark their time and working conditions against other professions and occupations. There is the new type of farmer who is prepared to spend less than 10 hours per week to manage and run their drystock/tillage enterprise, so that they can work off-farm and have a quality family life. These new breed of farmers want to enjoy the best of both worlds. They will endeavour to maintain their asset value while maximising their income earned per hour worked both on and off the farm.

The low cost wintering options using out-wintering pads and lined lagoons is promising. They offer a low cost alterative to farmers wishing to expand quickly and to maintain flexibility.

Careful panning is required when making any significant investment. But when we have investments of the scale taking place on Irish farms today, even more careful planning is required to get it right. In this context, I look forward to the first paper at today’s conference which addresses the financial decision to invest and the decisions required on repayment capacity and cash flow planning. It is sufficient to say that the co-operation of the bank, accountant and adviser are important in giving clear direction to ensure that commitments can be met. In this respect careful cash-flow planning and repayment capacity calculations based on realistic expectations are essential. Teagasc advisers provide two services - Options Analysis and Profit Monitor analysis – which provide you with the basis of sound investment decisions with or without grant aid.

If you drive in the rural areas, it is not difficult to see the historic stages of development reflected in roadside farmyards. The legacy of investment decisions of past generations is apparent “the good and the not-so-good”. REPS and other schemes have helped greatly to improve the visual impact of farmyards. I recall an excellent evaluation by Tony Leavy and others of the Farm Improvement Programme FIP 1986-1994. Two thirds of farmers participated over eight years, with very positive outcomes from the use of public funds. Farms were modernised, two thirds of farmers participating expanded their business, livestock numbers expanded, profitability and labour productivity increased. The rate of return on the investment was calculated at over 60%. The more recent Farm Waste Management Scheme and Farm Improvement Scheme have shown again to be hugely popular with farmers who have responded to the grant aid incentives on offer.

As director of Teagasc I must acknowledge the work of the research and advisory service staff in assisting farmers with decision making, design details, scheme applications and the vital financial advice given. They have been through two very busy years and it is a pity that some of this work must now be done in such haste.

I would also like to acknowledge the vital role of the Department of Agriculture, Fisheries and Food in setting very high standards for grant aided investment, these investments will, we hope, be durable and long-lasting, meeting the needs of farmers into the next generation.

I want to thank my colleagues in Teagasc for organising this important conference and I look forward to the contributions of the various speakers this morning, and the demonstrations which will take place in the afternoon.