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How Effective is Farmer Early Retirement Policy? Quelle est l’efficacité de la politique de préretraite pour les agriculteurs? Wie effektiv ist das Vorruhestandprogramm für Landwirte?

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  • Paul Caskie
  • John Davis
  • Michael Wallace

Abstract

How Effective is Farmer Early Retirement Policy? Financial support for EU farmers seeking early retirement is a discretionary element of CAP rural development policy and some EU member states, most notably France, Ireland and Greece have chosen to implement the measure. We explore whether the introduction of such schemes is likely to represent good value for money. We use data from Northern Ireland, a region with a relatively small‐scale family‐farm structure, where there have been periodic calls from farmer groups to introduce support for early retirement. We estimate the benefits that might arise from the introduction of such a scheme using FADN data and a separate survey of 350 farmers aged 50 to 65. We find that farm scale is a significant determinant of profit per hectare but that operator age is not. Benefits from releasing land through an early retirement scheme are conditional on such transfers bringing about significant farm expansion and changes in land use. Even when these conditions are satisfied, however, pensions payments of only about one‐third the statutory maximum could be justified in a best‐case scenario. Almost a quarter of all payments would incur deadweight losses, i.e., go to farmers who would be retiring anyway. Overall, the economic case for such a scheme is considered to be weak. Le soutien financier aux agriculteurs de l’Union européenne qui veulent prendre une retraite anticipée est un élément discrétionnaire de la politique de développement rural de la PAC et certains pays membres, en tout premier lieu la France, l’Irlande et la Grèce, ont choisi de mettre en place cette mesure. Nous recherchons si l’introduction de telles mesures serait intéressante par rapport au coût financier. L’analyse porte sur des données nord‐irlandaises, région d’exploitations familiales de taille relativement petite dans laquelle les représentants agricoles ont régulièrement appeléà la mise en place de soutien pour la retraite anticipée. Nous estimons les avantages que pourrait procurer l’introduction de cette mesure à l’aide de données du RICA et d’une enquête indépendante portant sur 350 agriculteurs âgés de 50 à 65 ans. Nous trouvons que la taille de l’exploitation est un déterminant significatif du profit par hectare mais que l’âge de l’exploitant n’en est pas un. Les avantages de la mise à disposition de terres grâce à un programme de préretraite dépendent de la capacité de ces transferts à entraîner un accroissement notable de la taille des exploitations et des modifications de l’utilisation des terres. Cependant, même lorsque ces conditions sont remplies, seuls des paiements représentant un tiers du niveau maximum prévu dans le programme de préretraite pourraient se justifier dans un scénario optimal. Pratiquement un quart du total des paiements serait liéà des pertes de bien‐être, c’est‐à‐dire que les bénéficiaires seraient des agriculteurs qui aurait pris leur retraite de toute façon. Globalement, l’intérêt économique d’un tel programme est considéré comme faible. Die finanzielle Unterstützung von Landwirten in der EU, die in den Vorruhestand gehen möchten, stellt in der Politik der GAP zur Entwicklung des ländlichen Raums ein diskretionäres Element dar; in einigen Mitgliedsstaaten wie z.B. Frankreich, Irland und Griechenland wird diese Maßnahme angeboten. Wir untersuchen, ob es möglicherweise finanziell sinnvoll wäre, solche Programme einzuführen. Dazu ziehen wir Daten aus Nordirland heran, einer Region mit relativ kleinen landwirtschaftlichen Familienbetrieben, in der sich Landwirte regelmäßig dafür aussprechen, Vorruhestandprogramme einzuführen. Wir schätzen den Nutzen, der sich aus der Einführung eines solchen Programms ergeben könnte, anhand von INLB‐Daten und einer gesonderten Befragung von 350 Landwirten im Alter von 50 bis 65 Jahren. Wir stellen fest, dass es sich bei der Betriebsgröße – im Gegensatz zum Alter des Betreibers – um einen entscheidenden Faktor für die Höhe des Gewinns pro Hektar handelt. Ein Nutzen aus der Landübertragung aufgrund eines Vorruhestandprogramms beruht auf solchen Transfers, die eine bedeutsame Betriebserweiterung und veränderte Flächennutzung zur Folge haben. Selbst wenn diese Bedingungen erfüllt werden, könnten günstigstenfalls nur Rentenzahlungen in Höhe von etwa einem Drittel der gesetzlich verankerten Höchstsumme gerechtfertigt werden. Beinahe ein Viertel aller Zahlungen wäre mit Mitnahmeeffekten verbunden, d.h. Landwirten zukommen, die ohnehin den Ruhestand antreten würden. Aus ökonomischer Sicht muss ein solches Programm als schwach eingestuft werden.

Suggested Citation

  • Paul Caskie & John Davis & Michael Wallace, 2008. "How Effective is Farmer Early Retirement Policy? Quelle est l’efficacité de la politique de préretraite pour les agriculteurs? Wie effektiv ist das Vorruhestandprogramm für Landwirte?," EuroChoices, The Agricultural Economics Society, vol. 7(3), pages 38-44, December.
  • Handle: RePEc:bla:eurcho:v:7:y:2008:i:3:p:38-44
    DOI: 10.1111/j.1746-692X.2008.00109.x
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    References listed on IDEAS

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    1. Michael T. Wallace & Joan E. Moss, 2002. "Farmer Decision‐Making with Conflicting Goals: A Recursive Strategic Programming Analysis," Journal of Agricultural Economics, Wiley Blackwell, vol. 53(1), pages 82-100, March.
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    1. World Bank, 2011. "Romania : Considering Options for Extending Social Protection Coverage to Elderly Farmers," World Bank Publications - Reports 12583, The World Bank Group.

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