As farmers age, the question of leaving the farm can become a catalyst for economic and personal crisis. But forward thinking farmers are looking at innovative ways to have their cake and eat it too – by living on their farm but not having to run the farm business.
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Research has for some time identified a demographic time-bomb waiting to explode on farms across the country as ageing farmers put off the difficult decision of when and how to retire. With many now farming into their 60s, 70s and beyond- and often without a following generation interested in taking on the family enterprise - serious personal and economic threats are emerging.
Social research has identified links between the absence of a farm transition or retirement plan and mental and physical health decline. It also highlights a high risk of farm families ageing into poverty as profits drop and the farm asset deteriorates.
Respected farm consultant, Meridian Agriculture director, Mike Stephens, has for decades encouraged and guided farmers through the difficult process of planning for the inevitable time when they have to hang up their work boots and relinquish control.
“This is not something that Australian farmers find easy to do, and at times it can cause a lot of grief for them and their families,” Mr Stephens said.
“For some, it is becoming daunting to continue to face the physical and mental challenges - including all the legal and compliance issues- of running the farm. But the prospect of leaving is more daunting,” he said.
Studying this issue for a PhD and having contributed to a number of farm succession handbooks promoted in the 1990s and 2000s, Mr Stephens has a better understanding of the complexities and difficulties of this issue than most.
He is currently assisting the Monaro farming community develop a forum on farm transition options to be held in Cooma on November 30. With the support of the Department of Primary Industries Rural Resilience Program and Monaro Farming Systems (MFS), this community forum will highlight some local success stories where elderly farmers remain on their properties while younger operators take over the business responsibilities.
The Q&A style forum will highlight the successes and the pitfalls of various leasing and share-farming options with a panel of experienced professionals answering questions relating to legal, financial and personal aspects of such deals. Farmers representing owners and lessees will also participate in the panel discussion.
Mr Stephens, who is also a director of MFS, said the production-focused farmer group had recognised a strong need on the Monaro and elsewhere for practical and realistic alternatives to selling and leaving the farm.
Nimmitabel grazier and MFS member, Mr Steve Rolfe, is one of the main drivers of the information day. He sees farm leasing and other innovative transition as solutions for both farmers who want to exit, and those who want to enter farming.
“There are plenty of young and enthusiastic sons and daughters of farming families who are well educated and have the skills, but don’t necessarily have the capital or opportunity to set themselves up to farm,” Mr Rolfe said.
Local farmer, and panel member, Howard Charles, will outline his experience of leasing his Nimmitabel property, “Rockybah” at the forum. Organisers are encouraging all interested district farmers, and not just MFS members, to attend the free forum and to bring any questions for the panel they want answered.
While there were many positive stories to tell, Mr Stephens, conceded moving from farm manager to farm observer was not an easy transition and although there were good reasons why farmers should pursue alternative business models, there was still much work to be done to convince them to take the first steps.
“One of the biggest barriers is this country’s historic attitude to land ownership. The hardest thing is to convince people that farmers don’t have to own land and land owners don’t have to be farmers,” he said.
“That’s almost a foreign concept.”
There were many business arrangements including partnerships, joint ventures, share farming and leasing where the older generation farmer could wind back and support the next generation to gradually acquire a level of ownership of the business over time. That “next generation” did not necessarily have to be related, he said.
“Historically leasing in Australia has not been well regarded but with intelligent leasing it can provide a win, win. In any event, leasing is only one of the options to business transition.”
But the consequences of not planning for dignified retirement could be more damaging than pursuing one of the transition options, he said, citing family breakdown, declining mental and physical health and increasing debt as possible outcomes.
The forum is at 1.30pm, Monday, November 30, at the Alpine Hotel, Cooma.
For information or to submit questions, contact either: Mike Stephens (mstephens@meridian-ag.com.au, 0418 508 150), Ted O’Kane ((ted.o'kane@dpi.nsw.gov.au 0427 781 514) or Stephen Rolfe (keniworth2155@bigpond.com, 0417 234 673).
