The Government would need to compensate farmers to the tune of €2.5bn over five years to reduce livestock numbers in pursuit of climate targets, the Irish Fiscal Advisory Council (IFAC) has projected.

The comments were made at an Oireachtas committee discussing what climate change means for the country’s public finances.

IFAC representative Killian Carroll said it estimates that €500m/year from 2026 to 2030 will be needed to support farmers to reduce livestock numbers to meet the country’s climate targets.

“Teagasc did modelling work to see what would likely be required for the sector to meet its targets. Its modelling work suggested that there would have to be a reduction in livestock numbers, particularly in the cattle herd – beef and dairy.

“We assumed, because there would be a reduction in livestock numbers, that there would be a corresponding reduction in farm incomes.

“We assumed that these farmers would ultimately need to be supported. The figure we had was about €500m/year between 2026 and 2030 in supports,” he said.

Carroll added that beef and sheep farms currently operating at a net loss could be incentivised to transition to forestry.

“One could support those farms in particular to transition away from using the land for their beef and sheep herds towards other land use like afforestation. They could end up better off as a result,” he said.