In literature, <u>situational irony</u> creates a contrast between what the readers might expect and what actually happens in the text. The goal is to shed light on the difference between appearances and the reality, with regard to a particular theme.
Here, the irony is that even though the farm produces more and gains more money, the animals who worked for this progress to happen are not getting the profits of this improvement. All the money goes to the hands of the ruling class (the pigs and the dogs), because the other animals are naïve enough to believe that the rulers' "supervision and organisation" work is enough to justify this unfair wealth distribution.
