Bill C-39 (Historical)

An Act to amend the Canada Grain Act, chapter 22 of the Statutes of Canada, 1998 and chapter 25 of the Statutes of Canada, 2004

This enactment amends the Canada Grain Act by
(a) clarifying the Canadian Grain Commission’s objects;
(b) combining terminal elevators and transfer elevators into a single class of elevators called “terminal elevators”;
(c) eliminating mandatory inward inspection and weighing as well as some requirements for weigh-overs at elevators;
(d) extending the right to require the Commission to determine the grade and dockage of grain at process elevators and grain dealers’ premises;
(e) eliminating the Grain Appeal Tribunals;
(f) eliminating the Commission’s ability to require security as a condition for obtaining or maintaining a licence;
(g) creating additional regulatory powers for the Commission;
(h) modifying enforcement provisions and creating certain new offences; and
(i) ensuring that some of the requirements and procedures set out are clarified and modernized and that certain language is updated.
The enactment also amends An Act to amend the Canada Grain Act and the Agriculture and Agri-Food Administrative Monetary Penalties Act and to repeal the Grain Futures Act as well as another Act, and includes transitional provisions and coordinating amendments.

Canada Grain Act

[Jay Hill, Conservative, Prince George—Peace River, BC]

moved that Bill C-39, An Act to amend the Canada Grain Act, chapter 22 of the Statutes of Canada, 1998 and chapter 25 of the Statutes of Canada, 2004, be read the second time and referred to a committee.

[David Anderson, Conservative, Parliamentary Secretary to the Minister of Natural Resources and for the Canadian Wheat Board]

Mr. Speaker, it is a great privilege and pleasure for me to rise today and support the proposed amendments to the Canada Grain Act, because they touch on a vital economic sector in this country and in my riding.

As I recall, many of the amendments to this act come out of work that has been done at the agriculture committee. It has been done in cooperation with all parties, so I look forward to their support for this bill.

When we look at the tremendous accomplishments of our agriculture and agrifood industry over the last 100 years, the Canadian grain sector stands out as a great success story. Today, Canadian wheat, barley and other grains are known by our customers all over the world for their outstanding quality, consistency, cleanliness and great innovation.

Each and every year, Canada's grain industry contributes over $10 billion to the Canadian economy. These dollars of course drive the economies of both the rural and the urban areas of Canada. They create and sustain jobs right through the grain production chain, from farm input suppliers to elevators, to transporters and processors.

These dollars create jobs and prosperity for Canadians here at home and they support our rural communities, which contribute so much to Canada's economy.

This government has taken concrete action in support of this vital sector of economy. We are putting farmers first, as we hear the agriculture minister saying quite often. Two-thirds to three-quarters of our caucus has rural roots.

[Wayne Easter, Liberal, Malpeque, PE]

What baloney.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

I notice that the Liberal opposition critic wants to heckle us on that because we do have a massive number of MPs from rural areas and he basically sits alone over there. We understand agriculture from the ground up, unlike the Liberals, and that is why it once again was a strong theme in our throne speech last fall.

Our first act as a new government in February 2006 was of course in the interests of grain producers when we accelerated the grains and oilseeds payment program. They thanked us for that.

We are investing more than $2 billion in the development of biofuels to open up new markets for our grain and oilseeds producers, to create new jobs in rural communities and to create a better environment for all Canadians.

We are working hard to deliver marketing choice to help our western wheat and barley producers capture new opportunities, to make business decisions that are right for their farms and, indeed, even to capture the opportunities that are available to other farmers across this country.

We have improved cash advance programming by doubling the interest-free portion for producers. That was another act we were able to deal with very quickly and successfully at the agriculture committee because everyone there was willing to cooperate.

We have helped the transfer of family farms to young farmers by boosting the capital gains exemption, which for many years has been asked for. The Liberal government would not do that for farmers. We chose to do that. We have moved ahead on it.

We are pressing for an ambitious outcome at the WTO for the benefit of Canada's entire agriculture sector.

The Minister of Agriculture and Agri-Food and his provincial colleagues have agreed to move forward on new programs to support farmers. These programs will be simpler. They will be programs that our producers can take to the bank, which is also something that they have asked for over several years. They will be programs that are going to be designed by the farm community for farmers.

AgriInvest, for instance, the producer savings account, is where producers can deposit their money to their accounts and trigger matching government dollars. To help kickstart this program, the government has committed $600 million, which started flowing in January 2008. We hear the opposition crying about our programs, but in fact they are working. We have just rolled out a major one in the last month.

Ministers also agreed to move forward on AgriStability, an improved margin-based program that replaces much of the coverage previously available under the Liberals' flawed CAIS program.

Ministers agreed on the details of AgriRecovery, a disaster relief framework that ensures rapid assistance to producers hit by smaller natural disasters. We look forward to that rollout.

Farmers can expect the whole business risk suite of programs to be in place and available by April 2008. That will be good news for them. They have waited a long time for good farm programs. Indeed, they waited through the entire Liberal regime to find a decent farm program. They will now have those programs in place.

The amendments the government is proposing to the Canada Grain Act and the Canadian Grain Commission are one more illustration of our commitment to grain producers. Canada's quality assurance system for grain is a key competitive advantage for our farmers. The measures proposed in these amendments will build on that competitive advantage.

When Canada's global customers purchase Canadian grain for processing, they can count on getting the consistent quality and cleanliness they have come to expect, load after load. This world class reputation that our Canadian grains enjoy around the globe has been earned.

In large part, it has been earned through hard work, first and foremost by the hard work of our farmers, who grow some of the best grain in the world, but also by grain handling companies, research scientists and the Canadian Grain Commission.

Why is Canada so successful? Our edge in the marketplace has always been quality. This kind of quality did not happen by accident. Much of the responsibility for the quality of Canadian grain belongs with the Canadian Grain Commission and the quality assurance system that it is mandated to administer under the Canada Grain Act.

Canada's grain industry is changing. The legislative tools required to keep the industry competitive need to change accordingly.

The Canada Grain Act has not changed substantially in almost four decades. In that time, the marketplace for grain has continued to evolve. There has been more emphasis on a broader range of crops in western Canada and on such things as identity preservation, niche marketing and processing of grains in our own country.

The biofuels industry, supported by initiatives put in place by this government, has become a major customer for grains. On the previous bill we were discussing, there was some debate on that very issue.

The reform of the Western Grain Transportation Act in the mid-1990s triggered a wholesale diversification as producers opted to market their grains through livestock or to switch to other crops such as oilseeds, pulse crops and horticultural crops.

I do not think the change was bigger anywhere than it was in my own region of southwest Saskatchewan, where at one time we grew almost exclusively grains. Now there are crops growing in my region that we never thought we would grow there, such as mustard, canola, lentils, peas and chickpeas. Farmers have taken the initiative to change their operations to respond to changes in the industry.

Today, wheat accounts for one-fifth of farm receipts on the prairies. That seems substantial, but in the 1950s three-quarters of our land was producing wheat, so there has been a huge shift.

Likewise, marketing structures are evolving as well. The Wheat Board monopoly on wheat and barley was put in place by Parliament 70 years ago because of a variety of dynamics and reasons.

The system was essentially designed to collect the grain produced by small farmers at small country elevators, market it around the world as a uniform commodity and then try to divide the returns from that process among all the producers who delivered the grain.

Today, those dynamics have changed. Our approaches and structures need to change with them. We face the prospect of numerous new and growing competitors in South America, the former Soviet Union and other regions around the globe. We need to respond to those challenges.

As well, in the buying side of the market, the grain market has moved away from the commodity procurement model of the past. Now we have a situation in which large numbers of mainly private buyers select a range of quality attributes for particular market segments.

In other words, people are getting picky. They want high quality products, which Canadians can produce, but they want them delivered at a certain time in a certain way and often in a manner that farmers are best able to meet. Our present marketing system just cannot meet those challenges.

We need to continue to evolve and adapt to these new realities. That is why we are working to open up opportunities for our producers through marketing choice. On barley marketing, a majority of farmers, 62%, has asked for marketing choice. Our new government remains firm in its resolve to stand up for farmers. We remain committed to giving producers the barley marketing choice they are calling for.

The Prime Minister also remains absolutely firm on our determination to move forward with producers for marketing choice and to bring them opportunities they have not had in the past. We are committed to freeing our farmers to make marketing decisions that are right for their own businesses. We want to give producers the freedom they deserve and the marketing options they need to maximize their own profitability.

We are proposing these amendments to the Canada Grain Act to help keep our grain producers competitive by improving the regulatory environment for Canada's grain sector. The proposed change to the Canadian Grain Act and the Canada Grain Commission will help the grain sector to meet the challenges of a more competitive and market oriented sector for the 21st century.

By removing unnecessary costs from the grain handling system, the bill works to build a lower cost, more effective and innovative grain sector. We are working to reduce the regulatory burden. As all costs in the system eventually work their way to farmers, this will result in a less costly system for those same farmers.

These amendments reflect the direction of both the COMPAS report and the good work done by the Standing Committee on Agriculture and Agri-Food. Both reports reflect extensive consultations held with the sector in preparing those reports. In short, these amendments speak to the will and the needs of the Canadian grain industry.

I want to talk a bit about the changes that we are bringing forward.

First, inward inspection and weighing of grains will no longer be mandatory. These amendments remove the requirements for costly mandatory services that do not clearly contribute to the bottom line of farmers and the grain industry.

Currently, the Grain Commission is required to inspect and weigh each railcar or truck lot of western grain that is received by a licensed terminal and transfer elevators. The industry has been calling for change in this area for some years now on the grounds that these mandatory inspections impose costs and are not essential to ensure grain quality. I should point out this does not affect the inspection that is done at the elevator when farmers deliver their grain. We need to be clear on that. They will still be protected.

Inward inspection itself will no longer be mandatory. Instead, shippers of grain will be able to request an inspection at their discretion when they feel the benefit justifies the cost. Elevators will also be required to allow access to private inspectors when an inspection is requested.

The Canadian Grain Commission will also be authorized to provide grade arbitration if so requested by the parties to a transaction, so farmers are protected in their transactions with the grain companies.

Second, the Grain Commission will get out of the business of collecting and holding security deposits from licensed elevators and grain dealers under the producer payment security program. This program has cost a lot of money, since security is working capital tied up with no return.

Some may believe that the security program provides a free service to farmers, but every cost in the grain handling system must be paid and the program does have costs. Worse, it does not work. We all know there have been some spectacular failures in which producers found out the security system did not guarantee that they would be paid.

With the Grain Commission leaving the security business, the field will be open to farmers to decide whether they need payment security insurance if the benefits are worth the cost to them.

The field will also be open to farmers and farm organizations wanting to look at alternative methods, such as commodity clearing house models or other alternatives in which they might be interested. The government will no longer impose the cost on farmers and will no longer make the assumption that it always knows best. This brings the policy in line with other areas of agriculture and it brings the grain policy in line with what goes on in other parts of Canada.

In addition, the legislation proposes several additional amendments to modernize the act. These amendments will improve the clarity of the application and the enforcement of existing provisions. They will reflect current practices as we modernize the act. They will enhance producer protection. They will eliminate some of the provisions that are no longer applicable or no longer used.

I have a final word on the job situation at the Canadian Grain Commission.

The commission will be working with staff over the duration of the legislative process to assess the full impacts of the proposed changes. We understand this process may have a significant impact on the lives of some of the employees and are committed to working with them in a clear and transparent manner.

The proposed amendments to the Canada Grain Act support the goals of the government's growing forward framework for agriculture. They will help the grain sector continue to evolve in a direction of greater competitiveness. They will give greater freedom to farmers to manage risks. They will bring in effective regulatory oversight where it is needed.

The amendments the government is proposing contribute to building a competitive and innovative grain sector by reducing costs, by improving competitiveness, by reducing regulation and by providing choice for our producers and others in the grain sector.

The government has built a strong foundation for agriculture across Canada. We have delivered on our commitments to farmers just as we have delivered on our other commitments to Canadians. In short, we have put farmers first. This proposed legislation is just one more example of that.

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, I listened closely to what the parliamentary secretary had to say. His last comments are glaring. He tries to leave the impression that the government has put farmers first and it has done anything but. In fact, the way the legislation is proposed, puts farmers behind industry.

In terms of the parliamentary secretary's remarks, there has been a lot of hot air about what the government is doing for farmers. In reality the government is talking a good line, but is not meeting the needs of primary producers in so many ways, especially the hog and beef industries at the moment. What the government is doing now is an insult to those industries.

His remarks on the position of the government toward the Canadian Wheat Board were even worse. The actions of the government are an affront to democracy. The parliamentary secretary knows that this week the minister called the Wheat Board, and those opposed to the Wheat Board, to a meeting and basically suggested—

[Ted Menzies, Conservative, Macleod, AB]

Ninety per cent producers.

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, one member over there says that he is talking to producers. We know for a fact that there are 12,000 barley producers in western Canada. The representatives, who were in that room before court in terms of the appeal, admitted they had been in existence since 1976 and represented 130 producers. Having 130 present out of 12,000 is not having barley producers represented at the meeting. That was said in the court documents, and the member knows it. What I am saying is it is an affront to democracy.

The parliamentary secretary mentioned the work of the standing committee in the review of the Canadian Grain Commission earlier. However, the bill, as drafted, ignored many of those recommendations. There is no cost benefit analysis, as was asked for by the standing committee. Recommendations 4, 5, 6 and 11 have been completely ignored.

Let me ask the parliamentary secretary this question. The current minister was chair of that committee. Why did the two members ignore the recommendations of the Standing Committee on Agriculture and Agri-Food in proposing this bill or is it just another sop to their industry friends in which they intend to weaken the position of farmers in marketing and grains around the world?

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Mr. Speaker, I am not sure if the member opposite was listening, but I explained the benefits of the changes to the act. They would benefit farmers with reduced regulation and improved protection and opportunities in agriculture in the future.

I want to address the issue that he spent the majority of his time on and that was the meeting that the minister called this week. The member is from Prince Edward Island so we would not expect him to have a clear understanding of what goes on in western Canada right now.

Last year we held a plebiscite and 62% of farmers in western Canada voted that they wanted some marketing choice with regard to barley. Since then there has been a huge shift toward support for our position, for bringing choice to farmers, particularly in dealing with barley. Not only has there been a huge shift, but there is a huge sense of urgency that something needs to be done very quickly.

This week the minister called a meeting between the barley industry and the Canadian Wheat Board. All barley industry participants were invited and they came. Wheat Board representatives came as well. The barley commissions, the barley growers, the malt industry, the Grain Growers of Canada, the brewers, the Wheat Board and three agriculture ministers from western Canadian provinces came to discuss what needed to be done in the barley industry in western Canada.

The member can afford to delay and hold this thing off, but western Canadian farmers are making their decisions about seeding intentions. They need to know what they are going to be doing this spring.

The Canadian Wheat Board is not bringing any sense of certainty to the market for western Canadian farmers. The last thing we need in western Canada is for the Wheat Board to continue to delay on this issue so farmers do not know if they should grow malt barley or not. If they make a decision to move out of malt barley, then the malt industry starts to make a decision about whether Canada is a good place to invest in the malt industry.

We need some stability in this industry and the board needs to take some leadership and make some decisions that will give farmers choice in this area. Then we can develop this industry the way it should be developed.

[Peter Stoffer, NDP, Sackville—Eastern Shore, NS]

Mr. Speaker, I have great respect for the member, but his comment that the member from P.E.I. did not understand western Canada was a cheap shot.

I am from western Canada, but I happen to live on the east coast. It would be like me telling the member and his party that they have no understanding of Quebec or Atlantic Canada. Therefore, he can retract that statement later in the House if he so desires.

With the direction the Conservatives are taking farmers, or the ones they purport to represent, these farmers, without the protection and the services of the Wheat Board, will end up at the hands of foreign multinational corporations like Cargill and Monsanto. When these farmers end up competing against those huge multinationals, they will be left out in the cold.

Will the government be there to help them? No. It is just an excuse to get out of the way. We in the NDP, and I am sure many others, support the idea of the Canadian Wheat Board because it was successful. If the Conservatives did not fire the Wheat Board president, we would probably have a much better thing going now.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Mr. Speaker, he just proved my point. He does not know what he is talking about. What he is saying is rubbish. We clearly have a situation in western Canada right now where we need some leadership on this issue.

We have the farmers, the maltsters, the brewers and two provincial governments representing 95% of the malting industry in western Canada all on the same page and the Wheat Board and the opposition on the other page.

We need to represent farmers. We are willing to do that. I wish they would get on board with that.

[Jay Hill, Conservative, Secretary of State and Chief Government Whip]

Mr. Speaker, obviously time is of the essence, but I did want to rise in this debate to support the comments made by my colleague, the Parliamentary Secretary to the Minister of Agriculture.

I want to refer to some of the comments made by my colleague. A large number of people in our Conservative government caucus are actively farming, or they have families actively farming, or have farmed before. Although I no longer own land and farm, so I am not in any potential conflict when I speak on issues like this, I farmed for 20 years and raised 3,000 acres of grains and oilseeds in the Peace River country. I am proud of that heritage. My father farmed all his life other than during the second world war when he was in the air force.

That is not unusual for members in this caucus. We have a lot of people who have direct links to the land. It annoys me to no end, and I know it annoys my colleague as well, when I constantly hear members on the opposition benches talk as though they are some kind of an authority on the Canadian Wheat Board and on what it means for western Canadian farmers.

It is fine to be from Prince Edward Island or from Nova Scotia and to tell us how we should market our grain, but it is hard not to get a little emotional about this issue.

As a former farmer and as a person who was involved in farm organizations for years and years before I got into federal politics, one of the criticisms I often heard from farmers was they were sick and tired of programs designed by bureaucrats to benefit bureaucrats. Would my colleague further elaborate on the new programs that are coming into place under this new Conservative government, which will help farmers and which they have had direct input into those programs.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Mr. Speaker, I have a quick reflection on the Wheat Board and then I will move on to something else.

Yesterday I sat on a panel with a Liberal member who brought forward a private member's bill together with an NDP member. Both of them are from urban ridings. I know the view from downtown Winnipeg is a lot different than it is from the farm, but the government has moved to protect farmers from day one.

I mentioned that we accelerated the grains and oilseeds payments. As soon as we formed government, we put that into place. We put $2 billion into the biofuels industry. We have worked hard to deliver marketing choice to farmers. We have changed the cash advance programming that the Liberals never changed. We have changed the capital gains exemption. For years that was requested. We are pressing at the WTO for a good result. We brought in agri-invest, and my colleague asked about that. As well, we brought in agristability and agrirecovery. This suite of programs will be ready in April.

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

Mr. Speaker, according to the Chief Government Whip, I should not rise to speak. If democracy were dictated by this government, since I am from Quebec, I would not have the opportunity to speak on behalf of producers from out west or anywhere else. What is happening is not an act of the Holy Spirit. These are proposals and questions put forward by the producers.

I would like to ask the parliamentary secretary—who attended the committee meetings when the Canadian Grain Commission and the changes to be made were being discussed—why did most of the committee's recommendations not find their way into this bill?

[The Acting Speaker, Conservative, Royal Galipeau]

The hon. parliamentary secretary.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Mr. Speaker, I think most of us here would try to abide by the rule that if we are going to speak we should talk about things that we know something about. That does not stop anyone from talking about anything they wan,t but that is probably the first thing that we should consider.

These recommendations deal with a number of issues. In these recommendations and amendments to the legislation, the mandate of the Canadian Grain Commission and the Canada Grain Act is being clarified, but there are a lot of other things going on. The Canadian Grain Commission is moving to protect the interest of grain farmers. It is working to protect the interests of--

[The Acting Speaker, Conservative, Royal Galipeau]

The hon. member for Malpeque.

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, it is kind of sad to have to stand in this place and outline my credentials before I start, but the attack on my person by government members is designed to try to discredit what I have to say.

As a former farm leader, I spent 11 years in western Canada on grain issues. I have probably been in as many, or more, farm yards than any of those folks across the way. I have been at many public meetings in the debates on these issues.

Why, as a member of Parliament from Prince Edward of Island, I am speaking on this issue, and the Canadian Wheat Board issue when that opportunity occurs, is that my office is swamped by phone calls, faxes and letters from western Canadian farmers, practising farmers who are concerned about where the Conservative government is taking Canada in terms of its farm policy. It is undermining the Canadian Wheat Board. Clearly, with this bill which has ignored so many of the recommendations of the Standing Committee on Agriculture, it is undermining the Canadian Grain Commission itself.

The Parliamentary Secretary to the Minister of Natural Resources and for the Canadian Wheat Board talked about how Canadian grain is recognized as quality number one around the world. That is true. It is recognized as quality number one around the world.

Where we are seen as the quality supplier of grains around the world, the United States is seen as the residual supplier. The Americans may set price, but they are seen as the residual supplier. Why is that? Because farmers long ago advocated for an agency, a commission, the Canadian Grain Commission, that would protect their interests, that would ensure they were protected from the grain trade, along with the Canadian Wheat Board. It would ensure the quality that Canada sold was number one.

It is the Canadian Grain Commission which has put Canada's reputation where it is today, as have the farmers, in terms of producing that high quality grain. So let us give credit where it is due.

We have to ask, if we were to pass this bill as currently composed, would Canada still be recognized as the quality number one supplier of grains around the world? Would Canadian producers still have the protection from industry that they currently have and from the grain trade? As I read the bill, I do not believe they would.

There are some real concerns about what the government has proposed in terms of Bill C-39. What should have been a decent bill after the Standing Committee on Agriculture and Agri-Food presented its report is like so much of what the current Conservative government does. It leaves out the balance in terms of the proposal and brings forward a bill that is more to do with ideology, with half measures, with no real intent to improve the system in an all conclusive way.

That is sad, because it would have been nice to be able to stand and congratulate the government for once, but again it has denied us that opportunity of support by basically ignoring the will and the recommendations of the Standing Committee on Agriculture and Agri-Food. By so doing, the government is ignoring the will and the recommendations of the farm community. Oh yes, the Conservatives cater to the few, as was clear in the parliamentary secretary's discussion about the meeting this week. They cater to the few, but they ignore the many.

The government has a responsibility in its actions to govern for the whole, not just those that the governing party is ideologically aligned with.

Mr. Speaker, how much time do I have?

[The Acting Speaker, Conservative, Royal Galipeau]

The hon. member has 15 minutes.

[Wayne Easter, Liberal, Malpeque, PE]

I expect, Mr. Speaker, that if you asked it, members would probably give unanimous consent for me to have another 20 more.

Bill C-39 does not reflect the unanimous recommendations of the Standing Committee on Agriculture and Agri-Food. For the minister to imply otherwise is misleading. The question is why this contempt for the committee, and why this contempt by the minister for his own Conservative colleagues that were on that committee, of which he was one. I suppose it does make some sense because that is the way they continue to act over yonder based on ideology alone.

When the standing committee presented its report in November 2006 it was under the chairmanship of the member who is the current Minister of Agriculture and Agri-Food. He was chair, and the parliamentary secretary for agriculture at the time is the current Parliamentary Secretary to the Minister of Natural Resources. They were at all those committee hearings and ignored the very committee hearings that they should have been encompassing in the bill. Why? Maybe it is, there is the rumour out there that the Prime Minister's Office and government dictates everything, and maybe they have had to toe the line there as well. Maybe that is the case, and I expect it probably is.

There are lots of concerns about this bill coming in. Let me read a few into the record. The National Farmers Union on December 13, 2007, which was the first major organization to draw attention to some of the serious deficiencies in this bill, stated a number of concerns quite clearly. Its president, Stewart Wells, said that Bill C-39 will fundamentally “turn back the clock” on the Canadian Grain Commission. In other words, it will bring us back to the havoc times before the Canadian Grain Commission was put in place. A number of other concerns were outlined, and I will raise them for debate at a later date. The amendments will remove the requirements that the Canadian Grain Commission operate as a public interest watchdog that regulates the overall grain industry “in the interests of producers”.

If this bill passes, the NFU says that the grain industry would become virtually self-regulated, and the CGCs role will be reduced to being a passive service provider that provides grading, weighing, and inspection services to grain companies on a fee for service basis. Farmers' protections will be reduced to a minimal level while the legislation leaves the door open for companies to be able to circumvent those limited provisions.

It went on to say, “Canada's farmers have not advocated for any weakening of the CGC regulatory role. At a time when grain companies like Viterra, ADM, and Cargill are consolidating their hold over the market, it is obvious there needs to be a mechanism in place to provide farmers with protection”. In other words, it is implying that the Conservative government is undermining those protections for farmers through this bill.

It goes on to say, “The current system allows grain inspectors to catch contaminated, off condition, or incorrectly represented car loads while they are being emptied, weighed and elevated, and before they are mixed with large quantities of other grain”. Mr. Wells said, “Eliminating this provision will have a negative effect on farmers' bottom line”.

It is true that eliminating this provision would have a negative effect on farmers' bottom line but it goes to the point of the parliamentary secretary earlier. One of the reasons that kind of contamination and bad grain does not get into the marketplace is because of what the Canadian Grain Commission does now, which is why we are seen as the highest quality supplier of grain in the world. The bill would undercut Canada's ability to be the highest quality grain supplier in the world.

The last point they make is that the amendments also call for eliminating the provision that grain dealers post a security bond before they can be licensed by the CGC. This provision was put in place to protect farmers who would be left holding the bag if the grain company were to go bankrupt. Mr. Wells says, “Eliminating this requirement will not save farmers any money. It will, however, greatly increase their risk.

In other words, another undermining of protection for farmers from the grain trade and grain companies when they do business.

It is interesting to note that one of the organizations that was at the meeting on Monday was the Western Canadian Wheat Growers Association. It is supporting the bill. I will admit and I will admit on the record that I sometimes wonder in whose interests the Western Canadian Wheat Growers Association speak, whether it is the farmers or in fact the grain trade. The fact that it supports the bill, its name implies that it represents a lot of western grain producers. However, it does not.

It is something like the Western Barley Growers Association. There are 12,000 barley producers in western Canada and on the record before court it said that it represents 130. Therefore, we must question who those organizations really represent.

However, I will get back to the bill. Those were some of the criticisms and concerns raised by a directly represented farmer organization, an organization that is concerned about farmers and their future.

However, what is absolutely shocking, which is typical of the government, it has done no cost benefit analysis on the impact of Bill C-39 with respect to any contracting out of grain inspection, as was called for in recommendation 5 of the standing committee report.

I will explain. This is not unusual from the government, but in terms of a cost benefit analysis, the legislation on changing the CGC shares the same ideological basis as the government's determination to undermine the Canadian Wheat Board. Neither are based on the kind of economic basis that we would expect a government to do. We would expect the government to study and to look at the economic implications on the country, but especially on producers, and it has failed to do that.

Recommendation 5 of the committee report called on the federal government to conduct and complete both pilot projects in contracting out services of grain inspection. The government has failed to comply with this recommendation.

Recommendation 11 required the government to address the issue of specific models which “could be implemented for protecting grain farmers as a result of the elimination of the producer payment program”. What the government provided, in the minister's statement of December 13, 2007, was a suggestion of what “producer groups” could do. It sounds awful familiar to the lack of analysis on the Canadian Wheat Board changes it proposed.

This kind of contempt is becoming common for the government: contempt for parliament, contempt for committees and their reports, and contempt for farmers. It is consistent with the actions that the government has taken with respect to the Canadian Wheat Board that the member talked about earlier.

On July 16, 2007, the director general of marketing policy for Agriculture Canada testified in the hearing on the Canadian Wheat Board court issue, and this makes the point that it goes to the heart of the lack of analysis by the government opposite.

During that testimony, the following questions were asked with respect to the economic impact analysis done by the federal government in relation to the regulations to deregulate barley from a single desk. They were subsequently found to be illegal by the court. The questions were:

Did the government or the civil service or anybody retained by either do any analysis of how the amending regulations would function in the marketplace -- are you aware of any studies of the kind I have mentioned to you?

Answer: No.

Was anybody retained to analyze that in the recent past?

Answer: No.

When governments are making substantive changes that will affect an industry, one would naturally expect that they would do the analysis to see the impact of those changes. The impact of the changes the government wants to the grain commission or the Wheat Board on farmers is of no consequence to the government, obviously, and that is by its own admission.

Why should the government be trusted when it does not do its homework before bringing in legislation that could have a serious impact on primary producers?

The elimination of inward inspections and weighing will cost the Canadian Grain Commission some 200 positions, which is serious. What about the responsibilities that those inward inspections are utilized for? Has there been an analysis done in that regard? There has not.

Measures contained in the legislation would ensure the commission focuses more on the concerns of industry and not just on producers. I will list a number of points that threaten Canadian grain producers in this proposed bill.

The grain commission has served as an independent referee to settle disputes between Canadian grain producers and the powerful companies that buy and export. That is needed even more today than it was in the past.

The commission has also served as the body that actually determines the amount farmers are paid based on the CGCs determination of the weight and quality of grain before it goes to market. That is a concern.

These rules will dramatically diminish if Bill C-39 becomes law, leaving producers newly disadvantaged in their dealings with grain companies when it comes to determining grain quality and quantity.

The producer can hire a private company to grade and weigh their grain even though no such companies exist today. Is that not something?

The bill would also expose grain producers to financial harm in the event of a grain buyer bankruptcy or refusal to pay.

Plus, as I mentioned earlier, there is the danger of undermining Canada's international reputation should the quality of grain be jeopardized as exporters have more authority and farmers have less protection.

The standing committee did good work but the minister, even though he was chair of the committee at the time, selectively took what the government wanted out of that committee report for its own ideological purposes and its own friends who are trying to undermine farmers' empowerment in the marketplace through the Canadian Wheat Board. They are working for the same people.

The government seems to be working for grain companies and not for farmers, and it is farmers in these kind of times who need protection. The bill could undermine that protection for farmers. That is a sad commentary on a government that purports to represent farmers but obviously does not.

We will be looking further at this bill and speaking to it in later debates. Maybe it can be changed for the better, maybe not, but the bill in its current fashion is certainly not acceptable to the official opposition.

[Ted Menzies, Conservative, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, I did listen with interest to my hon. colleague from Malpeque. I do need to suggest to our hon. member that we are thinking of his constituents right now in their trying times with the ice storm. We hope the member will be able to get back to his family this weekend to spend some time with them and maybe even put up power lines for his constituents.

I do take extreme exception to some of the comments the hon. member made, especially the suggestion that we should not make improvements to Canada's grain grading system because we need to protect 200 jobs. That should not be the reason to not go forward. However, I am not suggesting that any jobs should be replaced but, further to his comment that there is no company that can do the same thing for farmers, there are many. I will not make any advertisements but many companies are available. I used to use them on my own farm. Therefore, to suggest that these people would actually lose their positions, there are lots of other opportunities as we go forward with a better, more effective Canadian Grain Commission. Those people can play a very real part in a more effective system of grading grain.

I represented the Western Canadian Wheat Growers, an association that fought for about 30 years to get the Canadian Wheat Board and the Canadian Grain Commission to recognize that it was more than just visual distinguishability that should determine the value of grain.

The protein content of grain means more than its visual distinguishability. That group and many others fought a long time before we finally recognized that. That was one step.

We need to move forward in making grains available to the customer by their value and that value is their specific traits. It is not what they look like but it is the ash content, the falling number and it is the milling quality that need to be recognized. Those are some of the things that the government is trying to put through that did not get changed for farmers in the previous 13 years.

How would the hon. member suggest that we should not provide this benefit to farmers?

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, I thank the member for Macleod for the concern he raised for Islanders who are still feeling the impact of a serious ice storm.

The member asked a number of questions and some of them I in fact agree are concerns. However, the dilemma that the government has put us in as an official opposition is that it mixes a little bit of good in a bill with a whole lot of the bad and, therefore, it makes it very difficult for us to support the bill without very substantive changes.

On KVD, we agree--

[The Acting Speaker, Conservative, Royal Galipeau]

It being 1:30 p.m. the House will now proceed to the consideration of private members' business as listed on today's order paper.

When we return to the study of Bill C-39 there will be six minutes left for the hon. member for Malpeque for questions and comments.

The House resumed from February 1 consideration of the motion that Bill C-39, An Act to amend the Canada Grain Act, chapter 22 of the Statutes of Canada, 1998 and chapter 25 of the Statutes of Canada, 2004, be read the second time and referred to a committee.

[The Speaker, Liberal, Peter Milliken]

When this bill was last before the House, the hon. member for Malpeque had the floor for questions and comments. There are six minutes remaining in the time allotted to the hon. member for questions and comments.

Since there are no questions or comments, we will resume debate.

Resuming debate, the hon. member for Argenteuil—Papineau—Mirabel.

[Mario Laframboise, Bloc, Argenteuil—Papineau—Mirabel, QC]

Mr. Speaker, I am pleased to speak on behalf of the Bloc Québécois on Bill C-39, An Act to amend the Canada Grain Act. I would like to start by saying that the Bloc Québécois supports the principle of this bill, which would modernize the Canada Grain Act.

We are uncertain about some parts of the bill, though. For example, what would replace payment securities for producers? The Bloc Québécois therefore reserves judgment on the bill. We hope to hear comments from producers, but unfortunately very few of them testified before the Standing Committee on Agriculture and Agri-Food.

In addition, we need to recognize that the bill does not affect Quebec producers directly. We remain vigilant. The reform of the Canadian Grain Commission is taking place in a specific context. The Conservatives are trying to dismantle the marketing mechanisms that protect the interests of producers, such as the Canadian Wheat Board and supply management.

The Conservative government has appointed a friend of the minister to head the Canadian Grain Commission. The Bloc Québécois wonders whether the new commissioner will defend producers' interests or the minister's.

As for the details of the bill, the Bloc Québécois notes that the government is implementing some recommendations of the Standing Committee on Agriculture and Agri-Food, such as modernizing the mandate of the Canadian Grain Commission and eliminating mandatory inward inspection and weighing.

However, the Bloc Québécois is skeptical about the elimination of the Grain Appeal Tribunal and the payment security program, because we do not know what will replace it.

The Bloc Québécois also condemns the fact that the government has not introduced an office of grain farmer advocacy, as the Standing Committee on Agriculture and Agri-Food recommended.

The Canada Grain Act has been amended several times since the early 1970, but not substantially. The legislation was last amended in May 2005 to enable Canada to meet its WTO commitments. During the legislative process, stakeholders called for an amendment to require a comprehensive review of the Canada Grain Act and the Canadian Grain Commission.

On August 1, 2005, clause 2.1 of Bill C-40 came into force, adding section 120.1 to the Canada Grain Act, which requires a review of the Canadian Grain Commission. COMPAS Inc., a consulting firm, was hired to conduct the review, which was based on reviews carried out over the previous six years. COMPAS Inc. held extensive online consultations with industry stakeholders as well as public meetings across the country.

The COMPAS report, which was tabled in the House of Commons and the Senate in September 2006, was referred to the Standing Committee on Agriculture and Agri-Food for review. The committee issued its report in December 2006.

In summary, Bill C-39 amends the Canada Grain Act.

It clarifies the Canadian Grain Commission’s objects; combines terminal elevators and transfer elevators into a single class of elevators called “terminal elevators”; eliminates mandatory inward inspection and weighing as well as some requirements for weigh-overs at elevators; extends the right to require the Commission to determine the grade and dockage of grain at process elevators and grain dealers’ premises; eliminates the Grain Appeal Tribunals; eliminates the Commission’s ability to require security as a condition for obtaining or maintaining a licence; creates additional regulatory powers for the Commission; modifies enforcement provisions and creating certain new offences; and ensures that some of the requirements and procedures set out are clarified and modernized and that certain language is updated.

The bill also amends the Act to amend the Canada Grain Act and the Agriculture and Agri-Food Administrative Monetary Penalties Act and to repeal the Grain Futures Act as well as another act, and includes transitional provisions and coordinating amendments.

It is important for the Bloc Québécois to quickly describe grain production in Quebec.

The grain grown in Quebec is primarily for domestic consumption, especially for feeding Quebec poultry, cattle and hogs.

For these two reasons, producers in Quebec have never felt the need for a marketing system as centralized as the one in western Canada. Marketing in Quebec is governed by the Act respecting the marketing of agricultural, food and fish products. Under that act, the Régie may, on the application of any interested person, designate a person to inspect grain facilities or to grade or inspect grain. After the inspection or grading, the Régie shall issue a grain grading or grain inspection certificate to the interested person.

The Plan conjoint des producteurs de cultures commerciales, which was adopted and implemented in October 1982, gave the federation of Quebec producers of cash crops the means to negotiate the terms and conditions under which certain crops would be sold.

Until very recently, that federation had a fairly limited mandate in respect to the marketing of crops. In 2005, however, two-thirds of the affected producers agreed to the cooperative food-grade wheat marketing regulations—Règlement sur la mise en vente en commun du blé destiné à la consommation humaine—and that marked the beginning of their collective assumption of control over marketing. This was followed by a mandate from the Quebec National Assembly to establish terms and conditions for the sale of other grains, in particular, centralized payment management, the obligatory provision of information about transactions and a floor-price system.

There are more than 11,000 farmers in Quebec who grow and market such grains as oats, wheat, canola, corn, barley and soybeans on nearly a million hectares of land. Total grain production is about four million tonnes, worth a total of $750 million at the farm gate.

Our grains do have some special characteristics and uses. Quebec is especially responsive to niche export markets, such as GMO-free soybeans for human consumption. Quebec oats are also particularly prized in the United States for horse feed.

Bill C-39 obviously makes some changes to the Canadian Grain Commission. I want to turn now to the most important issues for grain producers—issues that were actually already addressed when the parliamentary committee considered the 100 recommendations from COMPAS.

Let us look at the change in the Canadian Grain Commission's mandate. Through this bill, the government would change it in such a way that, in addition to the interests of grain producers, the Commission would also consider the interests of the industry as a whole, including grain processors.

The Canadian Grain Commission’s mandate will be split into two parts. Part one will set out the CGC's core mandate to establish and maintain standards of quality for Canadian grain and regulate grain handling in Canada to ensure a dependable commodity for domestic and export markets. Part two will establish that the CGC shall specifically protect producer interests with respect to deliveries to elevators and grain dealers, access to binding CGC determination of the grade and dockage of grain deliveries, and the allocation of producer cars.

At present, the mandate of the Canadian Grain Commission is to, “in the interests of producers, establish and maintain standards of quality for Canadian grain and regulate grain handling in Canada, to ensure a dependable commodity for domestic and export markets”.

Clause 3 of the bill amends section 13 of the Canada Grain Act by removing the words “in the interests of producers” from the purpose for which “standards of quality for Canadian grain and regulate grain handling in Canada to ensure a dependable commodity for domestic and export markets” are to be established and maintained.

Like the Standing Committee on Agriculture and Agri-food, the Bloc Québécois supports modernization of the Canadian Grain Commission’s mandate. Our party recognizes that the commission must be able to consider broader interests, such as public health, preserving the enviable reputation of Canadian grain producers, and other interests.

Obviously, the Bloc Québécois is sensitive to the concerns of grain producers who believe that Bill C-39 is drafted in such a way as to reduce the protection it affords grain producers. That was one of the questions we had and we will pursue it in committee.

The National Farmers Union has told us, for example, that it is essential to preserve the language of the existing Act, which includes the expression “in the interests of producers” to describe the purpose of the Canadian Grain Commission and the standards of quality in the regulations respecting grain handling operations in Canada.

We know that the Conservative government is allergic to collective marketing mechanisms and instruments that enable producers to earn a fair market return. Deregulation and reducing constraints on the free market are key components of their ideology.

Agricultural producers in Quebec and Canada are quite right to distrust this government, which has set its sights on the Canadian Grain Commission and would like to dismantle supply management in the milk, poultry and egg industries.

On the question of the object or mission of the Canadian Grain Commission, the Bloc Québécois would support any amendment proposed in committee that could provide grain producers with satisfactory protection.

For that reason, the Bloc Québécois will be very vigilant. It is important that this bill be sent to committee so we can examine it in depth, to ensure that producers feel properly protected. That is what is important to the Bloc Québécois. If the producers have doubts about this bill, the Conservatives will find the Bloc Québécois standing up to them.

Obviously governance is going to be an issue with this bill. It is therefore necessary that the Canadian Grain Commission not be politicized. It is important to have a commission in the Canadian quality control system for grain. That is what guarantees the quality of Canadian exports.

The Commission cannot allow itself to be exposed to criticism. It cannot give the impression that its decisions are based on anything other than science and protecting the economic interests in the grain and oilseed supply chain.

It was extremely unwise of the Conservative government to appoint a former Reform Party MP, Elwin Hermanson, to head the Canadian Grain Commission in December 2007. While he has been a grain producer himself, we believe that his close political ties to the present Prime Minister, with whom he sat from 1993 to 1997, cast doubt on his credibility.

It must also be pointed out that there are very close ties between Mr. Hermanson and the present Minister of Agriculture and Agri-food. According to the minister’s website, the minister was Mr. Hermanson's campaign manager in 1993. He was even Mr. Hermanson's constituency office coordinator from 1993 to 1997. The close ties between the minister and Mr. Hermanson, the Chief Commissioner of the Canadian Grain Commission, could not be clearer.

Those close ties prompt us to ask the question that is on everyone’s lips: will the new Commissioner of the Canadian Grain Commission stand up for the interests of producers, or the interests of the minister?

Thus, there ought to be an office to defend the rights of grain farmers. As regards the protection of the interests of agricultural producers, the Bloc Québécois deplores the fact that the government rejected the third recommendation of the parliamentary committee, proposing the establishment of an office of grain farmer advocacy that would have reported directly to the Minister of Agriculture and Agri-Food.

The mandate of the office of grain farmer advocacy, whose role would have been similar to that of an ombudsman, would have been to ensure that producers understand their rights under the act, and to defend their interests in disputes with other stakeholders.

Like the parliamentary committee, we think that such an office would have ensured that the interests of producers are defended in disputes with other stakeholders involved, including the Canadian Grain Commission.

We believe that the communication, consultation, liaison and complaint investigation responsibilities assumed by such an office would have helped strengthened Canada's grain quality assurance system.

As for the elimination of grain appeal tribunals, it goes without saying that the Bloc Québécois has a problem with that part of the bill. Let me explain what the bill does. The grain appeal tribunal hears the complaints of grain producers and companies that are not satisfied with the grades given by the Canadian Grain Commission's inspectors. The chair of the tribunal is an authorized grain inspector, but acting at arm's length. The other members of the tribunal come from the grain industry.

The tribunal's position within the Canadian Grain Commission limits its legitimacy and perceived effectiveness.

Clause 14 of the bill proposes to abolish grain appeal tribunals, which are currently established under sections 35 to 38 of the Canada Grain Act.

We understand that, in case of a disagreement over a ruling made by the chief inspector, who is the first level of appeal, grain producers will no longer be able to turn to the grain appeal tribunal. They will have to turn to the regular courts, which is a costly, long and frustrating process.

That is why the Bloc Québécois maintains that the parliamentary committee did not rule on this issue, and notes that the COMPAS report stated that the Canadian Grain Commission's grain appeal tribunal “has earned some plaudits for effectiveness”.

COMPAS continued, saying, “We believe that the tribunal is respected for the role it plays in disputes over grades, even though some stakeholders may have occasionally felt that the office of the Chief Grain Inspector exerted undue influence”.

The Bloc Québécois is waiting for the government to explain this amendment. We think it is important to refer this bill to committee as quickly as possible so that our party can change it, fill in what is missing, and improve it.

With respect to eliminating inspection and mandatory inward weighing, this is what the bill would do. Weighing and inspection of grain is carried out by the Canadian Grain Commission and is mandatory on bulk shipments overseas but not for container movement or for exports to the United States, where these are optional. Inward inspections are the weighing and grading that take place when railcars or trucks arrive at transfer elevators or terminal elevators. The Canadian Grain Commission then provides third-party weighing so as to forestall errors and to provide assurance to producers.

The government is proposing that inward inspections take place only at the request of the shipper, but that outward weighing and shipping remain mandatory. Terminal and transfer elevator operators will be required to allow access to service providers who will do the weighing and inspection.

While the Canadian Grain Commission will no longer be involved in the delivery of this optional service, both shippers and elevator operators will have access to binding Canadian Grain Commission arbitration in the event of dispute over a grain grade.

Like the Standing Committee on Agriculture and Agri-Food, The Bloc Québécois supports optional inward inspection, as proposed by the government. We agree with this provision of the bill because inward inspection is no longer universally required. Such inspection does not seem to be required in the case of grain shipped to the United States, among other destinations, or by container. The cost of this inspection makes Canadian products less competitive. Grain companies, particularly those that ship grain to companies abroad, want to avoid costs that are not essential to their ability to manage their affairs efficiently. According to COMPAS, “half of the cars unloading grain at terminal elevators come from primary elevators belonging to the same company.”

Mandatory outward inspection and weighing of grains is maintained, and this will help protect the reputation of Canada’s grain products at the international level. We must be careful, however. Since inward inspection is optional, this could increase unit costs and prices by decreasing economies of scale. Making it optional would likely put smaller grain companies that do not have a terminal elevator at a disadvantage in terms of competitiveness. Inspection and weighing fees are collected from the farmer at the primary elevator. Optional inward inspection would benefit larger companies that have a terminal elevator by allowing them to avoid payment of the fees and offering a better price to farmers. Grain companies that have a better geographic location will be in a better position to take advantage of mixed shipments.

The Bloc Québécois believes it is important to promote competition in the grain handling system by helping the smaller companies. That is why our party believes that the Canadian Grain Commission must have sufficient funding so that the commission can maintain efficient and timely services for both producers and smaller handlers who need such services for transactional purposes.

What does the bill do in terms of guaranteeing payment for farmers? The Canadian Grain Commission has long been demanding that licensees provide farmers with guaranteed protection in case of bankruptcy. The guarantee can be in the form of security bonds, cash deposits, credit letters, guarantee insurance or payables insurance in sufficient amounts to cover the eligible liabilities, that is, the amount to be paid to the farmers, or any other acceptable financial instrument. All companies must report their eligible liabilities to the Canadian Grain Commission on a monthly basis. In the past, the amount of the guarantee has been enough to cover most of their obligations to the farmers in most cases of bankruptcy, but not all.

According to COMPAS, since 1982 there have been 19 failures of licensed, bonded companies. Of these 19, there are three instances where the payout was less than 100%, one of which was 98.4%. There are two other instances where the CGC paid producers 100% for failures of companies that were not licensed or carrying security. The CGC made payments in addition to or in the absence of security provisions in a total of five cases.

The Bloc Québécois recognizes, as did the Standing Committee on Agriculture and Agri-Food, that modernization of the system requires an effective and flexible mechanism for contractual security for all participants. Because they are at the beginning of the chain, grain producers need to be contractually protected against breakdowns that could occur down the line.

Our party has noted that the federal government does not require eastern Canada's grain industry—or producers of other crops—to participate in similar guarantee programs.

The Bloc Québécois has noticed that the current system has created a great deal of dissatisfaction. For example, the Western Barley Growers Association recommended a study of costs and benefits.

It is therefore important to understand that the Bloc Québécois believes that this bill should be sent to committee quickly because it is important that changes be made in the interest of grain producers.

We need to take a hard look at this position. This bill must be modernized, but in the interest of producers. The Bloc Québécois will see to it that the interests of producers are respected.

[Ken Epp, Conservative, Edmonton—Sherwood Park, AB]

Mr. Speaker, during the beginning of the member's speech, he mentioned that the bill would in no way affect producers in Quebec but then he proceeded to go on to say that he would be watching it very closely and that he would be defending the good of the farmers.

The fact is that western farmers, I think, have a sense of wanting to determine their own destiny and they are telling those of us in the west that they want to have more ability to market their product freely. They want a choice. They want to be able to use the government agency if it is to their advantage, but there are many times, right now for example, where they could get triple the amount of income if they had some marketing freedom.

How can the member justify saying, out of one side of his mouth, that this would not affect them when, by their own declaration the people in that corner have consistently said over the years that I have been here that they want to get out of Canada, which I feel badly about, but they keep saying it? However, now he seems to be so very interested in what is happening in western Canada. How does he reconcile that?

[Mario Laframboise, Bloc, Argenteuil—Papineau—Mirabel, QC]

Mr. Speaker, the answer will be quite simple. I will take this opportunity to outline the situation.

Quebec has grain marketing legislation and a board called the Régie. Quebec producers have their own organization.

We are closely monitoring this bill as are Quebec farmers. With respect to all aspects of supply management and the Canadian Grain Commission, the Conservative government has demonstrated that it does not support any system put in place to protect producers. These protection systems go against the Conservatives' philosophy. We will be very vigilant in this regard because western producers are asking us to intervene. The member should know that.

As long as Quebec remains in Canada, the Bloc Québécois will defend the interests of the men and women of Quebec. In this case, agricultural producers from Quebec and from the rest of Canada are asking us to step in. For us, this is important. If farmers do not feel protected by this bill, the Conservatives will find the Bloc Québécois on their heels. In our view, it is important that supply management and the other marketing protection tools acquired over the years by the farmers remain intact. This is why we are interested in seeing this bill quickly referred to the committee, which will hear farmers and be able to improve the bill in the interest of the men and women of the farming industry.

If, one day, the Conservatives start undermining collective marketing by the Canadian Grain Commission, this could trigger a domino effect. Supply management would be affected. There would be a very negative impact on producers in Quebec.

The Union des producteurs agricoles is asking the Bloc Québécois to be vigilant and to protect the western farmers. Obviously, we are happy to do it as long as we remain members of this House. We would not want this bill to have negative consequences on the existing legislation which provides marketing protection to other producers, for other types of crops.

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

Mr. Speaker, it is important to have this debate. The Canadian Grain Commission is the result of an act of 1912, which established three grain commissioners to oversee the regulation of the movement of grain from the country elevator to the point where it was loaded for export or processed in Canada. It has functioned in the interest of farmers. One of the main reasons it exists is to retain quality, so the wheat we send overseas has a stamp of quality from Canada.

Today, approximately 700 dedicated employees arbitrate disagreements over grain and weight, inspect grain passing in and out of terminal elevators, license and regulate elevators and grain companies and, most important, administer the Canadian grading system. Canadian grains are trusted and respected throughout the world due to the honesty and thoroughness of the Canadian Grain Commission.

I point out that we have specialists, people who have studied and learned what they are doing, working on behalf of farmers in Canada. Unfortunately, the way the bill stands now approximately 200 people stand to lose their jobs in the name of deregulation and privatization. That is one thing of which we have to be aware.

Grades like number 1 or number 2 Canadian western red spring wheat correspond to established specifications based on measures such as a percentage in the shipment of damaged or broken kernels or other kinds of seeds and of foreign matter such as dirt, as well as moisture content and the weight of grain. The grades assigned by the Grain Commission are under the control of the western and eastern grain standards committees, which meet and make decisions about any changes or additions to the grades that may be necessary because of changing market and crop conditions. Each year they also establish standards samples for each grade.

I mention that to underline the fact that the Grain Commission has a useful function. Any time we want to change or modify the way it works, we have to tread very carefully.

Bill C-39, as it stands, has a potential threat to Canadian grain producers. We know the Grain Commission has served as an independent referee to settle disputes between Canadian grain producers and the powerful companies that buy and export. It is no secret that our system of doing things in Canada is under attack. When I posed the question to our chief negotiator at the WTO last week during committee, he admitted, for example, that there was pressure internationally for us to do away with our state trading institutions, namely the Wheat Board. That same pressure exists to modify or to eventually make the Grain Commission not as serving as it is today. We have to be careful.

The commission has also served as the body that determines the amounts farmers are paid based on the Grain Commission determination of the weight and quality of grain before it goes to market. These roles would dramatically diminish if Bill C-39 becomes law, leaving producers newly disadvantaged in their dealings with grain companies when it comes to determining grain quantity and quality.

The producer can hire a private company to grade and weigh the grain even though no such companies exist today. The bill would also expose grain producers to financial harm in the event of a grain buyer bankruptcy or refusal to pay.

The feeling among many people who are in the business is that this will also undermine Canada's international reputation as an exporter of top quality grain. For example, the proposed elimination of inward inspection will likely result in diminished quality of Canadian grain exports. Currently, inward inspection by the Canadian Grain Commission ensures grains of different quality can be segregated to protect higher grades from being diluted by lower quality grain.

It took me a while to wrap my head around this, but I understand that when the grain goes to the elevator, for example, in Vancouver, which I have visited a number of times before with my farmer uncle from Saskatchewan, that the grain is put in bins and that quality is retained. The quality is there because of outward inspection when the grain is loaded on to ships.

Therefore, the way I understand it, there is the possibility, if there is no inward and outward inspection, there could be a mixture decreasing the quality of the grain, tarnishing Canada's reputation as an exporter of quality grain.

There is something called kernel visual distinguishability, or KVD, which is performed by the Grain Commission with this inward inspection. The bill proposes to do away with this.

I refer to an article by Mr. Wade Sobkowich, who is the executive director of the Western Grain Elevators Association. In general, the feeling is that we have to be very careful before doing away with KVD. Technologies are in the process of being worked on and finalized that can replace this famous black box, which we were told about at committee. However, to date nothing really exists to replace KVD.

Right now only certain varieties are eligible for a particular class and KVD means that a trained person can differentiate between the classes through visual inspection. Any grain that contains an excess of varieties outside of the intended class is downgraded to the Canada feed grain. In other words, if I understand this correctly, by having KVD, we are able to retain, with qualified people who understand it, a quality in the grain we export.

KVD is a consideration used by the Canadian Food Inspection Agency when deciding what varieties should be registered.

The biggest problem, according to Mr. Sobkowich, with removing KVD is the obvious one. It exists to protect the farmer because it allows settlement at the time of delivery.

Just as an aside, one of the problems with the bill, which goes contrary to one of the recommendations we made in committee, is it does not put the farmer first and foremost. The farmer is lumped into all the other segments of the agriculture industry.

Therefore, KVD protects the grain handler because the certificate final is based on a visual grading system. It protects the marketer by giving assurances that the customer is receiving what he or she has ordered. It protects the end use customers by providing confidence that they are receiving grain that meets the processing requirements.

The Western Grain Elevators Association is not saying that we have to keep KVD forever, that this is ingrained in stone. What it is saying is let us be very careful. Let us tread lightly. Let us ensure we do not replace something until we have something better to act in the interest of farmers.

What has been happening with the government is it appears to be willing to act very quickly and often recklessly with regard to the Wheat Board and the Grain Commission. Yet it seems to drag its feet when it comes to immediate aid that is needed for pork and cattle producers, which we saw during the debate. Somehow the government can act quickly if it wants, but if it does not want to, then we have the spin that it cannot get aid to people right away. Therefore, we have to tread very carefully.

So why is Bill C-39 flawed? Instead of having a study done by a parliamentary committee, the government used a report prepared by a polling firm whose very existence depends on contracts from government and large corporations.

COMPAS, which conducted the study that led to Bill C-39, had a favourable—I repeat, favourable—bias for deregulation and privatization right from the start.

So I ask the following question: how can a firm conduct a study if it has a favourable bias for deregulation from the get go. When a study is done, it is expected to be based on an examination of both sides of the issue.

Moreover, due to lack of funding, the Canadian Grain Commission has not been able to fulfill its mandate, and these failures are being used as an excuse to deregulate or privatize services to farmers.

What we have here is a ploy that involves cutting funding. We have seen the same thing in the health system. Then the government claims that the system is not working, but the reason for that is the lack of funding. If one looks at the commission's recommendations, one will see that one of these recommendations is to allocate sufficient funding to the commission so it can do its job properly.

Again, I want to stress the fact that this bill benefits large corporations rather than farm families. If we pass it in its current form, farmers will no longer have their say.

I will continue reading from a press release by the National Farmers Union, which states:

Many of those recommendations [in the report] would accelerate the economic leverage of large grain companies and railways at the expense of farmers, according to the NFU. “The mandate of the [Canadian Grain Commission], since the Act was first implemented in 1912, has recognized that farmers have less power in the marketplace and need certain protections,” said Boehm. He noted the Compas report specifically recommends “narrowing the mandate to protect producers' rights from a broad over-arching principle, down to some very specific limits.”

Boehm refuted the claim by the authors of the Compas report that they had heard no positive feedback about the CGC during their consultation process. “Such a claim is categorically not accurate,” said Boehm. “Particularly given our direct experiences at the public meetings in Saskatoon and Regina. Grain producers at both those meetings unequivocally expressed support for the CGC, particularly the role of the Assistant Commissioners.”

I would like to take an aside here and tie this in with what we have been experiencing with the whole debate on the Canadian Wheat Board. We have been told time and time again by the government that we have to move ahead for marketing choice, that we have to dismantle single desk, and that farmers are wanting this choice at this time. Yet in my office I have over 700 individual letters from people, some handwritten, some typed, which say that we have to be careful. These people say they do not want to do away with the Canadian Wheat Board and the single desk.

Then there is the spin we get from the government, which is that all these letters came from the same fax. Certainly. They are from members of the National Farmers Union. The National Farmers Union provides a service to its members. A member sends a letter and the NFU faxes it to me and other MPs. These are not form letters. These are individual letters. There are many gut-wrenching letters asking what the government is doing and why it is moving so quickly to destroy the Canadian Wheat Board. I would say that this is the same sentiment that there is out there among many farmers in regard to the Canadian Grain Commission.

I will move on to an article from the Winnipeg Free Press, in which we see that the minister has decided not to work with the board of directors of the Canadian Wheat Board and is actually threatening to introduce legislation, I think he said within 10 days, if he does not get his way.

Since I became a member of the agriculture committee and have taken up this file, I have always thought how nice it would be if the current minister--or the previous minister--would sit down with those elected officials who are there on behalf of farmers. It would be nice if he would sit down with all farmers' organizations, especially an organization such as the National Farmers Union, which represents thousands and thousands of farmers.

The minister could sit down, hammer out a solution and try to work with the system as it is. As we can see, the Wheat Board is trying to introduce new programs. The majority of the board's directors want the federal government and the malt and barley industry “to give their new CashPlus barley marketing initiative a chance”. As well, states the Winnipeg Free Press article, “The program seeks to put more money into farmers' hands sooner than with the current pooling system”.

So it is not as if the Wheat Board directors are stuck in a time zone. They understand what is happening, but at the same time they want to ensure that the market power stays with the farmers and they are not at the mercy of the big multinationals.

It is disturbing when we hear a minister give ultimatums. I will quote him from the article in the Winnipeg Free Press:

“They can lead, follow or get the hell out of the way,” he said.

What is that? What kind of a statement is that from the Minister of Agriculture of our country?

Now we will move on. Yesterday I received a letter from the president of the National Farmers Union, who was extremely upset over the comments made by the Parliamentary Secretary to the Minister of Agriculture in debate the other night.

It is incredible. I will quote what he is saying:

One of your other defamatory allegations in the same emergency debate is that acting as the President of the National Farmers Union, I have “disappeared on this issue [the CWB] this year”. Again, although you know this to be opposite to the truth (I have attached my recent press releases on the CWB issue as you are pretending that you haven't seen them), you seem to think you can mislead your fellow members of the House of Commons, and this is a further disgrace to yourself and your party.

In the last paragraph, he poses a question to the parliamentary secretary:

Do you have the integrity required to stand in the House of Commons and apologize to your colleagues and then make a further apology to me for your unsubstantiated, defamatory, and incorrect remarks?

I will pose the question to the Parliamentary Secretary for the Canadian Wheat Board: does he have the integrity to do this?

I hope that when we come back to the House he in fact will stand up and apologize, because it is time to work in a spirit of cooperation. Farmers want to work in a spirit of cooperation with the government. The government is doing some good things. It is not a time for confrontation.

It is not a time for shenanigans, as we saw yesterday in committee when the Parliamentary Secretary to the Minister of Agriculture tried to stop debate on Bill C-33 and rush it through, back to the House, even though he knew witnesses were lined up to be heard on this important issue. The issue of biofuels is not something that we just move through. It has to be looked at and we must at least put on the record that there are concerns.

Thankfully we have a committee chairman with integrity who stood up and made the right decision. I would like to applaud him for that.

In the minutes I have remaining, I would like to quote from a letter dated January 18 from the organization called Save My Canadian Wheat Board:

[Bill] C-39 includes some of the amendments proposed in the review and is sure to cause further controversy. For one, it proposes to remove the phrase from the act that requires the [Canadian Grain Commission] to regulate the entire grain industry “in the interests of grain producers”. Instead of the focus of the act being the protection and promotion of the interests of grain producers, the interests of producers that would be protected by the act are spelled out specifically and narrowly.

That is just one example from friends of the group, Save My Canadian Wheat Board. Further on, the letter states:

Likely to be highly controversial, and certainly not recommended by the 2006 review, [Bill] C-39 removes the requirement that companies wishing to be licensed by the [Canadian Grain Commission] as primary elevators must post adequate security to cover potential losses farmers may incur if the company goes bankrupt. The security posted by companies in the past has not always been adequate, but it has certainly protected farmers from huge losses in some cases.

I would like to once again emphasize that we have to take the precautionary approach before we move quickly. Often the government has not done that in dealing with health and with the environment and now in dealing with the lives of farmers and our grain industry.

The precautionary approach means that we tread very carefully before we move in to throw something out and bring in something new when we are not quite certain what the future will bring. This is especially so in light of the fact that today in the world there is this thrust, this feeling, in regard to Canada that other countries and the WTO want us to do away with any protection we have for our farmers. That is a threat not only to the Canadian Wheat Board, but also to supply management. We can see it.

I would like to conclude by saying that the bill as it currently stands certainly does not receive my support or the support of my party. I hope we have a chance to look at it and turn it into a bill that reflects the interests of all farmers in Canada.

[David Anderson, Conservative, Parliamentary Secretary to the Minister of Natural Resources and for the Canadian Wheat Board]

Mr. Speaker, it is great to be able to get up on this issue one more time. I want to address some of the accusations the member made against me, but first I think I need to suggest to him, and I know many of my colleagues would suggest this to him as well, that he needs to go to more than just the NDP's farm wing, the NFU, for his advice. He needs to get a broader perspective of the agricultural industry, particularly in western Canada.

With regard to his comments about what I said the other night, I found it very strange. I have always been a strong advocate of organic farming in western Canada. I think it presents some great opportunities. That is why I was extremely puzzled when Mr. Stewart Wells claimed that I had defamed him the other night when I called him an organic farmer.

It seemed to be an extremely strange response from him and the National Farmers Union, unless we know that this year the Canadian Wheat Board has given virtually a zero buyback to organic farmers. They can buy their grain back and they can market it however they want.

I am told by his neighbours that Mr. Wells is an organic farmer. He refuses to actually answer the question as to whether he is or is not. If he is, he is able to take advantage of that opportunity, while 98% of farmers in western Canada cannot access that same buyback. They cannot access the ability to market their own grain.

My questions to Mr. Wells have been as follows. Is he an organic farmer? If he is an organic farmer, has he been able to take advantage of the buyback? If so, why has he not stood up and suggested that it would be good for the rest of western Canadian farmers to have the same opportunities that he has? Those are simply the questions that I was raising the other night.

The NFU's extremely aggressive and angry response to me tells me that maybe he needs to answer those questions and that he is trying to avoid answering the questions as to whether he is an organic farmer and has been able to take advantage of that tremendous opportunity offered by the buyback, which the rest of us would love to have.

If Mr. Wells is not an organic farmer, I would be glad to apologize to him for that. I also understand that if he is not one he is probably wishing he was so that he could take advantage of the tremendous opportunities that organic farmers have, because they can market their own grain this year.

I would like the member from the NDP to explain to the House today why the NDP would be taking a position that would allow some farmers in western Canada to buy back their grain for eight cents and then market it themselves, which we think is a tremendous thing, but then tell other farmers that they cannot even get a buyback, that they can take a price from the Canadian Wheat Board that is less than half of what organic farmers are getting.

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

Mr. Speaker, as for this debate on the Wheat Board and the position we are getting from the government, we have heard it over and over again. The fact remains that there are many hundreds and thousands of farmers who do support the system, the Canadian Wheat Board, the way it functions today, and they have a democratically elected board of directors. Any changes made to that organization have to be made by farmers, not by the kind of heavy-handed approach that the government is taking.

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, Mr. Speaker, I appreciated the well-researched remarks by the member for British Columbia Southern Interior.

I agree with him when he stated that the government moves rapidly in areas such as trying to destroy the Canadian Wheat Board, which it is attempting to do, in terms of trying to weaken the Canadian Grain Commission, and now the minister's ridiculous announcement to do away with KVD by August 1, which industry, the Canadian Wheat Board, nearly everybody in the system, except the right-wing friends of the parliamentary secretary over there, claim should not be done until 2010 or it will completely disrupt the industry. It will in fact put Canada at risk in terms of supplying the quality grain it has a reputation of supplying around the world.

When it comes to responding to the beef and hog crisis, the government is absolutely missing in action. Why can it not move rapidly in that area?

Let me turn to the specific bill we are talking about, Bill C-39, on the Canadian Grain Commission.

We see that the Conservative government is undermining the authority of farmers. The original Canadian Grain Act has in the mandate that it is in the interests of producers. The new bill takes that out. That crowd on the other side is not really interested in doing anything in the interests of producers and it shows. The Conservatives are undermining them with the Canadian Wheat Board. They are undermining them with the Canadian Grain Commission. They are missing in action on hogs and beef. The Conservatives are turning over the authority of the Canadian Grain Commission to the interests of industry rather than producers. I would like to ask the hon. member his point of view on that.

There are other problems with the bill. The Conservatives are taking away the appeals tribunal. There were 2,000 appeals last year. There is nothing about reporting to Parliament in this bill. That right is being taken away and Parliament will not know what is going on with the Canadian Grain Commission and the Canadian Grain Act. They are taking away the necessity of grain companies having to post a bond to protect producer interests.

I would like to get the member's comments on that critique of the bill and certainly the critique of a government that is missing in action when it comes to developing real solutions for farmers in this country.

The Conservatives like to say that they put farmers first, but everything they are doing is putting farmers absolutely last.

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

Mr. Speaker, I would like to emphasize that sometimes the member is criticized because he is from Prince Edward Island, but I would like to assure the House that the member as a past president of the National Farmers Union and also as an MP has criss-crossed the country probably hundreds of times and he understands the agriculture situation in this country.

I agree with what he is saying. This is a flawed bill. It is a flawed process that will gradually take power away from farmers. We have to look at it very carefully.

With regard to missing in action, the government could get back into action by consulting with all groups in this country, not just with its friends, not just with the ones who support its particular ideological point of view.

As parliamentarians sometimes we have to rise above our ideological differences. We all have them; that is why we belong to different political parties. We have to look at the interests of farmers. Maybe the minister and the government could have another consultation with all groups, not just the government's friends, but groups such as the National Farmers Union and others, just to see what farmers are saying.

The letters that we get are not form letters. They are from people who are concerned. Sometimes I get the feeling that the minister and the government just are not paying attention. We certainly get that feeling in regard to the pork and cattle industry where, to this very day, there are people who are not getting the assistance that they need.