House of Commons Hansard #10 of the 36th Parliament, 2nd Session. (The original version is on Parliament's site.) The word of the day was farmers.

Topics

Questions On The Order Paper
Routine Proceedings

3:25 p.m.

Some hon. members

Agreed.

The House resumed consideration of the motion.

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Government Orders

3:25 p.m.

Reform

Monte Solberg Medicine Hat, AB

Mr. Speaker, I rise on a point of order. I think there was still a little time left for questions and comments after my speech but I am not certain.

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Government Orders

3:25 p.m.

The Deputy Speaker

I think the hon. member had about five minutes. The best information I have, and I was not here, is that the hon. member's time had expired. Therefore, we will resume debate with the hon. member for Durham.

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3:25 p.m.

Liberal

Alex Shepherd Durham, ON

Mr. Speaker, I am happy to participate in the debate on the motion brought forward by the member for Selkirk—Interlake.

I spent many years farming. Although I cannot claim to be a full time farmer, I can certainly sympathize with a lot of our farm community, especially those in the west who are suffering significant economic hardship today. I can remember receiving a cheque for a grain shipment and wondering why it was that the total amount of the cheque did not equal my fertilizer bill. I can imagine that some farmers can take that one step further and wonder how they are going to feed and clothe their families based on such low income levels.

I am amazed a little about the shape and form of this debate in the House today. I have listened to the members opposite who talked about all the things we should do as a government to solve this problem.

Some of the pork producers in Durham suffered through the low commodity prices for pork just last year. They had severe economic hardship.

A number of things were totally beyond their control, mainly due to a high cycle of productivity and the collapse of international prices for pork. The government came forward and addressed the issue. It listened to the concerns of farmers all over the country and implemented an AIDA program.

I am certain that there are those who have concerns about the AIDA program. I heard some members opposite talk about the problems of making application for these funds and the administrative process. Quite frankly I am surprised by the opposition. It has not taken into account the necessity for accountability in our framework. By that I mean we chose a methodology of program delivery that required farmers to use their income tax returns in order to prove, to hypotheticate and to understand the nature of their income support levels. I will be sharing my time with the member for Chatham—Kent—Essex.

This process became somewhat cumbersome. A lot of people have concerns about it. There is a time delay between cashflow problems and when the cheques arrive. We know of the reverse situation where governments got into program delivery where they simply wrote cheques and told them later about whether one could prove the necessity for or need for the program.

These programs are disastrous in and among themselves. The worst thing governments can get into is paying out moneys to people with income problems and turning around a year later and saying they overcontributed to the program and need the money back.

I am sure members understand that there are idiosyncrasies about the program. I am sure a lot of farmers are discouraged by the fact that they have to fill out these forms. I have to admit that I am an accountant but I have never had to fill them out. I understand their concern with my profession which makes money filling out these forms. I share and sympathize with the problem. It should not be that complicated. Indeed I do not think it is that complicated. Many of my constituents tell me that they complete these forms by themselves.

We listened today to the Reform Party telling us two or three different points. I cannot seem to reconcile the messages. It was telling us that part of the solution was to form a regime that would protect farmers from the disparities of international subsidies and subsidy programs. At the same time it was telling us that we should reduce taxes. It did not take long to understand that these two policy choices were in direct conflict with each other.

Many other businesses in the country are subjected to the disparities of international subsidies. I only have to think of our aircraft industry, steel imports and many other industries with concerns about tariff and unfair subsidies in other countries. It is not within our economic or physical ability to protect every interest in the country from distorting trade practices in other countries. As a government and a people we could go to countries within the World Trade Organization and other forums to argue that we need fairer trade practices.

Surprisingly enough, today the leader of the Reform Party and the member for Lethbridge, if I recall, talked on and on about how terrible it was that the Prime Minister would go on trade missions and not be in the House. The way we deal with these trade distorting practices is to go and talk with people in other countries.

Not long ago I was able to go to Taiwan. At that time I was concerned about what I considered to be the unfair trade practices of the Taiwan government that favoured American imports of beef over those of Canada. We talked about how we could find some way to liberalize that regime and narrow it for the benefit of our farm community.

Many other speakers have intervened in this issue, but the reality is that our exports of agricultural products are at an all time high. Canadian farmers have been very successful at producing agricultural products efficiently and cheaply and at being able to export them into world markets.

I do not think it takes a lot of brains to understand the way the world is going if we look at the Asian community. Quite frankly the conclusion is that the world is going into an era where it will not be able to feed itself. Certainly communities in Asia and others will not be able to feed themselves. It is a good opportunity for our agricultural industries.

One issue today was about government concern in this regard. Strangely enough, suddenly the Reform Party is greatly concerned about agricultural issues. My research tells me that the Leader of the Opposition in the last session of parliament never asked one question about agriculture and in this session he has only asked one.

We heard members of the Reform Party today. They are very concerned about the agricultural plight of the west, specifically Saskatchewan, yet the questions were on APEC, about the hurt feelings of a few people involved in the APEC inquiry. Farmers, whether in Saskatchewan, Manitoba or Alberta, were the least thing on their mind when it came to question period.

We are here today talking about some of the programs available to farmers. The NISA program has been in place for many years. It is a tremendous program where taxpayers attempt to match contributions to the fund by farmers to allow them the ability to smooth out their income over peak years.

Because of the drastic downturn in commodity prices and some of the climatic conditions that have impacted on the production of agricultural products in the west this system is not adequate enough. When we are designing income support programs we should find out where to put the safety net and how much we can afford to support the safety net.

Situations occur, whether in agriculture or other industries, where there is oversupply and undersupply and a rationalization going on in the market. Agricultural producers in my riding are not looking for free handouts. They are not looking to the government to subsidize them, unlike what the Reform Party is seemingly suggesting today.

If I went around my riding and asked the farming community whether it would would be happy with a program which protected them from all things in the world, which is what the Reform Party is proposing in the motion, my constituents would tell me no. They are big people. They are very confident they can effectively run their farming operations. Farmers want us to sit down at the trade tables to negotiate a reduction in international subsidies which gives Canadians the ability to compete in worldwide markets. I suggest that is what the government is doing.

We have a World Trade Organization meeting coming up in Seattle next month. The government is working very hard at the position it will put forward to reduce agricultural subsidies throughout the world. The best we can do for Canadians is not create another regime of subsidies and support like the Reform Party would have us do but reduce the unfair practices of today.

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3:35 p.m.

Reform

Jay Hill Prince George—Peace River, BC

Mr. Speaker, to be quite honest, I am absolutely astounded by the hon. member's comments. He seemed to want to use his entire 10 minutes of presentation to slam the Reform Party. I agree with one point the member made. Farmers are not looking for a handout. He is quite correct. I think that is universal all across the land.

The reality is that farmers do not have a level playing field. It is fine for the hon. member to talk about taking a strong position in the WTO and negotiating it, but what do farmers do in the meantime. That is what the motion is all about.

Whether or not the hon. member wants to get out of Ontario and face reality, the reality is that farmers are going broke while the government talks and designs a program with so much built-in accountability that it does not deliver any help to farmers.

Why does the hon. member not wake up, smell the coffee and understand what is happening on farms in western Canada?

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3:40 p.m.

Liberal

Alex Shepherd Durham, ON

Mr. Speaker, let me tell the hon. member a bit about reality. First, the people of Ontario have gone through tough times in the past. Second, we do not start equalizing tariffs by saying that we will increase ours. That is not a negotiating tool.

It does not make any sense to say we want them to reduce their tariffs and the way we will get them to do it is to increase ours. Quite frankly that is why we have had a long and heavy international regime of high tariff laws. As we put up ours somebody else puts up theirs and by the time we are all through we are all worse off. That is the plan of the Reform Party. It is just a no-brainer. It has not worked in the past and it will not work in the future.

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3:40 p.m.

Reform

Garry Breitkreuz Yorkton—Melville, SK

Mr. Speaker, I too am astounded the Liberals cannot see there is a real contradiction in what they are saying.

The member opposite asks how we can subsidize everybody that deals in the international marketplace. I think the member has a big blind spot. Reduce the tax burden on all Canadians including farmers and the government will not have to subsidize farmers and other businesses. Our high taxes built right into all the input costs like fuel, fertilizer, chemicals and capital expenditures can be reduced.

My question is for the member. Would he not agree that a tax reduction would help increase the bottom line for all farmers?

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3:40 p.m.

Liberal

Alex Shepherd Durham, ON

Mr. Speaker, I understand what the hon. member is saying about taxes on input costs within the farming operation. We all know that the biggest tax cost is income taxes.

Once again the Reform Party is telling me how irrelevant it really is. We are talking about people who are losing their farms, not making any money and obviously experiencing huge losses, and the Reform Party is arguing that we should have income tax reductions. It does not make any sense at all. It is ludicrous.

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3:40 p.m.

Liberal

Peter Adams Peterborough, ON

Mr. Speaker, I listened with great interest to what my colleague had to say. It is my understanding that we are going into the WTO negotiations in a very different way this time and that in fact the government and various commodity groups have got together at least for the initial position.

Would my colleague care to comment on how he thinks that will affect the outcome of this round of negotiations?

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3:40 p.m.

Liberal

Alex Shepherd Durham, ON

Mr. Speaker, I thank the member very much for his intelligent question. Clearly trade agreements take some time to evolve. The way we do that is through compromise and conciliation.

The role that the government has now taken, as the member suggests, to enter into a pre-consultation process to try to get some agreement on how it can move forward is the only intelligent way to deal with the distortion issues the Reform Party talks about. Creating a regime of new tariff laws within Canada is not the way to create that conciliatory process.

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3:40 p.m.

Progressive Conservative

Rick Borotsik Brandon—Souris, MB

Mr. Speaker, I could not agree more that tariffs are not the answer. Certainly subsidies are not the answer.

My question is for the hon. member. In areas other than Ontario agriculture we recognize that approximately 45% of western Canadian farmers may well not be able to farm next year. Is the member suggesting that we simply negotiate the subsidies and the tariffs and not worry about those 45% of farmers who may not be able to make it into the next year. If he does not believe that, what are the alternatives?

What is his government's alternative, other than a very flawed AIDA program?

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3:45 p.m.

Liberal

Alex Shepherd Durham, ON

Mr. Speaker, the hon. member talks about a very flawed AIDA program, but the fact of the matter is that the government has ponied up and has put $900 million on the table. As I understand it, of the applications that have been made for assistance, over 50% are from the province of Saskatchewan which has been the most hard hit by this time factor.

Are we going to be all things to all people? Are we going to help every single farmer 100% of the time? I do not think so. In my own riding people who have applied for the AIDA program complain that it does not do everything they would like it to do. However, I think when they sit back and think about how far we expect governments to reach into their wallets, all they are really doing is reaching into the wallets of other taxpayers.

What is the level of support that we can afford in this country? The reality is that we cannot be all things to all people, but we can try to do the best we can with the resources we have and I think we have been very effective at doing that.

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3:45 p.m.

Liberal

Jerry Pickard Kent—Essex, ON

Mr. Speaker, I really appreciate having the opportunity to debate this very important issue on farm income.

The federal government is committed to a strong, healthy, viable agricultural sector. Looking at the sector as whole it is exactly that, a strong, healthy and viable sector. That may surprise some people because that is not what we have been hearing in the news lately. One of the things I hope to do today is to give my colleagues and those who are listening a better understanding of this whole farm issue. It is very complex. It is not a simple issue, as many people have tried to say.

I am not suggesting that the sector is without challenges. Some farmers in pockets throughout our country, in western Canada in particular, have had many problems to face this past year. Farming is affected by weather and the marketplace, and sometimes, as we have witnessed in the past year, both factors collide at one time.

In this case the farmers' bottom line has felt the impact of a whole range of circumstances coming together at one time. The crisis in the Asian and Russian economies and the downturn in Latin America caused some markets to shrink. Declining commodity prices and an overproduction of wheat in the world also had an impact. We experienced at the same time difficult flood conditions in one region and drought in another. Needless to say, the effect on income to farmers, particularly those in grains, oilseeds and hogs, was severe.

The Minister of Agriculture and Agri-Food has responded to that situation and is continuing to work to put the tools in place to assist the producers, especially those who are most in need.

There are a number of tools which were put in place by this government to help producers through difficult times, as the minister of agriculture has pointed out in his remarks. However, often the challenges farmers face throughout the country are as diverse as the commodities they produce. As the Minister of Finance said in his budget speech earlier this year, a government that pretends it can be everything to everybody is a government that in the end will do nothing for anybody.

What a government can do is create conditions for a productive and competitive agricultural sector as a whole. That is what this government has done and that is what this government will continue to do. While doomsayers would have us believe that there is a crisis in Canadian agriculture, overall and across this great nation the agricultural sector is strong.

Overall Canadian farmers are among the most productive and efficient in the world. Farm production has been going up and so has farm net worth. Overall farmers have adjusted to constantly changing international markets. Their success is obvious when we look at our export numbers. Agricultural exports have risen from $13 billion to $22 billion over the last five years and even with the economic challenges of this past year they will be up slightly from 1997, which was a record year. Horticultural crops, special crops and red meat all had increases last year.

Trade is most important to growth in this sector. About half of the average farm gate income to Canadian farmers is the result of trade. That is why the government is working on the international front to bring order and stability to world markets and to provide better access to world markets. Despite the commodity market challenges, the outlook for Canada's agriculture and agri-food sector is positive.

Our industry has also met the evolving demand for specialized processed products. Our exports of value added products are surging. In fact, they grew by almost 9% last year. Processed goods means processing plants and jobs, jobs that add to the sustainability of our rural communities.

The industry itself has a lot of confidence in its own capabilities. Already Canada has about 3.3% of the world's agri-food trade. The Canadian Agri-Food Marketing Council, or CAMC, has set a goal to increase that to 4% by the year 2005.

CAMC, which is made up of agriculture and food representatives, has also set a target of increasing processed agricultural exports over and above bulk commodity exports. By current indicators, there is no reason to think the goal will not be met.

Our supply managed commodities are faring well. Farm cash receipts for chicken, for example, went up about $250 million from 1995 to 1998 and were about $1.3 billion last year. Egg receipts have increased slightly, while dairy receipts grew by $299 million to close to $4 billion for that same period.

Furthermore, for many commodities that have been affected by weak prices there are signs of gradual improvement, with indications that prices have hit a cyclical bottom. Red meat is doing extremely well and feedlot levels are at an all time high.

The worst situation a farmer can experience is foreclosure. It is the last thing anyone wants to see happen. Agriculture and Agri-Food Canada provides a financial review to producers through the farm consultation service and, for a stay of proceedings, financial counselling and mediation through the farm debt mediation service. These services have been extensively communicated to producers and creditors. While there is some increased activity at this time under these programs, applications are not at a high rate across Canada. Fortunately, we are not seeing thousands of producers experiencing financial difficulty, although there are reports which say that is happening.

The Government of Canada knows how important the agriculture and agri-food sector is to Canadians in general. The Canadian agriculture and food industry accounts for close to one-tenth of Canada's gross domestic product. It employs 1.8 million people either directly or indirectly. I would say that is a pretty solid business.

It is an industry that is varied and offers many interesting careers for young people. While we know the hard work of Canada's farmers helps to drive the entire economy, it is becoming more obvious that there is a wealth of other rewarding and worthwhile paths available to young people in this sector as well. Graduates from Canada's agricultural colleges and universities have jobs lined up before they graduate and there are even signing bonuses for some who are graduating. This is another sign of an industry that is strong and growing.

Canada has a worldwide reputation in agri-food products. It is unsurpassed anywhere in terms of high quality and safety. No matter where we go in the world, when people see a label with the red maple leaf, it is recognized for its quality, which is second to none. We continue to build on that reputation with team Canada missions and exhibitions at international food shows and by attracting buyers and investors to Canadian industry as we will be doing when we host the North American Salon international de l'alimentation.

The agriculture and agri-food industry has gone through a great deal of change over the last decade and has proven over and over again that it can meet the challenges and tackle the opportunities presented to it as it moves forward in the new millennium.

There are certain areas of the overall sector that are facing difficult times and the federal government is providing those producers with the tools to overcome these difficulties. Success is not a solo effort, nor is failure. By working together, the industry and all levels of government, this industry will continue on a path of growth and success.

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3:55 p.m.

Reform

Werner Schmidt Kelowna, BC

Mr. Speaker, listening to the hon. member speak, I thought to myself that if I was looking for a career what I would do is go into agriculture and start farming. It is the growth industry of Canada according to the hon. member. Egg production is going up and the price is going up. It is all the way down the line. Red meat is better than it has ever been. It is just a wonderful, rosy picture. How can the hon. member make statements like that when there is all kinds of evidence to the contrary?

We heard from the people who are representing the farmers of Saskatchewan, British Columbia and Alberta. All of them said that these people are in trouble, and this gentleman has the audacity to tell us that they do not have a problem, that there is just a bit of a problem here and there in isolated little pockets. We are not talking about isolated little pockets; we are talking about an industry that is in trouble in very many of its areas.

Exactly what is the hon. member trying to tell us about agriculture? Does he believe there is a problem, or does he believe there is not a problem?