Debates of March 8th, 2005

Criminal Code

[The Acting Speaker (Mr. Marcel Proulx)]

The time provided for the consideration of private members' business has now expired, and the order is dropped to the bottom of the order of precedence on the order paper.

[Continuation of proceedings from Part A]

Canadian Livestock Industry

[The Acting Speaker (Mr. Marcel Proulx)]

The House will now proceed to the consideration of a motion to adjourn the House for the purpose of discussing a specific and important matter requiring urgent consideration, namely the Canadian livestock industry.

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

moved:

That this House do now adjourn.

Mr. Speaker, it is a pleasure to rise the second time today to talk about agriculture and to get a few more things on the record. I am more than pleased to see that the minister is joining us today. He has been dedicated on this file. We cannot take that away from him.

I will be splitting my time with the member for Newmarket—Aurora.

For a number of producers who are watching tonight, the urgency started 18 months ago. They have been living on a wing and a prayer ever since that.

Government programs have been announced, and they have come and gone. Not a lot of producers were able to trigger what they needed in a timely and bankable way. The light at the end of the tunnel disappeared the other day with the injunction by R-CALF in the United States.The light blinked out for the time being, and we have to reignite it.

Part of that will have to be done within our own borders. We have to start to develop programs that are domestically driven and that will see our industry survive, in spite of not getting into our major exporting partner in the United States. It may be a while before that comes around.

A lot of anger and frustration is out there as well as a lot of backlash, which people are talking about now. The Americans are not the bad guys. We have a tremendous amount of allies across the line. We need to ramp up our work with them. I am sure the minister will run through that list later.

The retail association, the consumers association and the American Meat Institute are calling this a blow to free trade. Those are their words. They all are looking for that cross-border shopping to recommence.

The packing industry in the States is facing as big a blow as the Canadian packers at this point. The packers are not getting enough product in to keep their lines open. They are down to three-quarter weeks. People are being laid off. A lot of hurt has been created by the R-CALF injunction, some 10,000 members of a 1.5 million member organization. It is economically and politically driven. Science has no bearing at all on that injunction.

We saw the work up from the judge in Montana. A lot of the things he talked about were just pure nonsense, and will be refuted. The unfortunate part is we are relying on the USDA, secretary of agriculture Johanns and the President of the United States to intervene on our behalf.

The government could and should be doing things. We need a stronger presence in the States. Let us buck up and start to realize that we are in this in a common way. Let us get down there and make those points. I know they have been done on an ad hoc basis, much the same as the programs were on an ad hoc basis. We need consistency at the political and diplomatic levels. We have it at the bureaucratic level. We have to ramp that up a little or we will face the same types of things.

There has been a huge ripple effect and a lot of collateral damage over the past two years in the livestock sector. It is not only cattle. We talk about cattle because that is the mainstay of that trade. However, a tremendous number of other sectors have been negatively hurt, and we are not carrying the flag for them in the same way. We think that they got drawn down with the cattle and that they will get built back up again once the cattle moves.

When we talk about processing for livestock, every facet of livestock needs more processing. Our pork producers are facing the same things trying to export live hogs, but as soon as they are processed, there is no problem. We need to ramp up the processing. Our buffalo producers were just starting to get their feet back under them, but they have been hit and sucked down with this as well.

The problem that needs to be directed or solved in the near future is in our processing sector. We have let slaughter capacity and processing go over the last 20 years.

We have had heavy-handed regulations. The Canadian Food Inspection Agency inspectors have not been as user friendly as perhaps they could have been. I guess the minister may have to drive them a bit harder to do that. We have seen a couple of plants squeak into production, only after they have jumped through a lot of hoops and hurdles that were put in their way. They did not need to be there. They dragged it out, and they could have got there a lot quicker.

We have a few other plants that would like to open, but they have seen the trials and tribulations of other plants so they are pulling back a bit. As I said, there is that collateral damage on other livestock sectors.

We have to ramp up our processing and slaughter capacity. The government has talked about that. The only thing we have seen to that end is the loan loss reserve, $37 million or $38 million announced in September, topped up again in the budget by another $17 million, but nobody can trigger it. The forms are not even available yet. We met with the Canadian Bankers Association the other day. It said it was still working out the details with the government.

We have again lost six months in getting some slaughter and processing capacity going because we are playing around with the loan loss reserve, which means somebody will finally get some money. When and if they ever get built and go broke they will finally get some coverage. That is not going to trigger any expansion. Nobody is going to buy that one. That is something that definitely needs to be done.

First and foremost is to get some cash to hard-pressed livestock producers. Agriculture across the country in the year 2003 hit bottom with a minus $13 million income and 2004 is not looking a whole lot better.

We get into a little bit of positive numbers when we put all the government moneys in. A lot of announcements have been made. The minister talks about a cumulative almost $5 billion going into agriculture across the country. Those are the announcements. The reality of cash in the pockets of producers is a third of that at best. We still have pools of money sitting here in Ottawa that have not been triggered and have not got out there to the farm gate. They are still sitting on the cabinet table and not on the kitchen tables out there.

Spring is coming. We have grain and oilseed sector guys who are worrying about how they are going to get their crops in the ground. We have livestock producers who are bringing another crop of calves on the ground and do not know whether they will be able to move them in a timely way to pay their loans and get caught up again. Agriculture in this country, for all commodities, has faced some serious hits. Let us get some cash out there on these ad hoc programs.

Of the three pillars that are required, one is the new and emerging markets that are out there. They are buying from someone, but not from us at this point. China is a huge market coming on stream with a billion people who are hungry. The big thing with China is that we are going to have to process some of it to get it over there and we are not up to that game at this point. There are things the government can be doing almost immediately to get that started. We are seeing more of the farm groups coming to bear on this and struggling for their producers.

David Rolfe is the chair of Keystone Agricultural Producers in Manitoba. He said that he has problems with the CAIS program. He is not optimistic that CAIS can ever be made effective. He says it is a bad deal. He is quoted as saying that “CAIS is essentially CFIP”, the former program, “with a deposit”. Farmers have to put cash in a bank vault somewhere in order to trigger a payment someday somewhere down the road. That is like me going out to the dealership, buying a new tractor, leaving it there and never using it. It is cash stuck away that I cannot use.

We met with the Agriculture Canada officials today, who said that it is not a negative thing. The farmer puts some cash in the bank, triggers a CAIS payout and gets money back, so it is not a bad deal. The problem is that it costs him a couple of thousand bucks with his accountant to make that happen and in a lot of cases what he triggers out of CAIS does not even pay for his cash on deposit. It is not the cashflow stimulus that everyone is looking for. There is actually a negative hit in a lot of this.

I know the minister has talked about how the government is going to do a review. In the budget, the Liberals talk about getting rid of the deposit, but the officials today told us that the most they can do by the end of March is pay back anyone down to the third value, which is what all of us called for, but some guys are trapped in a catch-22 and had 100% of their deposit in. They will get two-thirds of that back and probably will be taxed on it if it came out of certain NISA accounts, but they still have to keep that third in there until all governments figure out how they are going to keep farmers “engaged” in this business risk.

Producers are engaged. A $44 billion agricultural debt across the country keeps them engaged. Having to put a crop in the ground every year and spend the value of the equity of their farms keeps them engaged. Bringing on another inventory of cattle into their livestock sector keeps them engaged with all the costs that are involved in that. They are engaged up the wazoo.

So a cash deposit is not required; it is trying to make the CAIS program GATT green. That is what the government is trying to do. It is taking an amber program, running disaster relief through it and requiring a cash deposit to make it GATT green. That is what this is all about.

The government is penalizing our producers to stand up to the global agreements that we have signed on to, and our guys are going down. They are. They are taking this hard. They cannot stand up to it.

The Canadian Federation of Agriculture, in its meeting just last week, called for the government to implement a cull cow program. We talked about that a year ago. We talked about putting $500 an animal cash in the pockets of producers out there to get rid of some of these cull animals that are a drag on the market and pulling us down.

The numbers show that the programs are not working. The ad hoc announcements after ad hoc announcements are not doing what they are supposed to do.

The government is looking for direction. It is talking about doing the right things, but implementation is awfully slow. I am hopeful that some of our producers will survive long enough to see a difference.

[Andy Mitchell, Liberal, Minister of Agriculture and Agri-Food]

Mr. Speaker, the member brought up the issue of slaughter capacity. As viewers out there may realize, and many of them are very knowledgeable about the industry, we already have seen a 20% increase in capacity in Canada from where we had been.

We were at about 65,000 a week. We are operating at about 83,000 a week and there are plans to bring that up to about 90,000. Of course we have indicated that we should be at about 105,000. The member mentioned some of the tools that have been used. I am quite prepared to refine those tools in a way that is important, but I want to ask him a couple of questions about it.

First, I think it is important not only that we hit the macro number we need to hit, but also that we remember the regional variances in terms of slaughter capacity. It is not just important to have total slaughter capacity; it has to be in the right parts of the country. Also, it is important that the right kinds of animals are being slaughtered to make sure that our slaughter capacity covers the variety. I would appreciate the member's view on this.

Here is what I think is most important. The member for Newmarket--Aurora made this point as well in a speech. That is, in doing this and in providing government assistance, we must make sure that there are a couple of underlying principles. We have to make sure that the proposals in front of us are supported by sound business plans and that they are going to be sustainable into the long term into a situation whether or not we have access to the U.S. border.

I am interested in knowing whether the member and his party share those underlying principles as part of the approach that we need to take.

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Mr. Speaker, certainly there are regional variances in slaughter capacity. There are huge regional variances in where the animals are; that is part of what drove it to begin with. The vast majority of the beef market is in Alberta, followed by Saskatchewan, so certainly the slaughter plants need to be built there.

Manitoba finds itself without any kind of federally regulated slaughter facility. Several groups have been taking a run at trying to get something under way there.

The minister talks glowingly about a 20% increase in capacity, driven by the big two, with Cargill and Lakeside expanding. The problem with it is that they are directed at the animals under 30 months and we do not particularly have a problem at that point. The problem is in slaughter capacity for buffalo, hogs and cull animals. That is the big capacity we need.

The minister cannot seem to differentiate that two streams of processing are required, certainly the one under 30 months, and the big guys are going to do well. They are expanding. They are putting in new technology and so on. They are doing okay and they will continue to.

What we need is a secondary line of processing that will address the domestic shortfall that we always used to import for. We always used to bring in grass-fed animals to feed our fast food lines in our specialty restaurants. We no longer do that, other than our WTO and NAFTA commitments. We do not do the supplementary quotas. That is a good thing, but we need specialty processors that can step up and fill that niche.

We used to export the vast majority of our culls and then buy back two-thirds to fill the niche markets here. We have never addressed that shortfall yet. That is what the minister is missing. Those are sustainable markets and sustainable plants.

Certainly we have to be very stingy with taxpayers' dollars and not put them at risk, but sound business plans directed at markets where there is a huge and glaring void now should be sustainable.

[Don Boudria, Liberal, Glengarry—Prescott—Russell, ON]

Mr. Speaker, I have listened to the comments made by the member opposite. I still am among those who think that the ultimate solution is the re-opening of the U.S. border. The only other solution is supply management with regard to this industry.

Is the member in favour of having a quota system for cattle, including cattle at the end of the cycle he has just identified? Is he in favour of this, yes or no? We know that, in the past, his party has not supported such a system for milk producers.

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Mr. Speaker, that was a nice try by the member, with that little bit of misdirection. He is good at that, like the old magician he always was.

Supply management for the beef sector is up to the beef sector. It was up to the dairy sector, it was up to the chicken sector and it was up to the feather industry to decide whether they wanted it or not. If it is the beef sector that drives it, certainly it will happen and that is what the member should be aware of.

Everybody wants the border open in the short fix, but the problem with the ultimate opening of the border is that it will not move us ahead. We have identified some major problems in our industry in this country. If we do not learn something out of the two years of hell we have been going through, then we have not gained a darn thing. If we just go back and reopen the border, we have not gained as a country. We have not expanded our processing. We have not gone out and looked for those new markets. We have gone right back into the same old rut that we have been in for the last 20 years.

[Belinda Stronach, Conservative, Newmarket—Aurora, ON]

Mr. Speaker, I would like to thank my colleague from Battlefords—Lloydminster for proposing this emergency debate on this very important issue. I also want to acknowledge the presence of the Minister of Agriculture and the attention that he has given to this very serious matter.

We are rising in the House this evening to yet again examine the failure of the government to protect the interests of hard-working Canadians. It is truly unfortunate that we need to be in this position. I am sure that each and every hon. member would like nothing better than the prosperity of the cattle and dairy industry, but the border with the United States remains shut tight as a drum. March 7 came and went with not a single truck carrying cattle across the border.

The government will claim that it is not its fault. It will suggest that the problem lies in the decision of a local judge in a Montana court or with ill-informed and protectionist U.S. senators. These explanations sound more like excuses to me.

The Prime Minister and his cabinet are making excuses for their failure to get the basics of the Canada-U.S. relationship right in the first place. The border has been closed so long because of BSE that the Prime Minister actually inherited the problem from his predecessor. The Montana court decision last week does nothing but gloss over the facts.

The Prime Minister has been on this file for more than a year and a half and only got access to the President of the United States to talk about it four months ago in Chile. Every single day that the Prime Minister has been unable to contact the president costs Canadian ranchers and feedlot operators as much as $20 million per day, with $11 million lost in export revenue and the rest in lost value for the cattle they hold. I have seen estimates showing that the running total of losses for the beef industry is now at about $7 billion, and the cattle trucking business in Alberta may never recover.

With those kinds of losses and the amount of money at stake, one would think that the Liberals would have put some fire in their bellies and moved heaven and earth to get the border open, but no. The Minister of International Trade visited Washington for the first time officially less than a month ago, to meet with his new counterpart. The Minister of Agriculture just went to Washington for the first time a month ago.

This is just plain wrong and irresponsible with the livelihoods of so many Canadians at risk in the BSE crisis.

When the U.S. Senate voted to keep the border closed last Friday, it took our government by surprise. That says a lot to me about the government's complete lack of political intelligence on Capitol Hill. In business one always tries to know what one's competitors are doing in order to stay one step ahead, but here the custodians of Canada's relations with the United States were caught flat-footed and asleep. For $20 million a day, this performance by the government is just not good enough.

I have been out to feedlot alley with one of my colleagues to see the situation with my own eyes. I can tell members that the top priority for ranchers and feedlot operators is to get that border open so they can sell their products like before and like they do so well. That is really what they want.

Michael Ignatieff, the Harvard University professor, argued recently that Canada-U.S. relations is the defining issue for Canada in the 21st century, as Quebec-Canada was for the 20th century. The root of the problem is that the Liberal Party simply does not understand this, neither the Liberal Party of Jean Chrétien nor this Prime Minister. They are cut from the same cloth.

Is it the Liberals' anti-Americanism? Is it a belief that their polling tells them to pander to anti-Americanism because it will make them popular? It is a dangerous game. As a matter of fact, as this evening proves, they are playing a game of chicken with the national interests and livelihoods of our fellow Canadians.

The government should never have been so passive as this BSE crisis dragged on. Now there are some concrete things it should be doing. The cabinet committee on Canada-U.S. relations should be in an emergency session now to come up with a plan on how it is going to get this border open. When has it met? Where is the plan? If there is one, let us see it. Let us hear it.

Why is the Minister of International Trade not a member of the cabinet committee when the relationship with the United States is so driven by trade? This is amateur. It is just not serious.

The plan requires real resources dedicated to a strategic and sustained strategy to engage the United States on a political level, to build relationships with individual members of congress. A Canadian minister should be in the United States each and every working day to advocate and educate American lawmakers and interest groups, potential allies, not just a visit once in a blue moon.

The government should be launching a blitzkrieg communications effort to explain that the BSE testing regime is solid and as good as or better than the one used in the United States. The fact that the Canadian program tests on downers and dead-on-farm cattle, the types of animals hardest to obtain, led to the discovery of two additional cases in 2005. The U.S. department of agriculture has yet to identify the types of animals that entered the U.S. surveillance system, so we do not know whether in fact it is any superior to our own testing. Americans need to know this.

The government should be well advanced in a major international marketing effort for Canadian beef to demonstrate that Canadian beef is the best beef in the world. We should be innovating with beef in a box for new markets. The responsibility lies on the other side of the floor and instead, the border remains shut and the beef industry remains devastated.

[Wayne Easter, Liberal, Parliamentary Secretary to the Minister of Agriculture and Agri-Food (Rural Development)]

Mr. Speaker, I am rather amazed at some of the remarks the member for Newmarket—Aurora made referring to the border being shut tight as a drum. Does the member not realize that in terms of beef itself, we are exporting more beef to the United States, not live animals, than we were prior to BSE? We have increased those exports to the United States. That is not shut tight as a drum.

In fact, we are the only country in the world which has had BSE and has managed to get into the market. That is as a result of the good work of the former prime minister, the current Prime Minister, the current Minister of Agriculture and Agri-Food, and many others. Let us be careful of the facts. I would want her comment on that.

I also want to make one comment because the attack from the other side seems to be on the government here in Canada. The Canadian government is not the problem. The group R-CALF is the problem. I want to quote the senator from Kansas, Mr. Roberts. This is what he said in a senate hearing the other day and I wonder if the member would agree with this quote. He is talking about the committee that is trying to ban or stop the USDA allowing imports from Canada into the U.S. He said:

Be careful what you ask for. We will take a giant step backward in our efforts to reopen markets to Japan, or for that matter, anywhere, if we vote today to approve this resolution.

The same international science and guidelines that say that U.S. beef and animals under 30 months of age are safe also say that the beef and animals in Canada under 30 months are safe as well. That is the international standard. That is the sound science standard. That is the kind of science we have in this country. We should be into that market. Do members opposite not think they should be going after the U.S. instead of the Government of Canada, which is working in the interests of Canadian producers?

[Belinda Stronach, Conservative, Newmarket—Aurora, ON]

Mr. Speaker, the point is well noted that our testing regimes are solid. In fact, as I can see, they are even stronger than the ones in the U.S. Why is it then that our beef remains shut out? It is not based on science.

I come back to the fact that the government has not done enough to build the face to face relationships on a general level to demonstrate why Canada is relevant, that 5.2 million American jobs depend on trade with Canada, and that 40% of the trade done with the United States is intercompany trade. This industry is interdependent and interlinked with the U.S. beef industry. The efforts that have been made are just not good enough.

Where is the major marketing campaign worldwide to create new markets for Canadian beef in the world? Why is this not done in Japan? Perhaps we need to increase our testing standards to open up new markets.

When I was in the U.S. last week, many of the congressmen and senators were oblivious to the importance of Canada-U.S. relations and how many jobs relate to a particular state. Not enough face time has been invested to build those relationships. We must make a much greater effort in that regard.

With respect to slaughter capacity, I have been out to Picture Butte, Alberta with my colleagues. I have talked to the feedlot owners and the ranchers. This is something that the government can do something about and increase the slaughter capacity. In my mind, as a former businessperson, it is a no-brainer.

When it costs $7 billion in damages to this industry, and one processing facility costs roughly between $100 million and $150 million, and those ranchers are prepared to invest hard dollars themselves, to me this is a no-brainer. It must be done and it is necessary to open up those new markets.

Further, we should be processing the beef that we have in this country and not just focusing on sending live cattle across the border. We should be creating more jobs and processing this product that we have in this country.

[Anne McLellan, Liberal, Deputy Prime Minister and Minister of Public Safety and Emergency Preparedness]

Mr. Speaker, it gives me great pleasure to speak tonight about the government's ongoing and continued support for Canada's livestock industry through the BSE related hardships it has endured over the past 22 months.

Though I am pleased to review the support we have provided to the industry and to pledge that our support will continue as long as it is necessary, it is unfortunate, dare I say devastating, that once again our hardworking livestock producers are being punished for events that are beyond their control.

Like all members of this chamber and Canadians across the country, I am extremely disappointed by the court decision that has delayed the reopening of the U.S. border to live Canadian cattle.

We know that our meat supply is safe, and we strongly disagree with the arguments put forward by the Ranchers-Cattlemen Action Legal Fund, otherwise known as R-CALF, in seeking an injunction to stop implementation of the USDAs final BSE rule that would have reopened the border this past Monday, March 7.

Canada and the United States have had virtually identical feed controls in place since 1997. These controls are fully consistent with international standards and the evidence to date is that they have been effective in limiting the spread of BSE.

I would like to point out that the USDA agrees with us. Two weeks ago the USDA published the results of its study of the efficacy of Canada's ruminant to ruminant feed ban and concluded that our system is effective. The American Secretary of Agriculture, Mike Johanns, said:

Canada has a robust inspection program, overall compliance with the feed ban is good and the feed ban is reducing the risk of transmission of bovine spongiform encephalopathy (BSE) in the Canadian cattle population.

Mr. Johanns recognizes that Canada's regulatory regime is almost identical to that of the United States and that it protects both animal and human health. Based on that science, the USDA believes that the border should be open.

The USDA has indicated that it will go to court to defend its rule which should have opened the border on Monday. What is more, President Bush has also indicated that he will veto a senate resolution disapproving of the USDA rule should it pass in the house of representatives.

I must respond to some of the comments that I have heard around the activity of the Prime Minister in relation to raising this issue with President Bush. I can assure this honourable House that the Prime Minister raises this issue every time he meets with the President. In fact, the Prime Minister on Saturday, in his latest discussion with the President of the United States, again raised the BSE situation and his deep regret that the border was not going to open as it was originally projected to on Monday.

We must stay focused on what is happening here. The U.S. administration fully supports its department of agriculture and our Department of Agriculture and Agri-Food that the border should be open to live animals under 30 months. In fact, the Prime Minister and the President of the United States agree. There is no light between these two men. They agree entirely in terms of the fact that the border should be open to live animals.

The chair of the United States house committee on agriculture also said last week that science rather than fear should be the guiding principle in making decisions. Bob Goodlatte said:

I remain convinced that if we abandon science as our guiding principle, we will harm the long term health of our beef and cattle community. Cattle producers, the people who work in our processing plants and retail establishments, and our nation’s consumers will benefit the most from a committed course based on sound science.

He was right.

It is clear that those who know and understand the beef and cattle industry are supportive of reopening the border and the resumption of trade. Unfortunately, science and good sense are not the only factors at play in the decisions that affect international trade and, just as unfortunately, there is a group in the United States that is effectively using the court system fully legally to protect its own special interests. In doing so, it is causing heartache and economic distress for our livestock producers.

Because of that, the border is closed when all of us here tonight and livestock producers across the country know that it should have opened yesterday. It is unfortunate and it is wrong but it is the reality with which we have to deal.

We did know such an outcome was a possibility and that is why the government has been moving so aggressively forward in developing a made in Canada solution to restructure the North American industry and to reduce the reliance of Canadian producers on the export of live animals to the United States. I am pleased to report that we have taken significant strides in that direction and that we will be doing more in the future.

The $488 million strategy to reposition the Canadian beef and cattle industry announced last September is already having a significant impact: building domestic capacity. Domestic slaughter capacity, and it is important to focus on these numbers, is projected to reach around 90,000 head per week by June of this year and 98,000 head per week by the end of the year. That compares to the 76,000 head per week being slaughtered at the end of 2003. By the end of this year, we will have increased our slaughter capacity by nearly 30%. This will be of great help in alleviating some of the excess supply of fed cattle and to rebalance the market.

As well, measures in the February 23 budget will even further enhance Canada's domestic slaughter capacity. More than $17 million will be directed to further increase that slaughter capacity through the loan loss reserve program. In addition to that, $80 million over two years has been set aside to deal with the challenge of removing specified risk materials, SRMs, from animal feed.

The government cares about its agricultural producers and is doing everything it can to help them survive this catastrophe that is not of their own making. The Government of Canada has paid out more than $1 billion to cattle and other ruminant producers since BSE was first discovered in our country in May 2003. Millions of dollars more have been committed through the repositioning strategy, the BSE recovery program, the transitional industry support program and the cull animal program.

Since September 2004, federal and provincial governments have committed $2.6 billion for BSE related initiatives. That funding will help our cattle and other ruminant producers get through this difficult transition period while we continue to build our own strong and profitable Canadian livestock industry that is not overly reliant on the export of cattle to the United States.

We are also pursuing other markets. The Minister of Agriculture and Agri-Food has been continually on the road making the case that Canadian beef is not only the best beef in the world but is also the safest beef supply in the world, and his efforts are paying off.

I take umbrage with some of the comments that I have heard here in relation to the activities of the Minister of Agriculture and Agri-Food. No one has been working harder in these past number of months to develop new markets so that our producers are not as reliant on the United States. I resent the fact that anybody would suggest that our Minister of Agriculture and Agri-Food is not doing everything he can to support our producers.

The minister has travelled to different continents and engaged in marathon meetings with government and industry officials in an effort to reopen markets to Canadian livestock and meat products. He has travelled widely in Asia. He has been to countries in Latin America and North America. He has focused his attention not only on the U.S. market, but has travelled to Mexico to try to regain access to our markets there.

Why has the minister travelled so extensively outside of Canada and the United States? It is because he knows the important role that markets outside of North America play in the profitability of the Canadian beef industry. Many of these markets, particularly in Asia, import the cuts of meat that we do not generally consume in North America, and this provides additional value for each animal slaughtered.

Let us not forget that Japan, Korea and Taiwan were Canada's third, fourth and fifth largest markets for Canadian beef and beef products prior to the discovery of BSE in May 2003. This government takes very seriously the need to normalize trade with these countries.

There has been unprecedented cooperation between government departments such as Agriculture and Agri-Food Canada, the CFIA, international trade and our foreign posts abroad. As a result of this collaborative effort, we have made significant progress in opening Asian markets to Canadian beef and beef products.

The efforts of our Minister of Agriculture and Agri-Food have netted some very positive results. Let me articulate some of these. After the minister travelled to Asia, Macau reopened its borders to Canadian beef. Korea, Japan and Vietnam lifted their bans on bovine semen and embryos. Hong Kong has indicated that it is prepared to open its market to boneless beef under the age of 30 months. Canada signed important protocols that allowed the Chinese market to open to Canadian bovine genetics, semen and embryos. Taiwan indicated that its BSE risk assessment consultation committee will recommend opening the Taiwanese market as long as there are no new confirmed cases of BSE.

As well, it should be pointed out that during the Prime Minister's recent visit to Japan, Japanese Prime Minister Koizumi indicated that, based on science, Japan intends to resume beef imports as soon as possible. Again, that was our Prime Minister talking to the Prime Minister of Japan. Our Prime Minister has been relentless in talking to world leaders about how important it is to reopen markets to Canadian beef.

These are all positive measures, demonstrating to the Asian market that Canadian beef is safe to eat. The Government of Canada is also working with the Americas.

We continue to assure the Mexicans of the integrity of Canada's science and regulatory system and are seeing success in this regard. The Mexican secretary of agriculture has expressed confidence that there is a low prevalence of BSE in the livestock in North America and that effective measures are in place to protect human and animal health.

Canada will continue to work with Mexico and the United States in order to develop a North American approach to countering the problems associated with mad cow disease.

We are very encouraged because Lebanon recently accepted Canadian certification for live cattle. We view this as an important step forward toward normalization of trade and hope that it will encourage other countries to adopt similar science based decisions.

We know there is more to do. The government is committed to continuing our intensive efforts to reopen borders and to normalize trade in ruminants and ruminant products. As well, we will continue to develop the repositioning strategy announced in September to build a stronger domestic industry.

The government will continue to stand behind Canada's beef and livestock industry as we have done since the beginning of the BSE crisis. I should point out that not only is it government that stands solidly with livestock producers, but so do the Canadian people.

After the first Canadian case of BSE was discovered in 2003, beef consumption actually went up in this country. That is a strong endorsement for the industry and a strong indication of the confidence the Canadian people have for the steps the government has taken to ensure that the Canadian food supply is safe.

Our livestock industry has been dealt a series of terrible blows since May 2003 but we have stood with them in their time of distress, and we will continue to do so. In doing so, we will build a stronger domestic industry in which Canadians will continue to enjoy worldclass beef and beef producers will make a profitable living for them and their families.

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Mr. Speaker, that was a glowing account of what the government has done but what we were hoping for today were new ideas. However we did not get any.

The Deputy Prime Minister said that the government recognized “heartache and economic stress faced by our producers in this country”. That is wonderful but to that very end, ranchers and feedlot owners in Alberta launched a chapter 11 challenge some months ago and sued to get back some $350 million that they felt had been wrongfully taken from them by the Americans in the way this was being handled down there.

The government has kind of given that a pass. It was asked to help with the financing of that or to launch a parallel chapter 20 that would be government to government to try to expedite some of these files but the government of the day refused to do either one. Why?

[Anne McLellan, Liberal, Edmonton Centre, AB]

Mr. Speaker, we continue to reassess all our legal options. As I understand it, with respect to the possibility of any financial assistance in relation to the lawsuit that has been launched, I believe interventions have been made with officials of the Department of International Trade and I believe the issue is with them now.

[Peter MacKay, Conservative, Central Nova, NS]

Mr. Speaker, I would like to pursue this a little further.

The Deputy Prime Minister is a lawyer and a professor of law. She said in her own presentation here today that the government is prepared to do whatever it takes. The government is taking these great strides. She has listed chapter and verse of these incredible efforts that have been made.

The fact remains that the border is closed to Canadian cattle. That hardship is being felt, as she has pointed out, in a very real way from coast to coast. We are seeing farmers and producers facing the worst crisis, arguably, since the depression. They have had to endure numerous natural disasters in the past but this is continuing to have a fatal human impact on the family farm and producers.

I want to ask again the question that my colleague from Saskatchewan posed. Why is the government not making every effort to have face to face consultations even if it means having cabinet ministers in Washington every week and high ranking Canadian officials there every other day making these submissions and making these points clear? Will the government not join with others in legal actions now if we are talking about doing everything possible; that is pursuing a chapter 20 challenge; invoking sections 7 and 11, health and safety considerations, business fairness considerations; and making the case before the courts simultaneously to the dispute resolution mechanisms that are available under the WTO and NAFTA? Why would the government not go to the wall and pursue this in the courts simultaneously to get the border open?

The minister is famous for talking about a timely fashion. It has been almost two years and the border is still closed.

[Anne McLellan, Liberal, Edmonton Centre, AB]

Mr. Speaker, the border is still closed but it is not because of any action of the U.S. administration, the USDA or the President of the United States, or any inaction on our part. The U.S. border is still closed to live animals because of the actions of one group called R-CALF in the state of Montana. It went to court, as I have indicated. As much as it is distressing to us, the courts are there and it used the courts to obtain an interim injunction.

As I indicated to the other hon. member in response to his question, the Department of International Trade is assessing all our legal options at this point in relation to whether it is possible for us to take legal action to pursue, be it either an interim injunction or be it more general terms, the opening of the border.

However we must keep in mind that the only reason the border is not open is this interim injunction. It is not the U.S. administration, nor is it the President of the United States or Secretary Johanns. It is one group of producers with its own special interests that used the courts to seek the interim injunction.

I can assure the House that it is the worst example of special interest and protectionism, and what we are doing is assessing all our legal options at this time.

[Brian Fitzpatrick, Conservative, Prince Albert, SK]

Mr. Speaker, seven days before the border was to open, the government decided to deal with the intercontinental ballistic missile issue. We had had months and months to deal with that issue, but it seems that the government decided at that very sensitive period of time to make that announcement.

It is not just the R-CALF case. The U.S. Senate brought in a motion to close the border to Canada and passed it and some of the rhetoric was related to this. We had a breakdown in communications between the Bush administration and the Prime Minister over that issue. To me that is what poisoned the whole thing. The timing of that announcement could not have been worse. I am not saying it is the cause of all the problems but it certainly did not help.

I wonder if the Bush administration is appealing the R-CALF decision as vigorously as it would have otherwise. I am wondering if the Bush administration is going to be as enthusiastic about a veto to cancel out any motions that come out of the Senate and Congress to close the border. That seems to be what the mood is. We need the Bush administration very strongly on our side on this issue, but it seems to me the government struck a thumb in the eyes of that administration seven days before the border was to open. There should be some accountability on that side of the House.

[Anne McLellan, Liberal, Edmonton Centre, AB]

Mr. Speaker, let me repeat the facts. The U.S. administration supports us. The USDA supports us. In fact, the President has made it plain. I stand to be corrected, but I believe the U.S. President has gone on the record as saying in writing that he will veto the Senate resolution if it passes the U.S. House of Representatives. I think that would be the first time that the President has used his veto power. Gee, what do we make of that, other than the fact that the U.S. President supports his department of agriculture, our Department of Agriculture and our government. It is not the U.S. administration that is the problem.

R-CALF is a small group, relatively speaking, of U.S. producers who have a special interest in maintaining an artificially high price because the border is closed to our live animals. That group chose at the last moment to seek an interim injunction. I assure members that the USDA and its lawyers and our lawyers are assessing every option in terms of getting that injunction overturned and what the best procedure is to get the border open as quickly as possible.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, the hon. member said that at the very last moment R-CALF stepped up to the plate. Well, the people in cattle country knew R-CALF was going to do this a year ago. I would like to ask the minister when were you aware, when did it dawn on you that R-CALF was going to do this to--

[The Deputy Speaker]

Order, please. I would urge the hon. member to address his comments through the Chair, please.

[Charlie Angus, NDP, Timmins—James Bay, ON]

I am sorry, Mr. Speaker. I would like to ask the hon. minister when she became aware that R-CALF was going to do this. Was it a last minute thing that shocked her? Everybody in cattle country saw this coming a year ago.

[Anne McLellan, Liberal, Edmonton Centre, AB]

Mr. Speaker, nobody was shocked by this. We were desperately disappointed but of course we had seen the actions of R-CALF before. Everybody knew it was a possibility that R-CALF would go into court and try to seek another interim injunction. The USDA and its lawyers were there and they believed that on the law and on the science they had a very strong case. Our lawyers went into the district court in Montana. We asked to be acknowledged as amicus curiae in that case. We sought to make an argument or present a brief. An amicus curiae is there as a friend of the court, to present our position in relation to the opening of the border and the arguments being made by R-CALF.

Of course we knew it was a possibility and the USDA was prepared and we were prepared. Unfortunately over the best predictions of the USDA, the district judge in question granted the interim injunction. Now what the USDA's lawyers and our lawyers are doing is figuring out what the best legal process is, if any, to try to get that interim injunction overturned and get the border opened.

[Denise Poirier-Rivard, Bloc, Châteauguay—Saint-Constant, QC]

Today is International Women's Day, and I am happy to spend the rest of it here with you, Mr. Speaker.

Let us say it right off the start: this is a very serious situation. These past few days, there were reports in the papers about the U.S. Department of Commerce maintaining countervailing duties on exports of live cattle from Quebec and Canada.

After the endless lumber saga, still without an end, and the saga of the lone mad cow found in Alberta, now the door is being closed on the pork industry. One after the other, our industries are threatened with closing, without the government taking appropriate action to support its agricultural industry as it goes through these difficult times.

No doubt about it, this is an emergency. Let us get right to the source of the problem.

While most OECD countries have strengthened their support for their agricultural sector, the past few years have seen Canada taking the opposite direction and abandoning its agricultural sector. Keen as it was to be at the top of the class in terms of open borders and free trade, the federal government, under the direction of the then finance minister, overlooked emergency safeguards. As a result, in the middle of the farm crisis caused by the slump in prices combined with the mad cow crisis, agricultural industries are dying, and their very core is threatened.

What country in the world would be so careless as to abandon an export industry among the most important for its economy, as this government has for the past several years? Eighteen months after a single case—not a pandemic, just one case—of mad cow disease was discovered, the U.S. border remains closed from coast to coast. Where is this government leader who promised us harmonious relations with our only North American neighbour?

The fact is that, since the promises made during the election campaign, the leader of this government has shirked his responsibilities and failed, to date, to deliver the goods, while at the same time doing his utmost to interfere in provincial jurisdictions. Must we remind this government that it is neglecting its own international responsibilities?

It would have been easy to prevent the mad cow crisis in Alberta from affecting the rest of Canada and Quebec by regionalizing health practices. But this government, known for its efforts at centralization, would have had to swallow its pride and decentralize in order to do that. How scandalous, having the provinces make their own decisions.

In this respect, Quebec's regulations are in many ways, better and more avant-garde than federal regulations. Its tracking system allows it to follow an animal from the beginning to the end of its life, which means it can isolate potential diseases and epidemics.

Here is another example. Quebec has prohibited animal meal since 1993, while the federal government waited until 1997 to do so. If the federal government had been as proactive, the Quebec and Canadian borders would have opened a long time ago, except in Alberta, or even in just one geographic region in Alberta where the only case of BSE in Canada was diagnosed.

So it is easy to see why an agricultural industry subjected to such strict regulations as those in Quebec would be so frustrated by the department's little progress in this matter. The president of the UPA, Laurent Pellerin, and the president of Maple Leaf Foods, Michael McCain, were saying nothing less last year, when they indicated they were in favour of regional mechanisms for the marketing of agricultural products, but were disappointed by the federal government's lukewarm response to this idea.

We can look even further ahead. If Quebec had decided in 1995 to take control of its own destiny, we would not be here discussing this and people would be enjoying our beef at steak houses in the U.S. Anyway, these additional arguments will doubtless make Quebeckers think.

Now, I want to come back to our cattle. It is essential that Canada improve its cattle tracking system.

If the investigation into the sole mad cow in Canada took so long, it is because it was impossible for the investigators to determine quickly and with certainty the farm on which an eight-year-old cow had been born, and those it had been on subsequently.

For cattle born after 2001, there is now a system in place to determine the farm of origin. However, it is not always mandatory to record movements from farm to farm, so it will continue to be difficult to trace the places an animal has been, when it has been on three or four different farms as the Alberta cow had.

There is still no real ability to track cattle in Canada, as there is in Quebec for example. There, every change in ownership must be recorded, from birth to slaughter.

Canada will, as a result, never be able to earn and retain the trust of its neighbours and cattle buyers unless it puts in place tools that allow it to offer meat from an animal whose birth place and changes of ownership are clearly known, and whose diet presents no real risk. Had such a system been in place, the ban put in place by our neighbours to the south could not have been justified so readily.

Furthermore, while waiting for the border problems and the problems with tracking cattle to be resolved, the government has come up with some agricultural aid packages that do little for Quebec producers. According to the latest figures, Quebec producers have suffered losses of $241 million after compensation. Cattle producers say that the most recent federal strategy does not include any direct assistance to compensate for plummeting cattle prices, nor any kind of interest-free loan program.

What is more, the federal programs do not take the Quebec reality into consideration. Most cattle producers there are in fact dairy producers who sell cows that are no longer good milkers for meat. These are termed cull. With this practice, 25% of a dairy herd is replaced every year.

Unfortunately, the federal program compensates for only 16% of their herd, while cattle producers in western Canada, who raise beef cattle specifically, are getting compensated for every animal slaughtered. This is compounded by the drastic drop in cull prices; prices have dropped by as much as 70%. As a result, producers receive compensation for only two-thirds of the animals they sell.

The five different aid packages developed in an attempt to remedy the crisis have been ineffective in Quebec. Perhaps the time has come to recognize that, once again, in this area as in many others, the federal government's intervention model as it relates to support for the cattle industry is based on a reality totally foreign to Quebec. Looming at this picture, we can easily imagine the distress of the cattle industry in Quebec.

In his February 23 budget, the federal finance minister had a golden opportunity to help the cattle industry in Quebec and Canada. But it would appear that he merely announced that a portion of the funding announced on September 10, 2004 would be reallocated to increase by $17 million the federal contribution to the program to expand our ruminant slaughter capacity.

The current negotiations between the producers and the government show that this funding is not for Quebec's plan to set a floor price for cull. In that respect, federal officials suggest that the projected acquisition of Colbex, for example, would not qualify for the federal program.

This budget is additional evidence of the Liberals' insensitivity toward Quebec. Although they are awash in surpluses and able to find $42 billion new for various programs that encroach on provincial jurisdictions, the Prime Minister and the Minister of Finance have produced a disappointing budget for the agriculture sector.

Even though the Minister of Agriculture and Agri-Food himself stated, on November 29, 2004, that there was a problem with cull cattle, and while the Bloc Québécois, the Quebec Liberal Party and everyone in Quebec's agricultural sector are calling out loudly for strong aid measures, what are these big thinkers who lead the government waiting for?

The UPA and a number of agricultural groups will be on Parliament Hill tomorrow. What will the finance minister and the Prime Minister tell them?

Here are a few recommendations for the cabinet to sleep on tonight. The Prime Minister should ensure that the United States government vigorously defends the reopening of the border in the American courts. The meeting between the Prime Minister and President Bush at the latter's Texas ranch in a few weeks should be the perfect opportunity for this.

We recommend that the government do its part, as the Government of Quebec has done, so that Quebec's dairy producers receive a floor price of 42¢ a pound for their culled animals, until the market price rises to the floor price.

In addition, these groups recommend that the government regionalize its animal health system in order to ensure that one isolated case of mad cow in Alberta does not paralyze the livestock industry all over Canada and Quebec, absolutely indiscriminately.

Also, the federal government must adopt targeted measures in order to compensate beef and dairy producers, for example, by setting up a real program of direct assistance to provide immediate aid to producers in order to compensate for the dizzying drop in prices; by establishing an interest-free loan program; by establishing a real cull cattle and veal calf program, to overcome the fact that the federal government only compensates 16% of dairy herds, while the real rate is 25%; and by making existing programs more flexible so money can reach producers who are seriously affected by this crisis as quickly as possible.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

Mr. Speaker, there are two points I want to make very quickly and hopefully hear some response from the hon. member.

The first is the issue of the extended closing of the border. We expected this week would bring good news of an opened border. However, one week ago the government decided to make a political announcement in opposition to the missile defence system of the United States. It is arguable whether there is a direct linkage between that decision and the supplementary decision to oppose opening the border that came first from a court, but I would remind the government, second from the U.S. senate.

I have spoken to officials in this country who have large vested interests in the industry. They indicate that they were in contact with the administration two days before the vote in the senate. They were told that not only would the motion not pass the senate but there was not enough signatures for the motion to come to the floor of the senate. However, after the decision made by this government to oppose missile defence, all of a sudden there was massive support in the senate to pass the motion, and it eventually passed. That is the reality. Whether there is a linkage or not, one has to acknowledge that the timing of the decision was not in the nation's interest.

The government stood in the House again and again and said that it would call a decision on missile defence when it was in the national interest. Instead it did it just one week before the borders were scheduled to open and put at peril, or at least at potential peril, the interests of this vital industry, which is prominent in my constituency. There is no explanation as to why the government made that decision.

Would the member across the way be willing to make some explanation as to why the government chose that time to take that decision?

[Denise Poirier-Rivard, Bloc, Châteauguay—Saint-Constant, QC]

Mr. Speaker, this is a memorable day. The re-opening of the border was eagerly anticipated, but it is not happening. We Quebec producers are being heavily penalized with regard to breeding and meat processing. It is urgent that the border re-open. This is extremely important to us. Much work needs to be done to help re-open the border.

The Minister of Agriculture and Agri-Food has been telling us since September 10 that he has implemented programs and that he is in negotiations with his provincial counterparts. However, I think that an agreement has yet to be reached. The situation is extremely urgent.

Some Quebec producers have committed suicide because they are no longer able to live off their farms, since there is no longer a breeders market. Milk producers have enormous herds of cull cows on their farms, while the banks no longer want to lend them money.

I want to ask the minister to see whether we might have good news very shortly to help Quebec producers.

[Andy Mitchell, Liberal, Minister of Agriculture and Agri-Food]

Mr. Speaker, I am glad the hon. member, who provided the intervention, is back to talking about BSE as opposed to watching the hon. member from the Conservative Party make a totally inappropriate case. He forgets or ignores the fact that the U.S. administration stands four-square behind Canada. The U.S. President stands behind Canada. They absolutely stand behind us. This is not an issue of there being a dispute between the government of the United States and the Government of Canada. The hon. member fails to understand or to realize that. Rather than making comments about the substance of the issue, he resorts to talking about something that is totally unreal.

First, I appreciate the hon. member's assistance in the work we recently did together in Washington.

I have a very specific question. I know she has long advocated the position in terms of the cull animals. Does she believes the action taken by the Canadian Dairy Commission, which provided a $5 increase to dairy producers, a portion of which was specifically to deal with the lost value of cull animals, has had a positive effect on producers across Canada and in her particular province?