Bill C-15 (Historical)

An Act to amend the Agricultural Marketing Programs Act

This enactment extends Part I of the Agricultural Marketing Programs Act to a wider range of agricultural products and makes benefits under that Part more accessible to producers throughout the production cycle of agricultural products.

Agricultural Marketing Programs Act

[Chuck Strahl, Conservative, Minister of Agriculture and Agri-Food and Minister for the Canadian Wheat Board]

moved that Bill C-15, An Act to amend the Agricultural Marketing Programs Act, be read the second time and referred to a committee.

Mr. Speaker, I am pleased and honoured to support of the proposed amendments to the Agricultural Marketing Programs Act, or the AMP legislation. I would like to thank all parties for their enthusiasm for the legislation and trust we will get it through the House this day.

There is no doubt that many of our farmers, particularly those in the grains and oilseeds sector, are going through some tough times financially. Over the past weeks and months I have sat down with producers, provincial ministers and other stakeholders from across the country and they have all stressed the severity of the situation to me.

At the same time, they have reiterated their desire to work with governments in order to help them earn a greater portion of their incomes from the marketplace. This is a desire we all have. This is what we are working toward for the longer term and it will require taking action on the domestic and on the international front. Internationally, we are working through the World Trade Organization to level the playing field for our Canadian producers.

We have also taken action on the national scene. As the members may note, the budget provides for an additional investment of $1.5 billion this year in farm families and the future of Canada.

We are also taking other measures to assist farmers. That is what we are addressing here today. As well as more responsive farm income stabilization and disaster programming, the government has committed to making cash advance programming more responsive to the needs of producers and more reflective of the modern Canadian farm business today.

This is precisely the aim behind the amendments to the AMPA legislation that we are proposing to the House today. Farmers have told us that they want these changes and we are acting.

Under the legislative changes the government is proposing, the spring credit advance program would be consolidated into the advance payments program, making one single program under the AMPA called the advance payment program, or APP. This consolidation would reduce red tape for producers and would extend the repayment period of advances to 18 months.

Further, under the single program, the government is proposing increased levels of coverage for farmers and broader coverage to include a much wider range of commodities, including livestock. Specifically, these proposed amendments would, first, move to a whole farm approach by increasing the types of commodities covered, including livestock but excluding supply managed products and breeding stock; second, acknowledge today's larger farm size and increased farm input costs by raising the interest free component of the cash advance loans from $50,000 to $100,000; third, increase the overall limits on advances from $250,000 to $400,000; and fourth, enhance emergency cash advances.

To help producers with immediate assistance while these changes are in the works, the government has announced that a transitional program, the enhanced spring credit advance program, would be implemented consistent with the proposed changes to AMPA. This was announced, with an order in council relevant to this made a couple of weeks ago. Under this enhanced program, the maximum interest free provision is set at $100,000. Further, the repayment schedule will be extended to September 30, 2007 under this interim program.

With these improvements, the AMPA represents a total annual federal investment of about $100 million, another illustration of how this government is standing by its producers and will continue to stand by them.

As well as addressing the financial needs of producers, the proposed amendments reflect the fact that the size and complexity of farm operations in Canada have been steadily growing. There is no denying that the realities of modern agriculture are different from what they were in the past. Farm operations are bigger than they used to be and, over the last decade, farmers have seen their operating costs rise by more than 80%.

The new cash advance program is designed to better reflect these realities. By giving farmers timely access to credit, it frees producers from having to make marketing decisions based solely on the need for working capital. The changes we are proposing will also cut down on the paperwork and streamline the administrative and assessment processes.

Our prime objective is to ensure the prosperity and stability of all farm enterprises in Canada.

This is good news not only for agriculture but also for rural Canada and all Canadians.

In closing, I will repeat what the Prime Minister told the House in the take note debate on agriculture a month ago:

--the government will stand up for a strong, vibrant farm sector that provides security of income to families dependent on farming and food security for all other Canadian families.

It is for these reasons that I trust the House will join me in supporting these proposed amendments that are so vital to the success of our producers. Again, I would reiterate my thanks to all opposition parties for supporting this legislation, I hope, ensuring its speedy passage and sending it on to the Senate.

[Tom Lukiwski, Conservative, Parliamentary Secretary to the Leader of the Government in the House of Commons and Minister for Democratic Reform]

Mr. Speaker, I rise on a point of order. I believe you would find that there have been consultations with all parties in the House and there has been agreement for the following motion. I move:

That, notwithstanding any standing order or usual practices of the House, a member from each recognized party may speak for not more than 10 minutes on the second reading motion of Bill C-15, after which Bill C-15 shall be deemed to have been read a second time and referred to a committee of the whole, deemed considered in committee of the whole, deemed reported without amendment, deemed concurred in at the report stage and deemed read a third time and passed.

[The Acting Speaker, Royal Galipeau]

Does the hon. member have the unanimous consent of the House to move the motion?

[Some hon. members]

Agreed.

[The Acting Speaker, Royal Galipeau]

The House has heard the terms of the motion. Is it the pleasure of the House to adopt the motion?

[Some hon. members]

Agreed.

[The Acting Speaker, Royal Galipeau]

(Motion agreed to)

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, I as well am pleased to have the opportunity to speak to Bill C-15. I congratulate the government on this bill.

It is nice to be able to congratulate the government for doing something on the agricultural file instead of, as has been the case on the agricultural file, leaving the impression that something is being done but that something never happening. The budget is a prime example. There are actually less dollars in it than there were in the previous year. The immediate cash the government promised for spring is still not there.

However, this is good legislation and I appreciate seeing it come forward. This legislation was originally introduced by the previous government in Bill C-69 in October 2005. It is not exactly the same bill, but it is pretty close. The current legislation builds upon the framework put forward by the previous Minister of Agriculture, the Honourable Andy Mitchell.

Like the previous bill, Bill C-15 begins from the same premise, namely, that legislation of this kind will be a direct benefit to our producers in that it will provide an enhanced cash advance to Canadian producers to assist them to operate profitably over the short term and the longer.

The key provisions of Bill C-15 are the following.

It will, as the minister said, expand the coverage applicable to include livestock production as well as provide for the inclusion of a greater variety of crops. As in the previous government's legislation, there is a provision whereby the governor in council may, by regulation, designate any other agriculture product not specifically identified as being subject to the act. I might say that this is important, because under the current legislation there were some commodities that got missed although it was not intended.

I would point out, though, in this regard, one of the concerns I had with the previous government and would have with this one as well when we are setting the limit. From a farmer's perspective, if I can put it that way, the interest free cash advance going up to $100,000 is good. If it becomes necessary to increase it a little further, doing it by order in council would be fine, but I would worry if things tighten up with the Minister of Finance and if he or she might, by order in council, sometime reduce it. I want to make it very clear that our intention on the order in council is to ensure that there are increased benefits, not fewer benefits, for producers through using the order in council provisions.

As the minister said as well, it should be noted that the provisions of the bill do not apply to supply managed commodities. They have their own system. They operate in a system that allows them to achieve reasonable returns for managing the system to meet effective domestic market demands.

We welcome the provision in the bill for the increase of the overall limit of the advances from $250,000 to $400,000. There are also provisions in Bill C-15 for an increase in the amount of interest free advances from $50,000 to $100,000.

I want to expand on the points made by the minister. I agree with him in that regard. In fact, farm operations are larger. I think we ought to keep in mind why cash advances were first put in place quite a number of years ago. In the beginning, they were not put in place so much as a financial incentive as a marketing incentive.

For those out there in the general public, they should understand that originally when farmers harvested their crops, and it was mainly for cash crops in the fall at the beginning, they had a lot of extra harvest expenses with extra labour and so on. In order to pay their immediate bills in the fall, farmers tended to dump their product in the marketplace. Everybody doing the same thing at once resulted in quite a surplus of product in the marketplace. That in effect drove prices down.

The original cash advance program was designed in such a way through the Government of Canada as to have an interest free cash advance so that farmers would have the moneys with which to be able to pay their harvesting expenses to get their crop off and feed their crop into the market. There were two benefits. One was the interest free portion, but second, they were able to drive a better price out of the marketplace as a result of having the advance payments program in place.

That was a good design. I maintain to this day that the original advance payments bill is one of the best farm programs we have. It utilizes the authorities of the federal government through cooperation with various marketing agencies and the provinces to assist farmers in achieving better prices out of the marketplace. That is a good thing.

Bill C-15 provides for the consolidation of the two cash advance programs, the advance payments program and the spring credit cash advance program. On May 18, the Minister of Agriculture and Agri-Food announced the early spring credit advance program, which focuses on the increase of the interest free loan portion in the act being made available to producers.

While we in the official opposition support Bill C-15 and, as our House leader said earlier, we want to see speedy passage of the bill through the House so that farmers can take advantage of it, and we will be doing that, we have expressed and continue to express our disappointment with respect to the federal government's lack in providing producers with direct cash for spring planting. We in the official opposition--and farmers, I believe--were of the impression that there would be cash for spring. Certainly some of the backbench members of the now governing party indicated that to farmers. That has not happened.

While the bill is a good one, I want the public to understand that this is a loan, and yes, as the minister has indicated, the government will be contributing close to $80 million to $100 million on an annual basis, covering the interest free portion of that bill. That is a valuable contribution by the Government of Canada, but in terms of the $100,000 itself, that is not money that is rolled out in a cheque to farmers. It is really the farmers' own money. It is borrowed money and we cannot borrow ourselves out of debt. Many of us in the farm sector have tried it. We have found that it just does not work.

People have to understand that this is in fact a loan. It will not deal with the cash shortfall as a result of poor prices in the international subsidy war that has driven grains and oilseed prices down and caused the farm income prices that exist in this country. It really will not deal with that problem. It is a good bill, yes, but it does not deal with the cash shortfall that already exists in the farm community as a result of low commodity prices.

To conclude, with the caveat that we have to recognize that this is another loan, by the same token it is a good program. There is a contribution from the Government of Canada on the interest free portion and we will be supporting the bill and trying to give it speedy passage, but I do express my desire that the Government of Canada reconsider what it can do for the cash shortfall in the farm community as a result of the international subsidy war going on, which is leaving farmers short of cash for the products they sold in the 2005 crop year.

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

Mr. Speaker, I am pleased to rise today in this House with respect to Bill C-15. We will take advantage of this moment when all the parties seem to agree on the matter. Indeed, it is not every day there is solid agreement in this prestigious place. We will this use it to good advantage.

Bill C-15 was introduced to amend the Agricultural Marketing Programs Act. In fact, as my colleagues before me have stated, it is a new version of C-69, which was introduced in October 2005 by the previous government. We supported the principle of Bill C-69 at the time. We still do today, of course, as Bill C-15 is an improved version of C-69.

Quebec's Union des producteurs agricoles, the UPA, has long called for the amalgamation of the two federal programs, the advance payments program and the spring credit advance program, known as APP and SCAP, to facilitate financial management.

The UPA also called for an increase in the ceiling of interest free advances by $50,000 to $100,000, which was done, and wanted the new program to be expanded to more sectors, including livestock. These amendments contained in the bill are certainly welcome.

In this regard, Bill C-15 proposes more than its predecessor. The ceiling for advances would increase from $250,000 to $400,000. The amount of interest free advances would increase to $100,000 from $50,000 and, as I was saying earlier, livestock and more crops would now be eligible.

Amalgamated, the advance payments program and the spring credit advance program will make things easier for producers while putting an end to administrative duplication, which led to unnecessary costs as the programs are complementary. It has been our habit to strongly criticize duplication when it involved the federal government and extended to the provinces, but even within the machinery of the federal government there is duplication. So we will be putting an end to some of this duplication, which is good news.

However, some questions remain. My Liberal colleague mentioned earlier that this spring there was no cash available immediately. We too find this inexcusable.

There are other questions. At this stage of the process, as I stated at the beginning of my speech, the Bloc Québécois is in favour of the principle of the bill. However, it does give rise to certain questions. Since the program is part of the agricultural policy framework agreed to by the federal and provincial governments, how can the government make unilateral changes without consulting Quebec and the provinces? It is a question we asked ourselves and that we asked at a briefing by the Department of Agriculture and Agri-Food. It appears that it can do so, but we believe it is a legitimate question nonetheless.

The costs of these programs are shared and so another question comes to mind: when the new bill to amalgamate the two previous programs is implemented, will it cost more for Quebec and the provinces?

There is yet another question. Although the new program includes livestock and a larger number of crops—good news, as I stated earlier—it excludes all agricultural products subject to supply management. We know that, in Quebec, supply management is extremely important as it accounts for 40% of revenue in Quebec's agricultural economy. In this regard, we would have liked improvements to the bill.

From an administrative point of view, the current programs are managed by the producers' associations. Although no official announcement has been made, we have some information and we are hearing things. We are somewhat concerned. Some information from the department leads us to believe that the financial institutions could ultimately administer this new program. We are totally against this way of doing things. As I stated earlier, there is nothing concrete stating that this will happen but this may be a possibility.

We totally disagree with and are opposed to this possibility. We want the producers' associations to continue managing the program, as was done when the two previous programs were administered by the agricultural producers.

In the short term, Bill C-15 is good news. As for the medium and long terms, I toured Quebec's agricultural regions a week ago. People asked a lot of questions and expressed a lot of concern about many things, including the Canadian agricultural income stabilization program, or CAIS. We know that the minister announced plans to change the program, but we are still in the dark. Among other things, we still do not know how much money will be distributed to agricultural producers through the Canadian agricultural income stabilization program.

Quebeckers' concerns are as follows. With respect to the method of calculation for inventory valuation, the billion dollars will be used to spread out recovery of the overpayments distributed through CAIS, as I said, so that farmers will know, at the very least, how much they are likely to receive once the program is changed. This money will also cover administration of changing to the inventory valuation method and increased negative margin coverage.

However, inventory valuation methods differ from province to province because the federal government handed over responsibility for managing CAIS to the provinces that wanted it. As a result, Quebec, Ontario, Alberta and Prince Edward Island were free to choose whichever method they wanted. In 1992, Quebec chose to use accrual accounting, which, according to the minister, is the method the federal government wants to put in place. Quebec and other provinces that already use this management practice will be penalized because they already have a system in place that uses these accounting rules.

During my meetings with regional agricultural producers in the UPA, people told me that they were wondering how the minister planned to distribute funds allocated under CAIS.

Furthermore, during our tour, there was some talk about agricultural policy framework over the longer term. The government certainly must have heard the cries of the farmers, who rallied right here on Parliament Hill on April 5. The next day, a take note debate was held in this House concerning the farm income crisis.

Farmers would like the government to finally establish a real agriculture policy. A farmer in my riding even asked me if Canada still wants to continue farming, if it wants to encourage agricultural production in this country and in Quebec, of course, since we are still here for now. One thing is certain: we have some grave concerns in this area.

In its preparations for a new agricultural policy framework, we sincerely hope that the government is finally hearing the farmers. They were consulted by the previous government when the first agricultural policy framework was being created. Despite those consultations, however, the changes that the farmers were hoping for concerning Canadian agricultural policy were never really implemented. Their demands and concerns in this area remain the same.

Bill C-15 is a step in the right direction. It does not resolve the entire farm income crisis, but it is close. We believe that this bill should be passed quickly so that farmers may reap the benefits as soon as possible.

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

Mr. Speaker, like my hon. colleagues, I support Bill C-15. I will not reiterate what has already been said by my hon. colleagues about what we need to do for our farmers. The main thing is they are now getting some help, and that is good. One concern is that it will increase the debt load. We will have to watch for that.

I am encouraged by the efforts of the Minister of Agriculture and his staff to help the primary producer.

I was contacted again last week by farmers of Porcupine Plain, who are concerned. They seem to be falling through the cracks. In spite of the $15 per acre available to help them with respect to disaster relief, they do not know if they will have access to the money now or if they will have to wait until the fall.

This area was hit by flooding in 2005 and 2006. Last week another three inches of rain fell. Riverbanks are overflowing and seeds are rotting in the ground. Prior to this, farmers had seen two years of drought, frost and other flooding. The majority of farmers in rural municipality 395 have no equity left against which to borrow.

I have heard gut-wrenching stories. I have been told, and I have the documentation here, that some farmers will have their lights turned off by the middle of June. One person has a remaining credit of $5,000 on his credit card. That is not enough to fix the transmission on his tractor let alone to buy fuel and food for his family. Another person had his credit card revoked on May 29, and his lights will also be turned off. Two farmers have deserted their large farms and have gone to Alberta to work in logging operations.

This morning, at a press conference, I alluded to the point that these people had real problems. Although I am encouraged by the budget and by what has been offered by the government, there must be some way that we can help these people today to get back on track so they can produce and continue to make a living in our rural municipality.

Cattle producers in my riding of British Columbia Southern Interior believe that a free flow of cattle over 30 months old is necessary. In talking with the Canadian Cattlemen's Association, the idea is that our government should take the initiative in this regard. They are willing to help as far as blue tongue and other problems that arise.

Another situation that local producers in the Slocan Valley face is the decision of our provincial government to close many local slaughter house facilities because of new legislation. They will have to move one or two animals to Kelowna or Kamloops, if there is room for them, to get them slaughtered, thereby putting themselves out of business. I know this is not a federal issue, but I wonder if there might be some guidelines through the federal CFIA with regard to flexibility so we can somehow help, working through the provincial government, our local producers to continue producing, specifically in the Slocan Valley and other areas of British Columbia.

Our fruit growers have some comments with regard to the legislation. Marketing of their 2004 fall crop was severely impacted by excess production in Washington state, which saw a substantial increase in the volume of U.S. apples entering our Canadian market, literally being dumped into our province. B.C. apple growers saw their returns plummet from a previous three year average of 22.3¢ a pound to a mere 12.4¢ per pound, a 44% drop.

There are many serious concerns on the proposed methodology of how money will flow to farmers and how or if the apple industry will be included in the current plans. In B.C. the majority of apple growers belong to cooperatives, where the products they grow are pooled. Because of this, they view the current distribution model of retroactive inventory valuation adjustments as not working for apple growers as it excludes them from the main body of the $900 million CAIS fund. It would be terribly wrong and unfair to apple growers to pay $1 billion of emergency funding based on inventory valuations.

Pressure is being brought to bear at the WTO to have us change our supply management system. We must protect our milk producers in Quebec and the rest of Canada at all costs. I find it encouraging when the minister says that he is going to do what is necessary to maintain our supply management system. We know that, today, discussions are under way between milk producers and processors about milk protein concentrates. Let us hope that we find a solution shortly.

Another important issue confronting our producers especially in the west is that of the Canadian Wheat Board. Many of the producers are worried that the government wants to make it into a dual marketing agency. According to a study and a survey, 88% of the farmers themselves want to make the decision. It is important that we allow them to make the decision based on their board of directors and their members. The government should not impose its will.

We have to be careful because these issues are tied together. Whether it is the Canadian Wheat Board or the supply management system, once we erode one, the other follows. We can cite the New Zealand experience in the 1990s where the apple industry voted to get rid of single desk selling. Since then everything has gone downhill. Quality is worse. Apples are being picked early in the rush to export. Shelf life is much shorter. Ships carrying identical crops are arriving in market ports at the same time and end up competing for lowest prices. There is a move in New Zealand to get back to a single desk model.

After talking with the New Zealand High Commission, it has been learned that the New Zealand kiwi fruit marketing authority voted to go back to the single desk after getting rid of it because those producers all too soon found themselves competing for lower prices.

We have to be very careful before the government starts to play with an institution that is governed and controlled by the farmers. We must look at examples in other parts of the world, such as New Zealand, where people are saying that maybe the single desk solution is the best.

The farmers' rail coalition is looking to the government to recognize that the farmers are prepared to support the federal plan for the hopper car fleet if the government can ensure that farmers' interests are best served. Once again, I appeal to the minister, as I have done during our committee meeting, that the time is right to involve these people. They represent farmers in western Canada. They are willing to work with the minister and with the government to ensure that we get the very best possible deal and the very lowest maintenance costs for our farmers so they can make some money and continue to produce.

In closing, I support Bill C-15 as outlined by the minister. It is a start. It is a step in the right direction. The government must do all it can.

We have to do all we can to support farmers. It is time for a vision for Canada, a vision that says yes, we must support primary producers.

It is very important to look at the primary producers when we look at Bill C-15.

Whether we are talking about supply management, the Canadian Wheat Board or whatever, we need to keep in mind that we must support primary producers.

I thank the minister once again for his hard work in pushing Bill C-15 through.

[The Acting Speaker, Royal Galipeau]

Pursuant to order made earlier today, Bill C-15, an act to amend the Agricultural Marketing Programs Act, is deemed read a second time and referred to a committee of the whole, deemed considered in committee of the whole, deemed reported without amendment, deemed concurred in at report stage and deemed read a third time and passed.

(Bill read the second time, referred to a committee of the whole, considered in committee of the whole, reported without amendment, concurred in at report stage, read the third time and passed)