Bill C-29 (Historical)

An Act to increase the availability of agricultural loans and to repeal the Farm Improvement Loans Act

This enactment amends the Farm Improvement and Marketing Cooperatives Loans Act to provide financial support for farmers, including beginning farmers, and farm products marketing cooperatives, as well as to allow for intergenerational farm transfers through a loan guarantee program. It also allows for the adjustment, by regulation, of amounts and percentages set out in the Act. Finally, it repeals the Farm Improvement Loans Act.

Canadian Agricultural Loans Act

[John Baird, Conservative, Ottawa West—Nepean, ON]

moved that Bill C-29, An Act to increase the availability of agricultural loans and to repeal the Farm Improvement Loans Act, be read the second time and referred to a committee.

[Pierre Lemieux, Conservative, Parliamentary Secretary to the Minister of Agriculture]

Mr. Speaker, I am pleased to speak in support of the proposed amendments to the Farm Improvement and Marketing Cooperatives Loans Act. I am sure that my hon. colleagues will agree that they are solid, common sense measures and that the time has come to adopt them.

Important changes are taking place in the agricultural sector. The size of agricultural farms is increasing and it is becoming more difficult for a beginning farmer to obtain the funds required to set up a viable operation. About half of all farms, representing some $123 billion in assets, are run by farmers who are 55 and older.

What will happen when these farmers want to retire? A good number of them will do so in the next 15 years.

Over the next 15 years, Canadian farmers, operating almost 84,000 farms, are expected to retire. I say “expected” because we know some will work beyond the age of 70.

In any case, we are talking about a major intergenerational challenge for Canadian agriculture that is going to play out over the coming years, a challenge to attract young farmers to the business, a challenge to transfer family farms to the next generation, a challenge to renew and rejuvenate the Canadian agriculture and agrifood sector and to put it on a sound footing for generations to come.

We need to attract young people to a future in farming. Young farmers are the foundation of Canada's agriculture and agrifood sector. They enrich and strengthen communities across Canada through their hard work and innovative spirit. They exemplify the entrepreneurial spirit that is critical to our success in the years to come. As entrepreneurs, young farmers want a government that gives their farm businesses room to grow and the tools to capture new opportunities.

I want to talk about a young farm family that is part of the next generation. Robert and Erin Brunel farm with Rob's dad, Paul, in Ste. Rose, Manitoba. R.P. Brunel Inc. is a fourth-generation family farm that specializes in grain. The Brunels farm 3,000 acres. Rob and his wife, Erin, welcomed their first child, Myley, in to the family in mid-November. Rob would like to continue to expand the business and eventually take over the farm completely from his father.

The Brunels dream of a future in agriculture, but realizing that dream is much easier said than done. It is not uncommon for farms today to have assets of well over $1 million, a considerable amount for the next generation to finance. Rob says that there are programs to help young farmers out there, but he does not qualify for many of them and they are not targeted to his specific needs. He would like a program to help him proceed with his expansion plans and eventually finance the farm transfer.

Farmers like the Brunels are the future of the sector and we need programs that will help them capture that future. That is the objective of the proposed legislation we are discussing today.

For the past 20 years, the Farm Improvement and Marketing Cooperatives Loans Act, commonly known as FIMCLA, has helped farmers and farmer-owned co-operatives improve and develop their businesses through government loan guarantees. Guaranteed loans of up to $250,000 are available to farmers for up to 80% of the purchase price. The interest rate is capped. For co-operatives, the maximum loan is $3 million.

Over the years, FIMCLA has been a valuable financial tool for farmers, helping them improve their farming operations when other sources of funding are not available or priced too high to make them viable.

Federal programs to help beginning farmers enter the agricultural sector have a number of restrictions. The advance payments program, governed by the Agricultural Marketing Products Act, only provides short-term financing to new farmers. Provincial programs for beginning farmers vary a great deal in terms of the types of programs and the amount of assistance provided.

Support for agricultural cooperatives is also limited. Debt financing provided by credit institutions to cooperatives is insufficient and provincial programs present the same problem. There is no doubt that the rules are not fair.

Consequently, in 2005 the previous government announced that it intended to cancel the program. The industry did not see this as a solution, and neither does this government. That is why we have pledged not only to maintain FIMCLA, but to consult on how to make it more responsive to the needs of farmers today. Therefore, we did that.

We heard from young farmers across Canada, farmers like the Brunels, who talked about the need for support for both beginning farmers and farm transfers. We also heard from co-operatives that told us about the challenges they had in raising the equity they needed to help farmers participate in value-added ventures.

I want to linger a moment on the topic of co-operatives. There is no question farmer owned co-operatives are a way to move farmers further up the value chain. In fact, in my riding of Glengarry—Prescott—Russell there is a very important agricultural co-operative known as St-Albert Cheese. Some farmers like the co-op approach. In fact, I have met with some in my riding of Glengarry—Prescott—Russell.

Co-ops have a record of providing benefits to farmers, improving their competitiveness, pooling risk, coordinating marketing and retaining local wealth and promoting rural sustainability through local ownership and control.

For example, Agropur, a Quebec-based dairy co-op, is one of the top dairy companies in Canada. Agropur reported revenues of $2.3 billion and a surplus of over $120 million last year, and it is owned by farmers. Across Canada, some 1,200 agriculture co-operatives generate annual revenues of $13 billion and return over $200 million back to their farmer members.

Like the farmers they serve, co-ops are evolving to take advantage of opportunities in the bio economy, to meet new consumer demands and to find new sources of capital and specialized expertise. This is more challenging than ever, given the high capital requirements of ventures like these.

We listened and we acted. The result is what we have before us today.

Before coming up with the amendments proposed in this bill, Agriculture and Agri-Food Canada consulted widely with young farmers and financial institutions. According to stakeholders, changes to the Farm Improvement and Marketing Cooperatives Loans Act (FIMCLA) will be a great step forward.

The Canadian Young Farmers Forum is backing these recommendations. It has also insisted that the paperwork be simplified.

Accordingly, the Department of Agriculture and Agri-Food will devise an electronic loans system under the amended FIMCLA in order to reduce processing times for loan applications.

Under the legislation we are proposing, FIMCLA, or the Farm Improvement and Marketing Cooperatives Loans Act, would be opened up to beginning farmers, to family farm transfers, and to a wider range of agricultural co-operatives.

For beginning farmers, the loan limit would be increased from 80% to 90% of the purchase price. We are proposing an increase in loan limits to $500,000 for real property and $350,000 for all other loan purposes. Loan guarantees would now be available on farm transfers through shares of a corporation or interest in a partnership.

For co-operatives, this proposed legislation would respond to the co-op sector's needs by expanding eligibility requirements to include all agricultural co-operatives with a majority, 50% plus 1 of farm members. These measures respond to recent trends in co-op development by allowing non-farmer investment while at the same time retaining farmer control.

The proposed bill would also build in flexibility in the regulations so that loan limits can be changed as the need arises. We are not talking about just fine-tuning FIMCLA. We are talking about key improvements to the core program.

That is why we are proposing in the new bill that the program name be changed to the Canadian agricultural loans act. This is a better reflection of the proposed legislation's stronger national focus.

Opening up the program to beginning farmers, intergenerational farm transfers, and a broader range of agricultural co-operatives would create a national loan guarantee program that would support the entire agricultural community, and it would bring parity to the agricultural sector with other sectors of the economy which are entitled to benefit from small business financing programs.

This is a government that delivers for young farmers.

We have helped support family farm transfers by increasing the lifetime capital gains exemption from $500,000 to $750,000, the first increase in 20 years. To help farmers manage cashflow, we have doubled the amount of interest free money available through cash advance programs. This would make about $600 million per year available to agricultural producers. We have delivered stable, predictable and bankable support for farm families.

We are working with provinces and industry to design programs under the growing forward framework to secure a profitable and vibrant agricultural sector for the next generation. This government supports strong, young farmer associations such as the Canadian 4-H Council, Canadian Young Farmers Forum, and Canada's outstanding young farmers.

I would like to quote briefly Doug Spencer, a dairy farmer from Campbellford, Ontario, because he touches on an important issue in the farming community right at the moment:

At the moment, the highest priority for my wife and me is to know that the business we've built up will be taken care of by the next generation, and this plan will help see to that.

The proposed amendments to FIMCLA will help farm families like the Spencers keep the farm in the family and help the older generation retire with dignity. It is good news for beginning farmers, for retiring farmers, for farmer-owned co-operatives, and for the whole sector.

The bill would provide fairness and parity with other businesses, both for beginning farmers and for farm families looking to transfer the business to the next generation.

It supports the next generation of farmers and agricultural co-operatives. It gets rid of some of the red tape and paperwork to make the program more accessible and more flexible to all farmers.

Farmers in my riding of Glengarry—Prescott—Russell represent the strong and vibrant agricultural community. They are in favour of this type of legislation and of the increased access to credit that it affords them.

I highlight that we have introduced business risk management programs. We have invested in the agricultural sector and launched new initiatives to help our farmers across the country. The minister has been very busy, opening foreign markets once again to help our agricultural sector. We are taking real action to defend and promote the best interests of our farmers.

Farmers strongly support this bill and I invite members to support the changes we are proposing to the Farm Improvement and Marketing Cooperatives Loans Act.

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, I listened with interest to what the parliamentary secretary did not say, although we will be supporting this bill.

He used an example of a fourth generation farmer, where the bill will be helpful in terms of intergenerational transfers. That is true. It will help. However, the reality of today in the farming sector is that we are losing sixth generation farmers right across Canada, day after day, because of the inaction of the government. The government has a sound record of increasing farm debt. It has increased by a little over $5 billion under its watch.

Will the parliamentary secretary just answer these two simple questions? What is this bill really about? It is not about providing money to farmers. It is about providing debt. Who is guaranteed under this bill? Is it not the banking sector? There is a 95% guarantee to the banks. Is that not correct, parliamentary secretary? When is the government going to actually deal with what the problem really is, which is sustainable farm income?

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

Mr. Speaker, I want to recap some of the highlights of these wonderful initiatives for farmers. We are talking about taking the loan rate for beginning farmers from 80% to 90%, so that they can borrow up to 90% in order to allow for the transfer of farms among generations. This is good legislation for our farmers.

If we could just have the cooperation of my colleagues in the opposition, this bill could be moved through the House and implemented before the summer. This is exactly the kind of programming that our farmers are looking for. When I am in my riding, they talk about difficulty with access to credit. They have very real bills to pay. When they want to save their family farm and move it from an older generation to a younger generation, access to credit is a very real concern.

This is the type of legislation that they have been asking for. I have not even touched on co-operatives here. We have worked very closely with co-operatives and they want greater access to credit as well. That is what we are offering here. I would invite my colleague to support this legislation and its rapid implementation.

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

Mr. Speaker, I want to point out that the Bloc Québécois plans to support this bill.

However, following the parliamentary secretary's speech, a few questions came to mind, especially when he said that young farmers all across Canada were consulted. He even referred to a young farmers' organization that fully supported this bill. I would remind the House that consultations did take place here and there across Canada. Consultations were held in Longueuil, Quebec, over the holidays from July 18 to August 11, 2006. I would like some clarification, however, from the parliamentary secretary. I looked carefully through the department's documents—and I have the consultation paper here—but I do not see the Fédération de la relève agricole du Québec anywhere among those invited to the consultation in Longueuil. If it was invited, it did not attend. One thing is certain: I spoke to the president of that federation last week, and he said he was not consulted. He even issued a press release on the matter, saying that the bill looked promising, but he would have liked to have been consulted.

How is it that this government can pride itself on doing a lot of consultation? If they did the same thing as with the “Product of Canada” label, the consultation was completely inconclusive. In fact, neither the Union des producteurs agricoles du Québec, nor the Coopérative fédérée, nor the Fédération de la relève agricole du Québec were included in that consultation in Longueuil. I would like the parliamentary secretary to give us some details about that so-called consultation. It appears that some people were missing.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

Mr. Speaker, I would like to say that consultations are very important. We worked very hard as a government to consult extensively right across Canada. It is not always possible to hear from all the cooperatives or associations when we hold a consultation in a particular location, but our doors are certainly always open. I am always available to our farmers, our cooperatives and our associations, and the minister is as well, both here in Ottawa and across the country. Letters and other forms of communication are also very important.

We consulted extensively, and we are delivering the results today with our bill. I am very happy to have the support of the Bloc Québécois, because we will need the support of every party here to make sure that the bill is implemented as soon as possible.

[Bev Shipley, Conservative, Lambton—Kent—Middlesex, ON]

Mr. Speaker, I want to thank the parliamentary secretary for his involvement around the country. As many of us know, he and the minister have been spending a fair bit of time talking to farmers on the back roads to find out what their issues are.

I have always found it interesting that the member for Malpeque is always so negative about farmers while this party quite honestly has done so much, from increasing the capital gains to the advance payment increases.

My question for the parliamentary secretary is this. There has been great support for the bill. We have talked to the Canadian Young Farmers Forum. However, when the parliamentary secretary has been crossing the country and talking to the ordinary farmers, has this been one of their priorities or is it just one of those other issues that they want to talk about?

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

Mr. Speaker, my colleague raises an excellent point. Is this a priority for farmers? It certainly is a priority for farmers.

The future of farming is a huge concern for our farmers all across Canada. The member quite rightly pointed out that both the minister and I have been travelling across Canada meeting with farmers from all the different agricultural commodities to talk about the future of farming and the challenges they face today and the challenges that they will be facing in the future.

Many farmers operate family farms and they feel that their family farms are at risk. One of the challenges they face is the younger generation having access to enough capital in order acquire the family farm. This is exactly what this legislation is aimed at. We are talking about increasing loan limits from $250,000 to an aggregate of $500,000.

As I mentioned before, we want to increase the loan rate for beginning farmers from 80% to 90%. This makes a big difference. For example, if a farm operation has an inherent value of one million dollars, a new farmer under the legislation as it exists today would have to borrow up to $800,000. He would still have to come up $200,000 himself. However, once this legislation passes, he would only need to have $100,000. We are going to be halving the amount of money that he would have to put forward to acquire a farm from another family member.

Once again, the co-operatives play such an instrumental role in the health and vitality of our agricultural sector. We have worked with co-operatives and co-operatives want greater accessibility to this type of financial resource that we are presenting here today.

Therefore, once again, I urge my colleagues in the opposition parties to join with me in voting for the rapid acceleration of this proposed legislation through the House for the benefit of our farmers.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Mr. Speaker, I have a co-operative abattoir that is set up in my region. The experience that it has had over the last couple of years in setting up is that the federal government puts a lot of regulations in place but does not actually show up to support the cost that is incurred by those regulations.

I wonder if Bill C-29 would actually help address the shortfall in money that happens for a lot of these smaller abattoirs that are co-operatively run, farmer-owned, and assist them in getting the product out the door and help sustain our farming community?

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

Mr. Speaker, I would like to highlight that we want to see our agricultural co-operatives succeed. By putting in place measures like the ones that we are proposing today will help the co-operatives. It will help that sector of the agricultural community to thrive. Giving them more access to credit will only help them move forward.

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, I am indeed pleased to speak on Bill C-29. During my remarks, I hope to explain the benefits of Bill C-29 and why the Liberal Party will support a quick passage of this bill. We in fact are willing to pass it through all stages and get it to the Senate so that it can be dealt with quickly and kick into gear, because the bill has been very late coming.

However, it is also critically important for the Conservative government to actually bring forward immediate measures that would deal with the income loss problems of primary producers.

I will outline those areas and propose some solutions.

The reality is that the minister talks, as the parliamentary secretary did in his remarks, of putting farmers first. However, when we drill down into the minister's record, it is nothing but a record of failure. The bill, in its final analysis, would add to what the government has been most successful at doing; that is, increasing farm debt.

Since the Conservative government has taken office, farm debt has increased by $5.1 billion and now stands at $54 billion, four times higher than that of the United States' farmers.

Worse, in recent years, this debt has not been for new technologies or new investments, in the main, but much of it has been for primary producers borrowing more money or gaining advance payments program money loans in the hog and beef sector just for their very economic survival. In the agricultural industry in this country, some commodities are in serious trouble.

So let us be clear. While the bill would provide availability of credit to farmers, it is not designed only for the interests of the farming community. It is designed, in its final analysis, to guarantee the banks 95% protection on the money they have lent.

In fact, if we look at the Prime Minister's announcement, he states that he will bring forward new legislation to guarantee an estimated $1 billion in loans over the next five years to Canadian farm families and co-operatives.

So let us be clear. The Prime Minister did everything he could in the announcement to make it look like he was providing $1 billion. He is not providing $1 billion. It is loans that are coming from the lending community, and the Government of Canada, through this legislation, is guaranteeing the lenders 95% security on those moneys.

The real problem in the farm sector is price, stability of income; and that, the government fails to address. I want to be very clear on that. Adding debt, then, will just not do it. Farmers' real challenge is sustainable farm income, and I will come back to that serious issue in a moment.

Bill C-29, then, really is about amendments, as the parliamentary secretary said, and it would provide a new loan guarantee program for these areas. Farmers would be eligible for new loan limits of up to $500,000 for the purchase of real property, and $350,000 for all other loan purposes. New farmers and producers taking over the family farm would be eligible for loans. They are not currently eligible under the current legislation, and I think that is important for intergenerational transfer.

However, keep in mind, the big issue on intergenerational transfer and why in my question earlier I talked about farms stopping at the sixth generation is not just access to credit. The fact of the matter is they cannot balance their balance sheets economically under the current pricing regime, and the government is absolutely nowhere to be found. We are losing some industries in this country.

As well, as the parliamentary secretary said, agriculture cooperatives, including now the ones with a majority of farmer members, 50% plus one, would be eligible for loans up to $3 million for the processing, distribution or marketing of farm products. But that is an important point in itself. It used to be that we had 100% farm members. Now we are dropping to 50% plus one. That tells us that there is a serious problem in rural Canada in that the assets are no longer there for the farmers themselves to provide the asset base and the stability for those cooperatives, and we have to go to others in the community. That is a sad commentary, because farmers themselves need to have the asset base and the net worth to be able to provide for cooperatives in this country, which is a good system. A new online system would improve the delivery of the program, and we certainly agree with that.

However, again, I must mention, the bill provides far more guarantees for banks than it does for farmers, which speaks to the government record in increasing farm debt. Farm debt has skyrocketed to over $55 billion today. The real challenge facing farmers is sustainable farm incomes. The Conservatives have a long list of broken promises with regard to support for farmers.

While we can support the changes in Bill C-29 to better reflect the size of today's farms, we should not let the Conservatives forget the list of Conservative failures to help improve farm income. They promised hundreds of millions of dollars and raised the hopes of farm families, but then consistently failed to deliver on those promises.

In March 2007, the Prime Minister himself announced $100 million per year to farm families to address rising “cost of production issues”. That plan was cancelled in the 2009 budget before it was ever implemented.

Also in 2007, the Prime Minister announced AgriInvest, a new savings program to help farmers manage business risks. The Prime Minister touted this initiative as “programming that is more predictable, bankable and better enables farmers to better respond to rising costs”. Two years later, it still has not been implemented. I remind the parliamentary secretary, because he used those words of predictability in his remarks, it only works if farmers have income that they can put into the investment and the government is failing to assist in terms of that level of income.

In November 2007, the minister committed $6 million to strengthen value-added processing in Atlantic Canada to help struggling beef and hog farmers there. Now, a year and a half later, this money has not been provided and we find out that it is also a loan, more lending, more credit, not income.

During the 2008 election campaign the Prime Minister committed $500 million over four years to create an agricultural flexibility program, to help farmers build flexible programs to meet their local needs, but once re-elected, the government broke its promise again and announced a program of less dollars that could not be used for flexible programming. In reality, it was only $190 million over five years and was not allowed to be used for RMP in Ontario or ASRA in Quebec.

In budget 2009, the Minister of Finance announced a new $50 million investment in processing capacity for livestock producers. Then, four months later, it changed into a loan program, far from what cattle farmers were led to believe.

By golly, Mr. Speaker, I almost forgot, do you remember when the previous minister announced the farm families options program, targeted to low-income farm families? After one year of a two-year commitment, it was cancelled in midstream.

That cancellation virtually robbed farm families of $246 million, money they had counted on. So much for the Conservative government putting farmers first. The fact of the matter is that what the Conservative government has done has increased debt and added to the farm community's financial instability.

Allow me to turn to some of the specific commodities, and I will make a few comments.

In P.E.I., the government's lack of action has caused, to a great extent, the loss of the hog industry. Roughly 80% of that industry has now gone in the last 18 months, and P.E.I. has lost its only hog slaughter plant. If the minister does not soon deal with assisting the regional issue of pork production and the one slaughter plant that remains in Atlantic Canada, then we could in fact lose the total regional industry. There are only four producers left in the province of Nova Scotia.

So I ask the minister to start to deal with the issue at the farm income level. There are several things that the minister could do. Certainly the minister has to come in with a major payment for the pork industry in this country, which is finding itself in financial distress, and nothing less than $1 billion in an ad hoc payment will save this industry.

The Canadian government must stand up for Canadian producers, must challenge the U.S. in terms of the country of origin legislation and ensure not more debt but that the cash is there to assist in the survival of this industry.

I would add a note of caution. If government does introduce an ad hoc payment, then it needs to be a total package. Number one, we need the ad hoc payment.

Number two, the severe economic hardship moneys that were advanced last year, which are now loans, were put in place not to provide income but to allow debt servicing so that farmers could maintain a credit line. Those severe economic hardship moneys must be extended out, not just using an ad hoc payment to pay off that debt, but that a new ad hoc payment can come in so that producers can use that for working capital they direly need.

As well, the beef industry is in serious trouble. Instead of dealing with the problems they have in that industry, the Government of Canada set up a system where they can acquire more debt. That is not what they need to do. I would suggest that what the government needs to do in this case is allow the current safety net program to work. First, eliminate the viability test; and second, allow producers the better of the Olympic or previous three years' average for reference margin calculations so that they can trigger the current program.

Regarding the current safety net program, if we remember back in the 2006 election, the Prime Minister said he was going to cancel the CAIS program. What did he do? He changed the name. In fact, the new AgriStability program is even worse than the old CAIS program in times of economic difficulty.

The suggestions I am putting forward for the beef and hog industries would allow the program to work for those industries. They cannot access the safety net programs now because the reference margins are not there. What I am proposing today is a simple solution so that the minister could allow the safety net programs to do what they were designed to do and allow hog and beef producers in my province of Prince Edward Island and across the country to be able to trigger a payment they direly need.

A similar situation exists actually in the potato and root crop industry in my own province of Prince Edward Island.

Last year, as the minister knows, there was a lot of weather damaged crop, which triggered the new agrirecovery program. The problem is that agrirecovery, although the government talks about it as a disaster program, does not work as a disaster program. The minister promised $12 million but only around $3 million was spent and that money was only allowed to be spent to assist in the costs of disposal of the crop, whether it was in the warehouse or in the field.

I have two neighbours in my home province of Prince Edward Island who are not planting this year because of the disaster caused by weather conditions. The government's program leaves them out in the cold and does not assist them. It costs $2,800 to $2,900 to grow an acre of crop. The agrirecovery program gave them $200 and it cost them $200 to dispose of the crop. That program is not working. What I would suggest to the government in that case is similar to what I suggested in terms of beef and hogs. The government should allow the agristability program to once again work. it should cut out that bad year and go back to the other years to get reference margins so that producers could at least trigger a payment.

I have two more points on the potato industry that I should make relative to Prince Edward Island. The government should not allow the disaster year to be counted in their production history. It is an event beyond producers' control. Weather crop loss is an act of nature. If it is kept simple and that year is not be counted in the production history, the producer would be more likely able to trigger a payment. The potato industry in P.E.I. and the other root crop industries really need a stay of default on the advance payment program so they can trigger that program again in order to have the working capital to put in a crop.

That is what is direly needed in this industry. Whether it is in hogs and beef, there are potential solutions. Credit is not the only thing that needs to be talked about. It is the same thing in the potato industry. Farmers need income and they need cash to do what needs to be done.

Again going to the record of failure, the government has been responsible for the loss of more slaughter capacity and value-added production in this industry than any other government in Canadian history. I will run through a list: two Maple Leaf Foods plants in Winnipeg and Saskatoon; two Olymel plants in Saint-Valérien-de-Milton and Saint-Simon-de-Bagot in Quebec; one Qualiporc Regroupement Coopératif plant in Les Cèdres, Quebec; and one Natural and Organic Food Group plant in Charlottetown, Prince Edward Island.

CanFax Packers directory reported that out of 33 federally inspected slaughterhouses in January 2006, only 26 plants remained in January 2009. Among those that closed down were Blue Mountain in British Columbia, Rancher's Beef in Alberta, Natural Valley Foods in Saskatchewan, Gencor Foods in Ontario and Abattoirs Zénon Billette in Quebec.

My point is that the record of the government is one of failure. While the bill today is needed in terms of advancing available credit, it ties into the record that the only thing the government has been successful at is increasing debt and as a result our industry is in trouble. The government must seriously address within days making sustainability a firm income sustainable and that way producers would be able to pay back the debt and not just get additional loans.

[Pierre Lemieux, Conservative, Parliamentary Secretary to the Minister of Agriculture]

Mr. Speaker, I listened to my colleague with close interest and what a confused speech. His opening position was that he supports our changes to FIMCLA, as he should. We are talking about increasing the amount of government-backed loans to farmers from $71 million to $292 million, which is great news for farmers. We are also talking about increasing access to capital for our co-operatives.

However, he then went on for the next 20 minutes with a litany of complaints and negative comments. We are trying to provide increased access to credit for farmers so they can buy the next generation of farms and keep the farms in the family, and he comes up with this wild theory that we are doing this for the credit of the banks. Who would believe that? It is certainly not the farmers with whom we consulted.

Can my colleague not just admit that this is good legislation for our farmers? Will he not just stand in his place and say that this is good and he is for it?

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, as I said in the beginning, we will support this legislation but the policy of the government is anything but good. It needs to be put it into context.

I asked the parliamentary secretary a question previously and I will ask him again. I may even get an opportunity before we are done to ask him a third time. Will he just stand in his place and admit that what Bill C-29 would do is guarantee the lending community, on the additional billion dollars of credit availability, that it is backed up at 95% to the lenders? Will he just stand in his place and admit that this bill is for the protection of the banks? If we are going to protect farmers in this country, we should protect and add to sustainable farm income. The government has failed to do that.

I had to go through a litany because there is no government in Canadian history with such a dismal record, a record of failure that fails to deliver income to producers. The bottom line is that it has increased the debt of farmers by $5 billion and we have lost 3,500 farmers a year. Can the parliamentary secretary stand and say he is proud of that? I would hope not.

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

Mr. Speaker, in his speech the member for Malpeque raised a problem, or at least a concern, regarding the potential excessive debt of those who will obtain new loan guaranties, particularly new farmers.

Earlier, I was asking the Parliamentary Secretary to the Minister of Agriculture about the famous consultation paper that I have here. I mentioned that several groups of young farmers unfortunately were not consulted before amendments were proposed to this law.

However, some participants [among those consulted] said there is a need to ensure beginning producers [the next generation of farmers] do not overextend themselves financially by using the program, which they said may occur if it encourages beginning producers to borrow larger amounts than they can manage to pay back. In the end, participants agreed on the need to support beginning producers and the importance of minimizing road blocks to participation in the industry...

To date, the government has not established a real policy to help the agricultural sector as a whole. It has presented certain ideas that may be of interest but it has not shown the real political will to help the next generation of farmers or farmers in general. Does the member for Malpeque believe that we run the risk of having farmers take on excessive debt, which would lead to other problems?

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, it is a sad commentary on the government when its consultation process leaves out some of the most important players in the industry. The government claims that its bill was designed for intergenerational transfer and for bringing young farmers into the industry but, as is usual, its consultation process leaves much to be desired.

The government is well-known in a wide range of circles for consulting with its friends. We saw that with the Canadian Wheat Board where it did not consult with the general population. It forgot that there is a government for all Canadians. It thinks it can govern basically for the right wing.

The member's question is a valid one and it is one of our concerns. We do not believe that just providing more credit and establishing more debt will bring young people into the industry. Farmers need to have income stability and some security in the future that they will be able to pay the bills, earn an income and provide for their family and the community. In other words, there needs to be economic prosperity at the farm gate level in rural Canadian and that is where the government has seriously failed to address the problem.