Thank you very much, Mr. Chair. It's a pleasure to be here to speak to the people around this table, because I know that everybody is keenly interested in making agriculture work better in Canada.
Let me begin by saying that I support what the horticulture industry has just talked about. CFA members supported the principle of SDPI quite some time ago. It would work better in the event of margin decline as a result of imports that haven't been produced within the same standards of environment and food safety we have in Canada. It would also help where there aren't adequate production insurance programs, or where it's too complicated to try to develop them.
You have a brief in front of you, and I'm not going to read it. I'm going to make some brief comments on it and then look forward to questions.
All of you know that Canadian farmers are coming out of the absolutely worst three years of farm income in history, and 2006 looks even worse. They continue to compete against U.S. farmers, who are coming out of the best three years of net income in their history. It may surprise you to know that I'm not here today to ask for more money. How much more money we'll have to invest in agriculture is still outstanding, but what isn't outstanding is that we believe we have to be much more strategic in how we spend the money on agriculture. In that context we have a few suggestions.
When we look to the U.S. we find exactly the same thing. Of course they spend more money, but it isn't just how much you spend; it's how you spend it. Let me say--and this was mentioned earlier by the horticulture industry--we believe in keeping CAIS as the base program, because it does work much better for some commodities than others.
There's been a lot of talk in the recent past about how we can separate stabilization from income disaster. We need to explore the merit of replacing the top 15% tier of CAIS with a NISA-like program. You may know that farmers were dragged kicking and screaming to the elimination of NISA some years ago when the APF was implemented. If we had a NISA-like top tier, it would be much more bankable and predictable. In the event of margin decline, because a contributory program is based on sales, it would also be a baby step toward addressing the declining margin issue. There's a long list of what we believe are advantages in going to a more bankable and predictable top tier in CAIS.
Farmers were also dragged kicking and screaming to the elimination of companion programs. We believe that a provision for companion programs should be brought back as well, because one national program cannot address all the provincial-specific or regional-specific needs. We would like to create the ability for provinces to develop companion programs that would address provincial-specific needs.
The paper you have in front of you demonstrates that NISA might not cost more to the government. Bringing back companion programs might not cost the government more money either--of course, it works well within what was just suggested by the horticulture industry. Because companion programs would be provincial-specific case offset, an aggregate might not cost more money. So we would like to see companion programs brought back.
My last point is on declining margins, which we really have to address. This hits especially hard right now in the grains and oilseeds sector. I was talking earlier about the strategy the U.S. has adopted. With the money they spend they prime the pump in agriculture, and that has cross-subsidized into the value-added industries, such as hog feeding, cattle feeding, and the biofuel industry. We need to spend more time and attention on the grains and oilseeds sector, because we continue to have high hopes and build on our strong hog and cattle industry. We also want to build a strong biofuel industry. So in the declining margin area, we certainly need to spend more time.
We have some of the most competitive farmers in the world and we would like, together with everybody, to roll up our sleeves and develop a more competitive policy so that our farmers can be more effective in the international marketplace and in the domestic market.
As I said earlier, Mr. Chair, I would be happy to answer questions.