Thank you very much.
As you know, my name is Herb Carlson. First of all, I'd like to apologize. I was notified of this just a few days ago, so I don't yet have my brief translated into French. That translation will be done in the upcoming days, and we'll have it circulated.
First of all, on my own behalf and on behalf of the Canadian Co-operative Association, I would like to thank you very much for the opportunity to speak to you today. I am a grain and oilseed producer from east central Saskatchewan. I farm with my brother; we grow all the grains, we clean seed, and we do all those sorts of things. I'm also vice-chair of the board of Federated Co-operatives Limited. That is Canada's largest non-financial cooperative, serving about 300 retail co-ops in western Canada; together these retail co-ops serve over 1,000,000 members.
I'm here today, though, to represent the Canadian Co-operative Association. I am a member of their board of directors. The Canadian Co-operative Association is a national association. We represent more than 7,000,000 individual members from over 3,000 organizations. Our members come from many sectors of the economy, including finance, insurance, agriculture, food, supply, wholesale, etc. CCA's mission is to provide leadership to promote, develop, and unite cooperatives for the benefit of Canadians and others.
At our annual general meeting this past June, CCA adopted a resolution on the Canadian Wheat Board. We have recently written a letter to the Minister of Agriculture to inform him of this resolution. The resolution stated that the Canadian Co-operative Association would firmly present to the Canadian government the position that the Canadian Wheat Board, group marketing agencies, and cooperatives be strengthened; that the Canadian Wheat Board remain a single-desk marketer; and that any decision to change the Canadian Wheat Board require the consent of the board of directors of the Canadian Wheat Board.
Agriculture is an important part of the Canadian economy and the backbone of Canada's rural communities. The Canadian agriculture system is also a complex web of institutions that relies on governments, marketing boards, cooperatives, the private sector, and, most importantly, the family farm in order to sustain its continued existence. If we open the door to dismantling the Wheat Board, we risk the futures of other marketing boards. They're already under attack from competing countries through the World Trade Organization negotiations.
The Canadian Wheat Board has helped Canadian wheat producers gain what has been estimated to be an additional $800 million per year in revenue from price premiums, transportation cost control, and other benefits. If the Canadian Wheat Board is no longer the single-desk seller, these additional revenues will be lost to western farmers, who are already hard-pressed. Our members believe a single desk gives prairie grain farmers the power in the marketplace that helps to balance the power of the few large grain companies. In addition, the Canadian Wheat Board's costs are low; some 96% of board revenues are returned to producers.
The Canadian Wheat Board has represented producers' interests in their dealings with railways, and the Canadian Wheat Board's 350,000-odd railcars of grain give it bargaining power. The board has developed marketing relations throughout the world and is a respected seller of high-quality Canadian grain.
I could go on, but defending the business performance of the Canadian Wheat Board is not my primary purpose here today. Rather, I would like to direct my comments to the governance and producer control of the Canadian Wheat Board.
We realize that the present government, as well as some farmer groups, do not agree with the single desk of the Wheat Board and would like to change it. While the Canadian Co-operative Association feels that this would be a mistake, we believe that ultimately the decision to keep or abandon the Canadian Wheat Board must be the result of a democratic process that respects the wishes of the majority of the producer members.
This decision cannot be solely that of the federal government. The Canadian Wheat Board Act indicates, in section 47.1, that:
The minister shall not cause to be introduced in Parliament a bill that would exclude any kind, type, grade or class of wheat or barley...unless
(a) the Minister has consulted with the board about the exclusion or extension; and
(b) the producers of the grain have voted in favour of the exclusion or extension....
The Canadian Wheat Board is a farmer-controlled organization. It is controlled by a fifteen-member board of directors. The government appoints five of these directors, but ten are democratically elected by the western Canadian wheat and barley farmers who use the Canadian Wheat Board. If the majority of these farmers wish to change the mandate of the Canadian Wheat Board, they already have the ability to do so. They may elect directors who favour change. Time and again, however, farmers have voted to elect directors who support the current structure of the CWB. That is not to say that the Canadian Wheat Board has been a stagnant organization. There have been many changes throughout its seventy-year history.
When I started farming on my own in 1974, the Canadian Wheat Board was governed by a panel of commissioners. Soon after, we saw the establishment of a farmer-elected advisory board, and that was replaced by an elected board of directors and a CEO.
Increased farmer-member control has become a driving feature of the Canadian Wheat Board change, especially in its most recent past. The farmer focus has manifested itself in the past few years as the Canadian Wheat Board has responded to farmer concerns about marketing options. While maintaining their right to accept a pool price, farmers can now choose from a variety of other options within the Canadian Wheat Board. This clearly shows that the Wheat Board has and will continue to evolve.
It would appear that the current government is not satisfied that change is happening fast enough. My thirty-plus years as a co-op leader at the local, regional, and now national level have shown me that evolutionary change is the better option in the long run. The structure of grain marketing in western Canada is not something that can be redesigned in four weeks. If farmers want change, they will elect appropriate directors. Today's grain farmers are knowledgeable business people capable of making decisions for themselves.
As a grain farmer myself, I have welcomed some of the initiatives of the current government changes, including changes to the CAIS and the Advance Payments for Crops Act, but I cannot support what has been happening with the Canadian Wheat Board.
Rules of good governance call for appointments of directors to be based on the significant skills they bring to an organization. I hope this thinking will be reflected in any future appointments to the Canadian Wheat Board, but mostly I hope the wishes of western Canadian grain farmers will be respected in any future changes. Elections are currently under way for the five Canadian Wheat Board members who will have responsibility for directing the board's operations.
If this board of directors wishes to make a major change, such as removing the single desk from the Wheat Board's mandate, then as called for in the act, it must call for a plebiscite of producers. Under no circumstances should such a change be made without a vote by producers on a clear question.
We urge the government to respect the democratic wishes of the wheat and barley producers of western Canada.