Agriculture Committee on May 15th, 2008

[Wayne Easter, Liberal, Malpeque, PE]

Thanks.

[Brian Storseth, Conservative, Westlock—St. Paul, AB]

Minister, you talked about something today in the beginning of your comments that actually struck home with me. I have a local mayor and reeve here from the area of Bonnyville who I think would agree with us. You talked about acting on what we're hearing rather than....

And for once I have to agree with Mr. Easter when he talks about Mr. Goodale's comments being long on rhetoric and short on substance. You, to your credit, as I'm hearing from all my producers, are long on action, so that's definitely a compliment for you.

We had Mr. White here at the last meeting. I tried asking him if he had a feeling on the mood of western farmers for barley freedom. It's my strong belief, Minister, that in Alberta, and my riding in particular, barley marketing freedom has risen dramatically since the plebiscite was held. I believe this is something about which our producers are getting restless and want to see sooner rather than later. Minister, what are you doing to accomplish this for our western Canadian farmers?

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

Thank you for your kudos at the opening there, Mr. Storseth. I guess I'd point to the fact that I have a great department around me. The folks you see here today are only the tip of the iceberg. They're all anxious to build a stronger industry. We're working ahead, we're redefining programs, we're adjusting parameters of programs to make sure they hit the target.

There's a lot of talk, and Mr. Easter brought this up, that there's less money than there was before and all that. It's because the marketplace is working. Farmers would far rather farm for the marketplace than farm for the mailbox. I guess that's the biggest difference. When the marketplace is working properly, farmers take that, they buy new equipment, they make those decisions they need to make because they know the market is there to support their movements. That's what this department has been so bullish about.

On the Wheat Board, we've never been shy in the last number of elections in western Canada—where the Wheat Board, of course, is predominant—about talking about changes to the Wheat Board, that it has to get up to speed, that it is mired in the past, it's not developing programs that the farmers feel are useful. Even with what they've been bringing forward to try to offset some of that, farmers are still not buying into them in any fulsome way. We've seen their market share deteriorate. Even with today's values of commodities, their market share is way off. We're looking at an industry that can't adapt or be flexible enough to the market signals that are out there.

So we've asked them to change. We did that through a plebiscite. In western Canada, 62% of farmers said they wanted a change. You can add the numbers up any way you want, but 37% said, no, leave it exactly like it is. That number has now shrunk to half. In our polling, in my discussions with producers, in your own consultations with your growers, that's what we're hearing. And the board's own polling is reinforcing that. They're getting those numbers as well. They have to be, because they're talking to the same people we are. We know that demand is out there.

The board is trying to adjust to those new realities, but they're still locked in on this single-desk idea, which no longer flies. We've seen other commodities go through the roof. We saw even the Wheat Board commodities' price spikes this year that were unbelievable, and we're hoping they were able to capture those. We won't know until the final payments come out almost a year from now. We'll be able to assess it at that point. We know there are some problems with the contingency fund, that they've had troubles keeping up with the marketplace, and we'll have to address those.

I had a meeting as late as Tuesday lunch with Larry Hill and Ian White, after they met the committee here talking about the next steps forward. I've given them some direction. We're keeping it out of the media because we've found over the years that we've gotten further dealing directly than we have running it through the media filter--no insult to my media friends here at the table. But we have to get this done. Farmers are demanding it. The Wheat Board understands that. It's a matter of how we get there. I will be attending their meeting coming up at the end of this month, to continue these discussions. We'll try to come up with programming that will address that barley freedom for this crop year.

[Brian Storseth, Conservative, Westlock—St. Paul, AB]

Mr. Minister, I appreciate what you're saying, but my farmers don't have a lot of faith in the Wheat Board directors trying to get this accomplished. My farmers don't want to wait around and miss another two or three crop years on this. I guess what they really want is your assurance that this a priority for you and that you are going to work to get this done.

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

Absolutely. We continue to try to find a way forward, working in conjunction with the board--it's faster that way--and we have to work with the opposition parties. But once the board buys in, there's really no reason for anyone else to say no, because the board is committed to working in the best interests of producers. We're calling them on that, saying “Here's what producers are asking you to do.”

There are ways within the act to make that happen, direction from the minister that they apply. They are very concerned about lawsuits from some fringe groups, as well they should be. This is a democracy. Everybody has the right to make a mistake, and lawsuits happen. But at the end of the day, producers are demanding change and they will get that change.

[The Chair, Conservative, James Bezan]

Your time has expired.

Monsieur Bellavance.

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

There is another issue I would like to discuss with you, Minister. If you were here every week, we would be able to talk about issues that we do not want to see disappear but nothing prevents you from talking about them in the House.

I would like to know if you have had a serious look at the program suggested by the Quebec and Ontario grain producers who have set up a coalition. That program, AgriFlex, follows from programs announced by the Department in the new agricultural policy framework. I have referred to Quebec and Ontario producers but that program would also be accessible to the producers of other provinces who would want to apply. They have been waiting for a long time for an income support program with visibility and regional flexibility. The Canadian Federation of Agriculture has said that this could be an excellent program to fill the present gaps of CAIS and of its successor.

Each year, we invest about 1 billion dollars in ad hoc programs. We keep reacting to emergencies. Indeed, talking about compensation, you have stated that you just reacted to what had happened in British Columbia and Saskatchewan. That may be part of the problem. We are dealing with issues on a case-by-case basis whereas, if we had a well-established program with the cooperation of the provinces, we might be able to avoid this type of problems and it might cost less to the government.

You are probably aware of that program. What do you think of it? Would it be possible for such a program to be set up, which would fill the gaps of the present business risk programs?

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

It's an excellent point. The Canadian Federation of Agriculture brought that forward some time ago and are promoting it. The Ontario Federation of Agriculture has picked it up, as has the Quebec UPA. We're moving as far as we can as fast as we can on that idea.

Alberta has done quite a bit of work on this as well. The unfortunate part is that no one has a model that shows us how to implement it without attracting countervail. We're all cognizant of this as we go into this global marketplace. Some of them are nuisance suits, but some of them are legitimate, and AgriFlex is problematic from that standpoint. We'll certainly keep working on it, though, no doubt about it. I think there's something to be had there.

We are in this go-around putting flexibility in the non-business risk envelope, the growing forward side, all the companion programs. We are putting the flexibility in there, so that the provinces can make the decisions.

Some like the training more than they like the environmental programs, more than they like the farm stewardship. We will allow the provinces to make those decisions. So we've gone as far as we can with the flexibility concept, in conjunction with the provinces, on the non-business risk side.

You are mixing issues a little bit when you say “flexibility” and “ad hoc” in reference to an animal or disease disaster and the actual business risk side. They are two separate things. Certainly the disease side is always ad hoc.

We try to be proactive as much as we can, and the role of CFIA is changing more and more from reactive to proactive. We see this in a lot of the farm-gate testing, farm food safety. We're trying to get ahead of the curve to mitigate a lot of this before it happens, testing ahead. We know there are hot spots. We saw it with the anthrax that has broken out in the last couple of years. We saw it with the TB around the park in Manitoba. Those programs will always have to be ad hoc, because there's really no way to know how big and how bad it's going to be at any given time.

Still, we're trying to get away from ad hoc on the farm sustainability side and business risk side. We want the provinces to know what's coming and we want it to be affordable for them. We want the producers to know what they can count on. If we need to expand those programs, that's what we will do. That's what we did in the livestock sector. We adjusted programming to make sure that the money flowed in a way that was more favourable to the livestock sector.

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

I understand. I did not say that we should get rid of all of those ad hoc programs. In some cases, I believe that the government should still have the possibility to react to specific emergencies. However, we keep investing 1 billion dollars each year in such ad hoc programs. Also, this AgriFlex program might allow us to lessen the cost of our ad hoc solutions. That is why I have raised this issue.

About the WTO, we have often had this discussion in the past, relating to clause XXXVIII of GATT or to other issues. The public servants are telling us that we might have problems at the WTO. My own feeling, since they are regional programs, is that we would not face any problems at the WTO.

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

To your first question, and your response on that, part of the problem with the way any department throughout the federal government is set up is that there's no capacity to roll over unused funds from year to year. You can draw ahead and so on like that, but there's no annual rollover capability. So if you didn't use all the money this year, you can't just roll it over into the next year and say, “Look what we have” and build to the future. There's a little thing called Treasury Board guidelines, and the Auditor General gets really antsy with that. So that's a bigger question to be addressed, and I certainly don't have any problem making that argument. If it takes legislation to do it, I know I'd have your support to do that.

On the WTO, we are getting down to the final nitpicky details as to what's going to happen and how it's going to happen. At the same time, we're seeing more and more of the countries shifting over to the NAMA, or non-agricultural market access. We've seen countries like Japan, which has been quite vocal on sensitive products and in our camp on some of those issues, now go quiet as we get into the non-agricultural. It is a very industrialized country, and it's looking to protect its auto sector and its turbines and a lot of its technology on that. So it's gone quiet on agriculture to try to keep its powder dry for those final negotiations. It's getting very interesting. I'm getting updates from Steve Verheul, whom you all met, and I think he's doing a fantastic job. He's gotten commendations from Pascal Lamy and from Crawford Falconer, the big boys around the table over there who are driving this or keeping it between the white lines.

I think we're going to see some movement. I'm very concerned when at the same time we're struggling to get WTO agreements, we're seeing the U.S. Congress pass their Farm Bill, which flies in the face of everything we're trying to do over there.

They're saying one thing and doing another. They're in an election cycle, so it's sort of the silly season. We'll have to wait and see what their take is around the table. There's still talk of a ministerial yet this spring. It keeps getting delayed. Crawford Falconer was supposed to have come out with another text. His third was supposed to have come about two or three weeks ago. It's still not out. Now there's talk it may come out next week or the week after that, but, of course, every time he delays, it delays the ministerial or the possibility of one.

If we don't have something nailed down by summer break, it's going to be very problematic trying to reinvent it in any positive way come fall, with the American elections. When you take one of the major players off the table, that's going to be very problematic. We don't want to lose the gains we have at this point, because I think Canada is forging ahead and coming through looking very good and very positive.

The SM5 are there and are briefed every day as to what's happening, what's going on, how we move forward. They are starting to whisper about being constrained by the November motion, that we all honour and we all obey. We may have to see something addressing that before the final result, but I've said it's up to the SM5 to make that call. If they decide that they want to see us move away from that motion of zero-zero-zero, and don't sit at this table, or don't sit at that table, it's their call, because we're going to honour it, the same as you are honouring it, the same as Liberals, the same as the NDP are honouring that motion. But if the SM5, at the end of the day, decides that we should have some changes on that, it will be their call, and of course we'll have to expedite that through the House.

[The Chair, Conservative, James Bezan]

Thank you, Mr. Minister.

It is 10 o'clock. Your time here has expired. I'm sorry we didn't even get through the entire second round of questioning....

Mr. Easter.

[Wayne Easter, Liberal, Malpeque, PE]

I have a point of order, Mr. Chair.

Before the minister leaves, the minister referred to some polling that the department had done relative to the barley marketing. I wonder if the minister would forward that polling, including the questions that were asked by the department, back to the committee so that we have that evidence, along with any economic impact analysis that I would expect any department would do when they're making a major change in marketing. If they've done that economic impact analysis, could they forward that as well to us?

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

I'm still waiting for the economic impact analysis that was done in 1998, when those changes were made. I have never seen that either.

I didn't say the department did any polling, Mr. Easter.

[The Chair, Conservative, James Bezan]

But you did mention, Mr. Minister, that you had a couple reports that you were going to table with us and leave with us, along with your comments.

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

Yes.

[The Chair, Conservative, James Bezan]

I'd appreciate if you'd do that. I understand that you're on a tight timeframe this morning, so I do appreciate it.

Mr. Boshcoff.

[Ken Boshcoff, Liberal, Thunder Bay—Rainy River, ON]

Thank you.

I'd like to table the differences between what was proposed by this committee and what actually came out in the bill, for the record. I'll pass that to the clerk.

[The Chair, Conservative, James Bezan]

Okay, certainly.

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Chair, I have a point of order.

The minister referred to polling in his official remarks before this committee. Now the minister has an obligation to table that polling before this committee.

[The Chair, Conservative, James Bezan]

We will look at the blues and make sure that--

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

Mr. Easter, you can check the record whenever you care to, or have someone read it to you, and you'll see that I did not say “departmental polling”, I said “polling”.

[The Chair, Conservative, James Bezan]

This is now a matter of debate. We will check the blues, and if there's anything in the blues that's contrary to what the minister is saying, we'll make sure....

With that, I appreciate your coming. I understand that both Madam Swan and Madam Baltacioglu are going to be here.

We will suspend for a few minutes.

[The Chair, Conservative, James Bezan]

We will continue with our study on the main estimates. We have the departmental officials with us.

Monsieur Corriveau has stayed with us and is now joined by Andrew Marsland, assistant deputy minister, strategic policy branch; Nada Semaan, assistant deputy minister, farm financial programs branch; and Krista Mountjoy, assistant deputy minister, market and industry services branch.

From CFIA we still have Mr. White with us. He is joined now by Cameron Prince, vice-president, operations; and Brian Evans, executive vice-president.

Welcome to all. Are there any opening comments that you wish to make? If not, will we just continue on with questions.

We'll start a new round with Mr. Steckle.

[Paul Steckle, Liberal, Huron—Bruce, ON]

Unfortunately we've lost our minister. I was going to ask him some questions, because there were statements made this morning...and I realize we're dealing with CFIA, but we'd still like the department here.

He made comments about peach orchards coming out and being replaced with grape vineyards. We recently had an announcement of a plant closure in the Niagara region, the last fruit processing plant in eastern Canada. Nothing east of the B.C. border is left in Canada. That same plant is also a sister plant of a plant that was closed in my riding.

The point I'm making is if government really has a commitment to sustainability in agriculture, and if we believe...because I met yesterday with a gentleman who is now, contrary to what the minister said this morning, pulling out his pear orchards and replacing them with peach orchards, early peaches so that he has a continuum of work for his helpers, his workers. They had come to the table and asked government, including province and fed, for help, but there was no help from anyone, yet we are there for other industries in this country when they need help.

I think it's a shame we have lost the last plant in southwestern and perhaps in all Ontario, certainly in eastern Canada. These people, this particular individual has lost $300,000. Even after the government assistance of $1,600 an acre is factored in, he's still losing $300,000. The peaches he's tearing out had just come to their fifth year, prime production life.

I'm just wondering, really, what commitment--and this is not a partisan statement, I think government has failed in these areas for many, many years. When will government come to the sense that Canada's food production is important, that we look after this as much as we look after any other industry in this country? Because people can't go on continuing to do this kind of thing.

A private operator, I'm told--I have no numbers, but people have told me this--came up with $15 million in private money to keep this plant alive, but no government was willing to step up. I think this is a disgrace and I think it needs to be known that this has happened.

What is the response of government to this kind of thing? Because the talk is everywhere that this has happened, and I think you're aware of it.

[The Chair, Conservative, James Bezan]

Mr. Marsland.