Agriculture Committee on May 15th, 2008

[Andrew Marsland, Assistant Deputy Minister, Strategic Policy Branch, Department of Agriculture and Agri-Food]

Perhaps I can begin to respond, and my colleagues may wish to supplement my response.

I can't really comment on the specific cases you raise, but it's clear a whole range of factors are in play that are really challenging the sector and its ability to succeed. The committee is very familiar with them, from the rapid appreciation in the dollar to the rise in input costs to new global competitors.

I guess as we've gone through the discussions on the Growing Forward framework, we've had a number of rounds. A whole range of these issues have come up. It's quite clear, as one would expect, that there's no one simple solution, but it's also clear, from what we've heard, that there has to be a focus on competitiveness issues, on innovation, on issues that impinge on the ability of the sector to compete, whether it be regulatory costs and so on.

So I think what you see in the Growing Forward framework, the consensus that has been developed between the federal government and the provinces, based on a lot of very detailed consultation with industry, is that you need a framework to address these issues, a long-term framework that goes to fundamental competitiveness issues: the role of innovation in that sector and the factors that affect competitiveness.

I realize that's not a simple answer, but I don't think there is a simple answer to address these issues. I think it requires collaboration and partnership and looking thoroughly at all those issues in the context of a collaborative framework.

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

I think one of the lessons we should have learned, if we haven't, is that in Growing Forward, and in going forward, in the past we have not been able to accommodate all the issues that surround the whole agricultural community. Provinces are different, the issues surrounding each particular commodity are different, and even the commodities within provinces are different. There are communities of people in the farm area...and the CFA is putting forward the view of AgriFlex.

I guess your view was that accommodations can be sought for that, because I think AgriFlex is what it's all about, because we have to be flexible. In the province of Ontario we have the business risk management program, which the province is supporting. The feds have not yet come to the table. To make that work, the feds have to be there.

What do you see happening there? The minister has said he's not going to participate. Is that the final word on that, or what can farmers in Ontario expect?

[Andrew Marsland]

It's not really my position to add, but I think the minister was quite clear--

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

But I want that on the table. I want it noted that I had raised that, because the minister is not here and I wasn't able to give it to him. If you care not to address that, that's okay. But I want him to know that I asked that question.

[Andrew Marsland]

Thank you. The issue of flexibility that you raise and the ability to respond to particular regional circumstances came out quite clearly, particularly in the consultations, not only on the business risk management side but also on the non-business risk management side. The issues faced there, whether they be environmental pressures or particular challenges of particular sectors, vary from province to province.

A key theme of the Growing Forward framework--and the numbers on this risk management side where some of the issues raised by the minister don't arise--is the need to build in flexibility there. I think what we will have is an agreement that is much more able to reflect the particular priorities of the provinces and industries in those provinces in building non-business risk management programs.

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

Thank you. Your time has expired.

Monsieur Bellavance.

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

Good morning. Thank you for being here today.

In the general context of your work, preparing the Estimates is probably your most exacting role. I do not doubt that you are extremely accurate and rigorous when you prepare the document to ensure that MPs will not find any errors when it is tabled in the House. Unfortunately, I did find some, which I found quite surprising. In various places, the French and English versions do not match and I wonder which one is correct.

At page 12 of the French version, and it is also page 12 in the English version, before the penultimate paragraph, there is a box indicating some expenditures for 2008-2009. The amount is $3,194,300,000, compared to $3,721,600,000 for 2009-2010. However, in the English version, the year is 2007-2008.

On the next line, the French version indicates: au fait que l'exercice 2007-2008 comprenait les postes budgétaires de 2006 but the English version indicates:“including budget 2007 items.

Which is the right version? Are there many parts that are correct in one version and incorrect in the other? I would like you to tell us what are the correct years.

[Pierre Corriveau, Assistant Deputy Minister, Corporate Management, Department of Agriculture and Agri-Food]

Thank you, Mr. Bellavance.

We apologize. There is indeed a mistake. The figures and the years are correct in the English version. The mistake was made in the French version during translation.

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

It is not a translation mistake since it relates to financial years.

[Pierre Corriveau]

Well, it was a mistake made when converting the tables.

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

Yes, that is more like it. What are we supposed to do? We were supposed to have a vote today. Could we get the right version for voting? I do not want you to spend a month or two reviewing the whole document but, if I found those mistakes, there may be others. Did anybody else find any mistakes?

[Pierre Corriveau]

That does not change the figures in the main tables. This is only an explanatory note. We can provide a revised version of the French explanatory note to the clerk of the committee in very short order.

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

Mr. Chair, were you planning on having a vote today on this?

[The Chair, Conservative, James Bezan]

That's up to committee if we want to have a vote today. We have to deal with it before May 31.

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

So, we might have a corrected version.

[The Chair, Conservative, James Bezan]

Yes.

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

I would not want to make the government fall on this but I think it would be essential for us to vote on a corrected version. I wonder if the other members agree with me.

[The Chair, Conservative, James Bezan]

If that's the wish of the committee...because what we're voting on are the actual budgetary numbers that are in the estimates, not the notes itself. So we're going to be voting line by line as to expenditures, but if you're more comfortable waiting until we have a corrected version, we can do that, just as long as we deal with this before May 31.

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

I would also ask you to review the document to make sure that there are no other such mistakes.

Do I have more time, Mr. Chair?

[The Chair, Conservative, James Bezan]

You have 30 seconds.

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

Thirty seconds? Thank you.

So, we will wait for a corrected version as soon as possible.

[The Chair, Conservative, James Bezan]

Thank you.

Mrs. Skelton, you have the floor.

[Carol Skelton, Conservative, Saskatoon—Rosetown—Biggar, SK]

Thank you very much for being here this morning. In regard to the report on plans and priorities--that over the next year the government will spend $2.2 billion to make Canada a world leader in biofuel development--I would like to know if this amount is going to be used primarily for large-scale production of biofuels from non-food sources, or can you give me the department's vision? I look at the whole biofuel industry, as someone coming from Saskatchewan, as very beneficial for our country. So I would like to hear the department's thoughts on that.

I would like to reassure Canadians, too, that just because we're going into biofuels and the products from...we're not going to deplete the food supply. I would like your assurance on that, and what the department has done to make sure that will not happen.

[Pierre Corriveau]

Maybe I'll start on the numbers and then I'll pass it on to my colleagues.

The $2.2 billion announcement has about $500 million that's earmarked for agriculture, of which--for this fiscal year--we're looking at about a $160 million level of expenditure on various programs. The largest share would be on ecoABC for about $76.9 million.

[Andrew Marsland]

The government's renewable fuel strategy has essentially four prongs. One is the establishment of mandates for minimum levels of ethanol and biodiesel in multi-fuels. The second is the establishment of support for the growth of the biofuel industry in Canada to meet that. The third relates to farmer participation--the ecoABC program--and the fourth is the sustainable fuels development fund, the $500 million fund. So I think the $2.2 billion you referred to is those four parts.

In terms of farmer participation, that's a core part of that, and the ecoABC program assists them in developing the equity to participate in the development of plants.

I think the issue you raise about food supply is clearly the one that has drawn a lot of attention, and a lot of studies are being done on the implications of what's driving the challenges around food supply, the recent spike in prices. I think what we've seen--as this committee is very much aware--is a long-term decline in prices, since at least the 1970s, for most commodities, but populated by spikes every so often. Every few years there's a spike in prices, and usually there's a supply response that brings prices back in line with that trend over a period of years.

When you look at what's driving the current increase in prices, the current spike, there are clearly a number of factors at play both on the supply side and the demand side. There is a very low stocks-to-use ratio in most products, and there is increasing demand from countries like China and India as changes in the nature of demand shift towards meat and so on. There are a whole host of factors at play and there's a debate about the relative weights of those.

But I think when you look at what we need to meet those mandates--in terms of world supply--it represents I think about 0.1% of production. We are price takers in Canada, so the prices are established on the world market for most of these commodities, and what Canada does has very little effect, as we found over the years when prices have been affected by a number of factors on the world stage.