Agriculture Committee on May 14th, 2009

[The Vice-Chair, Liberal, Mark Eyking]

Yes.

[Earl Dreeshen, Conservative, Red Deer, AB]

Thank you.

The Auditor General needs to conduct a full investigation to examine and explain how the Canadian Wheat Board lost farmers over $300 million last year. I believe that is significant.

Canadian Wheat Board reallocated the $25.5 million from its pool accounts to the contingency fund. How is the contingency fund used to mitigate risk? Could you perhaps answer that question, if you would, right off the bat?

[Ian White]

The contingency fund is a fund that's set up to absorb the pluses and minuses associated with a range of things, but primarily associated with the risk management of producer payment options. This fund has been in positive territory. It reached its cap some years ago in positive territory, and it's now in negative territory. We do hope always that the fluctuations will be minor, but in this very significant market circumstance that I explained, that's the reason for the negative associated with this finance year we're talking about.

[Earl Dreeshen, Conservative, Red Deer, AB]

There have been some unsuccessful attempts in designing the proper PPO programs in the past—for example, the daily price contract program. I'm just wondering whether it would not be in the best interest of farmers to allow the Auditor General to do a program review of all the PPO programs that have taken place over the last three years.

[Ian White]

The Canadian Wheat Board always looks to have programs that are useful for farmers. We recognize that in some cases programs are difficult to manage or are ones that farmers don't find as useful. We will always be looking to have the best quality PPO programs we possibly can.

Whether or not there's a need for the Auditor General, personally I don't believe the Auditor General has much expertise in the area. What I think would be better, from our point of view, is to ask farmers what they really want and then design programs to suit them.

[Earl Dreeshen, Conservative, Red Deer, AB]

Thank you.

Let's go back to the Gibson Capital report—an expert firm, as you indicated. I'm just wondering if you were aware of the Informa study, the 2008 report they have done.

I'll just mention a couple of the points. This is from the same people who were helping you with your report: Findings from the Informa study of June 2008 to Canadian Wheat Board earns no premium for farmers. U.S. farmers received higher prices for spring wheat in five of the past six years. Canadian Wheat Board spring wheat pool returns have been on average $15.97 per tonne below North Dakota average prices. U.S. farmers received higher prices for durum wheat in five of the past six years. Canadian Wheat Board durum returns have been on average $12.29 per tonne below North Dakota average prices. U.S. farmers received higher malt barley prices. In North Dakota, six-row malt barley prices have been $21.11 per tonne higher than Canadian Wheat Board returns. North Dakota two-row malt barley prices have been $5.51 per tonne higher than Canadian Wheat Board returns.

But then let's take a look at the other side: “In eight of the last nine years, canola prices received by Canadian farmers have been higher than canola prices received by U.S. farmers.”

Then if we also speak to the administrative costs, increased by an average of $2 million or 7.2% annually over the past 20 years, I think you can see why some people are saying there should be some studies done in this regard. I guess that's really what I'm looking at in that particular point in time.

How does the Canadian Wheat Board justify the differences we see there? Is it a case of getting too big and that you have too much machinery you're trying to deal with?

[Ian White]

There are a lot of aspects that you've just talked about there. When you go back to the informal study, we do have a very big difference of opinion on that. We have put out on our website our own--

[Earl Dreeshen, Conservative, Red Deer, AB]

Are these not the same people, though, who did your other study?

[Ian White]

The Gibson people?

[Earl Dreeshen, Conservative, Red Deer, AB]

Yes.

[Ian White]

Certainly not. I don't understand that at all. The Wheat Board has said that you can't draw some of the comparisons they've made. A lot of the comparisons they've made have been incorrect, and we have pointed those out.

But I do think it is important to have a proper study done, a proper understanding of these matters, rather than some of what I would consider to be pretty one-sided analysis that has been done.

[Earl Dreeshen, Conservative, Red Deer, AB]

Thank you.

I would like to move a motion, then, that the Canadian Wheat Board provide the full report of the Gibson Capital review to the House of Commons agriculture committee by June 1.

You have the report, so—

[The Vice-Chair, Liberal, Mark Eyking]

You can't put a motion out like that. I think you can request it from them.

If you have a full motion, I think it has to be done a different way.

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

On a point of order, Mr. Chair, actually, on page 851 of Marleau and Montpetit, under “Committees”, I think you'll see the chapter in regard to notice of motion. It leaves that up to the committee.

In our committee routine proceedings, which I verified with the clerk, Mr. Easter moved “That 48 hours’ notice be required for any substantive motion to be considered by the Committee, unless the substantive motion relates directly to business then under consideration”. This clearly does, so I believe Mr. Dreeshen's motion would be in order.

[The Vice-Chair, Liberal, Mark Eyking]

Well, I'm not going to entertain it right now.

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

Is that your ruling, Mr. Chair?

[The Vice-Chair, Liberal, Mark Eyking]

That's my ruling. Right now, because we have these witnesses here—

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

Mr. Chair, we challenge the chair's ruling on this.

[The Vice-Chair, Liberal, Mark Eyking]

So be it.

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

Could we get a recorded vote, please?

[The Vice-Chair, Liberal, Mark Eyking]

Do you want to nominate another chair?

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

No, we're just challenging your ruling on that and we would like a recorded vote.

[The Vice-Chair, Liberal, Mark Eyking]

Okay, who's here? You have more here than—

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

Only the ones who are allowed have signed in.

[The Vice-Chair, Liberal, Mark Eyking]

The motion would be that the chair's ruling is being sustained.