Second, many find the application somewhat cumbersome. We are concerned, because we believe producers are leaving significant federal and provincial dollars on the table as a result of these challenges.
Some solutions may be possible. Production margins, which are used to calculate the reference margins, include only eligible income minus eligible expenses. The list of eligible income and expenses could be adjusted to results in a more positive reference margin.
To qualify for AgriStability, the reference margins of the historical past five years are used to calculate the Olympic average and viability test. The Olympic average could be dropped and only the best three years and the historical past five years could be used to do the calculations.
The viability test could be dropped or altered. The CCA is currently lobbying to have the total positive reference margin requirement reduced to one out of three, while the hog industry is looking to have this requirement removed altogether, therefore allowing negative reference margins to still qualify for AgriStability coverage.
Efforts should be made to simplify the application and the supplemental forms and provide training to producers so they can adequately and confidently fill them out without incurring the high cost of professional accounting services. These extra costs are often the determining factor for many in deciding if they will participate in AgriStability.
AgriInvest: Since this program's inception, producers have been able to withdraw their money with no requirements from the federal government as to how it was to be spent. We encourage the federal government to refrain from placing restrictions on the spending of these funds until the industry improves.
AgriInsurance: We have been working with the AgriInsurance office in Charlottetown to develop a livestock insurance program for beef producers. Other provinces are also doing this, and we encourage the federal government to work with industry developing a program that provides equal coverage to producers while taking into account the different needs of the various regions of the country.
AgriRecovery: We just know of the potato industry triggering funds through AgriRecovery. But we feel unclear guidelines and unnecessary delays are experienced with this program. Some work needs to be done to clarify that and to make the next step clear once the payment has been triggered.
Then there's the cash advance program. It's been said in P.E.I. that if there was not a cash advance program, we wouldn't have a beef industry. Currently, some of our producers took out advances under severe economic hardship under the cash advance program in 2008, facing repayment of those in September. We are asking once again that the federal government defer those payments for another year until the fall of 2011.
There has been some discussion about the inventories of the cattle used as collateral for the severe economic advances, and those inventories could be released to allow the producer to take additional cash advances. However, we realize this would be a guarantee on the government's part.
I want to talk a bit about the Canada-P.E.I. agriculture stewardship program, in particular. It's available to producers in P.E.I. to address a number of environmental concerns, and they're categorized as best management practices, or BMP. For our industry, such things as manure storages, silage bunkers, fuel containment, and run-off control are areas where producers access the money. Uptake is low because of the minimal funding available. The program only covers a certain percentage of the project. However, these BMPs most beneficial to beef producers are capped between 15% and 30%.
The per capita applicant is only eligible for $50,000. One category, product and waste management, for example, includes fuel containment, improved on-farm silage storage, and others, and they are still only eligible for one project of $15,000 for four years. So that limits them to address only one area of environmental concern.
With regard to the cost of production, we face a decline in the ability to access potato waste from Cavendish Farms. That product has been diverted to a biodigester, so now our producers are faced with coming up with new feed sources.
We think that government could work with us to provide low-interest loans to producers to purchase new equipment to allow them to plant, harvest, and store these new varieties.
Loans could also be made available to do some critical repairs to existing operations and to replace barns and feed storages that in some cases are basically falling down, so there is need for capital investment there.
Quickly, we know a national price and basis insurance program is being talked about in other provinces. We're not exactly sure how this will affect us because we're not a very heavily exporting province, but we do want to make sure it's a good program if it is put in place across the country.
Brian is going to mention the Atlantic Beef Products plant, then sum it up.