Agriculture Committee on May 26th, 2010

[Wayne Easter, Liberal, Malpeque, PE]

I want to come to Jill, but I have a question for you, Eugene, and you can think about this while Jill's answering.

You said that if you can't get a 5% to 10% return on investment, then you're not going to bring people in. I need to know what you think the return on investment is in this industry overall, and I know it's not that.

Jill, you've talked about Australia and the response of the Australians to the U.S.-EU. Can you expand on that somewhat? What did the Australians do? I'm not aware of what they've done.

[Jill Harvie]

I can also defer that one to Travis.

[Travis Toews]

Sure. I think I can answer that. Basically, in that definition of beef, for it to qualify for this particular duty-free quota, included in the definition was a requirement that the graders be government graders. In both Canada and Australia, our beef graders aren't government graders. In Canada, we have the Beef Grading Agency and it's their graders that grade the product.

Australia commissioned some graders very quickly through their government and were able to meet the definition. It took CFIA many months to come to that conclusion, and I will say that we made that suggestion quickly. It took them many months to come to that conclusion. They got there eventually, but because of the delay, we're still caught up in process and correspondence with the EU on finalizing the terms.

[The Chair, Conservative, Larry Miller]

Thank you.

Wayne, your time has expired.

Now I'll move to Mr. Bellavance for seven minutes.

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

Thank you for your testimony. Mr. Toews, you answered Mr. Easter's question about specified risk materials. You said that the funds have not yet been paid out.

In fact, since the budget announcement made by the Minister of Finance, no money has been paid out. In addition to that fact, for a while now we have had a hard time getting information about the programs announced in the budget. We were told that we would get more information in the spring, but we are still waiting. I would like to know if you have any additional information for us.

I will tell you a little bit about my recent efforts to obtain more information from the government about SRM. Since I could not get the committee to adopt a motion calling for livestock and beef farmers to be compensated financially for losses arising from SRM standards, I decided to submit what is called a “written question on the order paper”. It asks the government to provide us with certain information on a specific matter, and I believe that the government has 45 days to get back to us.

When I asked when the Slaughter Improvement Program announced in the last budget will be available, I was told that I can submit a request for accessing these funds during spring 2010, which, I believe, is now.

Do you have any details on applying for funds under this program? Do you at least have information from the department stating when and in what manner applications can be made? Or are you still completely in the dark?

[Travis Toews]

The simple answer is no. At this point, we have no further details on the program. We've understood and we know that the government is working on those details, but we don't have any further information.

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

Another question I asked, Mr. Toews, is about the $25-million program designed to assist farmers in disposing of SRM. I wanted to know what form the financial assistance will take, what the maximum amount of funding per project will be, and what the program's eligibility criteria will be. I received an answer recently; I remind you that the budget was announced several months ago already. I was told that the program was still in development and that details would be available later.

I am now asking you the same question. Have you received any word from the department or the minister to the effect that program details will become available soon?

[Travis Toews]

The answer is no. This is the question that I understood I was answering before. We don't have any further details at this point in time on the SRM disposal cost offset program, other than that it's earmarked to offset the costs of disposal.

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

In fact, I am asking you the same question regarding three announcements made in the budget: the $10 million for funding slaughterhouses, the $25 million for assistance in disposing of SRM, and the $43 million—the subject of my third question—for funding the implementation of new technologies or other initiatives. Again, the government told me that the program was still in development and that details would be available shortly.

In particular, regarding the $43-million program, do you have any information that you could share with the committee and, of course, with livestock and beef farmers who are still waiting for the funds announced in the budget?

[Travis Toews]

Your information is as good as ours in terms of the details of the $40 million. We do know that ongoing discussions are taking place with the processing sector, but I'm not aware of any further details on the program.

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

On a point of order, Mr. Chair, I do realize that this was before Christmas, but both Mr. Bellavance and Mr. Easter have made reference to the motion that was present at the time pertaining to money directly to producers. That motion did not say “money to producers”; it said money to the slaughter facilities.... That's just to correct the record. I understand that it was a while ago, but if they could be factual with their evidence.... As a point of fact, exactly what they asked for is what the government put in the budget.

[Wayne Easter, Liberal, Malpeque, PE]

On that point of order, Mr. Chair, his facts are not quite correct. This was a request of which the Canadian Cattlemen's Association was a part, the Canadian Federation of Agriculture...it was a request from producers that we accepted. Government members filibustered and the new proposal is not anywhere close to the same.

[Voices]

Oh, oh!

[The Chair, Conservative, Larry Miller]

Okay, Mr. Bellavance.

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

In fact, Mr. Storseth can try to embellish things for the government's sake as much as he likes, but the fact remains that the motion derived directly from requests made by beef farmers. What I have said is simply a summary of what was asked by beef farmers, in particular by the Fédération des producteurs de bovins du Québec. They are the reason I put forward the motion.

There is something surprising about these budget announcements. I have already told the minister that I was very surprised that the budget announces rather large investments—several million dollars—for resolving a situation or at least for trying to assist farmers who are struggling with a problem like SRM, and that the program specifics were not even established in advance.

It seems that the government is improvising. In the budget, x million dollars are announced for assistance, and after that, we are told—and you have no additional information, either—that the program is still in development. The money is supposedly on the table, but the government still has to decide what to do with it.

I feel that the request made by Canadian Cattlemen's Association and all beef farmers from Canada and Quebec is quite clear and simple. As long as there is no agreement with the United States, we have to try to compensate for the fact that our farmers are penalized by this standard imposed by the Conservative government. It was mentioned earlier; Ms. Harvie talked about the $32 per head needed to cover the expenses incurred by our beef farmers. I know that this is more of a comment than a question, but if you have something to add, please go ahead.

[A voice]

You voted against the budget.

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

I did not vote. No voting took place.

[The Chair, Conservative, Larry Miller]

Does anybody want to comment?

[An hon. member]

There's no real question there, Mr. Chairman.

[The Chair, Conservative, Larry Miller]

Travis.

[Travis Toews]

Well, I'll respond to that.

That's correct. We have no further information. We were pleased with the announcement when it was made. We have no further information on the program. Certainly in terms of SRM disposal for over-30-month cattle, the critical period of time will be the fall months coming up, when over-30-month sales volumes rise dramatically.

From my perspective, it will be critical to have this program be up and running at that time. During the late winter, spring, and early summer, volumes of over-30-month cattle are much lower than they are as we approach fall. So it will be critical to have the program up and running for the fall.

[The Chair, Conservative, Larry Miller]

Thank you.

Mr. Atamanenko, you have seven minutes.

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

Thanks to all of you for being here.

My first question is for you, Ms. Harvie, to see if I understand correctly what you said. You mentioned that we should be going toward a North American standard for SRM removal. Do you agree we should lower our standards to meet their standards? That's probably what we would have to do. They would probably not come up to our standards.

Yet we have higher standards because the government, and rightly so, felt it was necessary in order to get more export markets in other countries. When we have higher standards, we have more validity and better access to higher markets. So if we had a lower North American standard, would it not then diminish our access to markets? That's my first question.

The other one is just a general question on the Canada-Europe free trade agreement. I've been studying some of the text and I'm wondering if we need this agreement to get better access for our agricultural products to Europe. Or can we do it within the framework of existing agreements?

In Alberta or Saskatchewan, we ran into some folks who were promoting the gold standard, in other words, conforming to European standards in the hope that they would get markets within the existing agreement. Sometimes I'm concerned when we try to push more agreements, because it's my understanding that the Europeans want to see this open up. They want what they call “subnational contracts”.

In other words, if we sign that agreement, we may gain some access, but it will open up subnational--in other words, municipal/provincial--contracts to European bidders. They will then be able to bid against local contractors and put local people out of work. That's a concern of mine.

Can we move within the existing agreements to get better access? And then there's the other question on North American standards. I'll stop there.

[Jill Harvie]

I'll take the first part of that question and then I'll let Travis take on the EU part.

As for the North American standard for SRM removal, it would be ideal. Currently, our long list--I guess you could call it that--of SRM removal, the enhanced feed ban is onerous, and if we harmonized with the United States it would be ideal. It would not be going to another level as far as being less than what we have today is concerned. It would be just as efficient. We both have the same OIE risk status. I believe that having a harmonized North American standard would be ideal. It also wouldn't hurt us as far as markets are concerned.

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

It was my understanding—and we saw this when we visited the slaughterhouse—that something like 100 pounds of material have to be removed from our cattle, whereas there it's really a small amount, so we got the impression that our standards are definitely stricter. If we were to conform to theirs, would that not be lowering our standards?