Thank you, and good morning.
I'd like to thank you for the opportunity to participate in this discussion today. As some of you are aware, I'm a fourth-generation grain farmer from Saskatchewan, and I'm also an agriculture business advisor. Just to clarify, I attend this meeting today as both of these. However, the views and opinions I'm about to express are those of Stuart Person, the individual, and they should in no way be associated with any organizations I work for.
Okay, with that out of the way, I'd like to talk about the effectiveness of the risk management programs under the Growing Forward framework, as you had asked, and I'm going to be speaking from a western Canadian grain farmer's perspective, which will differ quite a bit from my colleagues here, as you will see. At the moment, the risk management programs under the Growing Forward framework are actually very good for grain farmers in western Canada. My recommendation would be that they stay in place. Farmers involved in production of crops—this is the best they have ever had it in terms of the AgriStability program, and the previous government should be applauded, from a grain farming perspective, for bringing that in, and the existing government should be applauded for continuing to improve on that and maintain it. I realize there are challenges with the other industries, as have been noted.
These programs have significant advantages to producers and their ability to manage risk on today's farm from a grain farming perspective, and as a producer I use these programs to assist with risk management strategies on my farm every year.
I will just go over some of the key benefits I see in these programs. From my perspective, it does provide financial stability in times of volatile commodity markets and weather conditions. It provides a reduction in overall farm stress. It provides assistance with financing and cashflow planning. At the moment, it is encouraging farmers to make further investments and expansion in their grain farms. It does provide some assistance with succession planning and providing some stability in the profitability of the farm. For young and new farmers in a grain scenario, it is working at the moment in overall strengthening of our industry as a whole in terms of grain production in western Canada. However, all the benefits aside, some things should be looked at for improvements, and I'd like to go through a few of those, if I may.
The first one, as a general comment, is program funding. As a producer, I would like to ask that you please ensure that these programs continue to be funded and that they are properly funded. I often hear people in my area talk about concerns over the programs bankrupting the government or not being affordable. As a farmer, I'm making business decisions every year based on this program, based on the assumption that I'm going to have access to funding when I need it. As part of my risk management strategy, I'm counting on them to provide me with assistance when difficulties arise. My creditors are counting on these programs and they would like to know they are bankable. That was raised earlier as well. If for any reason they are not going to be funded and you do decide to make changes to the program, all I can ask is that you please give us lots of notice, because from my standpoint, I need lots of time to make other arrangements. So I am relying on this program as it would relate to AgriStability specifically.
Audits. Both as a producer and as an advisor, I would like to put forth the recommendation that you consider a statute barring system, especially to AgriStability, so that some closure can be obtained on these files. Being subject to audits on information that is eight years old is not reasonable, in my opinion, and can be expensive. We have seen a number of files pulled back as late as 2002-03 to be reviewed, and I think at some point we have to cut that off. If we can do it in the income tax system, I don't know why we can't do it under this program.
In the future, when you are writing the rules of these programs and you are coming up with new ideas on these programs, you need to recognize that the Hutterite groups seem to get left aside. They have a different and special set of circumstances and needs. They are a large group of producers in western Canada, and I'm sure they have a presence in the east as well. All I would ask is that you consider their needs when you are writing programs and how those programs will apply to these specific groups. If you need advisors for that, please contact me and I can put you in touch with people who can talk about that group of people.
As a producer and advisor, I would say that we need to consider the timeliness of AgriStability and AgriInvest program delivery, especially as it relates to non-calendar year-ends of corporations. No matter the year-end selected by the producer, they should be able to submit the agri program form within a reasonable amount of time, say three to nine months, and funding should be available shortly after. At the moment, that's not the case. Certain corporations are filing 18 months after their year-ends, which puts the money in their hands up to two years after the losses are incurred.
AgriInvest processing as well was very slow in 2008. I'm sure you've heard this before, but some producers are just getting their notices for 2008 now. That's two years afterwards, which is just too slow. We need to look at how to speed that process up.
I don't have to go too far into livestock challenges, as my colleagues here have already been down that road. But I will re-emphasize the point that a further study needs to be done on how these programs can effectively help the livestock industry. Right now they are failing, and changes are necessary to address that issue.
Lastly, on agri programs, there is a bit of a technical issue. I won't get into it, but if anybody wishes to talk to me afterwards, I'd be happy to talk about it. When corporations are selecting a year-end for their farm business, they have an option to go with any month of the year they choose. Sometimes it becomes necessary to change that year-end, maybe for tax or business reasons. Things change and people might realize a different year-end. I just ask that you consider those situations. Right now, the way the program works is that you can be penalized if you change your year-end, and there's not a lot of direction in the program handbook on how to deal with that. As a producer and an advisor, I'd just like to recommend that these types of things be looked at in more detail going forward.
I was also asked to talk about advance program payments. If I understand correctly, I assume you were talking about the grains and livestock cash advance programs. I'll make a couple of comments on that.
Spring and fall cash advance programs are excellent programs on the grain side. They provide many farmers with much needed cashflow every year. But one thing to consider is that we may want to look at changing the caps. Instead of having a flat $400,000 limit per farm, we could look at a per acre limit. The $400,000 cap has really been outgrown by a lot of farms, especially in western Canada. It's just not sufficient. We're talking about millions and millions of dollars going in every year, so a per acre limit would be more suitable going forward.
On the cattle and livestock advances side, it is also an excellent program. But a complaint that I've heard is that it lacks flexibility in terms of calving dates for livestock producers. There is a deadline for repayment. I believe it's September. Depending on your calving date, that repayment could come before you've actually been able to get your calves to market, which puts you in a cash crunch for a short period of time and unable to repay. It poses some financial difficulty for the producer.
Lastly, I just want to say that I'm in Ottawa for a couple of days, so if anyone is willing to talk to me, I'd be more than happy to do so. I have lots of other things I'd love to talk about, so please contact me after the meeting today.
Thank you very much for the opportunity.