Evidence of meeting #11 for Agriculture and Agri-Food in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was program.
A recording is available from Parliament.
4 p.m.
Conservative
November 15th, 2011 / 4 p.m.
NDP
Francine Raynault NDP Joliette, QC
Thank you, Mr. Chair.
I would like to know how the department intends to encourage agricultural research.
4 p.m.
Assistant Deputy Minister, Strategic Policy Branch, Department of Agriculture and Agri-Food
At this time, we have several programs requiring partnerships between government, universities and industry. Furthermore, we have put more emphasis on innovation during the years of Growing Forward. I believe that we have invested $160 million in innovation.
Going by the messages we received during our recent commitment, there will be pressure to provide more. There will be more requests linked to innovation. We will be asked to put more emphasis on research and development.
4 p.m.
NDP
Francine Raynault NDP Joliette, QC
Earlier, you referred to the matter of intergenerational farm transfers.
Do you believe that it might be possible to include in Growing Forward 2 a program facilitating access to seed capital? That would be helpful for new entrants. Parents wanting to sell the farm to their children could continue to have a decent life.
4 p.m.
Assistant Deputy Minister, Strategic Policy Branch, Department of Agriculture and Agri-Food
The difficulty with subsidy programs is understanding how they will be most effective.
The government has already put several programs in place. If I may, I will continue in English in order to give a more detailed answer.
We have several programs in place right now to deal with that capital problem. It's a serious one for intergenerational transfer largely because the value of farms has gone up, which means there are barriers to entry for new farmers and the debt structure they end up taking on can be a significant barrier to profitable returns. We have the Canadian Agricultural Loans Act, CALA, which provides young and beginning farmers with capital to invest in a farm. That's an innovation by this government in the last two and a half years to allow young farmers who don't have an experienced track record to have access to capital. One of the problems we heard about during the construction of Growing Forward I was that in the absence of a 10-year history of successful farming, banks were reluctant to invest in young farmers. So we try to deal with it in some measure that way.
There are several tax advantages the government gives farmers for intergenerational transfer. There's the, I believe, $750,000 exemption for capital gains, which can be used twice if there's a husband-and-wife operation. There are other intergenerational transfer benefits that allow deferral of taxes for a young farmer paying off a parent for his capital investment.
Irrespective of those changes, young farmers are still telling us there are issues, and we have to do more work to determine how to address them.
4:05 p.m.
NDP
Francine Raynault NDP Joliette, QC
Is Canada well positioned to face the challenge of feeding people all over the world?
4:05 p.m.
Assistant Deputy Minister, Strategic Policy Branch, Department of Agriculture and Agri-Food
I believe so.
Canada is one of a small number of countries able to export food all over the world. We have water, we have dynamic and innovative producers, and I believe that we are now well positioned to make sure that the world gets the food it requires.
However, I also believe that trade policies will create problems, in terms of technologies and attitudes, which will have to be resolved to ensure that the world can produce enough food for everyone.
4:05 p.m.
Conservative
4:05 p.m.
Conservative
Brian Storseth Conservative Westlock—St. Paul, AB
Thank you very much, Mr. Chairman.
Actually, I think it's Mr. Payne's time.
No?
4:05 p.m.
Conservative
4:05 p.m.
Conservative
4:05 p.m.
An hon. member
[Inaudible--Editor]
4:05 p.m.
Conservative
Brian Storseth Conservative Westlock—St. Paul, AB
I understand that there's a little jealousy because I shot a bigger deer than you this year, again.
I would just like to set the record straight, though, Mr. Meredith. It is very much well known, not only across Canada but internationally, that Alberta beef is the best beef in the world.
4:05 p.m.
Voices
Oh, oh!
4:05 p.m.
Conservative
Brian Storseth Conservative Westlock—St. Paul, AB
Now that I've done all the commercials, I can get to the questions.
I have a staffer here, Ms. Pundick, whose family lives on a farm, and I have to hear all the time about the paperwork burden when it comes to the BRM programs.
Do you have any comments on that? Are there any proposed changes to make it simpler? The two things that are always brought up when I'm talking to my farmers are how complex the program is and how expensive it is when they...because inevitably they have to go to an accountant or someone to deal with it, and even then they have problems with it.
That being said, I think it is important to give credit where credit is due, because the program is better than it was under the old program, which had a lot of problems with the paperwork side of things.
Is there any proposal to make the paper burden a little simpler on this? Or is it something you could take under advisement, at least?
4:05 p.m.
Assistant Deputy Minister, Strategic Policy Branch, Department of Agriculture and Agri-Food
We certainly hear that a lot.
We do hear good things about Alberta beef as well.
4:05 p.m.
Voices
Oh, oh!
4:05 p.m.
Assistant Deputy Minister, Strategic Policy Branch, Department of Agriculture and Agri-Food
No, but we do hear that; it's a very common complaint about programs. AgriStability in particular is I'm sure what they're referring to. It's complex, it's not transparent, and it's not as timely as it should be.
A few years ago, perhaps three or four, we tried to streamline the process by offering what we call interim payments or targeted advance payments, which would give a producer 50% of his predicted end payment earlier in the process. We put a calculator up on the web so that a producer could try to work through what the payment would be and make it a little bit more predictable and bankable.
I should explain, though, that it's almost the nature of the program that makes it complex. When we consulted with farmers about the design of this program, AgriStability, there was a debate, quite a healthy one, on margin-based programs specific to a given farm and a mix of farm inputs and outputs, as opposed to a model, which you see frequently at the provincial level, formed on an industry average that you compare your farm with. If you didn't do so well, you get some money. If you did better than the average, you don't get any support.
Producers told us then and have told us since, and very recently, that precision was really where they wanted to be. Their operation is unique and can't be easily compared with something else.
So we have to continue to have a dialogue. We have a committee of producers from across the country that the minister has assembled. We consult with them all the time about program parameter changes and fundamental redesign options.
We haven't reached a consensus on what would be better than AgriStability. I should remind you that one of the things this government did to get money into farmers' hands quicker and more predictably was to establish AgriInvest. That's a program we kick-started with $600 million right into farmers' accounts. Every year, there's a statement provided to farmers that says your performance on your farm allows you to invest x dollars matchable by the Government of Canada and the provinces.
4:10 p.m.
Assistant Deputy Minister, Strategic Policy Branch, Department of Agriculture and Agri-Food
It's easy. It's fast. It's predictable. It's bankable. There are few strings on it—the producer can use it in a bad year for income support or in a good year for buying new technology and investing in new capital equipment, something to better the farm and manage risk better.
So there have been some improvements, but it's a constant challenge.
4:10 p.m.
Conservative
Brian Storseth Conservative Westlock—St. Paul, AB
I understand. You're absolutely right; it is a complex program in the first place. To get it right means that there has to be some complexity in the application processes and going through it.
Are there any measurables we can see on how this has gotten better—things like the calculator and some of the other stuff? Are there any tangible results that we can point to or say, hey, we are getting better--incrementally, at least?
4:10 p.m.
Assistant Deputy Minister, Strategic Policy Branch, Department of Agriculture and Agri-Food
We have three things we could point to. One is an error rate. We went through an exercise to drive down the error rates, and now I think we're better than the employment insurance program. We have an error rate of roughly 3%. So 3% of the cheques that go out have a problem, but the other 97% don't. We could provide the committee with evidence of that.
We also have a survey of producers that measures their qualitative reaction to service levels of the program, the predictability of the program, and we could share that report with the committee.
Then we have a service standard that we set. I'm going to speak on behalf of my colleague, and I'm roughing it here, but I believe our standard is 75% of forms completed within 75 days. We'll share that service standard with you, because it's public. We make it public for producers. We may have had a few hiccups when we changed it over to a new system that approves delivery, but I think we're doing better now.
I'll undertake, Mr. Chair, to share those things with the committee as quickly as possible.
