Agriculture Committee on Nov. 29th, 2012

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Sorry, but just on that point, every trade deal that Canada has signed has benefited agriculture. There's always been a positive side to the ledger when it comes to agricultural trade around the world through the free trade agreements.

[Ruth Ellen Brosseau, NDP, Berthier—Maskinongé, QC]

Thank you.

[Francine Raynault, NDP, Joliette, QC]

Minister, the provincial ministers were told of the AgriStability reforms this past September, in Whitehorse. The changes came as quite a shock to many farmers in Quebec, given that the Financière agricole du Québec would have to assume the $445 million previously provided under AgriStability.

My question is this. I want to know whether other provinces had to take on a similar responsibility. And if so, how much does all that downloading represent for the federal government?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

The changes to AgriStability, Madame Raynault, are discussed at the federal-provincial level and the territorial level as well, and all of those changes are driven by a vote of eight of the provinces or territories with over 50% of the farm-gate receipts. The federal government does not have a vote at that particular table to make those changes workable.

I'm not sure where you get the number of $445 million. I've never seen anything like that number that comes close to the changes we have talked about. AgriStability is a demand-driven program, and it changes from year to year. There is a line item as to the allocation that's there. Should we go beyond that because of some major disaster, God forbid, then I go back through the cabinet process—Treasury Board, and so on—to ask for those dollars to be delivered.

There are a number of other programs within that pillar, within that support group. There are four, actually. Most important is the AgriInsurance, the crop insurance side, and then AgriStability, AgriRecovery, and, of course, AgriInvest, whereby a farmer can put in a certain amount of money and the federal government matches it, and then we move on. There are some changes coming to that program as well.

What we have done is taken the top tier of AgriStability down by 15%, but we have added 10% in the bottom for the most affected producers, the negative-margin producers. That's a good trade-off, because it's those that are hurt more often who actually have the demand for that program. By building up that bottom end, we've insured that those most in need will be able to trigger more dollars.

[The Chair, Conservative, Merv Tweed]

Thank you.

Mr. Payne, go ahead.

[LaVar Payne, Conservative, Medicine Hat, AB]

Thank you, Chair.

Thank you, Minister, for coming, and thank all the officials for coming. That's important.

Minister, I know that you've been travelling the world, opening markets for our farmers and for our beef and pork and so on. I think it's outstanding what you've done at this point.

In your opening comments, I heard you talk about CWB and the pooling available. You talked about net income for farmers being way up and you touched a bit on the Port of Churchill and a number of other issues.

Obviously with the new Wheat Board availability, we have put some funding in place for the transition. I believe it's about $184 million. Could you expand on that, and say why that is important to the CWB?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Sure.

To start off with your opening comments, you talked about trade and travel, and I do that in conjunction with industry. It's a great one-two punch. The Market Access Secretariat is there as well, to work on some of the technical issues. It's a tremendous feeling to go into some country and start to resolve the issues that have slowed down trade from a non-science basis.

When it comes to the Canadian Wheat Board, we said early on that we would not see farmers held hostage to extraordinary costs when it came to winding down the single desk and bringing up the ability for the new CWB to pool and continue on. We have a government guarantee on the new entity for up to five years on the transactions they do. That gives them some stability in the marketplace.

They also have the ability now to market grains other than wheat, durum, and barley. I know the CWB has moved some canola into export position, which is good news. It gives you another person buying that commodity as well.

The dollars that we allocated on the extraordinary costs were workforce adjustments for people. They had a staff of some 400, and going forward they feel that 100 or so people will probably do the job credibly. There were changes to an antiquated computer system, which they still owed a lot of money on, the rail cars—a whole number of things—and the building itself. I know there were some farmers who said that all the net benefit was being lost. I'm here to tell you that there was no net benefit; everything was leveraged pretty heavily.

The federal government, using taxpayers' money, has levelled that playing field so the CWB has a chance to move forward in the world and continue to market. They have a great Rolodex around the world, and they will make use of that.

When it comes to Churchill, there was a special program in place for a number of years, again using the pool accounts to offer enticements to use the Churchill port. We continued those for another five years so that Churchill has a chance to adjust. I'm here to tell you it was fully subscribed this year by a number of new players on the block, which is good news. They've now taken advantage of the Churchill port to get into certain markets. We won't limit them to the amount of volume they want to move, but there is a limit to the incentive. Churchill continues to be a valuable asset for Canada, and we wanted to maintain that through the incentive.

[LaVar Payne, Conservative, Medicine Hat, AB]

That's very positive. Thank you, Minister.

I noticed you also talked about grain companies going into Churchill. Do we know how many of those are active in that marketplace?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

I believe there are four or five this year, rather than just the Wheat Board. It used to be that only the Wheat Board made use of it, but there was the odd special crop that tried to ship through there.

This year we saw four or five major players, and then some smaller ones as well. It was good. It's good diversity.

[LaVar Payne, Conservative, Medicine Hat, AB]

You touched a bit on the EU and the TPP and their importance.

I know there are a lot of rumours going around, particularly on supply management. From what you said earlier today, certainly supply management is still being protected by our government, and we want to continue working with that.

Has that created any issues, from your point of view, at any of these trade negotiations?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

No.

There are a number of issues on the CETA that we continue to work forward on. There are a number of issues we will bring to the table at the first opportunity. That's coming up in New Zealand, I believe, within a week or so. We're excited by the opportunity to expand our trade corridors. At the same time, we've never been shy about talking about our defensive positions, including supply management.

I met twice last week, in Brussels, with the leadership of the SM5 groups. We had good, frank discussions. They walked away excited by the opportunities for the rest of the markets.

Of course, supply management is not immune to expansion in trade as well. Our dairy genetics are in great demand, and that will continue to be available to the world. There are some tremendous opportunities for us to discuss the great genetics that come out of SM. It has had a good, solid bottom line for years. We've developed bloodlines in chickens and turkeys that are in demand around the world, and we'll continue to make those available.

[The Chair, Conservative, Merv Tweed]

Thank you.

Mr. Atamanenko is next.

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

Thank you, Chair. I'll defer to—

[The Chair, Conservative, Merv Tweed]

Oh, are we going back to...?

Okay. Go ahead, Ms. Raynault.

[Francine Raynault, NDP, Joliette, QC]

Thank you, Mr. Chair.

Picking up on the E. coli outbreak among the animals at the XL Foods plant, I don't believe the Canadian Food Inspection Agency's standards were adequate. We know that an additional $7 million will go to improving Canada's food safety system.

What can you tell us about the cuts? Can you share with us the information the Parliamentary Budget Officer asked you for, meaning the details of the departmental savings under the cuts?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Are you talking about the overall budget for CFIA?

[Francine Raynault, NDP, Joliette, QC]

I'm talking about the $7 million to improve Canada's food safety system.

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Well, there have been a number of investments to enhance the food safety situation in Canada. Starting with our budgets last year, there was $100 million allocated over the next five years.

This year alone there was $51 million allocated to enhance food safety, working in conjunction with Public Health Canada and some of our partner, so there have been a number of budgetary increases. We have $75 million that has come out of the Weatherill report to add to the capacity in ready-to-eat meat products. As a government we continue to add to the budgetary capacity so that we can hire more inspectors, put more emphasis on certain plants, enhance our testing regimes, and so on.

I would hope that maybe the next time you would see fit to support us in those efforts.

[Francine Raynault, NDP, Joliette, QC]

But we know there were cuts. Can you tell us what those cuts amount to and how much AAFC had to save?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Sure.

There have been no changes at CFIA that will affect front-line food safety at all. I know there is some misinformation out there, but at the end of the day, this government looked for efficiencies across the board from every department and every agency. CFIA was not exempt. They have stepped up and done that.

Mr. Da Pont has a breakdown if you would like that.

Go ahead, George.

[George Da Pont]

Thank you.

I'll give you a breakdown. This information is posted on our website in terms of the outcomes of budget 2012. As I think everyone is aware, after three years, meaning by 2014-15, there would be an overall budget reduction of about $56 million.

About $24.5 million of those dollars are going to come from a series of administrative efficiencies. They're items like reducing the number of EX positions in the agency, things like reducing some of the internal administrative units that handle things like human resources, IM, and IT. In other words, there are a series of things that are internal to the agency administration. I know our chief financial officer will be at the table in a few minutes and can provide a bit more detail on any of those if you want.

In addition, we're going to have about another $3.3 million coming from a series of shared services between the CFIA and Agriculture Canada. For example, we now have one individual in charge of IM/IT in both our organizations. We've combined some aspects of human resource delivery, and there are a series of those internal shared services. We do have—

[The Chair, Conservative, Merv Tweed]

I'm going to stop you there because of the time, and we'll get back to these answers afterwards.

Mr. Minister, thank you for coming today. We appreciate your input.

We're going to take a brief five-minute recess while we change witnesses.

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Thank you for the opportunity to clarify the misinformation that was in the CTV report.

I hope the opposition has taken that to heart and will continue to support the great work done by CFIA.

[The Chair, Conservative, Merv Tweed]

Thank you very much.

We'll take a five-minute recess and seat our witnesses.

[The Chair, Conservative, Merv Tweed]

Welcome back to the second part of the meeting of the Standing Committee on Agriculture and Agri-Food.

Mr. Meredith, would you introduce the new guests who have joined us at the table, please? Then we'll move to questions.