Agriculture Committee on April 28th, 2014

[Dr. Reno Pontarollo]

I'll take this one.

Thank you for the question, Denis.

I absolutely do agree with that, yes. We still need project-oriented research. We still need short-term research projects, yes. But we still need to have a strong baseline in fundamental research that answers questions that maybe aren't important to industry or society now but could be important later on.

This is the type of research that was done as recently as 30 years ago, answering some fundamental questions about the science, about the biology, without necessarily having a commercial goal in mind.

So yes, I would absolutely support that, somehow, public funding goes towards that type of support for researchers. These are very creative people; they're highly intelligent, highly trained. We should let them have some free rein, to let their creativeness bear fruit for Canada.

[Denis Blanchette, NDP, Louis-Hébert, QC]

Thank you.

[The Chair, Conservative, Bev Shipley]

Okay.

Thank you very much.

I want to thank our witnesses for being a part of today, and for your good participation and great answers. I appreciate that.

We'll break, and then we'll be back in a few minutes with our second round.

[The Chair, Conservative, Bev Shipley]

Members, we're into the second hour of witnesses. We have with us from the Canadian Cattlemen's Association, Andrea Brocklebank, research manager with the Beef Cattle Research Council. Thank you for coming.

By video conference, we also have from Canadian Livestock Genetics Association in Mississauga, Michael Hall, executive director.

Welcome to both of you to our committee as we look into innovation in and competitiveness of agriculture.

I would like to start off with the Canadian Cattlemen's Association. Andrea Brocklebank, for seven minutes, please.

[Andrea Brocklebank, Research Manager, Beef Cattle Research Council, Canadian Cattlemen's Association]

Thank you.

Hello, I'm Andrea Brocklebank, the Executive Director of the Beef Cattle Research Council, Canada's national industry beef research funding agency. It is responsible for the successful delivery of the first and second beef science cluster. I am pleased to be here today to speak about the role of innovation in our industry.

In 2012 the Canadian cattle industry contributed approximately $26 billion to Canada's GDP. The industry has tremendous opportunities due to continued growth in global beef demand and record high beef and cattle prices. At the same time, our industry faces increased production costs and increased competition for land, water, and labour resources from other expanding agriculture sectors. These opportunities and challenges are expected to remain for the foreseeable future.

Innovation is crucial to ensure that Canada's beef industry successfully addresses these challenges. Innovation allows us to use limited resources more efficiently, while continuing to be a global leader in beef quality and safety. The benefits of research go far beyond simple productivity improvements. Research also supports the development of science-based regulations and trade agreements. It is critical to maintaining consumer confidence in our beef production system and the safety, quality, and nutritional attributes of the product we produce.

These additional benefits of research—that is, sound policy, regulation, consumer confidence, and international trade—provide broad benefits not only for industry, but also society as a whole. Consequently, research funding is viewed to be an essential industry and government investment that contributes to industry resiliency and reduced dependence on government's ad-hoc and business risk management programs.

Agriculture Canada has made considerable efforts to streamline and focus its research programs over the past several decades. Over the same time period, the beef industry has implemented a national check-off to support research and technology transfer programs. The industry has also developed and implemented a comprehensive national beef research strategy. The strategy informed the priority research outcomes targeted under the second beef science cluster and is working to guide and influence the funding decisions of other major research funding agencies across Canada. Significant industry effort has been placed on improving the efficiency and effectiveness of applied forage, cattle and beef research funding allocations with a focus on reducing duplication and facilitating co-operation among Canada's beef research funding community.

The industry has accepted the responsibility to develop and lead the beef science cluster and the national beef research strategy. This has and will continue to encourage greater industry investment in and adoption of research. By bringing together Canada's largest industry and public research funders, the science clusters program is significantly improving government-industry co-operation in research. The second beef science cluster is a $20 million investment, $15 million in government funding and $5 million in industry funding.

Investments under the second beef science cluster have increased substantially and not only include the national check-off, but also additional funding from five provincial organizations. We are convinced that the beef science cluster is a very co-ordinated and efficient research model. However, the system can be refined further, beyond administrative details that can be addressed elsewhere.

Allocating research funding in discrete five-year blocks creates challenges for long-term projects. Research in animal breeding, perennial forages, and environmental field studies requires a much longer time frame in order to achieve meaningful results. Enhanced industry-government collaboration could also make research programming even more effective. More direct engagement of industry in the federal government's planning processes would ensure that Agriculture Canada's internal research infrastructure, staffing, and other programming decisions were aligned with the outcomes identified in the national beef research strategy.

Industry engagement is particularly important to ensuring that Agriculture Canada research staffing decisions are aligned with both industry and government priorities, and cuts are not made by attrition. Cuts through attrition gradually erode research programs. There is also benefit in working to transition the new replacement scientists prior to the retirement of the older, retiring scientists, thereby providing an opportunity for mentorship and ensuring that research momentum is not lost.

To take full advantage of the potential that research promises, we need to emphasize a few additional points. First, stable and, ideally, increased funding for federal research facilities, together with staff and programs, is essential to maintain the integrity of Canada's internationally renowned agricultural research system. Second, the federal government has a clear responsibility to continue supporting long-term, basic, high-risk research. This is the knowledge pipeline that ultimately leads to applied research that benefits industry and broader society. The fire station analogy is apt here: Fostering innovation and maintaining core research programs ensures that we have the physical and scientific capacity to respond to issues as they emerge, not when they become emergencies.

Industry has made considerable investments in “public good” areas of research. Research supported by the beef science clusters is providing science-based information to inform the beef cattle code of practice, as well as the work under way at the global round table for sustainable beef, to confidently and factually address ongoing questions regarding antimicrobial resistance and food safety. However, this does not diminish the federal government role in these areas.

Social license issues, which pertain to the public's perception of industry, are increasingly important. In many cases, research generates the facts that can effectively address social licence issues. Environment, antimicrobial resistance, and animal welfare are prime examples. However, in order to be viewed as credible, relevant research data must be collected and evaluated by an independent, impartial body.

In closing, I would like to summarize our three main recommendations. First, continued federal government support of both basic and applied research programming is critical to supporting industry advancement in a sustainable manner. Second, further enhancing engagement of industry in Agriculture Canada's decision-making regarding critical research infrastructure, staffing, and programming will help to ensure the most efficient use of resources. Third, meaningful progress in both basic and applied research streams is contingent on long-term, predictable, meaningful funding commitments that are preferably 10 years in length.

I would be pleased to elaborate further on any of these points or to answer any questions you may have.

[The Chair, Conservative, Bev Shipley]

Thank you very much for your presentation.

We'll now move to Mr. Hall, for seven minutes, please.

[Michael Hall, Executive Director, Canadian Livestock Genetics Association]

Good afternoon, and thank you very much for allowing the Canadian Livestock Genetics Association to make a presentation today.

For those of you who don't know, the Canadian Livestock Genetics Association looks into exporting live animal semen and embryos.

I'm going to outline some of the key challenges facing the Canadian genetics industry.

Basically, the loss of export markets for live animals is one of the key struggles we have been dealing with since BSE hit Canada. Of the live markets that are out there, Canada is no longer getting its share. The United States has really come ahead in marketing a lot of cattle, a lot more than we are in Canada have, percentage-wise.

With that comes a loss of the genetic and exporting infrastructure. We no longer have heifer growers. We no longer have exporters that do the marketing. Should we get a large market, we would be struggling to fulfill some of these markets with cattle, or otherwise

Canada is facing a high logistical cost for exporting live animals. We're not close to the markets anymore. The big market used to be the United States. It's no longer in North America, and it's very expensive to get cattle from Canada to other countries.

High-risk markets are becoming the norm. Those are markets like Kazakhstan, where they don't understand some of the current and modern animal health technologies—it's high risk for exporters doing business there—to working with countries like India, where they are developing also the same lines.

We see decreasing market development support, and that's becoming critical. We need to work hand in hand with our government to develop these markets. Industry is quite prepared to move forward in that direction, but we do need ongoing support from the government.

Capacity of the government agencies to accomplish technical negotiations in a timely manner is becoming very critical, and there are difficulties in negotiating health protocols to some of these emerging markets.

Those are some of the issue that we're facing.

I'm going to hit a couple of things to clarify and dig into them a little further, research being one of them. Research is a key to the long-term viability and seeing Canada as a leader in these markets. If we want to retain and regain that leadership role, we need to focus on research. We need a long-term commitment for funding to focus on genetic research and innovation. Our world-wide recognition that Canada is leadership is disappearing. The leading geneticists from Canada are now leaving the country. Where Canada used to be a magnet for genetic researchers, we're now seeing them move to other countries, like New Zealand and over to Europe. We're acutely aware of this and how it's going to affect our long-term viability. Other countries are basically building their research capacity using our best-trained people.

Moving to the Canadian Food Inspection Agency, we're seeing a growing lack of capacity to develop export certificates. Again, this is going to be critical in the future, as we work on new free trade agreements with countries. We seem to have a lack of capacity, less and less people to work on the details of some of these agreements.

We need to strengthen our focus on animal health issues and programs to lower disease prevalence. This is one of the key things. We have to be innovative in how we're going to do this, and we have to be out of the gate a lot faster than we have been.

Again, the Canadian Food Inspection Agency needs to be a partner with industry, and we need to make sure that our domestic animal health programs do not put our domestic industry at a global disadvantage. We can't make them too stringent, too tough, too hard for producers and exporters to be part of, and that's a concern.

We have to be able to utilize new technologies for disease testing and for export. These technologies are out there, but it seems slow to be adapted into government regulations.

We need a government that is ready to support industry by creating flexible programs to enhance our competitiveness through partnering and funding. I mentioned that earlier, and it's a big part of market development, but we need to be really innovative. Some of these smaller companies don't have access to the capital, so another item might be capital access for companies wanting to develop genetic exports.

We need to see our key negotiators travel to markets to support industry. Whether it's negotiating an animal health certificate, we need to be able to get them there to finalize these negotiations and get them completed.

We need a government that actively supports exporters in conflict resolution and defending its trade rules. We see that happening, and we need that to continue.

We need access to specialized funds and insurance programs for exporters that are now taking unparalleled risks. Some of these programs, through capital and insurance, can really make the difference in how we can see competitively around the world what we're going up against.

We would like to see the expanding of the much-needed funding in the AgriMarketing program—we have seen that decrease a bit over the years—and possibly more participants in it. It's a key program that our exporting industry uses to develop markets, so we have to be innovative in those new market developments and how we're going to get our share, how we're going to be the first in and get that market share.

We need supportive, innovative, leading research and development that focuses on improving the Canadian genetic products that other countries demand. I mentioned earlier that it's getting to the point where we're seeing our leading geneticists leave our country, so we need a long-term strategy for research.

Also, we need to reinvest in these key research platforms. Universities that want to cut leading researchers or not refill the positions when they retire are part of the problem. We need a long-term strategy on how to keep these key people.

We have to co-develop demonstration farms in key markets. I think this is a big part of what can really set Canada apart from other countries. We need to show our innovation and our genetics, but we need to profile them in the foreign country's conditions.

That kind of co-developing of a Canadian farm or of Canadian genetics benefits more than just the genetic industry. It also supports a broad group of Canadian agribusinesses that are involved in farm production. We see a lot of countries beating us out of the gate in these development strategies in other countries. Canada needs to be a little more innovative and a little quicker to get involved in some of these types of ventures.

All in all, the Canadian livestock genetics industry applauds the hard work done by the various governmental departments and Minister Ritz in aggressively opening new markets and promoting Canadian genetics around the world. The genetics industry has made excellent use of the AgriMarketing program for developing new markets and we would like to see this program strengthened. We also would like to see a long-term strategy to keep research in Canada and to regain our position as world leaders.

Again, the CLGA would like to thank the committee for letting us have this time.

Thank you.

[The Chair, Conservative, Bev Shipley]

Thank you very much, Mr. Hall.

Now we'll go to our committee. We'll start with five minutes.

Madam Brosseau, please.

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

Thank you, Chair.

I'd like to thank both of our witnesses. I think you were very interesting. You had so much information, both of you, that my mind's kind of all over the place.

You've talked, Mr. Hall, about Canada losing its leadership role when it comes to scientists. You said that on the world stage we have a lot of work to do to regain that and that we're losing people to New Zealand and other countries. Can you explain how that has happened and what we need to do to regain and maybe have a retention of these scientists?

We all know that the research and development are very important, but it seems that we're not doing enough. Maybe we need to reverse some of the cuts to public research that we've had. I'm wondering if you could elaborate a little more on that, please.

[Michael Hall]

Thank you for the question.

I think it starts at the university level, where they'll take a 40% cut, say, and put it across the agenda or look for the savings. One of the easiest things to do in regard to some of these key research people, who they've had for years, is to not replace them when they retire. If you don't keep those senior positions, then you're no longer attracting graduate students from across the world to take part in your programs. That's what we're no longer doing in Canada.

Whereas we used to be the magnet for genetic research around the world and we saw some of the leading people do their post-doctorate work in Canada, stay in Canada, and then continue to research and work, we're now seeing our geneticists leaving. It has a lot to do with funding, for sure, and then a commitment to get it done.

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

We have programs and they do work, but they're kind of piecemeal. They're just for a few years. They're not long-term programs. I think Andrea touched on how right now they're at about 5 years, but we need something that's about 10 years long.

Would you agree that 10 years is a good long-term vision plan that we should set up for these types of innovation studies? Would you agree that 10 years is a good amount of time?

[Michael Hall]

Well, like a lot of the genetic research, it's a very rapid field, but it's the training of the people and keeping the people in Canada that's key. If your strategy is long enough and you identify the key people you need, then you put in place—and have time to put in place—what they need; you're not saying that a person is done and asking, “What are we going to do now?” Often, industry gets looked at in regard to picking up the role. Industry can only do so much. We need strong leadership on the government side too.

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

Andrea, I think you had three recommendations. Can you just go over them again? I think one was for strong and stable increased funding.

As well, perhaps you could define “high risk research”.

[Andrea Brocklebank]

High risk research is research where you're looking at things that don't necessarily derive value to industry immediately. So industry struggles to sometimes invest in it.

But on the food safety file, for example, it's the long-term evolution of food safety issues—something like E. coli, where you need constant investment—which really speaks to having that capacity available as things emerge, so that you're not trying to address them reactively but proactively.

Basic research also includes things like feed grain and genetic development, and all of those types of investments. To some extent, especially in the beef industry and in western Canada, the profiles of the feed grains that we use are not easily integrated into private research programs, because of the fact that you can save seed on the farm. So public investment is necessary when you speak about barley, wheat, and those types of things. Those are long-term programs, 10 years plus, to get results.

Speaking to the second part of that question, you need continual funding. One of the things we see with the current programming of five years is gaps in funding, which is when you lose capacity because they're looking for that long-term funding to attract graduate students to their programs. It's that difference between project-based funding and program-based funding. Sometimes it doesn't always need to be 10 years in length, but sometimes for certain stuff it does. When you have gaps, that's when you see issues and the departure of individuals.

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

Thank you very much.

[The Chair, Conservative, Bev Shipley]

Thank you very much.

Thank you, Madame Brosseau.

I'll now go to Mr. Hoback. Five minutes, please.

[Randy Hoback, Conservative, Prince Albert, SK]

Thank you, Chair.

I welcome the witnesses to the committee. It's very interesting when we talk about genetics and research in the livestock sector, for sure.

I'm just curious, Ms. Brocklebank, because you said there was $15 million and $5 million in funding, so that you receive roughly $20 million in total. How do you leverage that? When we were listening to the other witnesses earlier today, they said they were leveraging up to 5:1 with the private sector. What are you doing to leverage that money to get the most bang for the dollar? Then how are you allocating that money? How are you deciding what projects should go ahead and what shouldn't?

[Andrea Brocklebank]

The leverage under the cluster is 3:1, so it's industry putting up $5 million, and then government putting up $15 million. The majority of that is from Ag Canada, but there is a small amount of other government funding.

In terms of how we leverage it further, I think it's very important to point out that in the beef industry it's cash on the table. We count no incoming contributions, or any of those things, and there are significant amounts in there. It's just easier from an accounting standpoint for us.

But, obviously, that specific program is underneath, and those researchers have much larger programs so they're getting investments from all of the other provinces. It's those types of things.

In terms of how we allocate the research, the clusters and the process and some of the issues that we saw absolutely revolutionized how we approached research. Previously we'd look at programs on an annual basis; we'd fund some proposals, and there we would go. What happened is that we weren't looking at a portfolio of research, so it was often the trend of the day that was addressed to the greatest extent. However, that's where you see the departure of research, because if food safety wasn't the highest priority, it didn't get money that year. That sent a signal to government that we weren't interested—and that's very much not the case.

We've made strategic allocations. Basically, we have beef quality and food safety getting a portion of investment. For feeds and forages, animal health and welfare, we've tried to identify very clear outcomes over the five years and develop priorities underneath. The exciting part about that is we're also working with the other funders to ensure that their programs are addressing the ones that the cluster isn't.

[Randy Hoback, Conservative, Prince Albert, SK]

It's more the private sector, though. I'm not talking about the farmers and their contributions. How have you been able to attract the private sector to invest in the infrastructure and the research infrastructure here in Canada? I ask you this, because in the grains sector, for example, we're seeing huge participation from the private sector now, and we're curious about it. Are we seeing that in the livestock sector, and if not, why not?

[Andrea Brocklebank]

Under the cluster, we don't have any direct private sector involvement. We've done that strategically, knowing that the cluster really works on the applied research that benefits the broader industry and society as a whole. It also feeds into the research that the private sector then adopts and utilizes to further implement, enhance, and basically get the technology to the farm.

The other part is that we have entered into some private agreements outside of the cluster with check-off dollars to do those projects outside of the cluster. So we're trying to optimize funds, basically, and some of that—

[Randy Hoback, Conservative, Prince Albert, SK]

But why would you choose not to include the private sector? That confuses me. When you're looking at the participation of taxpayers' dollars, why wouldn't we also take advantage of private sector dollars?

[Andrea Brocklebank]

Well, to be honest with you, the biggest thing is the capital in the cluster. We were able to allocate check-off funds by strategically matching Ag Canada funds under the cluster, and we've developed other projects with check-off funds and private companies outside of the cluster.

I think it is important to emphasize that the first cluster was only national check-off dollars. This time we have five of the major provincial organizations contributing additional dollars, which demonstrates the value of the research and the feeling they have about this thing.

[Randy Hoback, Conservative, Prince Albert, SK]

To go back to the grain sector, I guess the confusion I have is that we're seeing a lot of researchers and research moving into Canada because we've allowed the private sector to do that. They're actually taking a very aggressive role in the research side of things in the grain sector. Why wouldn't we copy that successful program? We heard your colleague here talk about how universities are losing these top minds to other countries, yet we're not providing a platform for them to come over.

So if the university isn't the platform, what are we doing to make it something else?

[Andrea Brocklebank]

About 60% of our funding goes into forage and feed grain varieties. That is somewhere where the private sector has not been able to capitalize to the same extent, basically due to the nature of forages and feed grains, especially with barley, where they can't capitalize upon that and develop and privatize those varieties. To some extent that's where the beef industry very much feels that there is a—

[Randy Hoback, Conservative, Prince Albert, SK]

The proper patent protection, proper trade mark protection is very important.