Mr. Chair and committee members, thank you for the opportunity to appear before the committee to speak within the context of your study on innovation.
Canada's horticulture industry is an industry that very much aspires to be innovative, profitable, sustainable, healthy, and bring health with the products we grow for the future and for future generations.
The council represents producers from across Canada primarily involved in the production and packaging of over 100 different fruit and vegetable crops, apples to zucchini, literally. Members include provincial and national horticultural commodity organizations, as well as allied and service organizations, provincial governments, and individual producers.
We represent members on a number of key issues, such as crop protection, access to a consistent supply of farm labour, food safety and traceability, fair access to markets, research and innovation, and government programs.
The mission is to ensure a more innovative, profitable, and sustainable horticultural industry for future generations. Producers are committed to ensuring that strong Canadian farms will continue to be able to provide safe, secure, and healthy food for families in Canada and around the world.
I believe we have a demonstrable record of success in this regard. It includes the seasonal agricultural worker program, established over 40 years ago, which was very innovative at the time; and establishment of the Fruit and Vegetable Dispute Resolution Corporation under article 707 of NAFTA. CHC was integral to the establishment of the Pest Management Centre, and the CHC office was previously recognized as IR-4 North as Canadian trials were coordinated with the U.S. IR-4. CHC also developed and established the CanadaGAP food safety program for fruit and vegetables grown in Canada, which was the first food safety program in Canada benchmarked to the global food safety initiative.
We also led a collaborative initiative, which included the World Wildlife Fund, to develop an integrative fruit production program for the industry. We're a founding member of GrowCanada, and an active participant in a number of value chain round tables and other collaborative initiatives, such as Partners in Innovation.
Improving food diversity and security in a buy Canadian for Canadians manner is a priority that will only be achieved through: dialogue, understanding, and strategic collaboration through adequate funding for research and innovation; appropriate actions to develop and implement policies and programs that foster producer profitability, and that includes traditional and non-traditional risk management programs; ensuring a favourable regulatory environment that is conducive to commerce; and timely access to new crop protection technologies.
As indicated by my colleague, these must be science-based, and we need proper dispute resolution mechanisms, whether it's here domestically or within any of our trade agreements. The language might be good, but they have to be practical. They have to work.
Research and innovation are critically important to maintaining the competitiveness of Canada's horticultural sector. The initial and subsequent announcement of the Canadian agri-innovation program, specifically the clusters, with the stated purpose to encourage key agricultural organizations to mobilize and coordinate a critical mass of science and technical capacity in industry, was certainly welcome. It was received with enthusiasm and a sense of opportunity.
Our industry rationalized its needs and priorities vis-à-vis research and innovation defined with theme areas: health and wellness, food safety and quality, production and production systems, environmental performance of the horticultural system primarily but not limited to pest management, as well as energy management and efficiency. Those themes have served us well and were reaffirmed in 2013.
The CHC-led agri-science cluster for horticulture was a multi-activity project funded by Agriculture Canada in the amount of just under $5 million for science cluster one with an additional contribution from industry of $1.4 million. We were fortunate within Growing Forward 2 to also secure funding for science cluster two.
There have been a lot of successes and accomplishments from cluster one, and we look forward to more success with cluster two. Certainly I would offer that in any future opportunities, should the committee agenda allow, to bring forward witnesses who could speak to those successes and the positive results of investments that have been made. It's important to speak to the people who are the practitioners.
The market access secretariat was created in 2009 as an initial response to the implementation of industry's recommendations to strengthen how Canada approaches market access. Again, there were a number of successes there, but more are to be had. There are other success stories waiting to be had. Most recently for us in our case, we were able to access the Chinese market for cherries in 2013.
Crop protection has certainly been the subject of previous attention and studies by this committee. Investment and innovation are required there through producers and through the manufacturers. We've been very much proponents for the establishment of the Pest Management Centre. I think that's really been one of the success stories of Agriculture Canada.
There is much to be done with pollinators as well in terms of innovation. I think horticulture is very much an exemplary model of how co-existence between production and pollinators can thrive, but there is going to need to be research and innovation taking place there.
Bill C-18, which was also mentioned by my colleague, and our president.... It must be Manitoba for presidents. Our president is from Winkler and he also sent his regrets, but he was with Minister Ritz in Winnipeg in December when, of course, the bill was tabled.
We are very much strong proponents of and support the amendments to plant breeders' rights legislation. As farms work to match production with the growing global population, it becomes increasingly important that they have the tools needed to continue to increase production. New varieties are an important segment of the growth, and strengthening plant breeders' rights in Canada to conform with UPOV 91 will encourage investment and breeding.
I must comment on the U.S. farm bill. I know it's often difficult to compare country to country and the programs in both because they never will be the same; however, certainly for us in our reliance on the U.S. market, we very much need to sometimes take stock of that and how it affects our competitive position. Certainly in the most recent farm bill, specialty crops, or horticulture as we refer to in Canada, were very much a winner, with significant increases in a number of areas that are important to us and that we compete directly with them, not only with the U.S. but abroad, regarding their market access program funding, other specialty crop programs, how they address foreign market access barriers, and of course, commitment to research and innovation. In developing our own programs, we cannot fully discount the strategies developed and applied in competing jurisdictions.
I think we also need to take some innovative approaches to succession planning. As we look to the next generation, I think we all recognize very much that there is a challenge and a need to have the next generation continue on with our farms.
The small business tax limit has not been changed since the mid-1970s. The limit uses a calculation that includes assets and debt to determine whether the business farm continues to be eligible for the exemption.
As the next generation becomes involved in the farm, there is a need to look at expanding the farm to ensure that the operation can sustain the growth or, in the case where there are brothers or what have you coming on, increasing the number of people who are dependent on the farm. We often see where this requires that the farm must purchase additional land and equipment, which very quickly results in the farm exceeding the $15 million limit, which forces the farm to pay much higher rates of tax. In some instances, we've had some of our members talk to us about succession. They've seen that bringing sons in increases their tax bracket from 25% to 47%. They don't object to paying tax, but is that an appropriate or innovative way to approach succession?
Changes to Growing Forward 2 that support programs for farms, such as agri-stability, must be rationalized, and the approaches reviewed as we look forward to an ex-strategic framework.
Opportunities are all around us, and the challenge is for all of us to ensure that they are fully realized. The Canada-U.S. regulatory cooperation council and associated work plan was, in many respects, innovative and very positively received and supported by us, and we hope it will continue. However, those initial objectives must be completed. In particular, when I look at the long-standing financial protection for produce sellers, I see that as a good example of something that has to be finished.
As always, we appreciate the opportunity to come before the committee and certainly would encourage or invite you as you travel the country to call upon us to visit any of our many members and see your investment at work.