Agriculture Committee on Nov. 27th, 2014

[The Chair, Conservative, Bev Shipley]

Thank you, Madam Brosseau.

I now go to Mr. Payne, please, for five minutes.

[LaVar Payne, Conservative, Medicine Hat, AB]

Thank you, Mr. Chair, and I thank the officials for coming today and for an opportunity to review the estimates.

Under those supplementary estimates (B), Agriculture allocated $41.7 million for Growing Forward 2 cost-sharing initiatives. Of course, the Growing Forward 2 five-year program, 2013-2018, policy framework, which was made in 2013 for the agriculture and agrifood sector, is meant to focus on innovation, competitiveness, and market development, and basically “to ensure Canadian producers and processors have the tools and resources they need to continue to innovate and capitalize on emerging market opportunities.”

I'm wondering if you can explain what kind of programs this $41 million will be going to and what economic impact this would have on Canada's agricultural innovation. I'm not sure who's tackling that.

[Tina Namiesniowski]

I think, Mr. Chairman, I'll start, and try to provide a response to that question.

Pierre alluded already to the provision that the department has the ability to reprofile money from the previous year into this year, and we have a particular provision that's related to the cost-shared programming that we support in the context of the agricultural policy framework. So there is $2 billion that's earmarked in our framework for cost-shared programming, and that is programming that's delivered through the provinces. We provide 60¢ per dollar federally for that programming. Also, there are requirements placed on provinces in terms of the percentage of the funding that is devoted to innovation. At a minimum, they have to put 25% of the funding that falls under that cost-shared envelope to innovation and 25% to market development and competitiveness. But it is really up to the provinces to determine which programs they offer at the provincial level, since they know better than we do what the requirements are in their region.

So that $41 million is part of the cost-shared programming; and obviously, together with the federal-only programming, it has a significant impact on the success of the sector in Canada.

[LaVar Payne, Conservative, Medicine Hat, AB]

Basically, you're saying that the provinces make that determination. Is there any information exchange on this? Do they provide anything in terms of how that's going to help a particular province?

[Tina Namiesniowski]

Mr. Chairman, we work with the provinces in the context of the bilateral agreements we have with them. We exchange information on an annual basis with respect to performance targets and the information we're looking for with respect to the impact the programming is having on the sector.

We're working collectively in the context of the agricultural policy framework to ensure that the money governments earmark for the sector is making a difference in helping to, for example, drive innovation, support them in market development, and ensure that our sector remains competitive.

[LaVar Payne, Conservative, Medicine Hat, AB]

Thank you.

Also, we had the supplementary estimates, and I think the minister touched on it a bit, on the $3 million allocated to the Wheat Board for transition costs. Certainly for farmers in my riding, this was really interesting. I had a huge meeting with a bunch of them.

For the most part, they were all for it, but I did have seven guys who were really big-time Wheat Board folks, so they were pretty upset. I said, “Well, the Wheat Board will continue on and you'll still be able to sell your grain.” Anyway, in that process, in that conversation, I asked them if they were going to continue to sell their grain through the Wheat Board. The interesting comment was that they said no, and I was quite surprised by that. I asked them why and they said they could get more money from the other organizations, which told me the whole story, as it turned out.

Anyway, that's a bit of a side story. Sorry for taking you that way—

[Voices]

Oh, oh!

[LaVar Payne, Conservative, Medicine Hat, AB]

Could you outline how this marketing freedom has affected the western Canada grain industry? Do you have anything else to add to what the minister has said in terms of the strong Wheat Board and the vibrant marketing that is available for farmers?

[The Chair, Conservative, Bev Shipley]

Mr. Meredith, please.

[Greg Meredith, Assistant Deputy Minister, Strategic Policy Branch, Department of Agriculture and Agri-Food]

Thank you.

[The Chair, Conservative, Bev Shipley]

I see a smile on your face. You may be limited in what you may be able to talk about in terms of policy.

[Greg Meredith]

I always have a smile on my face at committee.

When we moved to eliminate the single desk, we had two objectives in mind. One, obviously, was marketing freedom for grain farmers in the west, but the other was to establish a viable Wheat Board that would continue to provide choice for farmers. That $3 million is part of that policy decision. Basically, we've said that any financial implication for the CWB that arose from removing the single desk would be the responsibility of the government, and the operations of the CWB would be their responsibility. That particular $3 million goes to the legacy pension obligations that the CWB has to its former employees.

In terms of how marketing freedom is going, I think the minister's comments dealt with how they're starting to develop a fully articulated strategy for originating grain and moving it to the ports. They have water access on the Great Lakes and in the St. Lawrence. They have inland terminals that they've purchased through Prairie West Terminal. They have four new terminals that they've established and are already being built. What this will do is offer greater choice to farmers, and it will increase competition for farmers' grain across the prairies.

[The Chair, Conservative, Bev Shipley]

Thank you very much, Mr. Payne and Mr. Meredith.

We'll now move to Mr. Easter, please, for five minutes.

[Wayne Easter, Liberal, Malpeque, PE]

Thank you, Mr. Chair.

That's an interesting discussion on the Wheat Board. I'll not get into it other than to say what the Wheat Board is now. It's just another grain company—it's as simple as that—that at some point in time, as most of the other corporate sectors do, will try to take advantage of grain farmers and not work in their interests as the old Canadian Wheat Board used to do. I'll leave it at that.

On the Canadian Wheat Board, though, Mr. Meredith, you mentioned—and the minister did as well—some of the numbers on the Wheat Board assets—or “not assets”. It is an issue. It's a debate. Does the department have any documentation on the numbers that they can provide the committee?

There's the $3 million that was talked about, but is there anywhere we can turn to? We no longer have an annual report that's accessible to us. You'll know that. We can't find out what the Canadian Wheat Board does anymore. We can't find out how much they pay in demurrage payments, which were huge last year. That was something members of government always asked for from the previous Canadian Wheat Board, but none of that information is available to us now. It's commercially sensitive.

Can the department provide us with the numbers on moneys that have gone towards the Wheat Board and what they determined the assets to be at so-called market freedom day versus what they are now?

[The Chair, Conservative, Bev Shipley]

Mr. Meredith.

[Wayne Easter, Liberal, Malpeque, PE]

I don't need them today, but can you provide them to us?

[Greg Meredith]

I can give you some indication of what moneys were set aside for the CWB.

The government, in making the transition to an open market, committed $349 million to the CWB for all the costs associated with that transition. You're talking about things like legacy debt against the building and against the ships that the minister mentioned, and you have other expenses like severance.

[Wayne Easter, Liberal, Malpeque, PE]

Yes, I understand that, and I don't want to interrupt you, but I don't have much time and I will anyway.

Do you have any place where those numbers are laid out? As I said, there is no longer a Canadian Wheat Board report that tells us anything. Is there any place we can turn where those numbers are laid out and where they can be analyzed properly?

[Greg Meredith]

The minister took a decision when he tabled the annual financial reports that a lot of that information was commercially sensitive, especially for a small grain company working in the Prairies. At the end of the day, there is not a lot of information that's available, in comparison to the public Wheat Board in the past. The reason for that is that the board is competing in an open market.

[Wayne Easter, Liberal, Malpeque, PE]

Yes, I think what we have now is the small grain company we're operating in the Prairies versus having one of the larger grain companies in the world moving grain.

We'll leave it at that. The number is not available, which I'm surprised the guys opposite are not excited about because they asked everything about the old Wheat Board when it was there and it was always in the audited report. For the old Wheat Board the numbers were always there. In any event, we are where we are.

One of the concerns I hear about a lot is research positions not being filled. Can you give me, either now or in written form, the number of researchers working for Agriculture and Agri-Food Canada now compared with five years ago? As well, how do the dollars for research compare with five years ago?

[Dr. Siddika Mithani]

I will certainly defer the dollar issue to my colleague, Pierre Corriveau.

Let me talk a little bit about the research numbers right now. The number of research scientists we have is about 387. In the department there are about 2,000 employees within science and technology, which is about 40% of the department. The majority of the employees who are in science and technology are involved in the delivery of science. Whereas there are 400 research scientists, there are about 110 post-doctoral fellows who help the research scientists. There are a number of technicians. That is our complement right now.

We have gone through a transformation and the new GF2 has allowed us to look at how we conduct or deliver science in a very different way. It is not about being able to be the only people who deliver the science, but really looking for partnerships with industry and with academia in order to be able to leverage a lot more science as we move forward.

Science is still critical. The way we do science has changed, and it's changed for the better on the basis of partnerships. That's the key objective.

[Wayne Easter, Liberal, Malpeque, PE]

I understand that and I will admit that this government is no more guilty in this research area than we were. We went to the matching dollars in research and one of the problems is that if you're partnering—

[The Chair, Conservative, Bev Shipley]

Mr. Easter, you're well over. I'm going to have to cut you off. Thanks, Wayne.

We're going back to Mr. Dreeshen, now.

Mr. Dreeshen, you have five minutes, please.

[Earl Dreeshen, Conservative, Red Deer, AB]

Thank you very much, Mr. Chair.

I won't go back to the Wheat Board, but I was one person who had to sell into the Wheat Board.

What I'm interested in—and you were just discussing it and perhaps we could flesh it out somewhat as far as the research is concerned. From what I heard there are specifically 387 researchers, but 2,000 others who are in science and technology and taking a look at a different way of doing research so that the money is being invested into clusters. They are the ones who are looking at the different types of new, innovative methods of science.

In the supplementary estimates an additional $30 million has been allocated for science and innovation, and we know what that is going to mean to industry.

I wonder if you could speak about the details of these investments that we have in science and innovation, and perhaps we can get it on the table enough so that everybody understands where the research is, how things are not being cut, and how we are moving forward because of this new approach to science.

[Dr. Siddika Mithani]

Thank you very much for your question.

I'd just like to respond with a few examples of some of the work that the science and technology branch does with industry in terms of industry-led clusters.

When we look at canola, canola is an excellent example of the science and technology branch scientists getting together with university as well as industry to move forward some of the targets for canola. Canola talked about 15 million tonnes, which was their target in 2015. With the research and innovation and the cluster, we were able to achieve that target by 2013. Canola has set another target, and their target now is to move from 34 bushels to 52 bushels in the next 10 years. We are now very much working with them, in terms of genomics, in terms of germplasm development, and in terms of resistence to a lot of diseases that we see in canola, for example clubroot. Sustainability practices are some critical examples of AAFC scientists working with industry to make sure that the economic prosperity of our sector is maintained. That's Canola.

We have a similar partnership with Mustard 21. Mustard 21 have their oriental and brown mustard, and we are helping them develop improved mustard lines. There's not only just the mustard, but also the carinata that is being developed for jet fuel. Another example, our classic example, is the industry-led national wheat cluster where WGRF—the Western Grains Research Foundation—the Alberta Wheat Commission, Grain Farmers of Ontario, and other partners are working with us to develop very high-quality finished wheat varieties for good quality and disease resistence, really based on market signals. It's what the market needs rather than the kind of research that we would want to do in terms of discovery research.