Agriculture Committee on Oct. 25th, 2016

[Alaina Lockhart, Liberal, Fundy Royal, NB]

The reason I bring it up is I know in my area, New Brunswick, that's one of the things I hear an awful lot from farmers. They have viable businesses, but limited opportunity to transition those. I just want to make sure. If there's a mechanism in the agricultural policy framework that would facilitate that, then we would look at that, too.

[Ron Bonnett]

The one thing in the agricultural policy framework, I think, that's critical with the transitioning in the farming is getting outside advice from accountants and lawyers to really make sure that you have a plan in place that ensures it's viable for the young person taking over and, at the same time, ensures that there's that retirement income for the person selling the farm.

We've heard horror stories where people didn't do proper planning ahead of time and, all of a sudden, they find they have a huge tax liability. Making sure that the business planning is really part of the next APF, particularly with respect to succession planning is critical.

[Alaina Lockhart, Liberal, Fundy Royal, NB]

Very good. Because we are talking about the transition of large businesses, for the most part.

Are there regional considerations? I gave you the example of being from New Brunswick, but is there anything happening differently, regionally, across Canada?

[Ron Bonnett]

I'll fill in, and the rest can answer as well. If you look across the country, it's a common issue regardless of where you are. There might be some scale differences. If you get into some of the farms in western Canada, they're very large, land-based farms. In eastern Canada, in some of the supply-managed farms, there's a lot of capital investment in those farms that has to be transferred. I wouldn't say there's a difference in the issue. There just might be a difference in the scale and the types of things that might have to be addressed.

[Fiona Cook]

I would also just like to point out that contrary to popular belief, most farms in Canada are still family-owned. If you look at the tax rules, you'll see it's often more advantageous to sell your farm to an outside interest than to pass it on to a family member because of capital gains treatment, etc. That's something that perhaps needs to be looked at in the future.

[Alaina Lockhart, Liberal, Fundy Royal, NB]

Thank you.

I think that's pretty close to my time,

[The Chair, Liberal, Pat Finnigan]

Thank you, Ms. Lockhart and Ms. Cook.

Madam Moore, you have six minutes.

[Christine Moore, NDP, Abitibi—Témiscamingue, QC]

Thank you, Mr. Chair.

My question has to do with funding programs like AgriStability. Growing Forward 2 was also mentioned.

How could we adapt these programs to small crops and somewhat atypical products, in other words, unusual products?

How could we meet the needs of these people?

Mr. Bonnett, perhaps you could respond first.

[Ron Bonnett]

I think we have to start looking at doing some analysis, first, of how the programs respond to different-sized farms. I know our staff have been engaged in discussions with Agriculture and Agri-Food Canada to see if there are ways that we can tweak the programming so that it responds to the needs of different farmers, because it may be very different if you have a very large farm versus a very small farm. There have been some discussions taking place, but it does get into some detailed discussion...“If we shift it here, what is the impact going to be?” But I think that has to be part of the discussion with the next agricultural policy framework, to ensure that the programs respond, and to realize that there are some differences in the size of farms.

Fiona.

[Fiona Cook]

I will definitely agree with what Ron has just said. That's why we'd like to see the AgriStability program have some flexible options in there. That would take into consideration different sizes of farms, different types of farms, maybe even where they're located. If you look at the 35% participation right now, you'll see, I believe, that the AAFC data shows that this covers 60% of farms, which at first sounds good, but that pretty well means it's probably the really large farms that are covered there. So the smaller, newer entrants, perhaps, are not using those programs because they're not flexible enough, and they're also quite complicated to administer and to apply for.

[Christine Moore, NDP, Abitibi—Témiscamingue, QC]

This may be more common in remote regions, but we are now seeing the emergence of agriculture on a human scale. These are often people who produce a little more than for their own needs and want to be able to sell their surplus locally.

However, they often face a range of administrative problems. Take, for instance, a person who has fifteen or so hens and who, obviously, can't eat 15 eggs a day. If that person sells them to a few neighbours, this may work for a while, but since it isn't allowed, the person ends up getting a slap on the wrist.

Do you think there are aspects of the strategic framework that would be important to consider so that it would be possible to maintain agriculture on a human or local scale?

[Kurt Siemens]

I could maybe speak to the small farms that produce probably in excess of what they can personally use. They can sell those products. I can speak mostly for Manitoba because I know the rules and regulations in Manitoba. I'm not sure about all of Canada.

They can sell that product. It's just that if they sell it to a public market, or for resale, where somebody else is going to use it in baking, the product hasn't been inspected, and that causes an issue with the CFIA. Those are some of the rules that they would have to work under.

As far as regulated producers, we have regulated producers in Manitoba who have less than 3,000 birds, and they are considered small farmers. They will do other farming with it. If they're a regulated producer, they would follow our same standards and they can sell those eggs to a grading station. Small farmers who are not regulated can also sell to a grading station, but the difficulty is the standards that those eggs were raised under.

As a comment to your first question of how to make it simpler for some of these small farmers or more remote farmers, if the agriculture policy framework, the application process, the ability to understand, were better, and if it were more transparent for them to fill out the application and get the application through simply, that would be much easier for them. The big farms will potentially have a person who is in charge of filling out all of this paperwork, whereas the small farmers might not have that. It's making that simpler for them to do that.

I don't know if that relies on the federal or provincial, but somehow or another that has to be worked out, to make it possible for them to do that.

[Christine Moore, NDP, Abitibi—Témiscamingue, QC]

I have a short question.

On some farms, farmers do not have access to Internet. Often you have to apply for programs on the Internet and you do not have access. In fact, you know well how a tractor works, but a computer is another thing.

Do you think we should keep applications available in ways other than the Internet?

[Kurt Siemens]

Absolutely.

I did apply for some growing forward 2 funding this last time. Because I have an Apple computer, it took me an extra...at least six or eight hours, and I had to really work through it to try to make that work. The ability to even fax in the application is not a bad thing. I mean electronic is great, but there have to be some options out there.

[Ron Bonnett]

I would support the whole paper concept, but I think you've raised a broader issue, which is that we need Internet access in rural Canada and we need it bad. Everything we go to do now is based on Internet capability. It's a matter of not only having the bandwidth but the costs.

I tell this story. We use an Internet system that uses a Bell stick. It was fine and dandy until our grandkids came to visit for five days and they hooked on with their iPads. The bill went from $50 to $650.

[The Chair, Liberal, Pat Finnigan]

Thank you, Mr. Bonnett.

Thank you, Ms. Moore.

Mr. Drouin, you have the floor for six minutes.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

I want to say that I hear you loud and clear in terms of access to broadband. All you have to do is drive half an hour in a circle around Canada's capital and you won't have access to broadband, which I think is a shame.

Kurt and Alison, in your statement you mentioned that over the past 50 years, egg farmers were able to increase their production by 50%, meanwhile reducing their environmental footprint by 50%. As you know, the “Calgary Statement” makes mention of one of the pillars, which is environment and climate change.

How do you see the APF supporting farmers in reducing that environmental footprint? How do you think the APF could help?

[Kurt Siemens]

I think there are programs. As I mentioned, the net-zero farm that we talked about in Alberta is a great example of how APF can help us in the egg industry to become more environmentally friendly. Most of the provinces, if not all, are actually working on environmental policies as part of their egg farmers policy programs, to find ways of having fewer emissions.

In Manitoba, they're working on an ammonia reduction system that gets installed in barns. It's very simple and farmers can operate it. The simpler you make it, the better it works. If you make it too complicated, it tends to have downfalls. So if the APF can be part of helping with some of the funding, as they do now—on my farm, if I want to apply they'll pay for 65% and I pay for the other 35%.

I think those are great opportunities for farmers to hook into those things, because some of these new technologies do cost some extra money and if the farmer isn't ready for that, if there's that little bit of help from the APF that's a great way of being able to attain some of those environmental goals that we're setting for ourselves and setting for our industry.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

With regard to the application, I know back home I've heard about timing of the application. It used to be a once-a-year model, now they've moved to a quarterly model in Ontario. I'm not sure if it's like that in other provinces. Do you find there should be more flexibility in terms of timing of application?

[Kurt Siemens]

I can speak to that. I know with my last application there wasn't a huge window for me to apply. It's open, now it's closed. You're not allowed to start anything until you've been approved. Why wouldn't you sometimes let the producer go through the process and put his own money out, and later on apply for the funding after the fact? If you would get 50% or 60%, that would be helpful at times, because of construction periods. Suppose I'm approved in October. Well, I can't build anything until next year, so sorry, you're into next year, you're not approved. Some of those are difficult.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

I assume there would be an understanding on the producer's side that he or she may not be able to qualify.

[Kurt Siemens]

Exactly. If he knows that going in, that's part of the business plan he has to develop.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

Ron, you and Mr. Anderson have talked about farm debt and some of the tools that may be available. I know in Ontario they have the Agri-food Management Institute that gives courses on business practices and whatnot. Have you heard from your members that this is working well?

[Ron Bonnett]

Yes, it's working well. One of the things we're running into is a lot of the farm management courses are being put on the Internet now, so it brings us back to the Internet question. Each province has taken the going forward money and used it differently with respect to farm management. I know the Agri-food Management Institute in Ontario—I believe it's called CRAAQ in Quebec—does some work. I think from the APF side, looking at business planning, it could be identified as a priority area of investment. The other thing is the cost-sharing, which shifted to 50:50 and left some organizations struggling to actually raise the amount of money to move forward with projects. I think taking a look at that funding model and moving back more to 70:30 would likely be a goal, still having industry putting in some and groups putting in some. I think that would be an important way to go.

Referring to your previous question, you were talking about the whole aspect of environmental sustainability. The environmental farm plan...I think we're looking at seeing if we can use this as a model now for dealing with a number of sustainability indexes, whether it be animal care, water, pesticide, herbicide use. We're finding more and more the public is asking the question, how are you doing in meeting these benchmarks? I think moving forward with an enhanced environmental farm plan would be one way to deal with that.

[The Chair, Liberal, Pat Finnigan]

Thank you, Mr. Bonnett.

Thank you, Mr. Drouin.

Now we'll move on to Mr. Breton for six minutes.