Agriculture Committee on May 16th, 2017

[The Chair, Liberal, Pat Finnigan]

Good afternoon. Welcome, everyone.

Our meeting has been cut a little short. We will have close to a full hour with our guests.

Lawrence MacAulay, Minister of Agriculture, welcome.

Also with the minister, we have from the Department of Agriculture and Agri-Food, Andrea Lyon, deputy minister; Tom Rosser, assistant deputy minister, strategic policy planning; Pierre Corriveau, assistant deputy minister, corporate management branch; Fred Gorrell, assistant deputy minister, market and industry services branch; and from the Canadian Food Inspection Agency we have Paul Mayers, vice-president, policy and programs branch. Welcome, all.

Thank you all for being here with us today.

Replacing Francis Drouin, we have Chandra Arya. Welcome, Mr. Arya.

And for the Ministry of Agriculture we have Gerry Ritz. Welcome.

We'll start immediately. I will give the floor to the minister for 10 minutes.

[Lawrence MacAulay, Liberal, Minister of Agriculture and Agri-Food]

Thank you very much, Mr. Chair. I'm pleased to be back at the committee again.

Good afternoon, everyone.

I want to thank the committee for its outstanding work in supporting the agricultural sector. You have recently been looking into some important issues, including agricultural debt, animal welfare, and the next agricultural policy framework. I want to thank you for your hard work and contributions on these issues.

The message I want to bring to you today is that our government will continue to work with you to grow Canada's agriculture and food sector. The main estimates before you show there is a federal government investment of $2.3 billion. These dollars are supporting a strong, competitive, innovative, and sustainable agriculture and food industry across the country.

Today, Mr. Chair, I would like to talk on three points: our government support for the sector, the next agricultural policy framework, and a look at the priorities ahead.

Agriculture is a high priority for our government, and proof of that is in the budget that we tabled eight weeks ago. Budget 2017 clearly positioned agriculture as the leading growth sector of Canada's economy. In the few years I have been an MP, I have never seen a federal budget give so much importance to the growth opportunities in the agriculture and agrifood sector. The sector is one of the six targeted areas in our government's new innovation and skills plan.

Budget 2017 supports the key drivers of a competitive Canadian agriculture and food sector.

On trade, the budget targets growing annual agrifood exports to $75 billion by 2025, expanding markets in Asia, finalizing the comprehensive economic and trade agreement with the European Union, $10 billion in a trade and transportation corridor, and $2 billion to support rural infrastructure, including roads and bridges.

On innovation, our budget invests $70 million in agricultural science and innovation to address the emergency priorities, such as climate change and soil and water conservation; almost $1 billion in superclusters, focusing on innovative industries, including agrifood; and over $1.2 billion in a strategic innovation fund to attract and support new high-quality business investments in emerging sectors such as agrifood.

On the environment, the budget provides $200 million to support the expanded adoption of clean technology in the natural resources sector, including Canada's agrifood; and over $5 million to extend the green jobs program to help farmers make green improvements on their farms and give young people job experience in agriculture.

The budget also renews the government's commitment to the next agricultural policy framework. We are making good progress on the framework. Based on the input from the agricultural sector last July, provincial and municipal ministers and I agreed to six key priorities as part of the Calgary statement. They are markets and trade; science, research, and innovation; risk management; environmental sustainability and climate change; value-added agriculture and agrifood processing; and public trust.

I had a productive meeting in Ottawa last week with my provincial and territorial colleagues, where we continued these important discussions. I look forward to the annual meeting in St. John's in July, where we will continue to work towards launching the next policy framework.

I want to thank the committee for its excellent work and recommendations on the agricultural policy framework. We are currently reviewing the committee's recommendations, and your input is valuable.

I can assure the committee that we will work with our provincial and territorial partners to ensure that the next agricultural policy framework meets the needs of the sector and Canadians. Like you, we are consulting closely with industry and Canadians. We will build a foundation for the future for our great industry. It will support the growth potential of the Canadian agriculture and food sector.

As well as the next policy framework, we have a number of priorities this year that will build on our recent successes.

The comprehensive economic and trade agreement with the European Union is a key priority. We are working hard with industry to make the most of the opportunities offered by CETA. The historic agreement will unite the markets of 35 million Canadians with 500 million Europeans. CETA will expand our agricultural trade with Europe by an estimated $1.5 billion a year. Beyond Europe, I will continue to work with all our international partners to promote our Canadian exports and ensure our trade is open and based on science. In the coming year, we're planning missions to key markets including the U.S. to meet my counterparts in Washington and the European Union, and a return mission to China. There is nothing like face-to-face meetings to expand our trade in these markets.

While promoting trade, I want to assure this committee that our government also continues to stand up for supply management. We are investing $350 million to help Canadian dairy farmers and processors stay on the cutting edge of innovation and make the transition to CETA. These important programs will be in place when CETA enters into force.

We will also continue to build our relationship with our largest trading partner, the United States. I recently delivered speeches to two key stakeholder groups in the U.S.: the State Agriculture and Rural Leaders in Louisiana, and the New England-Canada Business Council in Boston. I also had a very good call with the newly confirmed Secretary of Agriculture, Sonny Perdue, last week. We both understand the importance of a trading relationship. We will also continue to promote the benefits of NAFTA, which has increased agriculture in North America by four times.

Moving our products is critical to reach new markets and grow exports to our current customers. You cannot have trade without transportation. That is why the government has committed to bringing forward legislation to help build an efficient and reliable grain transportation system in Canada. This morning, we delivered on that commitment when the Minister of Transport tabled legislation in the House. The proposed legislation is part of Minister Garneau's overall 2030 strategy. It will address key concerns raised by the grain industry during the consultations. This proposed legislation will help to make Canada's rail transportation system more transparent, fair, and efficient now and in the years to come.

Building on these measures, today I am pleased to announce the Government of Canada is also renewing the crop logistics working group. The working group has done a great job bringing industry and government together. I am pleased we can continue to benefit from these insights in the years ahead. The industry also told us that information and collaboration are critical to ensuring top performance. We need a clear and timely picture of how well the system is performing at any time. That is why I'm also pleased to announce the government renewed the grain monitoring program for another three years. This will give the industry an accurate picture of how the system is working and help us take quick action on any issue that may arise.

Looking ahead, we will soon launch consultations with industry and Canadians to develop a national food policy. We are committed to undertaking broad consultations with stakeholders and Canadians on the development of food policy. I understand that the committee may also undertake a national food policy study. I certainly look forward to your recommendations, if you do so.

Of course, we will continue to reach out to young farmers, who are the future of our industry. We will continue to ensure we help our youth get the skills and support they need to drive Canadian agriculture forward for generations. It is always so inspiring to meet young people who are so passionate about the future of agriculture. I held a number of youth-in-agriculture round tables and Facebook Live events across the country because it's so important that we sit down with youth and understand their issues and concerns and see how they view the agricultural sector.

Mr. Chair, Canada 150 is a source of pride for farmers because agriculture has such deep roots in our Canadian history.

Agriculture will certainly play a vital role in growing our future. Looking ahead, I see tremendous promise and potential for the sector. Dominic Barton, chair of the finance minister's advisory council on economic growth, recently issued a report stating that Canadian agriculture can be a “key” part of Canada's path to prosperity. Canadian farmers and food processors produce the best food in the world, and they're well placed to meet that demand.

While our nation has tremendous opportunities, we can take nothing for granted. Success will take a lot of hard work and deeper partnerships. There will always be challenges, but if we work in a united front, we can continue to have great success in this country. I look forward to working with this committee to grow this bright future in agriculture.

Thank you very much.

[The Chair, Liberal, Pat Finnigan]

Thank you, Mr. Minister, for this opening statement.

We will now start our rounds of questions.

For six minutes, we have Mr. Bev Shipley.

[Bev Shipley, Conservative, Lambton—Kent—Middlesex, ON]

Thank you, Minister, for joining us today.

I would like to start by stepping back. In terms of the Canadian Dairy Commission and the policy framework, I was taking a look at some of the changes that happened in the commission, and I have a question on contributions to support the agricultural adaptation program. In its 2016-17 estimates, it was a little over $10 million. It moved down to $5.5 million.

I can see where some $800,000 went, but I'm wondering if you could help me see where the rest of the money got allocated, money that was there in terms of the adaptation program. Actually, Minister, when you're talking about all the things we want to do in terms of research adaptation, I'm seeing a cut of some $5 million to $6 million. I wonder if you could help us on that.

[Lawrence MacAulay, Liberal, Cardigan, PE]

I think I'll let Pierre answer that detailed question.

[Pierre Corriveau, Assistant Deputy Minister, Corporate Management Branch, Department of Agriculture and Agri-Food]

In the department reference level, this shows as a reduction, but in fact the money stays with the sector. That money is being transferred, with $4.47 million that's being transferred to the Department of Western Economic Diversification. It is to support the Saskatchewan Cattlemen's Association for a project planned with the University of Saskatchewan and and their vet college for two facilities, one in Clavet, Saskatchewan, and one in Floral, Saskatchewan. That is to support the organization.

That department, WD, will take the lead on this, but a portion of the funding is coming from this department. It's a normal process. Obviously from a departmental reference level, there's a small reduction, but the money stays with the sector.

[Bev Shipley, Conservative, Lambton—Kent—Middlesex, ON]

Thank you. There may be a follow-up to that a little later.

In terms of transportation, there have been dollars allocated, Minister, and you've talked about the money that was going to go rural transportation in terms of roads and bridges and what have you. What we're seeing in reality right now is that a huge majority—close to some 94% or 95%—of infrastructure projects have failed to even start construction. Then, when we look at the infrastructure funding across there, we see that there really isn't any new infrastructure spending beyond the 2016 fall economic statement. When you look further, you see that the majority of the funds are back-ended until after 2022. That moves us down the road a little ways.

In terms of funding for transportation, we're talking about it locally, like what you talked about with roads and bridges, but we're also talking about large projects. If we're going to be exporting—we're an export nation—and we need to get to markets, we need to have the infrastructure to get to the markets. I'm getting concerned when I see the back end of the transportation budget in terms of the estimates moving backwards, and in this case forwards until after 2022. I wonder if you could help to explain that.

[Lawrence MacAulay, Liberal, Cardigan, PE]

As you understand, the infrastructure situation in the country was not in great shape when we took over government, and what we wanted to do was make sure that we made a major investment because our government fully understands that you have to be able to move the product along with being able to produce it. We have the best farmers and ranchers in the world, but they also have to be able to move their product.

That's why, with the green infrastructure of $21.9 billion over nine years, most of that is with the provinces and territories as a joint agreement. What we want to do is work with other governments to make sure we put the right infrastructure projects in place so that, for the agricultural side, we'll be able to move our products. Also, trade and transportation corridors will have $10.1 billion over 11 years.

All of this is vitally important, and I'm not the infrastructure minister, but I was certainly very supportive of this issue because I fully understand that, if you do not have the infrastructure in place, one of the first things you have to do is make sure that you can move your product.

[Bev Shipley, Conservative, Lambton—Kent—Middlesex, ON]

Yes.

[Lawrence MacAulay, Liberal, Cardigan, PE]

Mr. Shipley, I'm just trying to answer your question.

What is so negative on trade and on economy is a poor transportation system. That's why, too, I was so big on reciprocal penalties, even in the railroad. Being a farmer, I couldn't imagine the likes of that happening.

A lot of things are taking place, but it can't all happen overnight, and we're going to make sure that we put the proper systems in place so that the farmers can move their products.

I appreciate your question.

[Bev Shipley, Conservative, Lambton—Kent—Middlesex, ON]

Yes, and I understand that.

Prior to that statement, we had the largest infrastructure spending where we actually put shovels in the ground. This one is a concern, moving it to 2022.

I want to go then to the green jobs program that you talk about, improving on their farms and giving young people job experience in agriculture. We know there is a huge demand, and there is an appetite from young people, but what I don't see any money in....

We're having trouble in the agriculture sector getting realization and appreciation for the positive benefits that agriculture brings to the environmental file. I don't see any money being spent to help promote that benefit that agriculture is already doing with the environment.

[Lawrence MacAulay, Liberal, Cardigan, PE]

Of course, number one, I would say that farmers are the best stewards of the land, for sure. But indeed, all this money is allocated to making sure that green projects come into place. It helps the farmers modernize their farms in an environmental way. That's why this program was put in place.

We also understand quite clearly that the $2 million last year was not nearly enough, so we more than doubled it this year. I'm very pleased that we did because we are moving on the environmental side in order to make sure that the agricultural sector is able to move even more forward. Nobody is more concerned about the land and a lot of issues on the environment than farmers. Being one myself, I understand you can't let it wash away, and there are a lot of things you have to do as a farmer.

This gives young people an opportunity to work on farms, to see these projects taking place. I think these programs.... Well, I know that last year was so successful, and the next couple of years will bring even more benefits to the agricultural sector, and always young people are looking at, “Well, what's your experience?” Well, they'll have experience. That's another important part in a very important field.

[The Chair, Liberal, Pat Finnigan]

Thank you.

Now we have Mr. Longfield for six minutes.

[Lloyd Longfield, Liberal, Guelph, ON]

Thank you, Mr. Minister, for being here, and thanks to the people from the ministry for being here for the detailed questions.

I have a question around the agricultural policy framework discussions with the provinces, and then I want to follow up with a question, if we have time, on changes with the CFIA budget.

On the discussion with the provinces, I understand from your presentation and also from the media that you were talking with the provinces in the last week or so. Guelph has the provincial and federal ministries in our city. There is a really good collaboration between the two. As we look at superclusters and the opportunity that they provide, are other provinces as excited as Ontario about getting into bullet point two, which is science, research, and innovation and specifically around the creation of these superclusters?

[Lawrence MacAulay, Liberal, Cardigan, PE]

Mr. Longfield, I appreciate your question, and absolutely, when you sit down.... I deal of course mostly with the ministers and agricultural union leaders, but there is absolutely no question. I don't think that anybody understands the importance of research and all of that more than farmers.

Just as an example, canola was established through scientists in the Agriculture and Agri-food department. They understand so well how important these programs are and how important it is that the dollars are used properly. The results end up in money in the farmer's pocket. In the end that's my responsibility, to put more money in the farmer's pocket, and that's what I want to do.

I think it's fair to say, right across the country, of course farmers want to do better, but they understand how they need to do better, not with more land, but with more results from the land they use.

[Lloyd Longfield, Liberal, Guelph, ON]

In terms of the discussions with the provinces around the agricultural policy framework, how is that going?

[Lawrence MacAulay, Liberal, Cardigan, PE]

It's going well, but there's always a discussion.

When you sit down with 12 or 13 different ministers and different governments, everybody has an opinion, but it's working well. We had a great meeting last week here in Ottawa—a lot of discussion.

You know what the main objectives are for the agricultural policy framework, and it's fair to say that all ministers agree that's the direction to go in. I think that's what will take place. I can't say for sure, because I'm one-thirteenth of the program.

I'm sure Gerry is well aware of this. It's negotiations, for sure, but everybody is there to make sure that every dollar is spent in the best way possible.

[Lloyd Longfield, Liberal, Guelph, ON]

Yes.

[Lawrence MacAulay, Liberal, Cardigan, PE]

There was a big discussion on business risk management programs. We're trying very hard to make sure we make these programs better, to make sure that the dollars are used in the best way possible. That's a responsibility of government.

[Lloyd Longfield, Liberal, Guelph, ON]

Yes, terrific. Thanks.

Hopefully that work we did, the study that we did, provides value. It was nice for you to mention that up front as well.

[Lawrence MacAulay, Liberal, Cardigan, PE]

Yes, absolutely.

What's so important is that when you get the ideas—and I'm sure everybody around this table knows too—when you get what's needed, it's probably not even from the ministers, it's the round tables and discussion that you have around the country. It's the people who actually do the work on the land, or represent the people who do the work on the land. You want to hear from the grassroots just what the problem is.

I think it's fair to say that we did, and we hope to address these problems as well as we possibly can.

[Lloyd Longfield, Liberal, Guelph, ON]

The creativity of farmers is never to be underestimated.

[Lawrence MacAulay, Liberal, Cardigan, PE]

You're right.

[Lloyd Longfield, Liberal, Guelph, ON]

Looking at the Canadian Food Inspection Agency, I'm noticing that the main estimates are showing a decline from $805 million on the most recent estimate, down to $704 million for 2017-18.

I just have a concern that we're supporting the CFIA in the way that it needs to be supported.

[Lawrence MacAulay, Liberal, Cardigan, PE]

We did make an investment, but I'll let Paul give you the details on that.