International Trade Committee on April 19th, 2016

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

I don't disagree with that.

This is a democracy. It's driven from the grassroots up. But I can count the number of calls I've had on the national pharmacare program on one hand, so it's not 91%. I could solicit my friends here too, and they would probably say the same thing.

Anyway, that aside, Mr. McGowan, thank you for your presentation.

I don't disagree with a lot of what you're saying about the temporary foreign worker program. The problem is that there are three different streams, and you're sort of intermingling a bunch of them.

On the the low-skilled work, absolutely, there's a lesser wage paid, and so on, because they are filling a niche. However, they are very temporary.

As for the skilled trades and high-tech work, where they bring in someone to set up a computer program because they are skilled at it, and go back as part of that company....

On the skilled trades, the other stream, everything is still in place. The company bringing in a person has to prove that they tried to buy Canadian work first. They have to pay the prevailing rate. They also have to pay the air freight, or whatever it costs to bring the person in, and have a ticket to go back out again. They supply housing, health care, and all of that. It actually costs more to bring in a skilled temporary foreign worker than it does to hire a Canadian, if you can find them.

As far as my opinion—and I really look forward to looking at your legal synopsis—I haven't seen anything in TPP that says Canada doesn't still have the right to adjudicate that stream of workers, which is really what the TPP is about.

[Gil McGowan]

Actually, the TPP explicitly says that all of those safeguards that you've just talked about would no longer apply for workers being brought in under the professional technical stream, which is the stream that employers would use to bring tradespeople into the country. They wouldn't apply.

We can have a debate about the temporary foreign worker program as it existed under the Harper government and as it exists now—

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

It's been around since 1986 or something like that.

[Gil McGowan]

Actually, it's much longer. The temporary foreign worker program has been around for almost 50 years in one form or another.

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

But it's the current iteration that we're asking about.

[Gil McGowan]

With the current iteration, the big change started in 2002. The big change was that the Chrétien government turned it from what had been a sleepy corner of the federal bureaucracy that was used by employers to bring in just a few thousand workers every year, mostly in the highly skilled, highly paid trades, as you said, technicians who had specialty skills that Canadians didn't have. They were coming in to install some products from Germany; the German technicians had to come in and out. It was used even for CEOs and high-flying accountants and professors.

That's what it was for, but in 2002 the government blew the doors off and said it would allow employers to use this program to bring in lower-skill workers, and then the skill level got lower and lower to the point that employers, especially in the service sector, were turning to it as a first choice for recruitment rather than a last choice, a last resort.

But the point is that what we're talking about here is something entirely different from the temporary foreign worker program.

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

I look forward to seeing your legal synopsis.

[The Chair, Liberal, Mark Eyking]

Thank you, Mr. Ritz. Your time is up.

I thank the witnesses. This ends this panel. Thank you very much.

For the audience, I'm just going to give a quick rundown of who's going to be here in the next couple of hours. Many of you are welcome to stay with us for the next couple of hours.

We're going to have the Alberta Canola Producers Commission, then the Alberta Pulse Growers Commission, and the Alberta Wheat Commission. That will be for the next hour.

Then in the last hour we're going to have the Alberta Chicken Producers, the Canadian Association of Petroleum Producers, and the Canadian Federation of Musicians. That's what we're going to run through today, but right now we're just going to break for 10 minutes, so we can get right back at the next panel.

Thank you very much, folks.

[The Chair, Liberal, Mark Eyking]

Welcome, everybody, to our consultation process.

This is our third panel today, on our second day of our trip across the country. We'll be going to every province. In Ottawa we'll also be hearing from the territories through Skype. We've already met many witnesses in Ottawa.

We're also getting submissions from the public. We had 5,000 last week, and I think we're up to 15,000. We'll be open to many more till the end of June. Then we'll pull it all together.

To the folks here, we're going to try to do this report this year. It's ambitious to do it. As many of you know, I think it's 6,000 pages. We're going to try to reach out to the whole country and everybody, but we also have to go through the report ourselves, draft it, and put it in front of Parliament. Our general idea is to have this before Parliament before the end of the year so that other members of Parliament can see it before there's any vote in the House of Commons. I'm sure there'll also be lots of debate in the House of Commons.

That's the lay of the land in terms of how we're operating.

Today we'd like to give each witness five minutes. We have with us the canola producers, the pulse growers, and the wheat commission: that's multi-grain, so we're good to go.

[Voices]

Oh, oh!

[The Chair, Liberal, Mark Eyking]

We will start with the canola producers.

Janelle.

[Janelle Whitley, Manager, Policy Development, Canadian Canola Growers Association, Alberta Canola Producers Commission]

Hello. I will start, and then I will pass it over to Greg.

[The Chair, Liberal, Mark Eyking]

No problem. You can split the time, but if you can keep it under five minutes, we'd appreciate it.

Away you go, and thank you very much for coming.

[Janelle Whitley]

Thank you, Mr. Chair and members of the committee. It is an honour for us to appear before you to discuss the importance of TPP to canola farmers.

My name is Janelle Whitley, and I am with the Canadian Canola Growers Association. CCGA is the national association of canola growers, representing 43,000 canola farmers from Ontario to British Columbia on issues and policies that impact their livelihood.

The canola sector is highly trade-dependent: 90% of what is grown in Canada is exported. Free trade agreements like the TPP are critical to our long-term competitiveness. The TPP is home to both our largest customers for canola but also our largest competitors. In 2015 canola exports were valued at $8.9 billion, and $5.3 billion, or some 60% of the total value, came from TPP markets. The tariff reductions secured under the TPP are expected to boost demand for canola, increasing canola's $19.3-billion contribution to the Canadian economy and the 250,000 Canadian jobs it creates.

The TPP offers four main benefits: new market opportunities for canola through tariff reduction, retention of our competitiveness vis-à-vis our primary competitors, new provisions to improve the trade of biotech products, and the ability to capitalize on any expansion of the TPP footprint.

Greg will further break these down.

[Greg Sears, Chair, Alberta Canola Producers Commission]

Good morning.

My name is Greg Sears. I am a farmer from Sexsmith, Alberta, and chair of the Alberta Canola Producers Commission.

ACPC works to increase the long-term profitability of our 14,000 members by investing levies in research, market development, and extension programming. ACPC also advocates on behalf of its members in the area of government policy to ensure that the needs of agriculture, and specifically the canola industry, are met.

For farmers like me, canola is the number one source of income from our operations. In 2014, the sale of canola generated $2.5 billion or 22% of the farm cash receipts in this province. By establishing fair, long-term, and predictable trading environments, agreements such as the TPP are critical to our long-term success.

Farmers grow and sell canola seed, but we're just one part of the Canadian canola value chain that includes everyone from input suppliers to those who process and package this premium vegetable oil product for customers around the world. Canola provides a prime example of how talented Canadians compete and prosper in the world marketplace.

The Asia-Pacific region plays a critical role for Alberta farmers. Vancouver and Prince Rupert are the closest ports, and Asia is the primary destination for much of our canola. As the economies in Asia continue to expand and disposable income grows, demand for our healthier oil and meal is expected to increase.

Under the TPP, the five-year phase-out of oil tariffs on Japan and Vietnam will create new opportunities. Once the TPP is fully implemented, Canadian canola exports could grow by up to $780 million per year, or by roughly one million tonnes of additional canola oil and meal exports.

As a result of the current tariff structures in Japan, Alberta sold $357 million of canola seed but only $4 million of canola oil in 2015. Once again, Canadians have been called on to supply the primary commodity, but other countries have captured the benefits of the value-added activities.

Keeping canola processing at home creates a greater economic benefit for Alberta, for both farmers and those employed in the downstream sectors. Alberta is home to a strong processing industry with facilities that provide delivery options for farmers and support for the communities in which they operate while generating high-quality jobs for Canadians. Furthermore, a strong domestic canola value chain supports growth of our sector and ensures that canola remains a viable cropping option for our producers.

It's important to develop new markets, but it's also important to retain our current ones. The TPP ensures that canola producers remain on a level playing field in our top markets. Failing to ratify this agreement places Canadian canola producers at a significant risk as the United States and Australia would enjoy trade concessions not available to Canada.

The oilseed and vegetable oil trades are highly competitive, and any tariff differences deter users from buying Canadian canola. We see this threat already under an existing free trade agreement between Australia and Japan. Japan applies a lesser tariff on Australian canola than on Canadian canola. As the tariff is gradually phased out and the market has time to adjust, Canada's trade disadvantage will continue to grow. The TPP will end this disadvantage and again place Canadian producers on a level playing field in the marketplace.

The story of canola is one of innovation and farming practices born of Canada's leading edge research and development capabilities. For various agronomic, economic, and sustainability reasons, canola farmers overwhelmingly choose to use the products of modern plant-breeding techniques.

As important as tariff reductions are the provisions the TPP contains to address numerous non-tariff trade barriers. Inconsistent and unpredictable approvals for innovations in crop-protection products and biotechnology continue to cause challenges for Canadian agriculture.

[The Chair, Liberal, Mark Eyking]

Can you wrap it up? You have only a few seconds left.

[Greg Sears]

You bet.

The TPP provides a platform to address many of these pressing issues.

I do have a brief comment about the importance of a transportation system, but in consideration of the time—

[The Chair, Liberal, Mark Eyking]

You might be able to inject that in one of your answers. Be creative and you can get it in.

[Greg Sears]

In conclusion, the Canola Producers of Alberta strongly endorse the TPP. We believe that, like most Canadians, we have the strength to compete on the world marketplace, given an equal-playing field.

Thank you.

[The Chair, Liberal, Mark Eyking]

Thank you, canola growers.

We're going to go over to the pulse growers. We have with us D'Arcy Hilgartner and Leanne Fischbuch.

Welcome, and for five minutes, go ahead, folks.

[D'Arcy Hilgartner, Vice-Chair, Alberta Pulse Growers Commission]

Mr. Chairman and committee members, thank you for the opportunity to speak today.

My name is D'Arcy Hilgartner. I'm a farmer from Camrose, Alberta, which is 45 minutes southeast of Edmonton. I'm also the vice-chair of the Alberta Pulse Growers.

This is the first time I have the pleasure to present at committee; however, I know you've heard from members of Alberta pulse industry several times over the years.

Our organization is part of that industry and a member of Pulse Canada. We represent over 5,000 producers of field peas, dry beans, lentils, chickpeas, faba beans, and soybeans in this province. We're a producer-funded organization, collecting service fees or check-offs from 1% of cash sales on pulse crops from producers to support research, marketing, and learning opportunities for our growers, as well as to support our national organization.

Since the inception of the Alberta Pulse Growers 27 years ago, we've seen growth in our industry, and more significant growth in the past three years. This year, thanks to strong prices and market demand, we project a record year for pulses in Alberta, with an estimated two million acres.

What about processing pulses? Currently, there's limited value-added processing occurring in Alberta, but we anticipate processing of pulse flours. In fact, it should begin in the next couple of years. This will help to further develop our industry, to diversify the rural economy, and to provide high-quality products for processors and consumers. We still recognize that the bulk of our Alberta production continues to be moved as export, and that is why trade agreements such as the Trans-Pacific Partnership are so important to our industry.

As you know, 2016 is the International Year of Pulses, and we see a future filled with opportunities to develop human, environmental, and economic health outcomes, and increase global growth of pulses.

The TPP is critical to the long-term growth strategy of the Canadian pulse industry. Members of the TPP are some of Canada's largest trading partners in pulses and special crops. Combined, these members will be Canada's third-largest market for pulses. The TPP is an opportunity to eliminate tariffs where pulses do not already have duty-free access, to provide a resolution of sanitary and phytosanitary issues between countries, and to provide an alignment between members on trade tolerances for the use of technology in food production.

The TPP also represents an opportunity to increase value-added processing within Canada by eliminating cases where higher tariffs are applied to pulse flours and fractions, more so than the whole product, and an opportunity to gain a tariff advantage over competing pulse exporters that are not part of the TPP and will face higher tariffs than member countries such as Canada.

The Canadian pulse industry would suffer severe consequences with respect to this competitiveness if Canada were not to implement the TPP. Two of the Canadian pulse industry's largest competitors, Australia and the United States, are members and would benefit from duty-free access, while Canadian growers would continue to face tariffs from TPP countries.

With me is Leanne Fischbuch, executive director, who can elaborate on specific opportunities.

[Leanne Fischbuch, Executive Director, Alberta Pulse Growers Commission]

Thank you, D'Arcy.

We trust that Parliament can implement this agreement as soon as possible to enhance the competitiveness of the Canadian industry exporting to TPP countries.

As our time is limited, I have a few points to make in summary. While the TPP will eliminate certain pulse tariffs ranging from 5% to 30%, it is an opportunity to improve the predictability of trade between TPP members concerning trade tolerances for the use of technology in food production.

It is critical that the scientific committees created under TPP are used to align pesticide maximum residue limits and policies on low-level presence of GM crops that are fully approved in exporting countries but not yet approved in the importing country.

Under the TPP Canada has the ability to lead the dialogue on recognition of scientific standards, recognition by regulators of other regulators' risk assessment work and MRLs for technologies used in agriculture. If an importing country accepted another country's tolerance in cases where it would otherwise apply a zero threshold because an MRL has not yet been set or approved, a large majority of MRL-related trade risk would be eliminated.

Canada has the opportunity to work within the TPP to utilize recognition of scientific standards to help ensure that food can continuously and predictably cross borders as it moves from world food surplus regions to food deficit regions.

Sound science-based processes can travel across national boundaries and the principle of sharing risk assessment work and tolerances where appropriate must be included in future trade agreements.

While the potential for disruption of food shipments due to regulatory gaps is not new, I would emphasize that we have the potential to utilize the TPP to get in front of this problem.

With the residue testing becoming less expensive, capable of detecting lower levels and being more prevalent, if we succeed we have addressed an otherwise growing potential trade disruption.

Thank you and we appreciate the opportunity to speak to you today.

[The Chair, Liberal, Mark Eyking]

Thank you, and thanks for being on time and moving that presentation forward.

Now we're going to go on to the Alberta Wheat Commission. We have Kevin Bender and Caalen Covey.

Go ahead.

[Kevin Bender, Vice-Chairman, Alberta Wheat Commission]

Thank you, Mr. Chairman, and thank you to this committee for the opportunity to present to you on this important issue.

My name is Kevin Bender. I farm in the west-central part of the province in the Bentley-Sylvan Lake area together with my dad, my brother, and brother-in-law. We grow all the crops represented here at the table as well as some barley and oats.

I'm a director with the Alberta Wheat Commission and have been for the past three years.

The Alberta Wheat Commission, along with my colleagues here, encourages the government to ratify and implement the TPP as soon as possible. This important agreement holds potential for expanded market opportunities in key wheat export markets.

Among the 12 signatories to the TPP, Japan, the United States, and Mexico are major buyers of Canadian wheat. Three others, Peru, Chile, and Vietnam, buy significant quantities annually. The U.S. and Australia are also major competitors of ours in the international market.

Over 70% of Canadian wheat is exported, meaning that western Canadian farmers depend heavily on foreign markets. To be left out of this historic agreement would be detrimental to Canada's wheat industry. We cannot afford to remain on the sidelines and risk losing ground in these key markets.

Australia and the U.S., as I mentioned, two of our major competitors, would see preferential access to key Canadian wheat markets within the TPP zone in countries such as Japan, Vietnam, Peru, Mexico, Chile, and Malaysia. These major wheat importing countries have annual imports from Canada that make up 27% of Canada's total wheat export market and more than $1.5 billion in annual farm revenues.

Japan is a premium market for Canadian wheat, with average sales in excess of one million tonnes per year. The TPP agreement will provide Canada with additional access through the Japanese state trading enterprise, with improved market access for both food and feed wheat through elimination of duties and increased quotas.

Vietnam, which is a growing market for Canadian wheat, will eliminate its 5% tariffs as a part of the TPP agreement, allowing Canada to compete for the two million tonnes of wheat it imports per year in this country.

With the implementation of the TPP agreement, Canada will also remain competitive in major markets of Peru and Mexico, which both import more than a million tonnes annually. These markets are important to Canada, as the U.S. is attempting to gain market share in these countries with its logistical advantage and would receive preferred access as a participating country in the TPP agreement.

The TPP agreement also creates a framework to prevent biotechnology-related trade barriers and protect Canada from sanitary and phytosanitary non-tariff trade barriers that are applied unfairly, as committees would be developed to address these issues. These trade barriers could create potential market risk and have a negative impact on the agriculture industry.

Several countries have expressed interest in joining with the 12 countries participating in the TPP agreement, including key Canadian markets such as Indonesia, Colombia, South Korea, and India, which would set the stage for unprecedented trade structures and return value back to Canada and its agricultural producers.

On behalf of the Alberta Wheat Commission and the 14,000 Alberta wheat farmers that I'm representing today, again, I'd like to thank you for this opportunity to present, and we encourage the Canadian government to move quickly in ratifying this important agreement.

Thank you.

[The Chair, Liberal, Mark Eyking]

Thank you, sir.

Do you have any more comments, or is that good to go?