International Trade Committee on Feb. 16th, 2023

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Is it also true that the House unanimously reaffirmed its support for supply management on several occasions?

[Luc Thériault, Bloc, Montcalm, QC]

Indeed, I mentioned this several times earlier. The House voted unanimously in favour of protecting supply-managed producers.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Yet, it wasn't enough.

[Luc Thériault, Bloc, Montcalm, QC]

It's at the negotiating table that problems occur. That's where decisions are made to sacrifice market share. However, Bill C‑282 seeks to legislate what happens before treaties are signed. That's why it's important.

In fact, if a government, be it Liberal or Conservative, decides to support supply management, the bill would prevent that government from negotiating the three protected sectors once at the table. It would be non-negotiable under the bill, as is the case for other products in other countries. The government would then have a mandate to not put it on the table, but also the ability to say, “It's my Parliament; let's move on to another issue.”

If there were ever any intent, be it malicious or perverse, to not respect the legislative authority, this bill would force the government to go back and table new legislation in the midst of negotiations. That would be somewhat futile. It would bear the blame for that decision.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

You used the U.S. as an example. It has legislation officially protecting cotton and sugar. U.S. negotiators wouldn't allow any breach into those sectors.

Have you heard that the U.S. would be weakened during negotiations because of that legislation, that it would undermine the U.S. or make them weak negotiators?

[Luc Thériault, Bloc, Montcalm, QC]

No.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

The EU doesn't have similar legislation. Instead it holds fully transparent debates and votes to decide the negotiators' mandate, including which sectors they want to open up, which ones they want to protect and which ones are untouchable.

Have you ever heard that the EU would be weakened as a result of that process?

[Luc Thériault, Bloc, Montcalm, QC]

No.

To my knowledge, the mandates given by parliaments are respected at the table.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

The Comprehensive Economic and Trade Agreement between Canada and the European Union has often been cited as an example. It's said to favour western beef at the expense of cheese. Canada said it was prepared to open a few small breaches, to accept a few small adjustments in percentage, because that would allow it to make considerable progress.

However, as we've clearly seen, the European market is closed anyway due to non-tariff barriers. In the end, it won't even have produced the desired effect.

Personally, whenever I hear people say not to put all the cards on the table and to keep the door open, I fear that this is just a way of saying that they're prepared to sacrifice little pieces yet again.

Are you drawing the same conclusion as I am?

[Luc Thériault, Bloc, Montcalm, QC]

If I did not think the same thing, I would not have introduced this bill. We need to stop letting people think we can negotiate on the backs of supply-managed producers. It's important.

Moreover, it is a system that works, it is balanced, and it has implications beyond just milk, egg, or poultry production. It structures the social and economic development of Quebec's regions.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

At the end of the day, this bill fills a gap or void. Words are no longer enough, and the motions made in the House are strictly symbolic.

Don't you agree?

[Luc Thériault, Bloc, Montcalm, QC]

You are right.

I'm not a negotiator, and I don't think anyone here was at the table for NAFTA. You have to put yourself in the shoes of the producers, who were duped three times. Those producers trust us, and they trust you.

All 293 MPs must agree that we need a bill to do this, because it will empower the negotiators. It is the people's assembly of Canada that will have told its negotiators not to touch this anymore. Then we can move on. In my opinion, this is the only way to ensure that there will be no further breach.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Basically, in a democracy, when a country goes to sit at a negotiating table, it is normal that parliamentarians have rights and that they have a say in the story.

Correct?

[Luc Thériault, Bloc, Montcalm, QC]

Usually, this is how it is done. The executive branch has to respect what the all-party legislature of the people's representatives states and wants.

However, since on three occasions this was not done, this private member's bill will give negotiators one more mechanism to enforce the word of elected representatives.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Next, we have Mr. Cannings, for six minutes, please.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Thank you, Mr. Thériault, for being here today, and for your bill.

I'm from southern British Columbia, the dry interior. There's not a lot of.... I have one small dairy producer, and I don't think I have any poultry or egg producers, not on a large scale anyway.

I'm more interested in other countries, the foreign markets, how they affect us, and how those countries support their agricultural producers.

My son lives in New Zealand, in the middle of the north island. It's in the middle of the dairy-producing part of New Zealand. It's one of the big dairy-producing countries in the world. It deregulated its dairy industry 20 years or so ago. There's been an enormous amount of consolidation. Right now, there's basically one company, Fonterra, that dominates the New Zealand dairy industry. Over 80% of its products go through that company, so it leaves producers with not much power in terms of how they negotiate prices, from what I understand.

Can you tell us how countries like New Zealand, Australia and the United States are forced to support their agricultural producers, when they don't have a supply management system? What mechanisms do they have to use, and how effective or ineffective are they?

[Luc Thériault, Bloc, Montcalm, QC]

I've already talked about the United States. As for New Zealand, I'd rather yield the floor to the Bloc Québécois expert.

[Marc-André Roche, Researcher, Bloc Québécois]

The beauty of the supply management system is its stability. When production, imports and prices are not regulated, we end up with prices that fluctuate a lot. When they are low, small producers die, if I can put it that way. Market fluctuations invariably lead, as you mentioned so well, to a concentration towards the biggest producers.

That said, regarding New Zealand, to get through periods of low prices, it offers massive subsidies to producers, which we don't need to do here. This costs their taxpayers money and allows their producers to sell at prices below the cost of production, as the difference is made up by subsidies. This makes it difficult for our producers to compete if they are not subsidized to the same level, hence the importance of protecting them.

Every time supply management has been breached to open up 1%, 2%, or 3% of the market, all of that market share has been filled, because a subsidized producer is always going to undercut them, inevitably. That's exactly why we need to maintain the system, including the border barriers, because our producers are not supported by the government, unlike their competitors.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Thank you.

I would like to also talk about.... One might think, if one didn't know much about the whole system, that a producer under a supply management regime has life easy. They wouldn't have to innovate or do things like that. It strikes me that it might be the other way around.

I wonder if you could comment on whether and how innovation takes place in either system.

[Luc Thériault, Bloc, Montcalm, QC]

Earlier, I said that our producers deserved some stability and predictability. It's expensive to buy and operate a farm, not to mention the farm equipment. These people are often heavily in debt. How do you expect them to make more investments and hope one day to pass their farm on to the next generation when they never know when an agreement might come along and saw their legs off? Stability and predictability are important for these people to become increasingly financially independent.

When I read about the American model, I got chills. I thought, this doesn't make sense. People have been made to disappear. How can you control the quality of a product when everything comes from the same person? We know very well that there are a lot of problems with milk produced in the United States for this very reason.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

I have one more question. It strikes me there are a lot of co-operatives involved in these supply management systems, especially in milk. That's how a lot of them started.

I wonder if you could comment on how that works and how beneficial it is to producers.

[Marc-André Roche]

The farms are family farms. The marketing process involves pooling of milk. The largest cheese or milk producers, for example, are mostly co‑operatives.

Just here, nearby, there is the Laiterie de l'Outaouais, which is a co‑operative. Agropur, which is one of the largest co‑operatives in Quebec, has actually bought up several cheese factories in the United States, where the small cheese factories were going bankrupt one after the other because of prices that fluctuated too much. This means that part of its production is in the United States, because our system is more solid.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Thank you.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

We'll move on to Mr. Baldinelli for five minutes, please.

[Tony Baldinelli, Conservative, Niagara Falls, ON]

Thank you, Madam Chair, and thank you, Mr. Thériault, for being here.

Thank you, Mr. Roche, for joining us. Like my colleague indicated earlier, there are a number of dairy farms and farm families in the Niagara region. Previously, prior to getting into elected life, I had the pleasure of working with representatives of the Dairy Farmers of Ontario for a number of years. I know the importance of the supply management system and those it impacts, particularly in the farm families.

I wanted to follow up with some of the questions that were asked earlier on the notion of consultations that you undertook prior to the design of the legislation. Did you seek a legal opinion on the legislation and whether or not it would be WTO-compliant?