Following the changeover from a quota system to a licensed system a few years ago, when the federal government spent about $300 million buying out the quota, and then farmers were able to pick up licences, provided they had contracts with companies, the crop size has more than doubled. We have a huge amount of tobacco circulating around the province, transported here and there and so on, but we have not had a means of actually registering and tracking, by markings, actual shipments as to where they start and where they end up.
The problem with that is, with this great increase in the crop size we've had some expression of concern about the fact that some of the crop is being diverted. We would have had a problem anyway, and there were some anecdotal reports in the Ontario media from law enforcement officers prior to this delay of the regulations and prior to the passage of Bill 186, which created the regulations for the marking system.
There was one story about a farmer who alleged that somebody had stolen it out of his barn, and it turned out, in fact, that he'd sold it to a contraband manufacturer.
There's not been a huge amount, but you don't need a lot to supply a number of smaller contraband manufacturers. So it's not a huge percentage, but it's some.
The reason for the delay, as far as we can tell, is that there are negotiations going on with two bands in particular to set up some form of what I'll just call a tobacco control bylaw on the two reserves whereby the band would take more responsibility for controlling its tobacco manufacturing and sales activities. We certainly don't oppose those kinds of efforts at all.
Fundamentally the problem is that selling tobacco is of benefit to first nations because of the huge price differential between contraband and regular product. If we're looking at changing the way tobacco is dealt with on reserve, how are we going to do that in a way that maintains an economic benefit for the first nations, while controlling the huge levels of smoking prevalence that Mr. Cunningham referred to, and at the same time reducing contraband without eliminating the price differential and therefore the benefit to first nations of making tobacco in the first place?
So there is a fundamental inherent conflict between the idea of trying to give first nations more control over their tobacco manufacturing activities and the ideas that we have in public health about controlling tobacco use, along with this issue of contraband. I don't know how we get to a point where reserves are able to manage their own tobacco supply and derive some economic benefit while at the same time we maintain the price differential between regular product and on-reserve manufactured product without continuing to promote a contraband market. That's the difficulty.
Reserves may have more of a hand in how they do business directly—that's fine, and nobody has a problem with that—but at the end of the day we, as health agencies, want to reduce tobacco use. We don't want to create a system that makes it easier to make and sell more product and give more profit to one group as opposed to another. I don't think that serves public health in any way.