Public Safety Committee on June 19th, 2007

[David MacKay]

I think the goal here is harmonization to a standard, no matter which facility you come from, whether it be a large corporate facility, or a small, independent, rural-based facility. By making sure the standard is up to a certain level of government assistance, we're not going to base the program on the financial wherewithal to achieve that standard. Some of our independents will be disadvantaged because they haven't got the wherewithal, but with government assistance that would be the equalization we might need to get them to where they would be standardized with the larger organizations.

[Rick Norlock, Conservative, Northumberland—Quinte West, ON]

Mr. Chairman, it looks like I've gobbled up all of my partner's time. He can go on the second round. How much more time do I have?

[The Chair, Conservative, Garry Breitkreuz]

About a minute, and a bit.

[Rick Norlock, Conservative, Northumberland—Quinte West, ON]

Thank you.

That brings me to the challenge we have. No matter which way you cut it, the big guy seems to end up the winner and the little guy is still in the same place. That goes the same to the questioning from the Bloc, from Mr. Ménard.

Basically, how do we as a country continue to compete? When we say the government should give us some money, it's like the government has this money. Well, it's not the government's money, it's actually the people's money. We get it from the very people...and eventually it goes down to the customer and the consumer of those goods, and it goes to an advantage and a disadvantage. Some governments really don't have the safety of their citizens...even though they care, they don't seem to be putting as much weight towards it. They are our competitors, but we continue to disadvantage ourselves. I'm not saying we shouldn't do it. I'm just saying it seems to be a conundrum. We're competing against countries that don't have the same rules and regulations that we do.

I will go back to Mr. Ménard. If we make a demand and tell the farmers they can't use so much fertilizer, they can't use so much of these pesticides and insecticides because of this, that, and the other thing, our competitors are laughing at us, because they're using it up the yingyang and they're selling the stuff to us.

I come from an economy that's pretty heavily agriculturally based. We have to be very careful, quite frankly, that we don't disadvantage the very people who have, from the beginning of our country, contributed so much to our wealth. From my personal perspective, we want to work with you, but not at the cost of cutting back our ability to compete against some people.

[David MacKay]

Our country unfortunately pays the penalty of being targeted by terrorist groups. I don't know if Argentina, Brazil, India, and China bear that same problem, but to do nothing would be the greatest disadvantage for the little guy. You will guarantee that small independents will close. Farmers will travel hundreds more miles to get products. The bigger companies potentially will be laughing. So to do nothing to equalize this issue could be one more nail in the coffin for rural communities by disadvantaging and closing up retailers, and thereby disadvantaging the growers. All that cost will be driven right down to the growers and the consumers.

[Rick Norlock, Conservative, Northumberland—Quinte West, ON]

Would CAAR be upset if the government said—I'm not saying the government is going to, I'm just a member of Parliament thinking out loud, which can be dangerous around this place—that if you posted a huge profit you'd be less eligible for funding than if you posted a lower profit or no profit at all?

[David MacKay]

I think if we posted huge profits we shouldn't be eligible for subsidization.

[The Chair, Conservative, Garry Breitkreuz]

Your time is up.

[David MacKay]

Don't forget, we're capitalists too.

[The Chair, Conservative, Garry Breitkreuz]

Thank you.

You made some very good points, Mr. Norlock.

We're over now to the official opposition again. Mr. Cullen, please.

[Roy Cullen, Liberal, Etobicoke North, ON]

Thank you, Mr. Chair.

Thank you, Mr. MacKay and Mr. Kisilkoski, for being here today.

You don't argue that these pesticides and fertilizers are potentially dangerous and need some protection. This can't be something totally new, although 9/11 and other developments may have accelerated the concern. But if you look at dangerous goods and decals, it seems to me that once they're identified as dangerous goods, a transport truck would need to have that information. I presume it's just more information, and more products that would have to be covered.

I suspect, from the stories I've read about bombs, that a lot of people just go out and buy fertilizer. I don't know what the experience has been in Canada with fertilizers being stolen and used for an inappropriate purposes, or pesticides being stolen and used for illegal purposes, but notwithstanding all that, I think it's appropriate that we protect these products.

In your brief you talk about the impact assessment written by Environment Canada. Now there's an interesting group to write an impact assessment on business--another department that's involved. They say the regulatory change would have minimal or negligible impact on the international competitiveness of Canadian firms or sectors producing or using the substances. What we've heard today seems to be totally contrary to that.

The Liberal government had a smart regulatory environment initiative. This government wants to be smarter with regulations. At the same time, these things are gazetted. Can you tell me when this was gazetted and whether you responded? Did you see the analysis that was done by Environment Canada? If it was gazetted, did you have the chance to respond, critique, and attack their brief? What was the timing on that?

[Jeff Kisiloski]

The environmental emergency plan was developed back in 2003 by Environment Canada. We read the Canada Gazette and RIAS responded to it. We ended up working directly with Environment Canada to assess the regulatory effect on the agri-retail sector. We worked with them to ensure that what came from that was cost-effective and efficient for both government and industry. We worked with them to develop a template for their environmental emergency plan, which was the big requirement of the E2 requirements at that time. It was basically government-endorsed, but tailored specifically for our industry. We did some training on that and some public information hearings. We cooperated with them on an information campaign.

[Roy Cullen, Liberal, Etobicoke North, ON]

Excuse me. You say you worked with them on that, but presumably you don't agree with their conclusions.

[Jeff Kisiloski]

That's correct.

[Roy Cullen, Liberal, Etobicoke North, ON]

In other words, you were part of a consultation process. You provided them with some data, some information, but you didn't write the final economic assessment report. Presumably you don't agree with it.

[David MacKay]

Not at all, and as a matter of fact, the industry that worked more closely with Environment Canada at that time was the manufacturing industry, as opposed to the retailers. Because we tend to be in the middle, we tend to get the news last.

Looking back historically as to the mistakes our organizations perhaps have made, we didn't protest strongly enough at the time manufacturers began consultations with government and we were not involved as directly as we should have been. All of a sudden now, we're left holding the bag of cost and liability for the upgrading of all these sites for all these products.

I'll give you an example. The Fertilizer Safety and Security Council got together to assess agri-retail sites as to the cost of upgrading. Their conclusion was it would range anywhere from $4,000 to $35,000 for the cost of upgrades for the very same security infrastructure we've introduced today.

Our research took no more than three weeks to conclude and more than tripled those estimates. In other words, industry doesn't seem to want to raise this as a red flag with government. Only when you finally shine a light on it do you realize that they were in error in terms of their cost estimates, and they should never have been the ones to speak in front of government on our behalf. We are the ones who speak on behalf of our members, not the manufacturers. So perhaps we were remiss.

[Roy Cullen, Liberal, Etobicoke North, ON]

Excuse me. The impact assessment written by Environment Canada, which was gazetted, would have detailed the proposed regulatory changes that would impact on your membership. So did you respond to that and say—

[David MacKay]

Yes, absolutely.

[Roy Cullen, Liberal, Etobicoke North, ON]

—that the numbers are all wrong, or that—

[David MacKay]

We did.

[Roy Cullen, Liberal, Etobicoke North, ON]

—it's fine for manufacturers, perhaps, but they've missed the point on you?

You wrote a brief on that, and there was a special committee of cabinet at the time that reviewed these things. Did you ever get any feedback? You sent a brief in, did you?

[David MacKay]

We did.

[Roy Cullen, Liberal, Etobicoke North, ON]

And you never got any response?

[Jeff Kisiloski]

I think the direct feedback was, “Well, then let's work together and develop something that is effective for your industry, but something that actually meets our requirements as well under these new environmental emergency regulations.”

[Roy Cullen, Liberal, Etobicoke North, ON]

But they were already gazetting these regulatory changes, and the regulatory changes didn't say “Well, we're going to cost-share the impacts of these”, so it was a sort of moot, hollow kind of promise, wasn't it, in a sense? I mean, that was our government at the time, but nonetheless—

I don't know what to say. At a time when we're trying to be smarter about regulation and the idea of this sort of incremental regulation—The provinces regulate; the federal government regulates. Everyone incrementally regulates, and no one stands back and says, “What is it doing to our industry?”

I thought we were smarter around these things. Certainly we should be, and I thought we were trying.