House of Commons Hansard #67 of the 35th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was industry.


Government Response To PetitionsRoutine Proceedings

10 a.m.

Kingston and the Islands Ontario


Peter Milliken LiberalParliamentary Secretary to the Leader of the Government in the House of Commons

Mr. Speaker, pursuant to Standing Order 36(8), I have the honour to table, in both official languages, the government's responses to 11 petitions.

Interparliamentary DelegationRoutine Proceedings

10 a.m.


Maurice Dumas Bloc Argenteuil—Papineau, QC

Mr. Speaker, in accordance with Standing Order 34(1), I have the honour to table in the House, in both official languages, the report of the Canadian Group of the InterParliamentary Union. This is the report of the official delegation that represented Canada at the 91st InterParliamentary Conference, held in Paris, France, from March 19 to March 26, 1994.

Coastal Fisheries Protection ActRoutine Proceedings

10 a.m.

Humber—St. Barbe—Baie Verte Newfoundland & Labrador


Brian Tobin LiberalMinister of Fisheries and Oceans

moved for leave to introduce Bill C-29, an act to amend the Coastal Fisheries Protection Act.

(Motions deemed adopted, bill read the first time and printed.)

PetitionsRoutine Proceedings

10 a.m.


Marlene Cowling Liberal Dauphin—Swan River, MB

Madam Speaker, it is my pleasure to rise in the House today, pursuant to Standing Order 36, to table a petition which has been duly certified by the clerk of petitions.

An ethanol industry will provide definite stability for agriculture, particularly in western Canada and for the Canadian economy, as ethanol is one of the most environmentally friendly fuels available.

Some 200 petitioners have called on the government to extend the exemption on the excise portion of ethanol for a decade to allow the strong and self-sufficient ethanol industry in Canada to go forward. I present the petition on their behalf.

(Questions answered orally are indicated by an asterisk.)

Questions On The Order PaperRoutine Proceedings

May 10th, 1994 / 10 a.m.

Kingston and the Islands Ontario


Peter Milliken LiberalParliamentary Secretary to Leader of the Government in the House of Commons

Madam Speaker, Question No. 19 will be answered today.

Question No. 19-

Questions On The Order PaperRoutine Proceedings

10 a.m.

Progressive Conservative

Jean Charest Progressive Conservative Sherbrooke, QC

What is the estimated total dollar impact that will result from individuals making a capital gains election to secure a lifetime exemption for gains accrued prior to the budget day for (a) the guaranteed income supplement, (b) veterans allowances, (c) the child tax benefit, (d) the old age security repayment, (e) the age credit repayment, (f) the alternative minimum tax, (g) the GST credit, (h) other non-refundable credits, (i) other programs and other features of the tax system; and, in each case, what is the estimated number of people affected and the average increase in taxes or loss of benefits; and what is the overall total effect of this?

Questions On The Order PaperRoutine Proceedings

10 a.m.

Winnipeg North Centre Manitoba


David Walker LiberalParliamentary Secretary to Minister of Finance

The precise dollar impact that the election for the $100,000 lifetime capital gains exemption will have on the various provisions mentioned in this question, such as the child tax benefit or the alternative minimum tax will depend on the number of people and the income and age characteristics of those who choose to use the election.

The election allows individuals to exempt up to $100,000 of capital gains. In most cases the cost associated with using the election will be relatively small compared to the potential tax savings of exempting capital gains. Nevertheless, it will be up to the individual to determine whether he or she wishes to utilize the election.

Questions On The Order PaperRoutine Proceedings

10 a.m.

The Acting Speaker (Mrs. Maheu)

The question enumerated by the parliamentary secretary has been answered.

Questions On The Order PaperRoutine Proceedings

10 a.m.


Peter Milliken Liberal Kingston and the Islands, ON

I ask, Madam Speaker, that the remaining questions be allowed to stand.

Questions On The Order PaperRoutine Proceedings

10 a.m.

The Acting Speaker (Mrs. Maheu)

Shall the remaining questions stand?

Questions On The Order PaperRoutine Proceedings

10 a.m.

Some hon. members


AgricultureGovernment Orders

10:10 a.m.

Regina—Wascana Saskatchewan


Ralph Goodale LiberalMinister of Agriculture and Agri-Food


That this House note the proactive work of the government, in co-operation with farm organizations, industry representatives, and the provinces, to enhance the agriculture and agri-food sector of the Canadian economy, contributing to the well-being of farmers, food security for consumers, sustainable agriculture, economic growth and jobs, and building the sector to be among the best in the world.

Madam Speaker, allow me to begin debate this morning by saying what a pleasure it is for me to be back in Canada and back in the House after my recent travels on behalf of Canadian agriculture and agri-food.

In mid-April I went to Morocco with my colleague, the Minister for International Trade, for the signing of the new GATT agreement and to continue our very difficult negotiations with the United States on a variety of bilateral trade issues in agriculture between our two countries.

After Morocco I was in east Asia with the Governor General and 15 Canadian farm leaders and agri-business leaders to promote trade with the countries of that particular region of the world. It was a great honour to be part of that state visit. It was a pleasure to meet personally and directly with so many of Canada's major international customers and to hear directly from them about what they are looking for from us.

Canadians have a good reputation in the Asia-Pacific region based upon our past history of friendship with the countries of that part of the world and based upon our strong reputation as a supplier of the world's highest quality products. Our delegation was warmly welcomed at every stop. I think we helped to solidify our bilateral relations in each of the countries that we visited.

Still there is no place like home and I am indeed happy to be back. I feel I should warn hon. members opposite that having dined in Asia upon worms, sea slugs and scorpions, I am ready for any challenges that might arise in the House.

Our government has been in office now for six months. We were elected on a platform that we put forward in our red book. We have spent the first half year implementing the fundamentals of that platform. We promised job creation, fiscal responsibility and a more responsive government, a government committed to integrity. We have been delivering on those commitments.

Job creation for Canada is inextricably bound up in the issues of international trade. Our top priorities have been concluding trade agreements and developing new markets. The trips I have made in the last month or so to Morocco and the Far East and our extensive round of bilateral negotiations with the United States are important parts of delivering on that job creation promise.

We have also made a number of key moves on fiscal responsibility, particularly the budget presented in February by my colleague, the Minister of Finance. While I am speaking about the Minister of Finance, I would like to thank him and thank all my caucus colleagues for pinch-hitting for me last week in the agriculture debate which was called while I was away.

As far as responsive government is concerned, we are involved in extensive consultations in all areas of government every day with Canadians from across the country, not just with businesses and organizations but with all Canadians: workers, farmers, students, people who make the country function day by day. Of course we still have a lot to do. As they say, Rome was certainly not built in a day. However I believe we have laid the foundation and we are getting on with the job in agriculture, agri-food, and a broad range of government priorities. As the Prime Minister said last week, we are offering Canadians a good government and we will try very hard to continue to do so.

In the agriculture and agri-food sector we promised to pursue financial security for farmers, food safety and security for consumers and a sound environmental policy over all.

The motion before the House today talks about making our agri-food sector one of the very best in the world. That is our goal and nothing less will do.

Last night I had the opportunity to attend in Toronto a final meeting of the Agri-Food Competitiveness Council of Canada. It is a group of individuals representing a broad cross-section of the agri-food industry in this country. They have been at work over the course of the last three years to develop the concept of competitiveness in the agri-food industry and to describe how that concept can be incorporated in the establishment and

functioning of government policy and how that concept can be used to enhance the quality of our agri-food sector in Canada.

The Agri-Food Competitiveness Council has established for itself the objective of making Canadian agriculture and agri-food number one in the world in comparison with its international counterparts. That is a goal and an objective which I share, and this government shares, an objective which is embodied in the motion before the House today.

I consider it my great good fortune to have been asked by the Prime Minister last November to preside over the very important agriculture and agri-food sector of the Canadian economy. This sector is vibrant and exciting. It is a very important part of the Canadian economy, accounting for a significant portion of our gross domestic product and a significant portion of Canadian jobs. It is also an area that I believe has huge potential for the future in terms of economic growth and job creation which were the fundamental underpinnings of our red book commitments in 1993.

However, this portfolio is no place for a faint heart. This sector is entering a period of change and reform of significant proportions. Our government has spoken often of the major reforms we anticipate in such fields as social security, which has been the subject of previous debates in this House.

The changes to be expected in agriculture and agri-food, while perhaps less talked about than some other areas, are of a similar magnitude and importance for the farm and food sectors of Canada.

Let me deal for a moment with the issue of financial security which I mentioned is part of our red book commitments.

Farmers constantly tell me that they want to earn their incomes from a decent marketplace and not from the high levels of subsidies that have prevailed in agriculture over the last number of years. They do not want handouts. They want a decent market. However, they will continue to need some reasonable degree of protection as a matter of public policy against the vagaries of the market, the weather and external disasters which are beyond their control.

Therefore, we are pursuing a two-pronged approach to financial security. As our platform promised, we are working on developing a new safety net system for agriculture in Canada based upon the income of the whole farm to replace the ad hockery of the past and the current, very expensive patchwork of programs.

This idea, the whole farm income concept, has won the support of farm organizations and the provinces. A national farm safety nets committee and federal and provincial officials are pressing forward with a number of proposals that will be presented for consideration at the next meeting of federal and provincial ministers of agriculture which will be held in Winnipeg in July.

The fundamental principles underlying our work with respect to the safety nets programs and this concept of whole farm income are as follows. First, to the largest extent possible, what we do in farm safety net programming must be GATT consistent so that we do not in future trip over trade rules that can destroy the best domestic programs.

Second, our programs must be production and market neutral so that farmers are making their own production and marketing decisions and those decisions are not driven by this or that subsidy from a government.

Third, the programs must be actuarially sound and fiscally responsible. That goes without saying, given the economic context in which all governments in this country find themselves at the present time.

Finally, our programs must be user friendly from the farmers' point of view so they are effective, affordable and easily understandable by farmers.

While we are working on the safety nets front, at the same time we are also working very hard to ensure that the agriculture and agri-food sector has access to the domestic and international markets which will ensure prosperity for the future. That is why we plunged into the GATT negotiations and in the short time available to us, between the date our new government took office, November 4, and the conclusion of the GATT negotiations in the middle of December, in that very short time span I believe we came out of the process with a deal that does meet the fundamental needs of our country.

Searching for those good international markets is also the reason why I have travelled to Mexico, South Korea, China and Hong Kong in the last few weeks promoting trade and helping to open doors to our exporters.

For the same reason the Minister for International Trade and I have sat eyeball to eyeball with our U.S. counterparts to try to settle some long standing bilateral issues in agricultural trade between Canada and the United States. That trade amounts to something in the order of $12 billion a year in total. It is big, it is important, it has been growing and it is mutually beneficial on both sides of the 49th parallel. It is obviously advantageous if we can arrive at an overarching framework agreement that will in the final analysis lay to rest the disputes that we have been working on once and for all and allow our trade opportunities between these two countries to grow and flourish in the future.

The negotiations have been difficult. The issues at stake here are not easy to resolve. In the process of the negotiations I believe that Canada has been fair and flexible. Our approach has been to try to maintain existing levels of trade between our two countries and to work toward enhanced levels of trade wherever reasonable and realistic.

This process started last November in our negotiations with the U.S. and it has been a difficult process. As a matter of principle, we have committed ourselves not to get into any kind of horse trading of one group of farmers against another, or one region against another, or one commodity against another. We believe that the various issues on the table for resolution need to be dealt with on their own merits, individually in their own right, without any tradeoffs as between commodities, regions or farm groups.

We are ever mindful of the fact that we are here in this government and at the negotiating table on behalf of Canada to serve the whole country and not just one part of it.

In the bargaining we will not roll over and play dead. We will not sign a deal that does not respect Canada's national interest. If the United States should decide at some point to act unilaterally against Canada with what we consider to be unfair or punitive measures, then Canada will fight back to defend its vital national interests.

That having been said, however, I would like to emphasize that we are not spoiling for a fight. I will keep talking at the negotiating table as long as there is something useful to talk about. As Winston Churchill once said, jaw, jaw is better than war, war. Of course he was not talking about a trade war but I think the quote applies just as well in our present circumstances.

If we can have a good agreement it would obviously be in our interest to have one. Canada is prepared to keep the negotiations going constructively until we arrive at the most reasonable result.

When the new GATT agreement is in place some time in 1995, we will have at long last an effective, rules based trade environment in the world for agriculture. To help position Canadians to take maximum advantage of our agri-food trading opportunities, our platform suggested two initiatives.

One initiative is the establishment of an agri-food industry council to advise the government on all matters related to improving Canada's market position and the promotion of economic growth and jobs.

As I mentioned a moment ago, there has been an institution in place over the last three years that has been focusing on the competitiveness issues in agriculture, namely the Agri-Food Competitiveness Council. That council will be going into the sunset, if you will, in June 1994 because it was scheduled to wind down at about that time.

However, building upon the good work of the Agri-food Competitiveness Council over the last three years and building upon the other consultative efforts that have been undertaken by the government in our first few months in office, we can see in the months ahead the foundations upon which we will build our agri-food industry council as suggested in our red book at the time of the election last year.

The other proposal we talked about in the red book was for a foreign agri-food marketing service. This service would enhance the ability not only of the government but of the private sector to identify international market opportunities. It would receive the best possible market intelligence from around the world and would position Canadian exporters to the greatest advantage possible to take advantage of those marketing opportunities. That is another proposal from the red book on which I propose to move in the months immediately ahead.

In implementing both of these initiatives, we are seeking to achieve an objective which the agri-food industry has already established for itself. That is the objective of increasing agri-food exports from Canada by 50 per cent over the course of the next five or six years.

The industry wishes to see our present level of exports, which is in the range of $13 billion annually, rise to a level in the order of $20 billion annually by the turn of the century. Our initiatives in terms of agricultural competitiveness, trade and marketing will be aimed toward helping our private sector and our farm organizations achieve that ambitious export objective.

While I was in Asia over the course of the last two or three weeks, I was discussing with our buyers and potential buyers what we need to do in Canada differently or better in order to expand our trade. There are a couple of important messages that flowed from those discussions overseas.

First of all, we must take every possible opportunity to diversify our marketing potential and our marketing opportunities. We have perhaps in this country over the last number of years been preoccupied with our trade prospects on the North American continent. The reason for that is understandable. Markets in North America are close to us. They are well understood by us. They are reasonably easy to access. The infrastructure is there. The personal and cultural links are already in place. The trade in North America is rather simple and easy for us to comprehend and exploit.

It is more complex and more difficult to seek and pursue and exploit markets that are overseas in Japan, Korea, China, Hong Kong, in the whole Asia-Pacific region or in Latin America. While we would never want to diminish our trading opportunities in North America, we have to be very mindful of the huge opportunities that exist elsewhere in the world, particularly in the Asia-Pacific region, which is the fastest growing economic zone on the face of the earth, and in Latin America, which is the second fastest growing economic zone on the face of the earth.

We have to broaden and diversify our trading horizons in order to take those vast markets elsewhere into account.

Second, we need to listen very carefully to what those markets are telling us. I think we have had a tendency in this country to say that we should simply go out there and sell whatever it is we might choose to produce. Maybe we have to turn that equation around the other way and think more of how we can produce what it is the world wants to buy. We have to listen to our customers, listen to our markets and make sure that we are producing, processing, further processing and adding value in a way that will tailor make our products and our commodities to suit the markets into which we wish to sell them.

Third, we have to put ourselves in a position to deliver into those markets in a timely way. We in this House and in the Canadian grains industry all know that in the last couple of months we have had some enormous difficulties in delivering on time. That is an issue that not only the grains industry but this government takes very seriously.

In that spirit over the course of the last number of days I know the subcommittee of the House Standing Committee on Agriculture and Agri-Food and the subcommittee of the House Standing Committee on Transport have been conducting very useful hearings. They have come forward with some ideas they wish the government to consider. They may rest assured the recommendations coming from those subcommittees will be given very careful consideration as we try to get to the bottom of what has gone wrong in terms of grain handling and transportation in this country over the course of the last number of months and producing the formula that is needed to solve those problems and to correct the situation for the future.

Furthermore, I have invited many of the major players in the Canadian grain handling and transportation system to meet with me on Monday of next week at a private meeting in Winnipeg. The doors will be closed, our jackets taken off and sleeves rolled up to focus expressly on this problem this year and to find out what we together can do to resolve the difficulty.

I am not interested in finger pointing and blame laying. That is an exercise that is a mug's game that quite frankly gets you nowhere. I want a good, thorough, candid, honest assessment of the facts. I want practical solutions to deal with the problem so we can alleviate the situation as much as possible this year and then for future years make sure that this country does not get itself into that kind of jackpot again.

It is a serious problem and I want all involved to know that the Government of Canada takes it very seriously.

Beyond the meeting next Monday in Winnipeg I also hope to engage the western grains industry in some broader discussions that go beyond the immediate problem with delivering our products through the congestion on the west coast. I want to involve the grains industry in an exercise of coming together to develop a common vision of where we want this industry to go in the years ahead.

I want to invite farm leaders and those who are involved in operating various parts of the system to think about the year 2000. What kind of a grains industry and a grain handling and transportation system do we want as we turn the century and look toward the future.

Let us begin planning and working together now to develop that system so that when we get to the turn of the century we have positioned our country in the most advantageous way to take advantage of our marketing opportunities around the world.

Our meeting on Monday in Winnipeg is partly to deal with this initial urgent situation on the west coast and partly to begin that process of looking toward the future and building toward the future in the kind of grain handling and transportation and marketing system we want to have by the year 2000.

Let me just say a word about orderly marketing. That has been a very vital topic of discussion from time to time in this House and in the standing committee on agriculture.

One of the great success stories in the Canadian agri-food sector over the last few decades has been the supply management concept that was invented by a previous Liberal government about a quarter of a century ago. Supply management has helped the agri-food sector in eastern Canada, especially Quebec, to prosper.

Knowing how important supply management is to the Atlantic provinces, Quebec, Ontario and British Columbia, our government made a very special effort to ensure that it is protected under the new international trade regime. We will have to make some changes to supply management in the wake of the GATT just as we expect other countries will have to adjust some of their practices and systems to conform with the new General Agreement on Tariffs and Trade.

The agreement that we achieved in Geneva and signed in Marrakech allows us to impose strong tariffs in place of what used to be import border controls. Those systems of tariff equivalents will ensure that our orderly marketing systems can continue to function successfully in this country for as long as we domestically want them to do so.

Quite apart from the GATT there are other changes that will be required in our supply management systems if those systems are to thrive into the future and to contribute effectively to economic growth.

We need to find a new domestic consensus on how our supply management system should operate, a consensus that removes some of the rigidities that are currently threatening to destroy the supply management system from within, never mind any international trade rule changes. Perhaps the largest challenge to our system is not international but in fact domestic and finding that domestic political will and that domestic consensus to allow our systems to function into the future.

My parliamentary secretary, the hon. member for Prince Edward-Hastings, is heading a small federal-provincial industry task force on orderly marketing that will make recommendations to federal and provincial ministers of agriculture when we meet in Winnipeg in July.

That task force has been hard at work since last January. We have already received one interim report from the task force. The work has been well received to date. Obviously more remains to be done. My provincial colleagues and I are anxious to receive the final output from the task force process so that we can position ourselves to meet the GATT requirements well in advance of the implementation dates in 1995.

I want to say a word about food safety and security. Canadians have been blessed over the years with the world's best and safest food supply. Our platform promised to maintain this standard of excellence.

Maintaining our exceptionally high food safety record and our internationally recognized animal and plant disease status is critical to consumer and foreign customer confidence in food supply. It is an essential selling point in marketing our agri-food products both at home and abroad.

My department's food production and inspection branch is working now with industry on a business plan that will ensure the health and safety of our food supply while at the same time trying to improve efficiency.

At present the federal, provincial and municipal levels of government all have a role to play in food inspection. The responsibility is further divided among agriculture and food departments, health departments and consumer and corporate affairs departments.

We are seeking a national inspection system that would streamline delivery among all of the various jurisdictions and inspection agencies. It would also provide equal treatment for imported products which under current rules sometimes escape inspection.

We will not compromise on the excellent food safety record that Canada enjoys but I believe we can reduce costs and better help our industry to compete.

The motion before the House today also deals with the environment. There is no subject more important over the long haul than the environment. When future generations write the history of this century, they will look back at our generation and judge how we have discharged our responsibilities to maintain the environment that we inherited. More than any other generation that has gone before us we have it in our power to ensure the sustainability of our environment. We can no longer claim ignorance of the consequences of our actions.

Our agri-food platform placed a high priority on conserving our soil and water resources. It stressed the importance of integrating economic and environmental goals. Now we are working with all interested parties to do just that, to develop long term approaches to sustainable agriculture that integrate our environmental goals and our economic and social goals.

Our rural areas and farming communities must be safe, healthy and vital places now and long into the future. These long term approaches will guide us as we develop a new national soil and water conservation program. This involves reviewing our programs on the economic side, for example, for their environmental impacts. It involves continuing to help our agri-food industry acquire the environmentally sound input products, technologies and practices that the sector needs to meet our goals for a sustainable industry.

In this regard I am working now on improvements to the present regime governing pesticide availability and use in Canada. Again, my parliamentary secretary is playing a large role in this endeavour to ensure that Canadian producers are not placed at a competitive disadvantage in the marketplace.

Alongside our concern about the environment and our desire to be competitive and to reach out into global markets goes our very great emphasis on research and development in Canadian agriculture. There are those who might believe that R and D is a kind of exotic frill that you throw aside when times get tough and hope you can pick up again when you are feeling more affluent. But science, research and development are not something you can turn on and off like a tap. It requires persistency and consistency of focus and effort and financing.

That is why in dealing with the budget for the Department of Agriculture for the current year, while we have had to absorb the same kind of restraint that applies to every government department across the board, in making our spending and priority and allocation decisions we have tried very hard to retain our emphasis on research and development, absorbing some deeper cuts elsewhere in order to preserve R and D. I think we have been able to do that in the budget for 1994-95.

In addition to that we are launching some new initiatives with the private sector, some joint ventures in research and development funding with the private sector to leverage more private dollars into agricultural science. We are thereby building the pot bigger and deeper for the funding that is necessary for research and development in this vital part of the Canadian economy. Only by being on the leading edge of international science will

we be able to retain our position on the leading edge economically of agriculture and agri-food in the world.

I want to say a brief word about rural renewal. That is a responsibility that falls to me under the mandate given to me by the Prime Minister. Shortly after the election he asked that I establish within my department a rural renewal secretariat to provide a focus within government and between governments for rural issues and rural people. That rural renewal secretariat is now up and running within my department.

Part of its job is to co-ordinate the activities of the federal government on issues that relate to rural Canada. Part of the job is to act as a liaison between federal departments, between the federal government and the provinces and between governments and a whole range of agencies and organizations in the private sector so that we can clearly identify the thrust that we want to achieve on behalf of rural Canada.

Within my department a variety of programs bear on the question of rural renewal. There is of course the system of farm debt review boards across the country. There is the farm business management program. There is the Canadian rural transition program. There is the rural opportunities initiative. There is also the Farm Credit Corporation which has, as of last year, undergone an expansion in its mandate to make it more flexible in dealing with issues that relate to financing in rural Canada.

There are also other related agencies such as the PFRA, the Prairie Farm Rehabilitation Administration, which has a long history stretching back to the 1930s in western Canada in rural development and rural renewal. There is also the co-operatives secretariat within my department as a method by which government can bring a special focus on the co-operative movement and how co-operatives, especially in rural Canada, can be involved in economic development, renewal, growth and jobs in the future.

I have established for myself an agenda for the balance of this year to review all of these various programs and initiatives that already exist within government to determine whether they are achieving the objectives that were originally established for them and to try to bring to all of these programs, agencies and initiatives a clear, sharp focus on the real issues of rural renewal and adaptation in rural communities. We will be focusing especially on value added, community based, economic diversification and development as an augmentation, if you will, to mainstream agricultural programming and policy. We want to have this special focus on the opportunities and the future for rural Canada.

Last October Canadians put their trust in this new government. Of all of the options available during the election, Canadians decided we were best equipped to lead Canada at this crucial time in our history.

In one of my first addresses as Minister of Agriculture and Agri-Food I told members of the Saskatchewan Wheat Pool last fall that we could not be all things to all people. We would be a sincere and honest government that would work very hard to earn the public's trust and try to be down to earth, fiscally responsible, open, accessible and accountable.

I also said that as minister I want to be a pragmatic problem solver. I do not want to get hung up on dogma or philosophy. I want to put myself in a position to act in the best interest of farmers and the Canadian agri-food sector. That is still very much my approach and the government's approach.

As I have travelled across the country in the last six months I have been struck by what I sense is a new feeling of optimism and confidence among Canadians and among farmers. I believe that Canadians generally support the direction that the government has taken in its first six months in office.

I believe that if we continue to implement our agri-food platform as described in the red book at the time of the election, four years from now our agri-food sector will have taken its place, as this motion before the House today suggests, as among the best in the world.

In closing I want to thank and to pay tribute to the members of my caucus, especially the rural members, who have been so vigilant, hard working and constructive in their pursuit of good agriculture policy. They are making a very solid contribution as they represent the vital interests of their constituents. I thank them very much for that hard effort.

I also want to invite the members of the opposition to play a positive role as well. No doubt we will come at some issues from very different perspectives, but I hope the bottom line will be that we all have the best interests of Canadian agriculture at heart.

In the debate today and in all agriculture debates I hope we can set aside the partisan bickering, avoid the rhetoric and cheap shots and focus instead on the real issues. I want to assure members of the opposition that positive advice offered constructively will get a fair hearing from me no matter where in the House it comes from.

Having said that, I look forward to listening to the debate today. I hope it will make a positive contribution to the development of agriculture and agri-food policy for Canada.

Before I take my seat I would advise the House that cabinet is meeting this morning and I may have to slip away in a few minutes to participate in the cabinet meeting. I hope members will understand that does not represent on my part any disinterest in what is going to be said today in this debate. I will only be absent for a few moments and will be following the debate very closely through the balance of the day.

AgricultureGovernment Orders

10:50 a.m.


Leon Benoit Reform Vegreville, AB

I rise on a point of order, Madam Speaker, to ask unanimous consent of the House to ask questions of the agriculture minister.

AgricultureGovernment Orders

10:50 a.m.

The Acting Speaker (Mrs. Maheu)

I wonder if the minister heard your point of order. He has just said he had to leave for cabinet. Do we have unanimous consent for the minister to stay for questions?

AgricultureGovernment Orders

10:50 a.m.

Some hon. members


AgricultureGovernment Orders

10:50 a.m.


Jean-Paul Marchand Bloc Québec-Est, QC

Madam Speaker, it is a great honour for me to speak on agriculture.

I extend my best wishes to the Minister of Agriculture on his return from his Asian trip. He has returned determined to act in the agricultural sector. I know that this is a very difficult field in which to work, and I also know that the Minister is beyond reproach, a person of high calibre in the world of agriculture.

This motion that the government is proposing to us today, dealing with agriculture and agri-food in Canada, must be read carefully. It must be read very carefully because it is made up of mere generalizations about Canada's farm economy, good intentions, statements of fine and good intentions that, for the most part, hide the tough reality that this country's farmers are facing.

It is fine with me if the government is bursting with fine and good intentions about agriculture and if, through its Minister, it makes promising statements about agricultural development; but can the spinelessness, the inertia, the near-paralysis that this government has shown in several fields since being elected barely six months ago be hidden? Can the iniquity that the federal government has shown toward Quebec for many long years be hidden?

In the motion we are debating today, for example, we read, and I quote:

That this House take note of the proactive work that the government is doing- to enhance the agriculture and agri-food sector of Canada's economy-

But I ask you, Madam Speaker, what proactive work has this government done lately? Is it the signing of the GATT, which from several standpoints has been a deep disappointment for Canada's supply-managed sectors, and which has produced for us, among other things, a worrisome situation in the poultry sector? Is it the studies and reports, however manifold, by the kindly officials at Agriculture Canada? Is it the objective of increasing Canadian exports by 50 per cent in order to reach $20 billion by the year 2000?

Madam Speaker, I am quite prepared to be optimistic, like Canada's Minister of Agriculture, and it is quite all right with me if his fine intentions bear fruit, but all his fine words hide another reality: we must not ignore the fact that agriculture, in both the western and eastern parts of this country, is experiencing many significant, serious structural difficulties.

For example, the Minister has just trumpeted the fact that he spent three weeks in Asia to stimulate Canadian farm exports. In fact, the Minister signed one single contract with Korea: one small contract for 50,000 tonnes of feed grains, with a country that has been an established export market for Canada for several years. The Minister hastened to tell us that he has developed, in addition to this small firm contract, several new export possibilities; I stress that they are new export possibilities only, with no firm contracts.

Elsewhere, when we read the media dispatches recounting the ups and downs of his trip, what strikes us most clearly are the criticisms by the Japanese and Chinese of Canada's grain transportation system. That is no small thing, coming from the Japanese and the Chinese, and at a time when we in Canada want to expand our Asian markets. These longstanding customers had so many doubts about our western Canadian grain transportation system that the Chinese, in particular, did not sign a new wheat contract, and the Japanese decided to look elsewhere, to the Australians, for their canola supply; until now, Canada had a near-monopoly in canola exports to Japan.

All this happened because, in 1994, Canada has a grain transportation system that is no more effective than it was in 1908. Is this a reasonable objective, then: is it reasonable to increase Canadian farm exports by 50 per cent in order to reach $20 billion by the year 2000 while, right now, we are incapable of meeting existing contracts because there is a crisis in transportation on the Prairies, costing the entire Canadian economy a great deal of money? This year alone, $35 million will be spent in demurrage costs of ships waiting to load in the port of Vancouver.

Canada has already lost sales of approximately 200 million tonnes of wheat because of this ineffective and poorly-run transportation system. Listen, getting to and from the port of Vancouver by train is, on average, no faster today than it was 80 years ago. That does not mean that it is not in Canada's interest to increase its exports to Asia. That is even desirable, but if we use plain common sense, should we not first ensure that we have an adequate transportation system enabling us to meet our

existing contracts with foreign countries before compromising ourselves in contracts we will be unable to meet?

That is as if a business person were trying to double his or her customers while not being able to meet the demand from present customers. That thinking shows a certain lack of logic. We can also wonder what Agriculture Canada, the federal government, and the Department of Transport are doing about grain transportation, because this system has been ineffective for more than a decade. It has not been ineffective for only a few months, as the Minister said.

In the 1970s I was an assistant to one of the greatest ministers in Canada's history, Mr. Eugene Whelan, and the grain transportation problem existed then too.

There have been at least three separate federal statutes, two government agencies, two departments, and several other interested parties governing grain transportation: such an administrative mishmash that one wonders whether any planning has taken place.

At least, it is obvious that no one can take responsibility for the present crisis. Mr. Warren Joly of the Western Canadian Wheat Growers' Association said, and I quote:

The Western Canadian Wheat Growers Association said: "We are in this mess because of a disastrous policy and now we are trying to address it with an inefficient, knee-jerk system".

The minister has received a dozen suggestions for improving the system, a very inefficient system. I would even be tempted to ask him to set up a commission of inquiry to find long-term solutions to setting up a transportation system in the West that would meet the needs of Canadians.

And to think that in spite of the crisis the port in Thunder Bay and the St. Lawrence are not used at full capacity. Over the past ten years their use has decreased by nearly 50 per cent. In fact, the seaway is steadily losing quantities of grain to the detriment of eastern ports. Since 1984, the amount of grain transshipped has dropped from 12 million to 6 million tonnes. However, a Great Laker can carry an amount equivalent to 250 railway cars, and the turnaround time in Thunder Bay is four days shorter than it is in Vancouver.

According to Mr. Glen Stewart, president of the St. Lawrence Seaway Authority, the Western Grain Transportation Act encourages pouring grain into the Pacific ports, and this is detrimental to the St. Lawrence. The situation is understandable up to a point, because we do have more clients now in the Orient than we do in Europe. But this does not explain how grains going to Africa and Europe first go to Vancouver and are then sent through the Panama Canal. Even though there is a crisis in the western grain transportation system, only 35 per cent of the grain goes through Thunder Bay and the St. Lawrence.

Are we to conclude that Agriculture Canada is unable to develop a good western transportation system, or must we conclude that Agriculture Canada is promoting western agriculture to the detriment of the east? Canadian products are of high quality and world renowned, but it is obvious that Agriculture Canada, a part of this federal government, is doing a less than satisfactory job.

As a department, Agriculture Canada has a long history. Initially, its primary responsibility was to ensure western development and, to some extent, Agriculture Canada's attention has remained focussed on the interests of western Canada. Frequently, this duty to promote western development was carry out in a manner that was extremely prejudicial to the interests of Quebec.

We just have to look at the estimates for Agriculture Canada over the past 10 or 15 years. In 1980, for example, Quebec received $300 million from the federal government, and the west, that is, the prairie provinces, received $1 billion-55 per cent of Agriculture Canada's budget. In 1987, Quebec received $410 million, while the West received $4 billion-76 per cent of the total budget. Last year, Quebec received $372 million, while the West received $1.5 billion-more than 50 per cent of Agriculture Canada's budget.

The federal government's unfair treatment of Quebec is demonstrated in a variety of ways.

In the 1980s, for instance, federal spending went up eight times faster in the West than it did in Quebec. In 1987, Quebec contributed more than $1 billion in taxes for the development of western agriculture. Quebec spent twice as much money on western agriculture as it did on its own agriculture, through the Quebec government.

Grosso modo, from 1980 to 1992, the amount of aid to the West increased from 42 per cent of the federal budget to nearly 64 per cent, and the amount of aid to Quebec went from 30 per cent down to only 10 per cent; this means that the 25 per cent of Canadians who live in Quebec pay into a system that gives back only 10 per cent. This is not very profitable for farmers in Quebec.

Speaking of grain transportation, why is it subsidized all the way to the Pacific going west, but only as far as Thunder Bay going east? And still speaking of transportation, why are so many railway lines being shut down in Quebec, on the pretext that they are not cost-efficient, while nearly 25,000 km of lines are maintained in the West, even if they are not cost-efficient, on the pretext that they are essential for the Canadian economy?

Agricultural diversification is yet another situation where we find Quebec has been unfairly treated. While the federal government has been investing for many years in western diversification, Quebec has received nothing. Over the past ten years, the area used for potato crops in the West has increased 30 per cent, while in Quebec, it has increased only 2 per cent. And I could add a number of other examples.

In 1988, a report produced by the Coopérative fédérée du Québec, the Union des producteurs agricoles, and the Ministry of Agriculture, Fisheries and Food, summed up perfectly the effects of the federal government's discriminatory policies toward Quebec by saying, and I quote: "The inequitable policy affects the level of competitiveness of Quebec farmers in comparison with their counterparts in the West, particularly in terms of grain and livestock production. Canada's agricultural policy contributes to the displacement of livestock production from the east to the west of the country".

A further illustration of Agriculture Canada's feeble defence of Quebec's interests is the case of Grand Pré milk, produced by the Groupe Lactel. Grand Pré milk has been sold in Puerto Rico for 15 years, accounting for 40 per cent of the Puerto Rican market. In 1991, the Americans changed the health standards. Grand Pré milk lost this lucrative market.

A change in health standards was tantamount to the Americans' imposing a non-tariff barrier on us. In spite of this, the federal government did not respond. They could have taken certain measures, but they decided to do nothing, and their inaction led to the consequences I mentioned.

Why did the federal government not take action to protect a sector that was lucrative for Quebec, whereas in other sectors-there are many examples-the federal government took immediate action, such as the recent case, for example, of American beer in Ontario. In this case, the federal government responded very quickly in protecting the interests of breweries in Ontario. The interests of Quebec do not prompt the same response in the Department of Agriculture.

The most recent example of the government's spinelessness and inertia is, of course, the GATT. Article XI of the GATT was important for producers working under a quota system and of extreme importance to Quebec, since 42 per cent of its agricultural monetary earnings come from such products.

The Minister had promised to protect article XI, but he came back empty-handed with nothing but tariffs that are supposed to have the same effect, but that bring the whole supply management system into question again. We can see its effects in the poultry sector; a trade war has arisen between Quebec and Ontario.

With the new tariffs, farmers will have to adapt to an entirely new system within six years. That is a very short time for those farmers.

Earlier, the Minister of Agriculture was telling us how he wanted to negotiate with the Americans, sector by sector, following the GATT agreement. In fact, that is not what he is doing; he is negotiating a package deal with the Americans because, when all is said and done, he has not succeeded in establishing clear directives under the GATT. Even the new tariffs of 300 to 350 per cent have succeeded in flooring consumers once again: they have the impression that they are paying too much for their food products when that is not the case.

In its negotiations with the United States, Canada seems to want to fold once again where products affecting Quebec, including ice cream and yogurt, are concerned. According to all reports on the negotiations, Canadians appear to be giving the Americans greater access to the Canadian ice cream and yogurt market, in order to protect the volume of wheat exports from the West. Is this not another case in which Quebec comes out the loser in federal agricultural negotiations?

The Bloc Quebecois is warning the federal government. We will never agree that the interests of farmers in eastern Canada should be sacrificed in order to allow better access to the American market for Canadian durum wheat. We will oppose any tradeoffs between the regions in order to reach an agreement with the Americans.

Agriculture Canada appears to have a carefree and careless attitude toward the development of agriculture in Canada. That attitude is surely not the fault of the present Minister. And we are well aware that agriculture is not a very easy sector of activity. No doubt the present Minister has many problems with his party, because it seems that, when agricultural issues arise, they are always set aside or not given as much attention as issues affecting other sectors. So it is not the fault of the present Minister, but we have a system that seeks to make cuts to farm programs, at a time when great changes are taking place in agriculture.

Basically, Agriculture Canada is operating in a laxist mode, letting market forces take over. Instead of protecting farmers and encouraging the infrastructure in order to increase the number of farmers, it lets market forces take over and seems to encourage the largest integrated companies that have ever more control over the agricultural sector. This means that farmers will eventually become employees, not independent managers. It should be noted that farmers have very low incomes and work an abnormally high number of hours, and that 73 per cent of them declared off-farm income in order to supplement their income.

Half of the farmers' wives have no income for the work they do on the farm, because farm businesses do not generate enough income. Farmers are not rich operators. In 1992, nearly 22 per cent of farms lost money. This trend toward loss of income and loss of farms is part of a longstanding pattern. There are fewer and fewer farmers in Canada, and active farmers are less and less well off financially. It cannot be said that this is a passing phenomenon; it is a trend that has been evident for a some years.

Who then can say that farmers are well served by Agriculture Canada? Surely not Quebec farmers. How can the government claim in the motion before us today that it is contributing to the well-being of farmers and to job creation?

This government, which claims to be concerned about the well-being of farmers, is in the process of dealing another blow to the farm economy. A tax on food, a proposal currently being discussed by the government, could have a disastrous effect on farmers. Imposing a tax on agriculture, which is already in an extremely tenuous situation, would be tantamount to taking an additional one billion out of farmers' pockets. One billion more to be subsidized by farmers. As a result, a great many of them could be forced into bankruptcy.

Despite the uncaring and unfair attitude of the federal government, Quebec farmers have rallied solidly behind their association, the UPA, and have shown that they can compete on world markets. They are eagerly looking forward to Quebec's sovereignty because they already know that the money Quebec spends to support agriculture in Canada will be available for Quebec farmers. In view of the federal government's actions over the past ten or fifteen years, Quebec farmers have had to band together and build a strong organization. The way in which they have organized themselves has proven to be the envy of other provincial farm organizations. Their organizational ability is their strength.

Farmers also realize that they will be the first ones to benefit from sovereignty since the Quebec government will then have money to spend in the regions. It will begin by shoring up the regions with money from new taxes and it will ensure that structures and support systems for farmers are in place. This group will be first in line to benefit from this situation and that is why they are eagerly looking forward to this day. They have already established several organizations in anticipation of sovereignty.

At a Montreal gathering in 1991, farmers recognized the importance of decentralization. They called for powers to be redistributed from the top down to give regions more autonomy and more decision-making authority. I am confident that this will prove to be the strength of Quebec farmers.

In conclusion, I have to say that the government's motion, however well-intentioned it may be, is full of oversights and neglects the problems which Quebec farmers are facing. I am proud of Quebec's farming community and I know that it will be the first to benefit from the money flowing from Quebec sovereignty.

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11:15 a.m.


Wayne Easter Liberal Malpeque, PE

Madam Speaker, I rise on a point of order. The minister made it clear this morning that he would not get caught in horse trading, region against region or commodity against commodity. The member is misinformed in terms of the-

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11:20 a.m.

The Acting Speaker (Mrs. Maheu)

I am sorry, I am afraid that is more a point of debate than it is a point of order.

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11:20 a.m.


Leon Benoit Reform Vegreville, AB

Madam Speaker, I thank the minister for this open debate on agriculture, a debate which is truly needed.

I believe that government involvement in agriculture over the past 20 years has created one disaster after another. I say this with absolutely no intent to attach blame or to point a finger but rather to emphasize the need for well-focused changes in the direction and the relationship among government, farmers and agri-business.

I appreciate the minister's speech this morning and I agree with much of what he said. The real test of course is in the interpretation. It is my greatest hope that his interpretation is at least similar to mine.

We urgently need a change in the direction of our agriculture policy. We must all put aside partisan politics and old disagreements and work together toward policies which demonstrate that we have learned from the mistakes of the past and recognize the new realities of the future. When I say we, I mean everyone who has a stake in agriculture at all. This includes farmers, businesses which buy, sell or process farm products, government agencies and regulatory bodies and the various levels of government.

I must also stress the need for all members to really listen to the ideas presented by the members of the other political parties. One thing I know for sure is that we all have the best interests of farmers in mind as we go through this debate today. I have no doubt about that at all.

Because we are all sincere I believe we owe it to each other and to the people we represent to try not to distort the intent or the proposals and the ideas that each of us present here today.

Farmers tell me that they are frustrated with farming because they have little control over their business and have too few choices when it comes to buying and selling. They feel they have too little control over factors such as unfair restrictions and access to markets due to trade wars between Europe and the United States and unfair import restrictions into Japan and Korea; a grain handling and transportation system which fails them again and again and is much too expensive; safety net programs which do not work well and are ever-changing caus-

ing instability; and high taxes and high input costs which make it difficult to compete.

They feel they have too few choices because marketing systems restrict their options and because overregulation limits their ability to find alternatives to dysfunctioning programs. With these concerns in mind I will briefly outline the principles which guide Reform agriculture policy.

Canada's agriculture policy should focus on allowing a self-reliant, market driven industry to develop. Reformers believe that all sectors of agriculture can be competitive if given a fair environment in which to operate both within Canada and in the world marketplace.

The role of government in this market driven industry is twofold. First is to provide market responsive education and training, infrastructure and regulation which will allow farmers and the rest of the agriculture industry to become and remain self-reliant. Second is to support and defend farmers and agri-business against situations over which they have little control such as unfair foreign subsidies, trade distorting influences and certain natural hazards.

Government should not be a partner with farmers or agri-business because government has proven very clearly in the past that it is a partner that farmers cannot afford and one that cannot be trusted.

During my speech today I will present an overview of Reform agriculture policies under the headings of safety nets, marketing reforms, transportation and grain handling, research and market development, and creating a healthy business environment for agriculture.

As I present our policy I will point out specific examples of lessons we can learn from certain policy initiatives of the past 20 years. Emphasis will be placed on the need to reduce regulation and legislation which has a negative impact on the industry by limiting options.

Also there is a need to reduce overlap between federal departments that affect agriculture, between the federal government and other levels of government, and between government and industry. Removing regulations and reducing overlap will reduce the size of government and reduce costs. Removing these hurdles, barriers and red tape will also increase the bottom line for farmers and agri-business.

Increasing farmers' profit margins will reduce the draw on safety net programs. Government involvement in safety net programs may be necessary to support and defend farmers against the negative effects of circumstances over which they have little or no control. These situations arise from foreign subsidies and other trade distorting actions, natural hazards and to some extent market cycles which occur in the open market. Safety nets must be market neutral and available in an equitable way to all sectors of the industry.

To this end, Reform has proposed three safety net programs: first, a trade distortion adjustment program; second, an income stabilization program; and third, an improved crop insurance program. We also propose keeping the Advance Payments for Crop Act to reduce the cash crunch induced selling in the fall, and vigorously enforcing countervail duties where dumping can be demonstrated.

The trade distortion adjustment program would compensate farmers from all sectors for damage done by subsidies in other countries, or limited access to markets through unfair import tariffs and the like. The program would include automatic triggering mechanisms based on the historic volume of exported products. It will not require producer premiums and will compensate farmers for a predetermined percentage of damage done by a subsidy on a competing commodity, or by unfair restrictions to market access.

It is our sincere hope that future GATT agreements will eventually reduce the amount of funding needed under this safety net program.

The Reform income stabilization program would shelter farmers in all sectors from the impact of market cycles which occur in an open market environment. This program could use NISA as its base, but would be modified and expanded in the following ways.

It would apply to all commodities in all sectors, that is, it would involve the whole farm approach. Supply managed sectors will have access to this program as tariff levels are reduced enough that the uncertainty and the instability of the marketplace creep into their pricing system.

Contributions would be based on gross margins in a way which would apply fairly across all sectors. The 3 per cent interest bonus would be replaced by tax deductible contributions.

The total level of government matched and unmatched funds will be subject to a regenerative cap which will be equitably applied across all sectors. There will be no limit on the level of contribution per farm unit so we would not discriminate based on size.

Upon a farmer's retirement these funds may be transferable to an RRSP or a RRIF.

The Reform Party also proposes as a part of the safety net package an improved crop insurance program to protect against some of the damage caused by natural hazards. The requirements of this program are: getting enough farmers involved in a particular area to make it administratively sound; maintaining present federal-provincial farmer funding arrangements and being actuarially sound within that arrangement; providing all risk yield loss protection; and a nationally consistent design across all sectors.

In implementing these or similar programs there are some important lessons we can learn from past and present programs.

Take GRIP, please. I have heard this a lot over the past few weeks from my constituents. There are more holes in GRIP than there are gopher holes in Saskatchewan, and that is a substantial number.

I could spend the rest of my time complaining about the flaws and problems with GRIP, but I know that most members already understand these problems and see the flaws. Besides, it would definitely ruin my day, probably everyone's day. Let us not get into finger pointing, but let us make sure we learn the lessons that have to be learned from programs like GRIP.

That is a brief summary of our safety net proposals. As for marketing reforms, we believe they are required to allow farmers to build more profitable, self-reliant industry. The Reform Party supports the right of farmers to form and operate co-operatives, commissions and marketing boards, as long as these bodies receive their direction from the farmers they serve. Farmers must be free to build a viable, self-reliant, market driven industry in which they can make their own decisions about how products are marketed. Government need only provide the basic rules and minimum scrutiny of these groups.

Most of the farm organizations and marketing boards in place could continue to operate under the policy we are proposing. Some organizations will however need substantial changes to make them work well in the world marketplace. Two examples are the Canadian Wheat Board and supply management.

There is substantial support across the prairies for major reform of the Canadian Wheat Board. Farmers feel stifled and unfairly limited by the monopolistic powers of the board. While there is considerable support for maintaining some aspects of the Canadian Wheat Board, farmers want the ability to bypass the board when they feel it is not doing a good job of marketing or when they see better opportunities which they can access either directly or through a grain company.

The Canadian Wheat Board then should be reformed in the following ways. First, farmers should control the board. A board of directors should be elected by farmers and replace the appointed commissioners. This board of directors could choose to keep all or some of the commissioners. Those who argue that the wheat board advisory committee already gives farmers some control over the Canadian Wheat Board are wrong because the wheat board advisory committee has absolutely no power.

Second, the mandate of the Canadian Wheat Board should be expanded to include any grains, oilseeds or specialty crops that it chooses to handle, but farmers must be allowed to compete with the board through grain companies or directly.

The third change to the Canadian Wheat Board would be that farmers have the right to choose between a pool price or a daily cash price. Some of the current wheat board powers should be maintained, for example the power to pay out advance payments on grain and the power to provide loan guarantees as long as other countries continue to use this practice.

I have received a few form letters from people worried that I am proposing the abolition of the Canadian Wheat Board. Of course that is not my intent or the intent of Reform. I want to take this time to assure them that I do not believe the wheat board should be abolished but rather improved to serve farmers better. Farmers want more choices and they must be given more choices.

I believe these changes to the Canadian Wheat Board will increase the price farmers get from the marketplace. This increase in market revenue will reduce payments needed for the safety net programs.

Since the first Reform task force met in 1990, of which I was a member, Reformers recognize that with new GATT deals supply managed sectors will need to adjust to freer trade within a global marketplace.

As a farmer it has been extremely difficult for me to watch as governments have pretended supply management can remain as it is. This stand has been taken mainly for political purposes and is a disservice to supply managed farmers. It is time for politicians to be open and honest with farmers from the supply managed sectors and help them prepare for the reality that as tariff levels drop they will be forced to compete especially with American producers.

On a positive note, a huge American market will open up to Canadian farmers. The extremely high tariff levels currently allowed under the GATT agreement will most likely be reduced at a faster rate than is projected right now. The free trade agreements, pressure from the Americans, and possibly new GATT agreements will cause this accelerated reduction in tariffs.

Canadian supply managed farmers can compete with anyone in the world if they are given the opportunity to do so. I encourage the government to do what is right instead of what is politically easy. I encourage the government to prepare supply managed farmers and to allow them to prepare themselves for the new challenges and opportunities ahead.

I would like to talk a bit now about what is wrong with the transportation and grain handling system. Simply put, it does not accomplish what needs to be done, that is move farmers' grain. It is one of the most heavily regulated parts of the agriculture industry. There is too much legislation and too many bodies involved to properly manage the system. There are no incentives or penalties in place to make it work better.

A few days ago there were about 1,000 cars of canola meal sitting near Lloydminster. Why, at a time when the industry desperately needs more cars to deal with the problems in moving grain, should there be 1,000 cars sitting on a siding near Lloydminster? I will bet a brand new pair of cowboy boots that if the system had the incentives and the penalties in place this 1,000 car mistake would have never happened. Or, if by chance it did, it certainly would have been dealt with very quickly. We need the incentives and the penalties.

At the joint agriculture and transportation subcommittee meetings on grain held last week there were two interesting proposals for dealing with this highly regulated and overadministered system.

The Grain Workers Union suggested that there be a czar who would be a type of overseer for the entire system. While the GTA was intended to be that czar it did not succeed partly because of interference from the Canadian Wheat Board. We tried the czar solution and it has not worked, at least so far.

The second proposal came from United Grain Growers. It suggested deregulating the industry and putting into place a system of initiatives and penalties to increase efficiency. However, when asked if a better solution would be to let railways take control of car allocations, the representative from UGG agreed.

With these changes guidance would come from the National Transportation Act as it does for others involved in transportation. To make this work it would be necessary to put the Crow benefit directly in the hands of farmers, either through our trade distortion adjustment program, a similar program or some type of pay the producer option. This would be a more viable solution to persistent grain transportation problems.

Reform's policy on transportation subsidy is to direct the Crow benefit into our trade distortion adjustment program. This takes care of the dilution problems that arise from some of the pay the producer options. Our policy will still provide for the benefits the pay the producer options provide by forcing the railways to become competitive. Furthermore, it will encourage more value added on the prairies through diversification and further processing. If the government were serious about jobs it would pursue a method of giving farmers control over the transportation dollars. That would create real jobs, long term jobs and productive jobs on the prairies.

Reformers believe that the grain handling industry should be deregulated, that railways should be responsible for car allocation, and that they should be administered through the National Transportation Act.

Problems in the grain handling part of the system contribute to problems in grain movement. Frequent and unnecessary strikes and lockouts have cost Canadian farmers through lost sales, demurrage, et cetera. Strikes should not be allowed in the grain handling system. A mechanism must be put in place to deal with labour disputes before a contract expires. This solution will work well for grain handling companies, for workers and most important, for western Canadian grain farmers.

I would like to touch on two more areas in conclusion: research and development and creating a healthy business and trade environment. Research and development must be a top priority in any agriculture policy. Private industry depends on research and marketing agriculture products for its very existence. Therefore it is important that government work to co-ordinate its research with that of the private industry.

The auditor general's report stated that there are over 800 research projects funded by Agriculture Canada. These projects seem to be uncoordinated and improperly priorized. While Agriculture Canada has been moving in the direction of private industry guidelines, there is a need for more of the stimulus behind these research projects to come from the private sector.

Reformers strongly support and promote an open market system as a type of economic system within which business operates best. Reformers recognize that to make an open market system work well there must be some regulation. The government's role is important in dealing with certain situations, for example unfair trade practices on the part of other countries. That is why Reform proposes much tougher anti-combines and fair competition legislation and recognizes the need to enforce import control regulations when dumping occurs. We believe this type of system works much better than the heavily regulated system of substantial government involvement that we currently have.

In summary, having proposed these substantial agricultural reforms, my greatest concern is that the government has and will continue to make cuts in agriculture spending before it has released farmers from the burden of overregulation. For example, the government followed through with the 10 per cent cut to the Crow benefit which was implemented by the former government. This reduction in spending was not preceded by the necessary changes in regulation which would free up the transportation system and let farmers get around the heavily regulated system.

I cannot stress enough the importance of getting farmers and farm related businesses more choices through less regulation and better co-ordinated programs as funding in agriculture is decreased. Better targeted spending with fewer and more co-ordinated programs will allow for further spending cuts of between $150 million and $200 million with about the same amount of money going to farmers.

Once again, I thank the minister of agriculture for allowing this very important debate. I urge him to examine carefully the alternatives we present on this side of the House, as well as the alternatives from members of other political parties.

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11:40 a.m.


Wayne Easter Liberal Malpeque, PE

Madam Speaker, I enjoyed listening to the remarks of the hon. member for Vegreville, but there was a considerable number of contradictions in them. I refer specifically to the case the member mentioned about 1,000 cars of canola meal that sat on a siding in Lloydminster for a month. There is no question that was a problem for the transportation system.

The member was talking about how well a deregulated system would work. In fact the reason those 1,000 cars sat on that siding was that some private individual or company tried to gain advantage for itself, was able to load those cars and get around the regulatory system. As it so happened the ship was not in port. The product could not be moved. While it was trying to obtain individual gains, complications for the system as a whole were caused.

As the committee recommended, the rules under the Western Grain Transportation Act need to be applied more vigorously. The GTA did not do its job. In the regulatory system the rules and the penalties need to be applied. In its proactive way the subcommittee on transport and agriculture made the recommendations to get around the problem. I am sure the ministers will act on them next week.

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11:40 a.m.


Leon Benoit Reform Vegreville, AB

Madam Speaker, I would have been very surprised if the hon. member had not stood and made a comment or two. I appreciate his comments.

I see no contradiction in what I said about the cars sitting near Lloydminster. I have proposed in my speech that there should be a system of penalties and incentives in the system. Right now we have hopper cars that have been paid for by the taxpayers of Canada and by farmers directly through the Canadian Wheat Board. Yet there is no way the system can charge railway companies or shippers demurrage or some other kind of penalty for not using these cars properly. If we had that type of mechanism in place this absolute blatant abuse of the system would not happen.

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11:40 a.m.


Len Taylor NDP The Battlefords—Meadow Lake, SK

Madam Speaker, I agree with the member for Malpeque who listened closely, as I did, to the comments of the member for Vegreville.

The comments were riddled with contradictions. One of the biggest was early in his remarks when he talked about the fact that governments should not be a partner with farmers or with agri-business. Then he went on to outline the Reform's three-point program which puts the government in partnership with farmers and agri-business. It did not make sense.

Would the member qualify or further explain what he meant by saying that there should not be any partnership and why he called for a partnership?

At the same time I would like him to deal with the issue of the majority deciding an issue. Clearly in Saskatchewan the majority of farmers who attended government sponsored discussions on transportation, clearly those who have attended the conferences of the Saskatchewan Wheat Pool, the National Farmers Union and other farm organizations in Saskatchewan have spoken in favour of the status quo for grain transportation and the maintenance of the Crow benefit.

Yet the member who believes very strongly in letting the majority decide continues to argue that the interests of the large corporations and the large farmers should be put above the ordinary producers throughout Saskatchewan and other parts of the prairies.

I would like the hon. member who speaks eloquently about agriculture and other issues to explain these things to me and other members of the House.

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11:45 a.m.


Leon Benoit Reform Vegreville, AB

Madam Speaker, I have never been accused of speaking eloquently before. I appreciate that very much.

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11:45 a.m.


Lyle Vanclief Liberal Prince Edward—Hastings, ON

But accused of other things.

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11:45 a.m.


Leon Benoit Reform Vegreville, AB

I have been accused of a lot of other things, that is right.

First of all, in terms of the majority of farmers deciding, it is very simple to deal with. The hon. member feels he is right, I have a good feel for what the majority feels. Let us hold a plebiscite and decide the issue. It is as simple as that.

In terms of a partnership, my concept of a partnership is two or more bodies that work very closely together and have equal control. I believe the safety net programs the Reform Party is proposing take that government control and interference out of the safety net mechanism, so it is not a partnership. This is money provided by taxpayers to help farmers deal with situations which are largely beyond their control. I think that is legitimate, but it is not a partnership, nor should we have a partnership.