Mr. Speaker, I rise to speak on second reading of Bill C-76, an act to implement certain provisions of the budget tabled on February 27, 1995. For my constituents the bill should be known as an act to kill the Crow or an act of unfairness to the prairie economy.
Bill C-76 is the legislation that will allow for the payment of compensation to the owners of farmland in the absence of the Crow benefit. I quote National Farmers Union President Nettie Wiebe:
The federal budget delivers a double hit to Canadian farmers. They are increasing farmers' costs by cutting transportation subsidies and then hitting us with fewer funds for farm safety nets, less money for dairy subsidies and reducing the budget overall.
I will direct my remarks to two points. First, I will look at the principle of withdrawing federal support from grain transportation. Second, I will address the specifics of the payment of the $1.6 billion outlined in the legislation before us.
I have said previously in questions in the Chamber, in comments to other speakers and in response to inquiries from the media that the elimination of the federal financial commitment to the transport of grain destined for export is the single most devastating element in a very difficult budget.
On February 27 the federal finance minister announced the elimination of the transport support program which, just two years ago, was providing $720 million a year. The grain on the prairies is grown on land that is farther from port than in any other export oriented grain growing country in the world.
I have been consulting with farmers and community leaders in areas supported by the farm economy. During the consultations we took out our pencils and calculators and looked at the implications of the elimination of the Crow benefit in real, personal and community terms. The only word to describe the implications of the federal government measure was devastating, the word I used earlier.
In the province of Saskatchewan the loss of the Crow benefit will mean that delivery costs from virtually every delivery point in the province will increase by about $1 million a year. Producers who deliver grain to local elevators will have additional freight costs deducted at the elevators equalling collectively about $1 million a year. With reduced incomes of some significance there is a net community loss that is unlikely to be made up elsewhere.
That is the point the federal government failed to address in the budget. The withdrawal of federal support will have an immediate effect on countless communities, most of which will have neither the resources nor the ability to make up the lost funds.
In spite of my questions and the questions of others, the federal government has not produced a single page of study, evaluation or analysis to indicate or prove the contention of the finance minister that the elimination of the financial support will lead to greater crop diversification or enhanced value added production capacity in these communities.
I draw attention to the speech yesterday of the Parliamentary Secretary to the Minister of Finance who talked in glowing terms about the elimination of the subsidy encouraging the development of value added processing and the production of higher value goods. He said that the elimination would result in a more efficient grain handling and transportation system. He said that the elimination of the Crow benefit would help maintain our market access for grain sales in foreign countries.
No evidence has ever been produced to prove these contentions. What is there? What analysis has been made to substantiate these claims? Absolutely none. Not one shred of evidence has been produced to give us any confidence that the investment to replace the lost income from increased freight costs will magically materialize. Every delivery point in Saskatchewan must find $1 million a year in new revenues just to remain where they are today. How many more peas can we grow? How many more pigs or cows can we produce? How many new flour mills, ethanol plants or breakfast cereal plants can we build by this time next year to replace the $1 million per community that is being taken out of our province by this single move in the budget?
There are a lot of unanswered questions which deal with the future of my province and even the uncertain future of the Canadian Wheat Board that are not being answered. Yet the government is proceeding with great abandon to ensure that the Crow benefit is gone before the end of the crop year. It is sheer madness.
On virtually every other issue the Liberals talk about their election promises, the red book promises, the guide to direct them in policy matters, but nowhere in the red book do we see a promise to get rid of the Crow benefit and bankrupt agricultural communities with such swiftness. I quote the red book: "Our goal is reducing input costs to make farming more valuable". What have the Liberals done? They have increased costs, not reduced them as promised in the red book.
I have asked the Minister of Agriculture and Agri-food and the Minister of Finance to postpone any actions on the elimination of their commitment and responsibility to the west until the long term implications are well known, thoroughly reviewed, and mitigating measures are outlined and debated. It is absolutely crucial that we look at what the long term implications will be before the decisions are taken in the Chamber by the members who are sitting here today.
In the legislation before us the government is barrelling ahead with the decision to kill the Crow without knowing what it will mean to those most affected. The legislation gives the government the authority to make a transition payment to the owners of farmland in western Canada in lieu of the Crow benefit. Once the legislation is passed and the process of making the payments is in place, it will be very hard, indeed it will be impossible to go back and assess how bad the damage will be. We have to defeat the legislation if we are to make the proper assessments.
At the same time it is important to look at the specifics of Bill C-76. There are three main problems with which I would like to deal: the principle of the idea, the payout, and the process of regulations. In principle the idea of providing $1.6 billion in a payout is wrong. First, as I said, it should not be done. Second, if the government insists on making the payout obviously it is very inadequate.
Every member of the Chamber is aware that the Crow deal was originally a condition of building the railway in return for being given a lot of land on which they have made a lot of money over the years. In return for the government building the railway itself, the railway companies promised to ship grain from the
prairies to the port. It was a very simple condition. It can almost be called a condition of Confederation for western Canada.
Many farmers are very upset the government came along and out of the blue announced the deal was no longer in effect. The farmers have to pay once again for a service that was paid for long ago, and the railways once again get off scot free. In principle that is grossly unfair.
The $1.6 billion is an arbitrary figure that means virtually nothing. "Where did the government get this figure from", farmers ask. The prairie pools have made their calculations. They said if the Crow benefit were to be eliminated and replaced with a fair payout to farmers the bill should be providing authority to pay $7 billion rather than the inadequate $1.6 billion which will do very little to compensate the landowner or the shipper, no matter how we look at it.
Another problem with this section of the legislation is the fact that it proposes to pay the $1.6 billion to landowners rather than to producers. It seems the Liberals think that compensating for the loss of land value, which they acknowledge will result from the loss of the Crow benefit, is more important than compensating farmers for the additional costs associated with increased freight rates. Paying money to landowners means that about 40 per cent of the payout destined for Saskatchewan will go to the banks and other financial institutions such as the Farm Credit Corporation.
Although the Liberals say that these institutions should pass along the payout to those who lease land from them, there is no guarantee, no certainty that anything will get passed on. At the same time the legislation makes the payout to landowners including the banks tax free; but money that finds its way to farmers who lease their land, if the money gets to them, becomes taxable. Obviously this means that the Liberals seem to have much more sympathy for the poor banks than they do for the poor farmers.
Third and last in this section, the legislation before us leaves virtually all the details about how this is going to be handled to the regulations. All the questions about who qualifies, what kind of land will be paid for, when the cheques will be written and mailed and so on will be decided in the minister's office. The specifics will be settled in the regulations. The decisions are left to the bureaucracy and there is virtually no public input through this Chamber and members of Parliament.
In conclusion, there is much wrong with this idea. This legislation should not be supported by the members of this House.
I once again appeal to the Minister of Agriculture and Agri-Food. I ask that all this stuff relating to the elimination of the Crow benefit be put off until such time as a complete evaluation of the consequences has been written and reviewed. We cannot afford to abandon the farm economy and the communities that depend on that economy.