Madam Speaker, my distinguished colleague and member for Malpèque is an expert in dairy production, and I have considerable respect for him.
The Federation of Dairy Producers of Canada decided to comply with the provisions of NAFTA-and NAFTA is the reason we are here debating Bill C-86 this afternoon-because the $3 levy per hectolitre of milk could have been reduced by 15 per cent a year. However, GATT determined that, as of August 1, 1995, this $3 deduction from the income of industrial milk producers would be illegal under the NAFTA agreement, because it would be considered a direct export subsidy.
This is debatable, but since it seems we do not want to overly upset the Americans, we bowed to their demands. We still do not know which takes precedence-GATT or NAFTA-so we comply with the requirements of NAFTA.
Under this agreement, we obtained an extension in order to become legal. As the member for Malpèque pointed out, the quota may be negotiated between provinces. The hon. member for Malpèque could buy part of Quebec's quota to expand his farm. Better yet, if he wants to swell his coffers, he could sell his quota to Quebecers, who could take his quota from Prince Edward Island and bring it to Quebec.
I think this is a very good point in Bill C-86, given that, in the agreement signed by the farm producers of the six provinces, if, for example, Prince Edward Island sees its milk quota vanish like snow in springtime after the 1 per cent sale, it can temporarily withdraw from the agreement it signed with the other five provinces.
What I want to find out from my colleague for Malpeque, who is very familiar with agriculture across Canada, is: what is going to happen to the three recalcitrant provinces? I will not go so far as calling them separatist, but I would like to know what we can give these three western provinces to get them to sign the agreement with the six other provinces, since they produce barely 18 per cent of Canada's milk.