Mr. Speaker, I am pleased to speak in this debate on the motion to refer Bill C-4 to the Standing Committee on Agriculture and Agri-Food.
The changes to the Canadian Wheat Board that are proposed in Bill C-4 have been designed to respond to the wishes of western Canadian grain farmers. Some western grain producers and producer groups have been asking for more flexibility in the marketing of wheat and barley. The question arises, would Bill C-4 allow aspects of a dual market or voluntary marketing through the Canadian Wheat Board? The short answer is yes, subject to the democratic will of the farmers themselves.
The tool, Bill C-4, would enable the Canadian Wheat Board to provide additional marketing options to farmers while maintaining the integrity of pooling and single desk selling. However, the board of directors, two-thirds of whom will be elected by farmers, would also be empowered to recommend changes that would result in a marketing system with some of the features of a dual market, if that is what producers want.
Part IV of the current Canadian Wheat Board Act provides the Canadian Wheat Board with single desk control over the export of wheat and barley, while part III deals with the acquisition of grain from producers, pooling and initial payment.
Part IV also provides for monopoly control over interprovincial trade of wheat and barley which has, of course, long since been removed for domestic feed grain. As members can see, producers currently have three options for selling their feed wheat and feed barley. They can sell it to the Canadian Wheat Board. They can sell it to the private trade. Or they can sell it directly to a domestic customer. None of this will change if Bill C-4 is passed. In fact, it has been made more explicit to remove all doubt.
Right now the option of selling to the Canadian Wheat Board, the private trade or directly to the final customer exists, but only for domestic feed grain. However, under the exclusion clause in the new legislation it will be possible for this option to be extended to “any kind, type, class or grade of wheat and barley.” This clause provides for the exclusion by regulation of any kind, type, class or grade of wheat or barley from the provisions of part IV of the Canadian Wheat Board Act. But it would still allow the Canadian Wheat Board to continue its activities under part III. This would mean that the Canadian Wheat Board would still be able to purchase the grain from producers and at the same time operate a pool.
For such an exclusion to occur three conditions have to be met. First, a new farmer controlled board of directors would have to recommend it. Second, the Canadian Grain Commission would have to approve an identity preservation system to safeguard quality. Third, a producer vote would have to be held if the board of directors decided the exclusion is indeed significant. If all three conditions were met, the minister would recommend the exclusion and the governor in council would pass the legislation.
Balancing the exclusion clause is an inclusion clause. This clause allows for the extensions of part III or part IV or both to grains not currently covered by the Canadian Wheat Board Act. I should point out that this inclusion clause is confined to crops that fall within the definition of grain now in the Canadian Wheat Board Act, that is oats, flax, rye and canola.
It is subject to the commodity organization which best represents the producers of that grain asking for it. And of course, the Canadian Wheat Board directors, as I said, those who were duly elected, would have to agree and farmers would have to approve it by a democratic vote.
Suppose that all these three conditions were fulfilled and suppose that the Canadian Wheat Board Act were thus extended so that part III applied to rye, but not part IV. Remember, part III refers to pooling while part IV refers to single desk selling. Extending part III but not part IV would create a situation as I have described under the exclusion clause, that is, farmers would be able to sell rye not only to the Canadian Wheat Board but to others. If the decision is to extend both parts III and IV, this would result in both pooling and single desk selling.
Another provision of Bill C-4 would allow for cash purchasing. The Canadian Wheat Board would have the flexibility to purchase grain at a price other than the initial payment. If this were used extensively for a particular grain such as feed barley, the result could be that prices for feed barley in Canada would differ from prices in the United States only by actual transfer costs. In such circumstances, licences to export feed barley to the U.S. would likely be granted with no charge for buy back, although there might well be conditions imposed to ensure that such feed barley exports would not adversely affect the Canadian Wheat Board malt barley exports to the U.S.
This situation would be somewhat comparable to a dual market or voluntary marketing through the Canadian Wheat Board.
Finally, part VI of the Canadian Wheat Board Act allows marketing plans for voluntary pools to be established for grains, varieties, grades or classes that are not required to be marketed through the Canadian Wheat Board.
Such a marketing plan can only be set up after an association of producers or an association or firm engaged in the processing and marketing of grain submits a proposal for the establishment of a marketing plan to the minister and is approved by the governor in council. Such a marketing plan would include guaranteed initial payments, however, the guarantee would only cover a maximum of 90% of any losses incurred.
The provision for marketing plans is in the current act but it has never been used. If it were it would result in a voluntary pool for grain covered by the marketing plan. Under this provision the administrator of the plan must be designated. It is conceivable that after it becomes a mixed enterprise the Canadian Wheat Board might qualify to be an administrator.
In conclusion, there are several ways that a dual market or voluntary marketing through the Canadian Wheat Board, or similar results, could be achieved under Bill C-4. All of them would require as a minimum that the producer controlled board of directors take a conscious decision to do so. In most cases farmers would carry the ultimate authority through a democratic producer vote. It comes down to producers deciding what producers want. They will elect the majority of the board of directors and they will vote on inclusion or significant exclusions of crops.
Like many other aspects of the legislation these tools are enabling. They put power in the hands of producers, allowing them to shape the Canadian Wheat Board to the needs of Canadian farmers.