Debates of Feb. 18th, 1997

Canadian Wheat Board Act

[John Williams, Reform, St. Albert, AB]

Mr. Speaker, I am glad to join in the debate on Bill C-72 which is amendments to the Canadian Wheat Board Act and consequential amendments to other acts.

I was reading through the bill and was rather surprised when I read sections 3.93 and 3.94. Section 3.93 starts off with an innocuous statement:

(1) The directors, officers and employees-shall

(a) act honestly and in good faith with a view to the best interests of the Corporation; and

(b) exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances.

That is good stuff. We would hope that these patronage appointments the government is going to put on this board would live up to that promise. However, when I read on, I find that while they may act with honesty and good faith and exercise good diligence, they are indemnified if they do not. Section 3.93(3)(a) states:

(3) Directors, officers and employees are not liable for a breach of duty-if they rely in good faith on

(a) financial statements of the Corporation represented to them by an officer of the Corporation or in a written report of the auditor of the Corporation as fairly reflecting the financial condition of the Corporation;

This tells me there is a problem with the financial statements. If they have the annual report of the Canadian Wheat Board for 1994-95 which has been audited by Deloitte and Touche and seems to be a fairly reasonable audit report, and if we find that someone relies on that financial statement and that financial statement is wrong, they are now going to be absolved from liability. My rather devious mind asks the question: What is wrong with the financial statements if they are to be indemnified if they rely upon these financial statements?

I read on in section 3.94:

The Corporation shall indemnify a present or former director, officer or employee of the Corporation-against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, that are reasonably incurred by them in respect of any civil, criminal or administrative action-

What are we talking about here? Are we going to indemnify these people against criminal action? That is what it states. Let me read it again:

The Corporation shall indemnify a present or former director, officer or employee-against all costs, charges and expenses-incurred by them in respect of any civil, criminal or administrative action-

What kind of stuff is this? First we have them indemnified against relying on audited financial statements. Then we find out we are indemnifying them against criminal action taken in the nature of their duties. These are pretty strong words.

Bear in mind also that the wheat board alone is protected in that it is excluded from the Access to Information Act. We cannot obtain information on the Canadian Wheat Board because by law it is protected. No one can use the Access to Information Act to get information from the board. To make matters worse, as far as I am aware the auditor general is denied the right to take a look at the Canadian Wheat Board and pass comment on it.

Let us add all these things up. The auditor general cannot take a look at the wheat board. No Canadian can take a look at the wheat board because they are denied access through the Access to Information Act. And now its officers are being indemnified against criminal activity and there is some shadow of doubt being cast on its financial statements.

When we add all that up what do we get? There seems to be some kind of conspiracy to cover up around here. There seems to be some doubt being cast on the integrity of this government and on the management of the Canadian Wheat Board.

I would like the minister of agriculture to stand up in this House and tell us what is going on. I do not see any reason why we should pass legislation that creates a monopoly that is protected by legislation and is given the greatest secrecy imaginable and its officers are indemnified against criminal activity. Surely we, as all Canadians do, deserve real answers. Why are these two sections in this bill?

I have not heard one word out of the minister of agriculture explaining why he feels he has to indemnify the employees of the wheat board who rely on financial statements that have been audited by an independent auditor. I do not know why he has to indemnify the employees of the wheat board if they are sued in a criminal action. Mr. Speaker, can you give me any reason? Can anyone else give me a reason? I do not know.

This is indicative of the way this government has been managing its affairs. We have seen it in the Somalia inquiry; it gets embarrassing and the government shuts it down. We have seen it in the Krever inquiry seeking information and it is stonewalled. We talk about the Pearson airport and now we go to court. There is the Airbus fiasco which the government has bungled from day one. It has cost the taxpayers millions of dollars and we found out the other day that the Minister of Justice spent $160,000 of taxpayers' money so he could sell us a bill of goods. It has got to stop.

Criminal activity cannot be condoned under any circumstances whatsoever. To indemnify through legislation has to be the worst thing I have seen since coming here three and a half years ago. To put that in a bill on the wheat board which is protected against inquiry by the auditor general and against inquiry by any Canadian through access to information, is something even communist Russia would be proud of. That is what we are getting from this government today.

We have had it before and we will have it again. Whitewash. Pull the wool over Canadians' eyes. Do not tell them what we are doing with their money. Do not tell them that perhaps, and I say perhaps, somebody is cooking the books in the financial statement and now when it may come out, the government wants people indemnified.

The point is that questions are being raised. I do not have the answers but I am quite sure the minister of agriculture has the answers. It is his responsibility to stand up in the House and tell us what he is trying to cover up by these two sections. If he is covering up illegal activity and fraudulent statements we need to know about it. We need to know whose head is going to roll.

Maybe it is the minister's head that should roll because this type of activity in a democratic country cannot be tolerated. I hope the minister comes in, stands up in the House and tells us what his intentions are.

[Leon Benoit, Reform, Vegreville, AB]

Mr. Speaker, today we are debating a motion to refer Bill C-72 to committee before second reading. I support that move because so much of this legislation needs to be debated and discussed before the bill is allowed to be passed.

People have three main concerns regarding the Canadian Wheat Board. The first is the lack of accountability of the board. It has a security level equal to that of CSIS. The second is that farmers do not have control of the board yet it is their money entirely that funds the operations of the board.

The third issue is that the Wheat Board has a monopoly that was only given to it under the War Measures Act but which has not been removed. Farmers want a choice. They want to make it extremely clear so that no one can possibly say otherwise.

Most western farmers and certainly most Reformers support keeping the Canadian Wheat Board as a marketing agency. That is not the issue here. We support that. We support giving farmers a choice. In a democratic country, it is almost unimaginable that they have not had that choice.

I want to deal with these three issues. I know I will not have time to cover them adequately but I will give it a try. I will relate them to this legislation. By the time I finish it will be abundantly clear that scrutiny of the bill is necessary before second reading.

First, the Canadian Wheat Board has a level of secrecy the same as CSIS, almost unimaginable. Yet it is not accountable. People have to ask themselves why that level of secrecy is in place.

The auditor general, for example, does not have access to wheat board documents and to information from inside the board. Therefore, we cannot rely on an auditor general's report to deal with the operations of the board and to determine whether things are being done as they should be done. That is the level of secrecy.

For example, the only way we found out that a commissioner who quits or is fired is entitled to a severance package of somewhere around $290,000 was through a leaked document. Yet as a grain farmer, as someone who pays for the board's operation, I was not entitled to know that. We do not know the salaries of commissioners. We do not know, certainly, the benefits package of commissioners.

Farmers believe generally that the benefits package is totally beyond anything that is reasonable. As the people who are paying for these benefits, paying these salaries and paying this severance package, we have a right to know exactly the dollar amounts that are involved.

Accountability is the first issue. Has this bill changed accountability?

[An hon. member]

No, it is worse.

[Leon Benoit, Reform, Vegreville, AB]

Has it dealt with accountability? Yes, but it has made it worse as my colleague says.

I refer to section 3.93(1) and read from the bill:

The directors, officers and employees of the Corporation in exercising their powers and performing their duties shall:

(a) act honestly and in good faith-

It talks about what the officers should do. When we read section 3.93(3), it says:

Directors, officers and employees are not liable for a breach of duty under subsection (1) or (2) if they rely in good faith on

(a) financial statements of the Corporation represented to them by an officer of the Corporation or in a written report of the auditor of the Corporation as fairly reflecting the financial condition of the Corporation; or

(b) a report of a lawyer, notary, accountant, engineer, appraiser or other person whose position or profession lends credibility to a statement made by that person.

The bill says they should act honestly. Section 3.94 goes on to state:

The Corporation shall indemnify a present or former director, officer or employee of the Corporation or a person who acts or acted at the request of the Corporation-

It indemnifies former directors or officers or employees. We have to wonder why. I would like to ask the minister why this protection has been given to former officers and directors of the board. To my way of thinking the only reason is that there is something to hide. That subsection certainly cannot be left in the legislation.

Because of time restraints I will go on to my second area of concern. Farmers do not have control over the board. They pay for the operations of the board but they have no control. Has this been changed? The answer is not necessarily. The legislation may not give farmers one bit more control over the board than they have now.

I refer to section 3.6(1) which states:

On the recommendation of the Minister, the Governor in Council may, by order, designate one or more positions on the board to be filled through election by producers in accordance with this section and the regulations.

Does this mean necessarily that even one director will be elected? The answer is no. It is unbelievable. "The minister may decide to have an elected director". That is not what he has been telling farmers.

The minister will probably change that because it certainly will not be tolerated. If that is slapped into place, the backlash from the farm community will be unimaginable. I think the minister can see that and the clause will be removed. However, that does not excuse him for this being in the legislation.

It is one of two things. Either he has intentionally deceived farmers and the public when he said that there would be elected directors, or he is showing incompetence. This is sloppily drafted legislation and that is intolerable. Either one of those two possibilities are completely unacceptable and the minister has to answer to that. Are farmers given more control? Not necessarily.

The third concern is the monopoly, the whole issue of giving farmers a choice. Farmers generally want the wheat board. But they also want to have the choice of marketing through a grain company or on their own. It is a choice that is given to anybody else in the country.

Will the bill give them that choice? Absolutely not. The monopoly power is maintained absolutely and that is unacceptable, especially when we look at how the monopoly was given to the wheat board in the first place.

In the memoirs of Mitchell Sharp, a former Liberal member of Parliament and cabinet minister under the Trudeau government and a close colleague of the Prime Minister, he spoke about when he was a high level civil servant in the finance department during the war in 1943, when under the War Measures Act the Canadian Wheat Board was given its monopoly powers. What did Mitchell Sharp say about that? Every Liberal in the House should read what Mitchell Sharp said. He said that because we were in a situation of war it was reasonable to give the wheat board a monopoly to control the supply for wheat. He acknowledges that it drove prices down. That was the purpose, to drive prices down so the government could afford to help Canada and Britain in the war effort.

What Mr. Sharp said was that he believed at the time, and he still believes, that it was absolutely wrong that this monopoly was kept in place after the war. He believes that it has cost farmers a pile of money.

In particular, he acknowledged that the five year contract that was put in place after the war cost farmers hundreds of millions of dollars. That was only allowed because of the monopoly that was given to the board. The farmers have never been compensated for that.

The books are closed. Secrecy is there. The board is unaccountable. The monopoly remains. It makes no sense. It has to be changed and it has to be changed soon. Farmers are absolutely sick and tired of this issue not being dealt with and we have to deal with it.

[Len Taylor, NDP, The Battlefords—Meadow Lake, SK]

Mr. Speaker, I am pleased to speak to Bill C-72, the amendments to the Canadian Wheat Board Act. This is an important bill. It is an important issue which I have been following for a long time.

I have discussed this matter with many producers throughout Canada and, in particular, throughout Saskatchewan and the prairies. I attended meetings of the Western Grain Marketing Panel when they were held in the province. I attended the meetings in Kindersley and North Battleford. Little of what was talked about is reflected in Bill C-72.

Bill C-72 is not being given the usual second reading in the House. Instead it is being introduced here for a short three hour debate and then sent directly to the agriculture committee for study. I definitely support the committee study but I oppose the process of fast tracking debate in the House in principle.

This process of sending a bill to committee before second reading is a recent innovation in the legislative process. In some cases it works very well, but in other cases it does not work well at all and I believe that is the case with Bill C-72. Bill C-72 is important to all Canadian farmers. Therefore, it is important to Canada.

Second reading is traditionally a time when members of Parliament address the principle of recently drafted legislation. It is a time to examine in public debate the concepts on which the bill, as written, are based. It is a time when MPs who have discussed the legislation with their constituents can put those comments on the record and share them with other MPs in the hopes of influencing the clause by clause discussion which follows when the committee studies the bill.

Not all MPs can speak during this shortened three hour debate. Not all MPs are members of the agriculture committee. Therefore not all MPs and, most importantly, not all of their constituents will have their voices heard on the principles contained in this legislation before third and final reading, when it is too late to make substantial changes to the bill. This process is simply fast tracking the legislation, despite the fact that perhaps there will be a shortened committee stage.

The process of shortening debate at second reading was designed for highly technical bills and not for ones like the Canadian Wheat Board legislation which also has political and subjective economic content. I object to this process being used for Bill C-72. I believe the minister of agriculture is simply using it to avoid lengthy public debate on a bill which he knows is flawed and which he does not want to fix.

I use as an example the fact that the day this legislation was introduced the minister said he was prepared to accept amendments. The next day the agriculture committee chairperson said: "This bill will in fact be amended". Today the parliamentary secretary, when introducing the debate, said that the minister would look at amendments to the bill. If the minister knew the bill was flawed and needed amendment he should have written it as such to begin with and not have introduced it the way it is today. He should have simply said: "I am prepared to listen, talk to me". If he knew it needed amending he should have done it originally.

I also object to the timing of the debate. It falls in the middle of the voting process on the future of barley within the jurisdiction of the Canadian Wheat Board. I and others had asked that the bill be delayed until voting had concluded on the barley motion to ensure that both these matters got the full attention of the public which they deserve. I am sorry that the minister has chosen not to listen to this advice.

On the other hand, so as not to seem entirely negative, I am pleased that the agriculture committee to which this legislation is being sent is talking about travelling outside of Ottawa to make itself accessible to farmers, farm groups and communities on this bill. I would argue that the success of the Canadian Wheat Board

certainly depends on the legislation changing, as the views of the farmers and the farm communities are important.

The committee, if it chooses to travel and if this House gives the approval of the committee to travel, would be doing the right thing in this regard. I can only hope that it has given everyone enough time to prepare adequately to respond to the challenge that is in front of all of us.

This is an important bill and therefore I want to once again express my concern and disappointment that the minister chose not to seek the face to face advice of the farmer elected Canadian Wheat Board Advisory Committee in drafting the bill. The advisory committee, which is being replaced in this legislation, is made up of the farmers most knowledgeable about the operations of the Canadian Wheat Board and the affect those operations have at the farm gate.

The minister should have involved the advisory committee immediately right from the beginning but he did not. Obviously the flaws in this bill are there because he chose not to consult and therefore it is obvious that we could be avoiding unnecessary debate, saving lots of time and money had the minister done this differently. The advisory committee's advice in designing and drafting this legislation should have been sought as a matter of course.

Many in the House today are not farmers and certainly not farmers of grains under the jurisdiction of the Canadian Wheat Board. Therefore they may not realize that the economies of grain farming during the last 10 years have been stressful. Last year's crop and price were probably the best in that 10 year period which generally was characterized by low prices, low yields, low grades and lower and lower morale. Bankruptcies and quit claims were high, as were farm debts, suicides and on farm accidents.

At the same, time huge changes in the international marketplace have been taking place, not the least of which have been the subsidy talks of the Uruguay round of GATT and the subsequent establishment of the World Trade Organization.

Canada agreed with the United States and Europe to do away with a number of programs identified, I think incorrectly, as subsidies, and as a result Canadian farmers have lost their ad hoc emergency programs, the Crow benefit and certain supply management guarantees. I might add that Canadian governments under Mulroney and the present Prime Minister have done this without seeking similar moves by Europe and the United States, both of which are maintaining their GATT identified farm support programs.

Into this volatile mix is thrown the Canadian Wheat Board, the agency that sells Canadian wheat and barley to the international marketplace. This agency which maintained sales and prices during the turbulent times of the last 10 years has been targeted by the United States as an unfair trading practice with support from a number of Canadians, many of whom are seeking ways to escape huge debts they have built trying to survive through the very tough times.

This is a most vulnerable time in the history of the Canadian Wheat Board and this government should be doing everything in its power to support and sustain it from those outside attacks. This legislation and, I might add, the barley vote as well are only fueling the debate which has the possibility to weaken the board and therefore jeopardizes its future and therefore the future of farm income.

If nothing else, the minister of agriculture should resist all pressures to make substantial systematic changes to the board. He should give the board his unconditional and unqualified support and ensure that on the operational side the board has the flexibility it needs to address the internal and domestic challenges it faces.

Therefore in looking at Bill C-72 we have to look at the bill in that larger context. Perhaps the best thing the minister could do right now is to withdraw the bill because it weakens the position of the board and jeopardizes the future income of Canadian farmers across the prairies at a time prior to an election when we should discuss this during the election campaign.

[An hon. member]

He should resign.

[Len Taylor, NDP, The Battlefords—Meadow Lake, SK]

I hear comments from my colleagues that the minister should resign. I want to put it on record that I support that move. It sounds like a good move. The minister should resign but withdraw the bill before he does that.

We certainly need a stronger, not a weaker, Canadian Wheat Board working for us. Anything less is an abdication of farmers interests to the corporate controls of the artificial international marketplace.

In committee I hope we will look at the legislation in a lot more detail, so I will not be too specific today. However, there are a few matters I want to put on the record while there is still time. I note that in this shortened three hour debate members are allowed 10 minutes whereas there would be longer speeches provided for in a debate at second reading. Many of us would have much more of an opportunity to express our detailed concerns about the bill.

First and foremost is the question of governance. It seems very clear that farmers want more say in how the board is run. There are numerous ways to achieve this goal but the minister and the government have chosen in this legislation to create an elected board of directors with a government appointed chair and a government appointed chief executive officer.

Although the minister says that the vast majority of the board will be elected by producers, the legislation does not say how many members of that board will be elected. So we have some serious problems in dealing with a matter on which there appears to be a general consensus, more farmer control of the board's operation. Not only is there no guarantee that more than a couple of farmers will be elected to the board, but there is no guarantee that their influence will have any value. As long as the government appoints some members to that board and controls the appointments of the Chair and the CEO, the board will not be accountable to producers.

As a representative of Saskatchewan, of New Democrats and of a lot of producers in Saskatchewan, I feel there has to be some assurance of the long term guarantee represented in the legislation. Most of us in Saskatchewan support amendments that make the board more flexible and more responsive to producers, but at the same time we want a better balance between responsibility to producers and fiscal responsibility to the federal government. That needs to be struck.

[Garry Breitkreuz, Reform, Yorkton—Melville, SK]

Mr. Speaker, there are probably a lot of people across Canada listening to the debate today via the parliamentary channel. They will be wondering what we are talking about. Why are the MPs from the west concerned? I am from Saskatchewan, some of my colleagues are from Alberta and Manitoba. We are concerned about agriculture and a very specific matter with the Canadian Wheat Board. That is what we are discussing today.

[Marlene Cowling, Liberal, Dauphin—Swan River, MB]

Mr. Speaker, I rise on a point of order. I rose to speak in the House. Is there not a rotation with respect to speakers?

[The Deputy Speaker]

The hon. parliamentary secretary was not seen by the Chair. I am sorry for that. If I had seen her I certainly would have recognized her. She is quite right that it is a rotational system. Is the hon. member, being a perfect gentleman from the west, prepared to give his place up?

[Garry Breitkreuz, Reform, Yorkton—Melville, SK]

Mr. Speaker, would I still be able to speak? There has been a real absence of members from the government side to address this issue. We have had no response. This has not been a debate. It has simply been a raising of issues by the Reform Party and one NDP member with regard to this issue. If government members would have something to say we would be happy to hear it. We have not even heard the minister address this issue.

[The Deputy Speaker]

I think the hon. member is also indicating he would be happy to hear from the member and I take it the hon. member is in agreement that the parliamentary secretary speak before him?

[Garry Breitkreuz, Reform, Yorkton—Melville, SK]

That is fine as long as I get to speak.

[The Deputy Speaker]

The hon. Parliamentary Secretary to Minister of Natural Resources, with thanks to the hon. member for Yorkton-Melville.

[Marlene Cowling, Liberal, Parliamentary Secretary to Minister of Natural Resources]

Mr. Speaker, as a member of Parliament who represents the rural constituency of Dauphin-Swan River, as a grain farmer and as a strong supporter of the Canadian Wheat Board, I am more than pleased to speak on behalf of Bill C-72, the amendments to the Canadian Wheat Board Act.

This legislation is the result of recommendations made last summer by the Western Grain Marketing Panel. The Minister of Agriculture and Agri-Food Canada commissioned the Western Grain Marketing Panel to hold extensive hearings and to come up with a set of recommendations to reform western grain marketing so the system can function more effectively.

After an exhaustive consultation process involving countless letters, phone calls, faxes, E-mails, petitions, public and private meetings, demonstrations, parliamentary debates, surveys and the hard work of the panel, it is clear that most farmers do not hold extreme irreconcilable viewpoints.

This was evident in the recommendations of the panel that, along with views of members of Parliament and provincial governments, helped the Government of Canada to decide on the contents of the bill we are debating today.

I know there are differences of opinions among farmers and parties and that in the end one cannot make decisions that will please everyone.

Indeed, given the historic fractiousness of the western grains industry and the deep divisions that exist between those farmers who hold the most extreme views on grain marketing, it is not possible to satisfy all sides.

I believe most farmers want the board retained but with some degree of change. They want the board to be more contemporary in its structure. They want more accountability. They want a bigger say in how things are done. They want more responsiveness to changing producer needs and changing producer opportunities. They want more flexibility in board operations. They want a greater cash flow from their grain as quickly as possible. And, of course, they want to minimize their vulnerability to trade attacks or trade limitations imposed by other countries.

On the other side of the equation, most farmers also value the proven strengths of the Canadian Wheat Board, its global reach, its market clout, the sheer size and skill to go head to head with the world's largest and most powerful grain traders and win, the ability

to minimize the effects of the European and American trade distorting export subsidies, the board's world leading market intelligence and weather surveillance systems, and its sophisticated and comprehensive before market and after market customer services.

The Canadian Wheat Board currently serves more than 100,000 prairie farmers as a single desk marketer for wheat and barley for export and domestic human consumption. Its annual sales revenues are close to $5 billion, making the board one of Canada's most significant business enterprises. It is the country's fifth largest exporter and Canada's biggest net earner of foreign exchange. It carries on business in more than 70 countries and has earned for itself and Canada a very positive reputation in the eyes of its global customers.

However, we cannot rest easy about these achievements. There is a new world out there that requires regular change in business methods to cope with changes which this legislation addresses.

The changes contained in this legislation fall into three broad categories. The first category includes changes related to the Canadian Wheat Board's structure, governance and accountability. The second includes changes related to more flexible wheat board operations and improvements in cash flow. The final category includes changes related to the Canadian Wheat Board's marketing mandate and the empowerment of farmers.

I would like to discuss the second group of changes in greater detail. To backstop cash purchases and to help the wheat board manage adjustment payments quickly, the board will be allowed to establish contingency funds as a financial cushion. The Canadian Wheat Board is currently limited to purchasing grain from farmers in elevators or in rail cars at the initial payment and subsequently issuing those individual adjustments, interim and final payments.

Under the amendments, the Canadian Wheat Board will be allowed to buy grain on a cash basis. This authority will provide the board with more flexibility in acquiring grain by allowing it to buy grain at prices that represent one time settlements with producers. When used to complement pooling operations, cash trading will tend to reduce delivery uncertainty and increase pool returns, for example by reducing demurrage costs, facilitating additional sales at attractive prices and by improving the overall efficiency of the Canadian Wheat Board's sales program. With this authority the Canadian Wheat Board will be able to bid on varying prices for grain, thereby securing supplies more effectively and improving the efficiency of its sales program and returns to farmers.

The board will be able to manage adjustment payments during any crop year on an expedited basis by removing the need to first obtain cabinet approval.

The federal government currently guarantees Canadian Wheat Board initial payments and adjustments to initial payments made during the crop year. The current requirement that all such payments be approved by cabinet hinders the speed with which the Canadian Wheat Board can adjust prices during the crop year.

Providing for the board to operate in a more businesslike manner by adjusting payments to producers more quickly, the current system of government guarantees and approvals eventually will be amended to apply only to initial payment established at the start of each pool period. After a sufficient Canadian Wheat Board contingency fund has been established, the Canadian Wheat Board will be authorized to make all subsequent adjustments and issue related payments to farmers at its discretion.

I should point out that in its 61-year history the board has never incurred a deficit on an adjusted initial payment on any of the farm pools. The few deficits that have occurred in the Canadian Wheat Board's history have all been relative to the initial price established prior to the start of the crop year.

The Canadian Wheat Board will thus be authorized to establish the appropriate contingency funds to guarantee adjustment payments to farmers and to back cash trading operations. Options for building up such funds include the board's profits on lending operations which totalled about $80 million last year and a check off on producer sales.

These new flexibilities will help put more money from the Canadian Wheat Board operations into the hands of farmers more quickly. There are some additional changes designed to increase flexibility, most of them recommended by the western grain marketing panel.

These amendments will enable the board to offer storage payments, interest payments or other delivery related payments on farm stored grain. This change is intended to encourage producers to sign delivery contracts early in the crop year and will also authorize the Canadian Wheat Board to pay bonuses for good delivery performance by farmers.

Payment of carrying costs will reduce the need for the Canadian Wheat Board to draw grain evenly from across the prairies during the crop year and thus help in logistical planning. Greater logistical efficiency results in higher net returns for farmers.

Under the proposed amendments, the board will be allowed to issue final payments well before January 1 which is not possible under the current act. The Canadian Wheat Board will be authorized by the legislation to close pools on short notice during the crop year and establish a second pool for the balance of the crop year.

Transferable producer certificates will offer greater flexibility by allowing farmers to negotiate how and when to receive payment for grain delivered to the board. Specifically the board will be allowed to establish a program that would provide farmers with a mecha-

nism to trade their producer certificates at mutually agreeable terms.

The development of condo storage facilities and the removal of delivery quotas on non-board grain crops have put out of date a provision that said deliveries of grain to an elevator facility must not exceed established quotas. Because it is necessary for the board to be involved in authorizing the flow of grain to condo facilities, this change will formalize open access by farmers to condo facilities.

With the changes proposed in Bill C-72, the Canadian Wheat Board will be able to become an even more effective marketing agent for western Canadian grain farmers.

[Garry Breitkreuz, Reform, Yorkton—Melville, SK]

Mr. Speaker, I am disappointed once again. I thought that by allowing the member to go ahead we might get the answers to some of the questions we have been raising but we never got any such thing. We just heard another one of those speeches written by the bureaucrats in the backrooms. The member never got down to discussing some of the concerns being raised by farmers in my constituency and as the member knows, by farmers in her constituency as well.

I will outline what this debate is all about for the hundreds of thousands of people across the country who are wondering what we are talking about today. Most of the western MPs who are concerned about agriculture are debating the issue. The issue deals with the Canadian Wheat Board.

In agriculture the government has singled out the Canadian Wheat Board as a special area of concern. The government has been maintaining a lot more tighter control especially over the marketing of wheat and barley. It maintains this tight control through the Canadian Wheat Board. That is the essence of the debate we are having today.

Most people in Canada may not realize why the debate is important to the people of Alberta, Saskatchewan and Manitoba. It is because they do not have the freedom to sell their grain, wheat and barley that the people in Ontario and Quebec have. They are being treated very differently. People need to understand the context of the debate.

Who am I representing? Why am I standing up to speak about the issue? It is because many, many people in my riding have come to me. I am their representative. It is my duty to analyse legislation the government puts forth in a certain area and to critique what the government has done and to suggest changes.

The biggest concern people have is the delay which is occurring in making some of the changes that will give farmers the tools they need to market effectively in today's world. Why is the delay a concern? The delay has been horrific. We are three and a half years into this government's mandate and it still has not made any changes. The people in my riding are very concerned about the weakness of a minister that would allow this kind of situation to develop.

The hon. member for Dauphin-Swan River mentioned that the government must be sure it is making the right changes and that there are huge divisions developing within the farming community. Why have those divisions developed? It is because of inaction and the frustration farmers have experienced. The minister has created those divisions and he is continuing to widen them by the ineffective legislation he is introducing in the House.

I do not know why the minister has not bothered to speak to this but farmers want an answer. They want to know why he continues to review the situation. In 1993-94, during the first year of this Parliament, we asked the minister to begin to make some of the changes. He gave us the standard answer: "I am reviewing the situation". He has been saying that for almost two years. Then he put a panel into place. Now he is going to study it even further.

Every delay tactic possible has been used not to make changes that would give farmers more control over the marketing of their products. Farmers on both sides of the debate no matter what their perspective is are asking for the same thing. They are asking for more control over the Canadian Wheat Board. I did a survey in my riding and the vast majority, 90 per cent of the people who replied, want the board to be controlled by farmers. Not by the bureaucrats and not by the politicians in Ottawa; they are much too slow to respond.

One of the biggest problems with the bill is that it reduces the possibility of future changes to the Canadian Wheat Board. It is entrenching and putting more power into the hands of the minister of agriculture rather than giving farmers more control over their own affairs. To the people across Canada who are listening, if you do not think this is an injustice, then what is? We need to have that and farmers are asking for it, no matter which side of the debate they are on with regard to the Canadian Wheat Board issue.

Some of my colleagues have pointed out some sections which are of a huge concern. An example is section 3.94 where the corporation will pay the bill for any one of its directors or officers who may make a mistake. The farmers will still be liable to pay the bills.

The wording of course is lawyer talk: "The corporation shall indemnify a present or former director, officer, employee of the corporation or a person who acts or acted at the request of the corporation" and it goes on to describe it. In other words, it removes accountability on the part of the people who are transact-

ing business on behalf of the farmer. It removes their responsibility. Why is that a concern?

We are all aware of what is happening on the west coast. Demurrage charges by the ships that are waiting in the harbours are being charged to farmers who have absolutely no control over the situation yet the farmers have to pay the bill. Now we have legislation which puts that into law with respect to the Canadian Wheat Board. It is absolutely wrong that farmers should have to pay the bills for things they have no control over. Why is the responsibility not put on those people who are causing the problem?

Farmers are coming to me every day saying that their transportation costs have gone up astronomically, especially since the government removed the Crow rate without any warning. They have appealed to me asking if there is something I can do.

The problem is that the people who are causing the problem are not accountable. They do not have to pay. It is entrenched in this legislation. It is a huge concern.

The government says it is implementing the recommendations of the panel. Again it is simply cherry picking. It is only picking those minute things which it feels it can do without lessening its power.

The essence of the problem farmers have is that they are battling big government. They are being held down. Their freedom is being limited by the minister and the bureaucrats in Ottawa. They are not being given more control over their own affairs. That is of real concern to them.

I noted some of the words the government used in the introductory speech that would sound good to farmers. For example, it said that the Canadian Wheat Board will be evaluated on its marketing success and performance or on its financial competence. Is there anything in the bill that allows an arm's length third party such as the auditor general to evaluate the performance of the board? Farmers do not even know what is happening. They have a very difficult time deciding whether the board is doing a good job.

The minister knows what is going on. No one can tell me that the minister does not know what farmers want. They want control over the Canadian Wheat Board. Why does it have to be controlled by the bureaucrats here in Ottawa? That question has not been answered.

If the minister set out to destroy the Canadian Wheat Board, he could not have done a better job of destroying it than he is doing right now with this delay and the way he is handling the situation. People on both sides of the debate are telling me that the minister of agriculture is destroying the Canadian Wheat Board. Farmers are frustrated. They are very concerned about what is happening.

If we are to have an effective marketing tool, we must begin to make some of the changes which Reformers have been asking for. This process does not facilitate that. Sending the bill to committee now is simply another delay tactic as far as I can see. I do not think the debate this morning will facilitate the changes which need to be made to the Canadian Wheat Board.

[Julian Reed, Liberal, Halton—Peel, ON]

Mr. Speaker, the hon. member for The Battlefords-Meadow Lake made a statement about committees being inaccessible to members and therefore many members will not be able to debate the bill when it is before the agriculture committee.

I would like to correct the record and point out that every member in the House has entitlement to speak at any standing committee. There is absolutely no restriction. For the hon. member to make such a suggestion is fallacious to say the least. To my hon. friends across the way, when this bill goes to committee, these concerns can very definitely be aired.

The bill makes changes to the Canadian Wheat Board. It gives farmers more power on the wheat board. The suggestion of my hon. friend from Yorkton-Melville about the demurrage charges when wheat is not getting through to load the ships right now is rather interesting. I wonder where he would like to lay those charges.

[Garry Breitkreuz, Reform, Yorkton—Melville, SK]

On the railroads.

[Julian Reed, Liberal, Halton—Peel, ON]

On the railroads. I notice his leader made that statement in the press. I suspect the next move his leader will make is to call for the railroads to be taken over again by the government so those charges can be absorbed out of the public treasury. Is that what the hon. member wants?

One of the wonderful things about the wheat board and the service that it provides to grain growers is that it allows them in times of difficulty to level out those costs. Right now when grain prices are relatively higher than they have been in a number of years-

[Garry Breitkreuz, Reform, Yorkton—Melville, SK]

No, they are not.

[Julian Reed, Liberal, Halton—Peel, ON]

Yes, they are and the hon. member knows it if he watches the grain prices. The temptation and the desire is always there to want to escape from the wheat board and deal independently. When prices are low then that opinion shifts and some of those grain growers then want the protection of the wheat board again.

They want a dual system where grain can be marketed independently or not. How in the world is the wheat board going to survive in that situation? In a year of higher prices there will be a shift

away from the wheat board and all of those employees and all of that wonderful infrastructure that is set up to market wheat sits idle. Then in a year when prices go down there will be a run back to the wheat board again and all of sudden it has to get back in gear.

It is totally unacceptable to operate in that way in international markets. Either we go all the way in marketing grain outside of the wheat board or we keep the wheat board. Let me tell the hon. member that as long as there is a majority of farmers in Canada who want the wheat board maintained then the wheat board will be maintained. If there was a great movement away from the wheat board, if the majority of farmers did not want the wheat board, the government would not be forcing it down their throats.

My hon. friends will have all sorts of time to debate this at the agriculture committee. They will be able to go there whether they are members of not and sit down and express their concerns. They will be listened to. I happen to sit on that committee and I will make sure that they are listened to.

[Charlie Penson, Reform, Peace River, AB]

Mr. Speaker, I am happy to take part in the debate today to discuss Bill C-72 which makes amendments to the Canadian Wheat Board Act and to move those discussions to committee.

My son and I and our families operate a 1,500 acre grain farm in Alberta in part of the area designated to be under the Canadian Wheat Board. I have a lot of colleagues on this side of the House who are farmers as well and who have experienced firsthand the Canadian Wheat Board's operation. It always amuses me to hear speakers, like the hon. member from Ontario who spoke just before me, express their views on how great it is under the Canadian Wheat Board when they have not had any actual experience under the board. Ontario is exempt from being under the Canadian Wheat Board operations, and I know there is another member from Ontario ready to speak here.

Between the members who are not under the board's operation and the lawyers from the other side who extol its great virtues, it seems they are being a little hypocritical. If it is so good, why does the Canadian Wheat Board not operate in Ontario and Quebec as well?

Bill C-72 has been very badly drafted. It will enhance the control and the power of the minister of agriculture. That is exactly the opposite of what is wanted in the agricultural community currently under the Canadian Wheat Board. It is so bad that I think the minister should resign. It is not just for this reason. The minister has established a clear record in the past three and a half years since he has come to this Parliament and become the minister of agriculture. I will go through items and I suggest that he has failed on every account. He has made those on all sides of this issue angry at him for the way he has handled the amendments to the Canadian Wheat Board and the whole marketing debate throughout the prairies.

Some historical background is necessary in order to talk about the Canadian Wheat Board with some knowledge. The Canadian Wheat Board was established in 1917 during the first world war as a war measures act. I can understand quite fully why that would be. In a war you want control over food supply. We had some commitments to Britain at the time and we wanted to have stable prices during wartime.

After the first world war the Canadian Wheat Board was disbanded as it should have been. The grain trade operated in a free market economy until 1935 when the Canadian Wheat Board was re-established. It was brought back as a dual market with private grain trade. It operated in that way for eight years until the beginning of the second world war. At the height of the second world war, in 1943, the Liberal government decided that the Canadian Wheat Board should be brought back in a monopoly capacity. There again was the factor of war conditions.

I support the move that was made at that time. We were supplying grain to Britain again. We were supplying grain to our allies. We wanted the price to be kept down in order to support the war effort.

However, after the war other factors became involved. There were some five-year contracts. As one of my colleagues said earlier, Mitchell Sharp, who has been a minister in government, has been quite critical of the fact that the board continued as a single desk agency when it was not required after the war.

That sets the context for the debate that has taken place in western Canada for the past several years. The debate is all about marketing choice. Some farmers want to pool their products, have the Canadian Wheat Board do their marketing for them and accept an average price. Farmers on the other side of the issue want to market their own grain. They think they can do better than the board is doing. They have their own special needs. It may be that they have a big farm payment to make at a certain time of the year and need cash flow when some of their neighbours may not need it.

That is the debate that is taking place. It is a matter of whether we should have complete restrictive measures and marketing through the Canadian Wheat Board or whether there should be choice. I understand fully both sides of the issue. We live in a free democratic country and my belief is that farmers should be given the choice to either haul to the Canadian Wheat Board and accept an average price or to go on their own. I suggest that farmers will decide with their produce which system they like best. I think it should be left that way.

This is the background to that issue. In the last three years, the Liberal government has taken away the subsidized Crow freight rate even though our competitors have not removed subsidies to the same extent that this government has. We have moved faster than all our international obligations suggest we need to. These days

farmers are paying the full cost of freight. As such, they have had to scramble to try to find the best possible market prices in order to survive. Many of them are doing just that.

However, I suggest that the minister of agriculture is tying one hand behind the back of those farmers who want to survive. He is suggesting that the farmers simply could not market their wheat and barley internationally. He is saying that it is not possible. I think he is actually suggesting that farmers are not smart enough to do that.

Let us look at the facts. I farm myself. We market a number of products and my neighbours market a number of products already and there are companies out there that facilitate that. Canola is right up there in terms of dollar value with wheat as to which is the biggest export outside the country in dollar value per year. Canola is not marketed through the Canadian Wheat Board. Peas are not marketed through the Canadian Wheat Board. Farmers are marketing these products: fescue, clover, flax, rye, lentils. The list goes on. They are marketing beef. There has been a 40 per cent increase in the export of beef since the free trade agreement. The wheat board does not have to do that. There is no monopoly situation. It is a market economy.

For those who want to market through the Canadian Wheat Board and accept a pooled average and not have to do their own research and marketing, I suggest they keep that method in place. However, for those who do not want to market through the wheat board but want to look for other alternatives, that should be a matter of choice.

This brings us to the current round, 1993. Let us go through the list. Besides losing the Crow rate, the minister decided to increase pressure on the grain marketing debate and set up a grain marketing panel about a year and a half ago. This was a hand-picked Liberal panel. The chairman of the panel is a Liberal buddy of the minister of agriculture. I am sure the minister thought this guy would do what he wanted and come up with a favourable report. In fact, I think maybe that was the original plan.

However, once farmers and farm groups started making presentations to the panel, the members of the panel had their eyes opened up. In fact, there was so much demand for the panel to travel to different parts of the country that it had to finally agree to go to Edmonton and Regina. It was just going to hold hearings in Winnipeg.

In my riding, a group in the Grand Prairie-Peace River area said it did not make sense travelling to Winnipeg to make a presentation to the committee. Surely the committee should be out listening to the farmers in their communities. Some kind of compromise was reached and the panel ended up going to Edmonton. The panel was not even anticipating that in the beginning. However, there was so much pressure from producers that is what happened.

Members of the panel had their eyes opened up and, to their credit, they wrote a credible report suggesting that compromises be reached in certain areas and a consensus be reached in certain areas. They then made a series of recommendations. However, the minister of agriculture did not comply with those recommendations. In fact, he even refused to meet with the panel to discuss its recommendations. That is how contemptuous he was because the panel did not write the kind of report he wanted.

Further to that, the panel had recommended that barley should be outside the Canadian Wheat Board. However, the minister could not accept that and decided to hold his own vote. He knew from an Angus Reid poll he had taken earlier that farmers wanted a choice in how they marketed their barley.

He knew he could not ask the farmers whether they wanted a choice in how they marketed their barley because he would lose and that was not what he wanted. Therefore, he designed a question that was all or nothing: Do you want to deal with the Canadian Wheat Board on all sales of barley, malt or feed grain, or do you want to have the board not involved in any of that and deal with the entire free market?

That is not the debate that is taking place out there and this ballot, when it is finally tallied and the minister gets the result he wants, simply will not end the debate because it has not addressed the real issue.

[Elwin Hermanson, Reform, Kindersley—Lloydminster, SK]

A dishonest question.

[Charlie Penson, Reform, Peace River, AB]

Absolutely. That brings us to the amendments to the Canadian Wheat Board Act that the minister has decided to bring in. What are the amendments? They give more control to the minister and the government, more control at a time when they are asking farmers to accept more risk. That is not tenable. If members look at this legislation they will see countless times that different matters "have to have approval by the minister of agriculture and the Minister of Finance".

Specifically, section 18(1) has been added to the act, requiring the directors of the new board to follow any directions given to them by the governor in council. It is apparent that the board has become merely a puppet board to be controlled by the minister of agriculture.

In conclusion, it is absolutely essential that the agriculture committee travel to western Canada. It will fill its members' ears as should be because this is a badly drafted piece of legislation and does not reflect what farmers want. I encourage the committee to

take as much time as possible and travel where people live to discuss this as a very important issue to farmers.

[Murray Calder, Liberal, Wellington—Grey—Dufferin—Simcoe, ON]

Mr. Speaker, I would like to address two issues that have not been fully discussed in this debate on Bill C-72.

First I would like to put to rest, once and for all, an issue some have raised which really is a non-issue. I am referring to the notion that this proposed legislation either rescinds or intends to rescind the existing free interprovincial movement in the domestic feed grain market.

Grain farmers in western Canada have been able to sell feed barley and feed wheat domestically in designated areas on a private basis outside the Canadian Wheat Board since the government passed an order in council way back in 1974. It is not being changed.

This point has been made a number of times: in the policy announcement the minister of agriculture issued October 1996, in printed material circulated to all farmers in December, in comments the minister made in this House, in remarks he delivered at a meeting last month of Alberta's Wild Rose agricultural producers, and in a statement he made in Regina on January 21. Officials of Agriculture and Agri-Food Canada also reiterated the point that the existing domestic feed grain market is not being changed.

The minister said in a statement on January 21: "Those who persist in raising this red herring are mistaken".