Mr. Speaker, I am pleased to take part today in the debate on Bill C-25, an act to amend the Farm Credit Corporation Act and to make consequential amendments to other acts. Amending an act always has an impact on other acts.
If I understood the essence of the bill correctly, the Farm Credit Corporation is going through an identity crisis. It is normal that, at this time and in the current context, the Farm Credit Corporation finds itself lacking in identity. Is it related to a province, to a country or another country? Thus it was decided to settle the identity problem by changing the name.
I am anxious to meet with the officials, at the stage of the clause by clause examination of the bill, and see whether they can justify why, by changing the name of the corporation and giving it a Canadian identity, they are debasing the French language in the process.
The corporation used to be called “Société du crédit agricole” in French. Now its name will be changed to “Financement agricole Canada”, three words with no link between them and no modifiers. I wonder what warranted such a change. It could easily have been called “Société du crédit agricole du Canada”. Adding “du Canada” would have been enough. Why introduce the concept of “Financement”? That does not tell us how it is organized. This tells us that someone is involved in “financement”. Someone, something, some agency somewhere is providing financing to the agricultural sector.
In my opinion, the effort to find something elegant in French has not been excessive, to put it mildly. I will have some questions on this lack of respect for the French language for I feel linguistics have been rather short-circuited here. It strikes me as unacceptable that they want to change the name while not respecting the essential elements of the language.
On the other hand, the minister has raised three points in his speech, while the summary gives six reasons for changing this bill.
In his speech the minister referred to his desire to extend the corporation's capabilities to provide services.
In itself that is good news because our farmers have told us on a number of occasions that theirs is a sector in crisis. Farmers need to see financial steps taken to allow them to keep going, either to get through bad times, or to develop, create more employment and so on.
So extending the scope of services is, in itself, a good thing. The desire to do so however must not allow the new Farm Credit Corporation to go beyond the primary sector, for example, and to focus increasingly on financing the processing sector to the detriment of the production side.
I did not see anything in the bill in the way of a safety valve—or a guarantee or security—that would enable us to be absolutely certain that farm credit in Canada will not suddenly become obsessed by profit, like all funding agencies, and want to neglect the primary sector, the agricultural producers, in order to make more profit by supporting second level development, for example the processing sector.
The second objective is to help family farms achieve their long term goals. This is good news because we see more and more a tendency where family farms are disappearing.
Last weekend I took part in a symposium in Sainte-Croix-de-Lotbinière where farmers had chosen as a meeting theme “Rethinking Agriculture”. They are concerned, and rightly so, about industrial farm development at the expense of family farming, which is reasonably big and allows a family with a few children to live from farming and to leave a legacy to its children.
When we see the increasingly huge developments in different sectors and, as a farmer put it, when they have to leave $2 million of rigging to their children before leaving them their assets, there are few young people who will be able to become farmers if we do not pay attention to this issue.
This is all the more important because, if we neglect family farm production—the small farm,—our rural communities will be depopulated. A farmer told me that in his village in Kamouraska there is only one child. There are no other children. They have all gone because there is no longer a school. Instead of taking the bus to get to the neighbouring village, people move directly to that village.
In some villages there are four, five or six abandoned farms that were, not too long ago, during the settlement, cleared away and returned to farming, and that are now lying fallow and quite often returned to the forest because there are no other means of supporting the young people who would like to move there.
I hope that the Farm Credit Corporation will always have as a goal the provision of long term support to an increasing number of family farms.
Again, there is an issue which will have to be dealt with and which is a real social problem. It has to do with the third goal of the bill, which is to help family farms make the transition from one generation to the next. This issue will really have to be dealt with.
We will have to find incentives and other measures to facilitate passing on farms from one generation to the next.
When a farmer is unable to pass on his farm to his son because most of it will go to income tax, there is a major problem because people will try to sell their properties instead of trying to find solutions to the situation. We will have to deal with this problem and help families to pass on their properties to the next generation.
After reviewing the goals of the bill we see that, according to the information we were given, there were several series of consultations before the bill was introduced. It seems that those responsible for the Farm Credit Corporation have consulted several agricultural organizations and that a majority of them were favourable to the proposals contained in the bill.
The government of Quebec looks favourably upon the amendments contained in the bill, but it believes that the new corporation should continue to play a limited role in Quebec's agricultural industry.
I think the Quebec government would like the new agency to play fair and avoid providing, in Quebec, loans at below market rates. It would not like Farm Credit Canada to take hold of the Quebec market by offering discount rates, as is already being done to a point.
I heard complaints by some credit unions and information to the effect that in certain areas even the National Bank is a victim of the current Farm Credit Canada, which is providing loans at below market rates.
Obviously this new agency will have to abide by the market rules and abstain from providing lower rates to attract potential clients. It is extremely important that the agency be very cautious with this.
The UPA, or Union des producteurs agricoles du Québec, was indeed consulted in 1999. It agreed with the principles of the bill being discussed then and it should still agree with this bill, provided it has not been changed.
But the UPA has one serious reservation. It is against any direct loan by the new agency to companies that are exclusively in the processing industry.
As I said in my preamble, Farm Credit Canada should not shift its focus from the primary sector to the processing sector.
It is also concerned that that could result in a shift in Farm Credit Canada's mandate where it would end up supporting the processing sector to the detriment of the primary sector, which could jeopardize the great objectives the minister of agriculture was talking about last week and I also mentioned earlier, namely helping young farm families to settle in and to inherit their parents' properties.
If Farm Credit Canada changes and ends up giving preferred treatment to processing, we could have problems.
What led the government to pot for the changes it is introducing today? I can think of three, including the need to give farmers greater choice in financial and commercial services. Per se, that is good news. When a farmer goes to a bank, a caisse populaire or to Farm Credit Canada, he will probably be able to negotiate better conditions if there is competition. He will sometimes be able to find a better account or better loan conditions by comparing. It is very important that the Corporation not make it a policy to offer the lowest rates at all times.
It cannot usher a farmer into its office and say “How much did the bank want? How much did the caisse want? I will give a lower rate to start with”. It should not work like that otherwise it would be really unpleasant.
Another principle underlying the amendments is the need for greater structural flexibility. Farm producers have often told us that greater flexibility is needed. The rules are often complicated and complex. The bureaucracy is heavy and things no longer get done.
If Farm Credit Canada—I have a hard time remembering that name, because it means nothing in French and is impossible to remember—has greater flexibility, it will be farmers who benefit.
The government also wants to create partnerships, which will serve farmers over the long term. This too is very interesting to imagine. Although it is not possible at the moment, we can see that in the economic development of our regions, it would be extremely important to be able to create partnerships because the resources we need are not always available among our young people or farmers themselves. It is important to be able to create partnerships if we are to develop the economies of our regions.
This government should be concerned about examining the state of the regions at the moment. Resource regions are losing their populations. The day the resource remains, but the people have left, we will pay a whole lot more to recover the resources in these regions than we do at the moment.
It is vital we keep our resource regions alive, that is, with an economy to support the existence of the local market, the gas station, the confectionery store, the grocery store, the school, the church, the caisse populaire, and so on. If we do not keep this in our regions, we will wake up to the fact that it will be too late. Special programs will be required to recover the land we gave up. This is very important.
What are the main changes? First there is a name change and the name is not entirely a success. I hope we will get some explanation and at least have a full sentence in the bill. If I get an answer like “The lawyers suggested it”, I will remember that lawyers specialize in the law, not in language, as I have always known. It is because they have such a hard time drafting legislation that we have so many trials. If they were as rigorous with the language, if they took words for what they mean, there would be fewer trials to interpret them.
When I am told that lawyers provide linguistic help I think there is a problem in terms of understanding people's respective responsibilities. A lawyer is competent in the legal field, but language is not necessarily his forte.
The main changes will allow the corporation to provide business services to producers, directly or through a partnership. These services include business and estate planning and also land management.
With our aging population it will be extremely important—and I support the idea—to ensure that this corporation can help our communities in the estate planning area since it is critical to ensure that the land is passed on, under acceptable conditions, to members of the younger generation who are interested in carrying on.
These services are already provided in certain areas, but the bill seeks to make them accessible in every rural area in the country and this is a positive point.
The bill will also allow the corporation to provide lease financing to farm producers. The current act does not prevent the corporation from providing such financing, but the bill will clarify and define its scope.
As can be seen in the automobile industry, an extremely important factor has been to allow people to drive more comfortable and better cars since many are taking advantage of the option to replace their vehicles at regular intervals.
For a young person who wishes to go into farming or take over the family farm but wants to acquire more modern equipment, I think that leasing is probably a more interesting approach for him to consider, or at least to think that it might be available instead of thinking that he has to tie up $200,000, $300,000 or $400,000 in equipment, before even starting to plant.
This would also give producers and farm corporations access to equity financing. The corporation will thus be able to share directly in the business capital or use these investments to attract other investors.
This too is excellent news for our producers, for our farming co-operatives, and for the projects that our farmers are developing in certain sectors short of resources. This is surely a very good prospect for them.
The purpose of the corporation will be to provide financial services to businesses related to farming. Here again—I wish to be clear about this, and we will be discussing this at committee stage—it will be necessary to ensure that this represents perhaps a percentage of the financial products devoted to this and to ensure that the primary sector will not suffer as a result.
Finally, the corporation will be able to create subsidiaries to form partnerships which will provide new services independently of the existing corporation. This too is good news but, again, care must be taken to avoid having the legislator's intention circumvented by the kind of flexibility the government wishes to introduce.
I am pleased to tell the House that the Bloc Quebecois will be supporting this bill and that we will do everything we can to see that it is passed as quickly as possible so that farmers can benefit from the services which this new legislation will offer.