Debates of April 30th, 2001

The House resumed consideration of the motion that Bill C-25, an act to amend the Farm Credit Corporation Act and to make consequential amendments to others acts, be read the second time and referred to a committee.

Farm Credit Corporation Act

[Kevin Sorenson, Canadian Alliance, Crowfoot, AB]

Mr. Speaker, once again I am honoured to rise in the House to debate issues that are specific to the agriculture sector.

As a farmer and member representing a predominantly rural riding where the agriculture industry is a major economic engine of our communities, anything related to farm and to finances is extremely important to me, as it is to my constituents.

Bill C-25 is an act to amend the Farm Credit Corporation Act. It proposes to modify the role of the Farm Credit Corporation. What does Bill C-25 do?

First, Bill C-25 will change the name from Farm Credit Corporation to Farm Credit Canada.

Second, it expands the role of the Farm Credit Corporation to allow the corporation to lend to businesses that are not necessarily directly involved in primary agriculture production or do not have farmers as the majority shareholders.

Third, it expands the lending role to let Farm Credit Corporation provide equity financing by allowing it to hold non-fixed assets such as cattle as collateral.

Fourth, it formalizes Farm Credit Corporation's leasing ability which, although not specific, could include farmland.

Today is the last day of April. We are back on a Monday. After I spent the weekend in my constituency back in Crowfoot travelling throughout the constituency I can tell members that it is very apparent that farmers are in the field.

We were promised and guaranteed by the federal agriculture minister that Canadians would see financial help before the seed was put in the ground. That has not been the case. As we travelled throughout the constituencies people continuously asked where the money was that was promised by the federal Liberal government.

We were home this week. Springtime is usually the time where spirits are high as farmers look forward, with great expectation, to preparing the soil, seeding, planting, putting in their crops. Spirits are not high on the family farm and throughout western Canada and rural Canada. As we travel throughout the constituencies we see that it is a cloudy horizon, a troublesome horizon.

I do not know how I could explain to the House some of the things that we saw as we travelled throughout Crowfoot this past weekend. In the distance we saw on the horizon clouds that looked like they were fires. They were not fires. They were dust clouds. They were dust storms. The wind was blowing hard; it was hot and dry and the dust was blowing. Farmers were turning off the tractors and shutting them down because they realized that the more they cultivated the more the moisture disappeared. They were already laying the seed into a dry bed, so to speak.

Spirits are not high. As farmers go to the fields, they realize that this spring input costs have soared and are going through the roof. Fertilizer costs have nearly doubled from last year. Commodity prices are in the pit. Barley is around $2, wheat is $3 and canola is under $6. Commodity prices farmers are getting have not kept up with the input costs. Hope is diminishing.

Through the winter our farmers were writing and calling and stopping at the office asking what we could do about the heating bills. Working in the shop was almost ruled out because they were trying to save on their heating bills. The troubles just seem to go on.

However, have no fear, because the Liberal government has come forward with a proposal that will change the name of the Farm Credit Corporation, a proposal that will expand the lending abilities of the Farm Credit Corporation to allow it to now lend to businesses, not just farmers, not just the family farm, but remotely related agriculture businesses. That just does not sell down on the farm. That just does not sell where the rubber meets the road.

With regard to the name change, the federal government believes that this name change is absolutely necessary to affirm its federal identity to the program and to the corporation. I was born and raised on the family farm and have been farming actively for over 20 years. I think it is a very well known fact that the Farm Credit Corporation is an agency of the Government of Canada. I therefore do not necessarily agree that the name should be changed, particularly if it will result in the needless expenditures of scarce federal dollars for agriculture and agriculture related programs.

Currently 94% of the corporation's financial services are directed to farmers and businesses that are directly related to primary production. Recognizing that expanding the lending capability of FCC may strain the corporation's ability to service farmers' demands for credit, I must oppose this amendment to the FCC act.

The Canadian Alliance, as stated by my colleagues earlier today, does not agree with extending Farm Credit Corporation's involvement beyond family farm operations. The extension of that lending ability beyond primary production may bring Farm Credit Corporation into direct competition with private lending institutions and may overlap the government's institutions such as the federal Business Development Bank.

We should think of what the Liberal government is trying to accomplish. It says we need money. It says we need to provide financing for farmers and for agriculture related businesses, but now it would open up the floodgates to other businesses that are not necessarily primary producers or tied to producers.

I believe the government has perhaps changed the wrong name. Maybe it is not the word corporation that it should get rid of, but the word farm, because the legislation would take money off the farm tables and undoubtedly put it onto many business tables, and it may also effectively end up remaining on cabinet tables. The problem we are seeing in rural western Canada is that there are not enough funds being put onto the kitchen tables on the majority of farms.

Why not change the name to Canada Credit Corporation, CCC? It is easy to remember. Then the word farm will be taken right out of the equation. We could change it to CCCP, like the hockey team's sweaters that read CCCP, Canada Credit Corporation Policy. Maybe that is what the government should be looking at. It might be as effective.

With regard to formalizing the leasing ability of FCC, the government has stated that the intent is not to include land. Rather, it claims the leasing provisions are for equipment. However, this is not made clear in the legislation. This will definitely be one of the amendments which I hope will come forward through our very good agriculture critics in the Canadian Alliance, or all parties could bring that amendment forward.

The Canadian Alliance does not think it is appropriate for the government to be holders of farmland. We believe that if Farm Credit Corporation is allowed to permanently hold and lease land, it could result in the Canadian government's holdings influencing the market value of farmland. While we accept that it is impossible for Farm Credit Corporation to avoid holding land for short periods of time, the act should explicitly state that Farm Credit Corporation should divest itself of any holdings as quickly as possible.

A number of years ago I looked for packages of farmland on a map of Saskatchewan. As I looked at the central Saskatchewan area, close to Central Butte and Riverhurst and some of those areas, I was appalled to see how much farmland was actually held by Farm Credit Corporation. It held quarters and quarters of land.

That will happen. It is evident, especially with what farming and agriculture have gone through. However, the responsibility of the government and the responsibility of Farm Credit Corporation must be to hold that land for a very short period of time to allow the market to set the value, to disperse it and to give hope to young people who want, for some reason, to get into farming.

We support extending FCC's lending ability to include equity financing. We applaud it. It is a great idea, but as stated before, we want that given only to primary producers. That portion of the bill must be related only to those who are farming and involved in primary production, those who are making their living by putting the seed in the ground or raising cattle or any of the other things primary producers are doing. Allowing non-fixed assets such as livestock to be collateral for loans would greatly assist farmers who are currently not eligible for financial assistance.

The Canadian Alliance certainly encourages increased financial assistance for cash-strapped farmers toiling endless hours a day producing the high quality food products that Canadians have come to appreciate, enjoy and expect. Unfortunately the federal Liberal government's failure to provide farmers with a much needed cash injection will result in more farmers depending on loans to get their crops in the ground this spring.

As raised in the House on many occasions in the brief three months of this session of parliament, farmers have continually come here, lobbied and asked the government for a minimum of $900 million. I have heard some groups explain to the government why they needed a minimum of $1.6 billion, others why they needed $1.2 billion, but it was generally accepted that the lowest figure was the minimum of $900 million. The government however saw fit to come forward and provide only $500 million.

We therefore proposed on March 20 in a supply motion that the government authorize the expenditure of an additional $400 million. En masse Liberal members of parliament voted against our motion and again the federal government denied farmers the much needed financial assistance. My colleagues have repeatedly stood in the House expressing our sentiments and those of our constituents regarding this financial holdout.

Today I would like to share with all members of the House the opinion of Mr. J. J. Huber of Midale, Saskatchewan, as written in a recent edition of the Western Producer . I ask members to listen carefully. He stated:

It makes me sick to my stomach to have to listen to the senseless dribble coming from our rural Liberal MPs. They talk the talk, but when their job is on the line, they cannot abandon the Canadian farmers quick enough. I tell you, if we lose 45 percent of our farmers in the near future, agriculture will become a non-issue in Canada. Maybe we should just seed all arable land to grass and we can import all of our ag products from the U.S. or U.K. because they are the only people left in this world who care about their agriculture industry.

And when our consumers in Canada give their urban MPs grief because the price of food has quadrupled, who will the MPs run to then?...The farm gate is just the starting point.

He continues:

To hear the MPs say that farmers or other common folk don't understand politics, what's not to understand? It's really simple: you lie to the people and tell them how you will speak for them, and once the waters get a little rough in Ottawa, you ditch the people who you represent because you might lose your job if you actually do what your constituents want you to do.

You then do a 180-degree turn and tell your constituents that they do not know much about politics and that your abandoning them is just part of the political game. I don't know of any other job in the world where you can continue to lie to the people who pay your wages, and turn your back on them when they want you to actually do your job, and still continue to get paid. Politics, it makes me sick to my stomach.

Agriculture, politics, I think it tends to make all of us a little sick to our stomachs.

However, I say to Mr. Huber that he should take great strength because the government has come up with a bill that would give a name change to Farm Credit Corporation. Does that make Mr. Huber feel better?

If that does not quite do it, he can understand this. The legislation will allow not just farmers to receive the help from a lending institution of this Canadian government, Farm Credit Corporation, but it will also allow help to other businesses so that the government can stand and say x amount of dollars is available to farmers and to agriculture when actually in effect it is going to businesses that are not even related as primary producers. Does that make Mr. Huber feel better?

What about expanding the lending role to let FCC provide financial equity by allowing it to hold non-fixed assets as collateral? There is a little grab-all in every legislation. Maybe that is the one little bit that we need to grab hold of and put our hope and our trust in for better help. What about the pill to formalize FCC's leasing ability, which could include farmland? How does that make Mr. Huber feel? Mr. Huber and young people across Canada would have the ability to lease back land.

There was a hope that we could own our farmland, make payments and pay off debts. Now we have the ability to lease it back from our federal government. Despite the financial hardships that our farmers must endure as a result of increased costs of production, the legislation needs to be changed. We can change it and make it truly effective. The legislation is a bitter pill to swallow, as I study it further and see it coming down the pike described as some type of agricultural help.

[Andy Mitchell, Liberal, Secretary of State (Rural Development)(Federal Economic Development Initiative for Northern Ontario)]

Mr. Speaker, I listened with interest to the hon. member across the way. His passion and concern for his constituents in the agricultural community certainly came forward.

I have some concerns, though, because part of his approach is too limited in its scope. He is right. We do have to deal with the issues and the concerns of our primary producers. However there is more than one way to do that.

One of the things that is critical is that our primary producers have a greater opportunity to paint a long term vision for agriculture. The hon. member has spoken about a long term vision for agriculture. Part of that should be developing down the chain from producer to consumer. There is a fairly long chain between when we produce the goods until we eventually sell them. The more of that chain and that value adding of our agriculture production that can actually occur in rural Canada in our farming communities, the better off our rural communities would be and the better off would be their long term sustainability.

If we are to create a value added entity within a rural community, access to capital must be one of those issues. If the FCC's mandate is expanded, not so that it can fund just any old business because that is not what is being done but to fund businesses that are part of that chain, we would be working toward the sustainability of rural communities.

Could the member explain why he would not see that as a positive way of helping our primary producers and a way of sustaining our rural communities, which I know is critical to him and to all rural members who sit in the House?

[Kevin Sorenson, Canadian Alliance, Crowfoot, AB]

Mr. Speaker, that is a very good question coming from an individual who has studied rural development a great deal and understands the things that need to happen in agriculture. I am thrilled that he mentioned value added and the important role that value added products give to Canadian agriculture.

One of my concerns is that we do not see the Farm Credit Corporation as the agriculture credit corporation. We need to have a body such as the FCC that can provide capital to young farmers, farmers who want to buy more land, enlarge their facility and to do some of the things that the FCC is very good at doing.

We have a number of FCC branches in our constituency. Very close friends of mine have used the FCC and have gained financing from it. However, I do not wish to see the FCC becoming only an agriculture credit corporation. It is imperative to have directives toward the farm that will encourage farming.

To give the government some credit, we have the Federal Business Development Bank. Would it now get out of anything that may be deemed agriculture? Would it abandon anything that might be remotely close to being agriculture? I think not. Good sound business such as value added products, fertilizer, equipment and any of those things would still be covered by the Federal Business Development Bank.

Everything should not be thrown into the Farm Credit Corporation. It should be pointed singularly toward farming, farmers, the family farm and the people who are trying to get started. Right now 94% of the moneys available through the FCC are given directly to family farm operations. It can deteriorate. It can be chipped away at. Pretty soon a very small percentage could be dedicated to the family farm.

As far as value added, let me also say that many other things would encourage value added products or businesses being promoted in the west.

One of the hindrances toward that could be the Canadian Wheat Board. The Canadian Wheat Board says that if we were to begin to make a value added product in the west we would not be able to buy our wheat locally. We would have to pay the transportation of that wheat to a port, pay the transportation of it back, even if it were next door to where the wheat was produced. We would have to buy it off the Canadian Wheat Board, pay the elevation charges and all those things.

We could do a number of things to help promote value added. The member has hit the nail on the head. We should start with the Canadian Wheat Board.

[Carol Skelton, Canadian Alliance, Saskatoon—Rosetown—Biggar, SK]

Mr. Speaker, I rise today to speak to Bill C-25, an act to amend the Farm Credit Corporation Act. As a mother living on a family farm and who has lost two sons from that farm, I speak passionately about the Farm Credit Corporation and the institution that it is in western Canada and for farmers.

It provides services that are not available through other more traditional financial institutions. Farmers have come to rely upon the Farm Credit Corporation. The bill would expand the focus of the Farm Credit Corporation past its original purpose of providing financial services only to family farms and the businesses that are directly related to primary production.

The lending role of the Farm Credit Corporation would be expanded to allow the corporation to lend to other businesses that are not necessarily directed or involved in primary agriculture production and do not necessarily have farmers as major shareholders. It raises some serious issues with respect to government getting involved in areas where the private sector already operates.

By extending the lending abilities of the Farm Credit Corporation beyond primary production, the bill would bring the Farm Credit Corporation into direct competition with private lending institutions and would overlap with other government institutions such as the Business Development Bank of Canada.

The problem with the proposal is that it lacks clear definition. It is not stated clearly. It raises more questions than it answers. For example, if the Saskatchewan Wheat Pool needed an infusion of cash, would the provision allow the Farm Credit Corporation to become a major lender to the Saskatchewan Wheat Pool? That is of great concern to a lot of people. The Canadian Alliance has always opposed government expansion into areas already competently served by the private sector.

Bill C-25 would formalize the ability of the Farm Credit Corporation to own and lease land. The Farm Credit Corporation has stated that it is not the intent of the amendment. It claims the leasing provisions would be for equipment. However it is not made clear in the legislation.

It is not appropriate for the federal government to be the owner of farmland. Canadian farmers are supposed to own farmland. Allowing the Farm Credit Corporation to permanently hold and lease land could result in the government holding and influencing the market value of farmland. We have seen that lately in our own district.

Allowing the Farm Credit Corporation to permanently hold and lease land may also provide the corporation with an incentive not to pursue every possible means to allow farmers to stay on the land if they are experiencing financial difficulty. In short, the bill could provide Farm Credit Corporation with an incentive to prematurely foreclose on farmers.

Even under the current legislation the Farm Credit Corporation has become a significant landowner. In 2000 the Farm Credit Corporation owned over 360,000 acres in Canada. Ninety-five per cent of that land is held in Saskatchewan, the province that has been the hardest hit by the farm income crisis. That is scary. The last thing Saskatchewan needs is for the federal government, through the Farm Credit Corporation, to start distorting the market value of farmland.

While it is impossible for the Farm Credit Corporation to avoid holding land for short periods of time, the act should explicitly state that the Farm Credit Corporation should divest itself of any holdings as quickly as possible. My party hopes to convince the government to bring forward amendments to the bill to clarify this situation.

Bill C-25 would extend the lending ability of the Farm Credit Corporation into the area of equity financing. It would be done by allowing the Farm Credit Corporation to hold non-fixed assets such as cattle as collateral for loans. This change would allow the Farm Credit Corporation to provide farm financing to primary producers who are not eligible under the current legislation. In many cases it would provide financing that would not be available from private lenders. It is a positive change to legislation of which my colleagues and I are supportive, provided financing is limited to operations involving primary producers.

A point not directly addressed by the legislation is the issue of fairness. In many cases the Farm Credit Corporation treats supply managed sectors differently than it does sectors not governed by supply management. This is something that my party is opposed to. It would be far better for the Farm Credit Corporation to treat equally all producers, regardless of which sector they may be a part.

Once again we have a situation where the Liberals have introduced provisions that we object to for sound reasons coupled with reasons we support. Extending the equity financing capability of the Farm Credit Corporation to non-fixed assets like livestock is certainly a positive move and one which we support. However, if we put that up against extending the ability of the Farm Credit Corporation to lease and hold land and to lend beyond primary producers we have a stalemate.

As a result, the Canadian Alliance has decided to oppose the legislation unless significant amendments are made to clarify the problems I have identified.

[Larry McCormick, Liberal, Parliamentary Secretary to Minister of Agriculture and Agri-Food]

Mr. Speaker, I have a short question for my colleague who is a very valued member of the Standing Committee on Agriculture and Agri-Food. The member is from Saskatchewan and I respect her knowledge of the situation in her province.

The member talked about her party not being in favour of extending the Farm Credit Corporation moneys beyond the producer. I encourage her to ask her neighbours and colleagues if they feel the same way. When we offer money to the agri-food companies and expand markets, we are able to move the grain beyond the farm gate. They have done a great job of diversifying, but there are many crops grown today in Saskatchewan which we could market better.

I would ask the member to support the legislation. I look forward to her amendments if she is making any. Would she ask some of her neighbours at home how they feel? I have heard from people in Saskatchewan who are in favour of the legislation.

[Carol Skelton, Canadian Alliance, Saskatoon—Rosetown—Biggar, SK]

Mr. Speaker, as a producer of lentils, chick peas, hay, wheat, oats, barley, elk and bison, I know a lot about marketing in Saskatchewan. I also know a certain segment of our economy looks to the Farm Credit Corporation. My problem is that the Farm Credit Corporation is not clearly defined in these changes. A large multinational corporation can come in and get a huge amount of money from the government.

I do not think the government sees the agriculture producers in Saskatchewan as being able to market their own grain. I would like to tell the hon. member that we have tremendous marketing people in our industries.

A previous member spoke about the Canadian Wheat Board. I want to mention to the hon. member that the Canadian Wheat Board is not a Canadian wheat board. It is a western Canadian wheat board because it is not the same in Ontario or in Nova Scotia. When the Canadian government expands the wheat board and makes it equal across Canada for everyone, not just the western provinces, then maybe we will have fairness in the system. Maybe then producers in western Canada would look at this more favourably. The neighbours I have spoken to are not in favour of this.

[Ken Epp, Canadian Alliance, Elk Island, AB]

Mr. Speaker, I value the privilege of speaking to the bill because it addresses the wider issue of agriculture, a very important aspect of what happens here.

I was not originally scheduled to speak on this but after listening to the debate throughout the day, and especially to my hon. colleague from Crowfoot, it got me fired up. I felt I had to get to the House and deliver some words that would castigate the Liberal government for its total mismanagement of the agricultural sector.

We are here talking about the Farm Credit Corporation, a corporation that should have been designed to help farmers but which, too often, has been just the opposite. What the country needs is a government policy that would permit farmers to actually produce and market their product at a price they can afford to pay for production and provide themselves and their families with a reasonable living. That is what is really needed and that is the part that is missing.

Therefore in the few minutes I have I will talk a little bit about not only the Farm Credit Corporation and financing for farmers and agricultural producers, but I also want to address briefly and tie it in with the whole idea of marketing by the wheat board and the way it applies and misapplies.

The reason I became fired up is that I remembered not long ago speaking with a farmer from Saskatchewan. I have said a number of times in the House that I was born in Saskatchewan. I used to say that I was actually born at home because it was a long time ago when a lot of people were born at home. I used to say that as soon as my mother saw me they had to rush her to the hospital. That was not really true. It was just a little bit of humour.

However I was born and raised on a farm in Saskatchewan in the last year of the thirties. Out west we know the term dirty thirties. I do not think that term is as well known in Ontario and points east. In those years we had a tremendous drought. We had jokes about how poor we were and all sorts of different things. However I do not want to get into that. What I want to say is that when my mom and dad got married and started farming it was a difficult uphill climb. It meant long hours of work, being subjected to extreme variables and, once in a while, getting a good crop.

In those years a really good crop meant maybe 20 to 25 bushels to the acre. Ten to fifteen bushels was considered average and anything less than that was mediocre or a crop failure.

The incredible thing is that right now farmers are producing crops that average 40 to 50 bushels per acre on the same land. Production has gone up because of the advanced use of modern technology. Efficiency has also gone up.

My dad and his two boys farmed 10 quarters, which was considered a pretty big farm back in the forties when I was a young boy. A typical farm today that can make its own way is at least 10 times as large. We are talking about 40 quarters to make a good viable farming operation.

Instead of summer fallowing every other year and having only half the land in production, with the use of chemicals and modern farming methods they are able to do much better than that, in many instances not engaging in summer fallow for the rest of the land at all.

It is really true that my brother and his boys today can produce four times as much crop per acre as my dad did some 40 years ago. What is so absolutely distressing is that in this modern day, when production has never been as good, farmers are suffering more than ever. We need to ask ourselves why that is.

My dad, who is in his 90th year and has seen many crops come off the land, cannot be kept off the land at harvest time. There is something magnetic about the grain coming out of the combine or, back in the old days, out of the threshing machine. We are producing food to feed people who would otherwise starve to death. That is a very noble profession.

My dad told me last year how sad it was that when we have one of the best crops ever farmers are not making it. That is really sad because farmers still work hard and long hours, as we do. Nothing has changed. For farmers to be successful they must work long hours, especially during seeding and harvest. It involves a great deal of hard work, massive investment and a lot of risk taking, studying and reading to be competent in all the different aspects of farming. What do we have? We have a government that stands in the way.

I want to talk about a farmer to whom I spoke. When I go to Saskatchewan to visit my relatives, I go with my brother to the elevator to look at the prices, to deliver a load of grain or to do different things and I end up talking with different people. When they find out that their neighbour's little brother is an MP they like to talk to me. I talked with a farmer who was very frustrated. This is very relevant to today's discussion. He told me that he was frustrated because he was going to be out of business with the way things were going. He said that his payments were due and that the Farm Credit Corporation was telling him to pay up or it would foreclose on his farm.

The same farmer told me that he could pay the bill. He said that he had a market for his bins full of grain if only he could be permitted to get a trucker to haul it. He said that he could sell his Durham wheat for approximately 50% more than he would get from the wheat board. He said that he could get the cash right away, make his payment and then everyone would be happy. However the wheat board said no. It said that he had to sell it to the wheat board at a loss. The government agency, the wheat board, which presumably is there to help farmers, in this instance specifically prevented the farmer from even surviving.

Do members of the House see why I am fired up and had to rush down here to say this? This is so wrong. Liberals ought to wake up and realize that if they cannot give a proper price to farmers for their product so they can pay their bills, make a living and not go deeper into debt until they face bankruptcy and lose farms that have been in the family for 100 years, then maybe they should consider that their policies might be wrong. Maybe they should think about that.

The Farm Credit Corporation was supposed to be designed to help farmers. The only way one can help people by lending them money is if those people have the ability to repay, otherwise it becomes a massive, socialistic way of confiscating farmers' land.

Under the bill, the Farm Credit Corporation, under its new name, which will cost thousands of dollars to change all the stationery and everything, would have the right to own property and lease it out. In other words, this is a very thinly disguised plan to simply take over all the farmland on behalf of the government. I am not one to say that this is the government's overt plan, but I predict it will be the result of it.

The Farm Credit Corporation has the ability to lend money to farmers when those farmers at the same time do not have the capacity to pay that loan back as well as pay for their other operating costs because of the restrictions of the wheat board and other government policies, such as high taxes and a whole bunch of other things. In the end farmers will face foreclosure and the Farm Credit Corporation will end up owning the land, which by the way, in the short term I think it is inevitable that some farmers will not make it.

However in this particular bill the Farm Credit Corporation would now be given the freedom to continue to keep that land, farm it or rent it out to other people. It is a straight form of confiscating the very essence of what farming is all about, and that is the private family farm.

I am very concerned that the government, in tinkering with stuff like changing the name of the Farm Credit Corporation, is missing entirely the whole impact that agriculture has and the impact that this lazy, Liberal federal government has on the farm scene in Saskatchewan, Alberta and in Manitoba particularly.

I do not know what members think about this, but I believe in the equality of people. It does not seem right to me that a farmer in one of the prairie provinces can be coerced, under the threat of going to jail, to sell his grain to the wheat board, whereas farmers in other parts of the country are not so required. Other farmers can get an export permit if they want and can export to the United States if they find a market for their product.

I am at a loss for proper vocabulary here. I know I must be respectful in the House, but why, in the name of everything going, can the government justify that? If there are farmers in Saskatchewan who want to build a co-operative pasta plant together, what is it in the government's motivation that says that they cannot do it, that they must first sell all their wheat to the wheat board at a loss and then the wheat board will sell it to the pasta plant? Farmers look at the bottom line and say that if they need the wheat board as the middle agent here, they cannot make it and therefore the deal is off.

What is it in the government's interest and in the people of Canada's interest to say to farmers that they might have an idea that will help them but that they had better not do it because it is against government policy? It is self-evident that the policy is totally wrong. If a person actually comes up with a solution to the problem, why would the government not allow them to expedite that solution?

Other businesses have no such restriction. A good friend of mine is a car dealer who has a lot of inventory. I asked him one day how he managed to keep so much inventory. He said that it was a good business decision. He said that when his lot is full of new cars, people come by and say that he is really successful because of all the new cars he expected to sell. They pop in and buy a new car. His volume goes up simply because of his business decision. There is no government rule that says he cannot do that.

There is another car dealer nearby who has a very small inventory. He claims he has lower costs because he does not maintain a big inventory. Therefore people can go to him and get a lower price.

It is competitive. Both of them are doing fine. They do not need a government agency to tell them how to run their businesses.

It is high time that the federal government butts out of most of its very restrictive rules and regulations and gives farmers the freedom to market the products they produce in the way they choose. After all, one could properly ask who owns the product? Who is making the payments on the land? Who is paying for the fuel and paying all the taxes on it? Who is buying and repairing the machinery? Who is getting up at 4 o'clock in the morning to work on the land? Who works all day until sundown? Who is taking all the financial risks? It is the farmer.

What does the government do? It says the last thing it wants is a successful farmer in Canada. That is really the message it is giving. I cannot understand it.

In essence what I am saying is that the bill is totally misdirected. The government should be focusing much more on getting its act together with respect to marketing and international agreements. It should do what it should have been doing for the last seven years, and frankly it was the same for the Conservatives before. The government should have been working on making sure the world market had a level playing field, something the government totally failed to do. That is what it should be concentrating on. That is what we should be discussing.

Instead what we are discussing is changing the name of the Farm Credit Corporation so that it can in the name of government confiscate all the property in the country that belongs to farmers, meanwhile making it impossible for farmers to make a living because they cannot sell their product for what it costs to produce it. How shameful. I think the government is totally misdirected.

In conclusion, I would like to ask a question. I think members of the House should ask this question, as should anyone who happens to be watching on television.

By the way, I doubt there are very many farmers watching CPAC right now. This is not the time of year to be sitting in the house. In Saskatchewan and Alberta right now it is 3.30 in the afternoon. Farmers are out there working. They are not watching television, but I hope the word gets to them.

The questions that they should be asking are: Why should they be supporting a government which uses the very agencies that should be helping them and why should they be supporting a government which makes it virtually impossible for them to succeed? The government's policies do that.

Another example just came to mind. I talked to a farmer in Saskatchewan. My roots are there and I know a lot of people, although I represent a riding in Alberta. I speak to a lot of farmers there as well. This farmer in Saskatchewan said that what he did best was raise durum wheat, that his soil was best suited for that. He said he could not make a living with that and had to diversify. He has. He now does other things. He has entered into contracts with international companies.

This individual is a successful farmer. I think it is totally ironic that to be successful he had to divest himself totally of wheat board crops so that he has the freedom to make a living. Is that not ironic? The government should smarten up. That is my final answer.

[The Acting Speaker (Mr. Bélair)]

Is the House ready for the question?

[Some hon. members]

Question.

[The Acting Speaker (Mr. Bélair)]

The question is on the motion. Is it the pleasure of the House to adopt the motion?

[Some hon. members]

Agreed.

[Some hon. members]

No.

[The Acting Speaker (Mr. Bélair)]

All those in favour of the motion will please say yea.

[Some hon. members]

Yea.

[The Acting Speaker (Mr. Bélair)]

All those opposed will please say nay.

[Some hon. members]

Nay.

[The Acting Speaker (Mr. Bélair)]

In my opinion the yeas have it.

And more than five members having risen:

[The Acting Speaker (Mr. Bélair)]

Call in the members.

And the bells having rung:

[The Acting Speaker (Mr. Bélair)]

The division on the motion is deferred.

The House resumed from April 26 consideration of the motion that Bill C-6, an act to amend the International Boundary Waters Treaty Act, be read the second time and referred to a committee.

International Boundary Waters Treaty Act

[Joe Comartin, NDP, Windsor—St. Clair, ON]

Mr. Speaker, in spite of the comments from some of my colleagues in the Conservative Party, I intend to speak to this issue as long as I am entitled to.

[The Acting Speaker (Mr. Bélair)]

The hon. member is allowed 20 minutes with 10 minutes for questions and answers.

[Joe Comartin, NDP, Windsor—St. Clair, ON]

Mr. Speaker, it seems that information needs to be shared with other members of the House. When I watched some of the early debate on this bill, I was taken a bit by surprise in that the debate by the government was led off by the Minister of Foreign Affairs, followed by the Minister of the Environment. I was taken aback because in my review of the proposed bill the debate should have been led off by the Minister for International Trade, because the bill is not about the preservation of our water system in Canada and the protection of the export of our freshwater resources but just the opposite.

It is supposed to be about protecting the ecosystem that our freshwater feeds into. It should be about protecting our freshwater from the travails we will have with it as climate warming moves ahead. It certainly should be about having available to all Canadians a safe freshwater system. That is not what it is about.

I would like to go back in history for a minute or two and draw to the attention of the House the resolution that was passed on February 9, 1999. That was a resolution introduced to the House by the NDP member for Winnipeg—Transcona. It was a motion that received support from all members of the House, including members of the Liberal government, and ultimately it passed unanimously. I will read the motion to the House. It read as follows:

That, in the opinion of this House, the government should, in co-operation with the provinces, place an immediate moratorium on the export of bulk freshwater shipments and interbasin transfers and should introduce legislation to prohibit bulk freshwater exports and interbasin transfers and should not be a party to any international agreement that compels us to export freshwater against our will in order to assert Canada's sovereign right to protect, preserve and conserve our freshwater resources for future generations.

That resolution passed unanimously. I would like to make an additional note about that motion because an important part of it was an amendment which included the phrase I have already read:

—and should not be a party to any international agreement that compels us to export freshwater against our will—

That motion recognized, first of all, the need to pass legislation that would ensure bulk water could not be exported from any source in Canada. Second, it specifically and explicitly recognized that water needed to be exempted from any future trade deals because there is of course a serious issue under the existing trade deals as to whether we have that protection.

It is interesting to note that no one spoke against the motion. No one voted against it, as I already indicated. It passed unanimously. No one stood up and said he or she believed we were wrong and that we should export water. No one said that. No one said our freshwater supply should be included in the next trade deal. None of that was said at that time. Everyone was unanimously of the opinion that we needed to take action on the issue. I think it was obvious to every member of the House at that time that action would be forthcoming from the government and that our freshwater would be protected.

Here we are a little over two years later. What is the situation we are confronted with today? We are debating a bill that any objective observer would say does not realistically address the issue of exporting bulk water. It just does not do it. In fact, it opens the door to the export of water by providing for the licensing in certain circumstances, the licensing that would eventually lead to the export of bulk water.

We are also faced two years down the road, under the FTAA, with another trade deal. Of course we still have not seen the text of the deal. We do not really know what it contains and the government has been less than clear as to what its position is on the trade deal. We do know that the government has refused to make an absolute or unequivocal commitment that the FTAA will prohibit the export of bulk water. It has been adamant about refusing to make that commitment.

I found it interesting last week when the Minister of Foreign Affairs was speaking on the bill. I would like to quote him. He said:

All Canadians recognize that water is a natural resource unlike any other.

We have heard that from other members of the government. It makes sense and we all agree with that. I think all Canadians agree with that. The problem I have when I look at the bill is that the government is in fact not committed to that principle. It in fact does not recognize that water is a natural resource unto itself, unlike any other.

In his remarks, the Minister of Foreign Affairs went on to say this:

Canadians look to all levels of government to take action now to protect Canada's water. We must ensure that our children and grandchildren inherit a Canada in which our freshwater resources are secure.

Again I ask: does he really understand what he is saying? Why will the government not give us that commitment, which was certainly contained in the motion passed over two years ago that was brought forward by my colleague from the NDP? It did not at that time place an immediate moratorium on the export of bulk freshwater and the legislation that has now been introduced in the form of Bill C-6 does not in fact prohibit bulk freshwater exports.

Let me draw the House's attention to proposed section 11 of the bill on licensing. To be fair, there is a separate provision which talks about prohibiting the export of water, never using the term of course. The government knows that if it uses that term it may invoke the trade deals. Again that is something it will not admit in public.

The first part of proposed section 11 states “except in accordance with a licence”. A licence in fact would permit this. The proposed section continues, and this is the important part “no person shall use obstruct or divert boundary waters”.

In reverse that says, and I guess I am wearing my lawyer's hat for a minute, that the Minister of Foreign Affairs who is responsible for this, and that it is interesting too that it is not the Minister of the Environment, could issue a licence that would allow “for the use, either temporarily or permanently” of boundary waters. It is permitted.

The history up to this point of this legislation and the treaty it flows into with the United States, is that nobody has done this. Canada and the United States have not done it. What we hear is the implicit understanding that we will not do it.

Given the more recent history in the last decade with the free trade agreement, NAFTA and now the proposed FTAA, it is obvious that we are very concerned that the water would be treated as a commodity and would be exposed under chapter 11 of the NAFTA.

The Minister of Foreign Affairs said that if we pass the bill, it becomes law and is incorporated into the treaty then all problems would be solved. Anybody reading the proposed section 11 would say that that is not what the bill does. It does just the opposite. It allows some subsequent minister of foreign affairs to licence the export of bulk water.

The other point about the bill is that it is primarily designed to deal with the water in the Great Lakes Basin and the St. Lawrence. It deals with boundary waters across the whole of the country. What it clearly does not do though is prohibit the export of water. It does not deal with the proposal we heard floated from the province of Newfoundland and the export of bulk freshwater from Gisborne Lake. That proposal has not been dealt with at all.

We fall back as we so often do and say that that is the provincial responsibility. That is not good enough for Canadians. If we have what is called a Monroe government, which is prepared to expose the rest of Canada to chapter 11 under NAFTA by going along with the bulk export water scheme, we as a Canadian government have to tell it that it cannot do that, that water is a natural resource which is also a national resource. We have a responsibility to protect all Canadians.

If Gisborne Lake or some other type of hare-brained scheme like that was to go ahead, there would be no protection for the export of bulk water any place in Canada, none whatsoever.

We have a number of legal opinions in the country that accept the proposition I just made as the reality under the NAFTA. If Gisborne Lake or some other scheme like that goes ahead, water becomes a commodity in the whole of the country. We then lose our ability to protect that freshwater resource.

The Minister of Foreign Affairs in his address to the House last week made this comment:

To pretend that one government can solve the issue with a wave of a legislative wand, or that the issue may be simply reduced to one aspect, such as `water export', in the words of some critics, is unrealistic, ineffective and undermines the goal we have.

That is the government's attitude. Obviously what it is trying to do is pass the buck and say that it is not its fault, that it is what the provinces did or did not do and that it did nothing about it.

Reality is that two years ago the government should have implemented a moratorium on the export of bulk water. It should have introduced meaningful legislation to the House that would have prohibited absolutely and unequivocally the bulk export of freshwater right across the country. It would have made a clear and unequivocal commitment that the FTAA would not include any provision that would expose our water to a claim under that treaty, if we ever did do it.

The government could have taken a leadership role but it did not. It needed to follow both the wording and the spirit of the motion that was passed two years ago in the House. What did we hear from the Minister of Foreign Affairs? He said that kind of export ban would undermine the goals we had. One has to question what the government goals are with regard to freshwater and the bulk export of it?

It was interesting to note in the minister's closing comments last week on Bill C-6 when he said that the bill was “consistent with Canada's international trade obligations”. That is so meaningful. Like just about everything else the government does, it is driven by those obligations, not driven by what is in the best interests of the country or its citizens but by these trade deals that the government has entered into.

Would it not have made more sense to have had the Minister for International Trade front this bill because that is really what it is about?

The Minister of the Environment when he spoke to the bill made this comment “the safest and most effective way of protecting Canada's water resources is through an environmental approach, through an approach based on trade”. I agree with that statement. That is the way the government should be conducting its business but it is not in fact the reality.

We still do not have the commitment that the FTAA will not compel us to bulk export. If water is not on the table under the FTAA, then we should be given a commitment. The government is not prepared to give a commitment.

The Minister of the Environment went on to quote from the international joint commission's final report on the issue of water in the Great Lakes Basin, specifically and more generally in transboundary water, which said “that international trade law does not prevent Canada and the United States from taking measures to protect their water resources”.

The Minister of the Environment is conceding that we in fact cannot pass legislation that protects our water resources. Again the question is obvious. Why do we not do that? Simple legislation is required to ban the export of bulk fresh water.

I would like to finish off by talking about the legal position we are in vis-à-vis the trade deals. I will quote from a legal opinion that was commissioned by the Council of Canadians in 1999 referring to the trade conflicts involving export controls on water.

The opinion stated:

—the potential for such conflicts should not delay action by the federal government to ban water exports. Indeed for the reasons noted, delay in doing so is likely to further limit Canada's options.

That was two years ago and we still do not have it.

I was going to quote again from the concern expressed in that legal opinion about the things that have happened under NAFTA and some of the WTO cases, but I see I am almost out of time.

We had promises from the government in the cultural area and in research and development programs that were not covered under NAFTA. In fact we found to our chagrin just the opposite. That is the position we are in today.

The bill is not going to resolve that problem. It does not go far enough. It does not deal with it adequately. It allows for licensing and does not deal with the export of water elsewhere in Canada.

Our position on this legislation will be to oppose it and to continue to press the government for more realistic and adequate legislation that will protect the interests of Canada.

[Charles Caccia, Liberal, Davenport, ON]

Mr. Speaker, while I appreciate very much the intent and objectives expressed by the member for Windsor—St. Clair, I do not share his view as to the sinister motivation of the Government of Canada with respect to the legislation.

Is the member aware of the council of environmental ministers agreement in November 1999 when they agreed to honour the need to prohibit bulk water removal? If he is aware of that agreement, how would he propose that we build on that particular agreement to make absolutely certain that bulk water removal will never take place?