Madam Chairman, I thank the House for the opportunity to make some comments. Unfortunately I will not be able to remain for all of the debate, but I can tell members that I have staff and other members who will be monitoring the debate. I look forward to the comments that will be made by all hon. members today.
The drought situation is almost over in Canada. However the hon. member pointed out there are some predictions that some areas may continue in a drought situation. This has been one of the most severe drought situations on a coast to coast basis that Canada has had for many decades. It has seriously affected the income of many producers, but its severity has been markedly different in other parts of the country.
Southern Alberta, Saskatchewan, Ontario, Nova Scotia, New Brunswick and Prince Edward Island have all been hit by the drought. The drought was not as prevalent the further we go east in Saskatchewan as it was in the western part of the province. I am not making light of the severity when I mention this, but I spoke to one producer this week from eastern Saskatchewan who said that he had better than average crops this year.
As members are aware, I am from Prince Edward County which is halfway between Ottawa and Toronto. If members look in the drought package I sent out last week they will see one orange spot in the province of Ontario. This orange spot represents the area that has received the least moisture, and that happens to be my riding. The same riding that was the coldest and wettest in Ontario last year is the driest and the hottest this year.
There were also drought areas in British Columbia, Quebec and Newfoundland. The main concern in the province of Manitoba was that there was too much water. In some areas of the country there were above normal crops.
Since agriculture is without question the single most important industry in Canada it deserves and demands as many protective measures as we can collectively put in place as individual producers, as industry sectors, as provincial governments and as the federal government to do all we can when Mother Nature takes the upper hand.
There are a number of safety net measures and programs in place to help alleviate losses. I repeat again there is nothing as good as a good crop and a good price. However we need to work as hard as we possibly can to get to that point.
The government will continue to monitor the situation. All of the harvest is not lost. I know if I say that some people will say they know a producer who did not have anything to harvest. That unfortunately is the situation with the individual, and we recognize that.
Over the last few years we have worked in conjunction with the industry and the provinces to make our programs as flexible as they possibly can be to help farmers manage these situations. The system is more flexible compared to what it was a few years ago.
I do not need to go into the reasons for putting our fiscal house in order. Where would we be today if we were still running a $42 billion a year deficit? Any action that we have been able to take in the past and even consider for the future would simply not be in the cards. As a result of unfortunate incidents in the last couple of weeks we may have expenditures in that area as well.
As a result of an agreement with my provincial colleagues a couple of summers ago, $5.5 billion is available in safety nets over three years. That includes the period that I call crop year 2002 for such programs as crop insurance, the net income stabilization account, the Canadian farm income program and fall cash advances, to name a few.
We will continue to monitor what we have done. Over the last year or so we have made the availability of NISA accounts much more flexible for producers. Producers asked for this and we were able to react to that. If producers were to ask for an interim withdrawal right now, we can assure them that they would have money in their hands in 30 days.
I know the hon. member made some valid points regarding the Canadian farm income program. It is more effective and has proven to be more effective for livestock or a situation where the returns in the market have been fairly high and then dropped off the table.
In reference to Saskatchewan, I must remind the hon. member that the AIDA and CFIP have put hundreds of millions of dollars into that province. Would we like to put more money in all of the provinces? Yes.
The province of Saskatchewan received considerable more money than any other province. Did all provinces get sufficient money from that to make them as economically sustainable as they would like to be? I understand that may not have been the case.
Tens of thousands of farmers received support. Applications are now being accepted for the CFIP 2001 crop business year. These are interim applications. I have seen the form which is very simple and can be filled out very quickly. We can turn those around in 30 days.
I am pleased that more farmers who have crops on more acreage are covered with crop insurance this year than ever before. I am however disappointed that more farmers do not buy crop insurance. I understand that some farmers have made the business decision to take the risk on their own. For whatever reason, they were not totally happy with the insurance program for their commodity, or whatever it was, and chose to take that risk on their own.
Our estimates of a couple of months ago, before the severity of the drought continued, were that crop insurance payments to farmers this year would probably be between at least $1.1 billion and $1.4 billion. The average over the last five years has been less than a third of that.
The farmers, the provincial governments and the federal government make contributions to the premiums. When one deducts the total contributions to the premiums of about $200 million from the $1.1 billion to $1.4 billion, it still indicates our estimate of the crop insurance payments we will be providing to farmers this year which will probably exceed $1 billion.
In the province of Saskatchewan alone it is estimated that farm income will be down to about $700 plus million. It is estimated that crop insurance in Saskatchewan this year will likely provide to farmers somewhere between $500 million to $800 million in crop insurance payments.
The programs are there. Could crop insurance be better? We had discussions with ministers and members of the industry in the west as I toured western Canada this summer. We will work with them to strengthen those programs to make them more enticing to producers so that their best business decision is to buy rather than not to buy. I think that is important.
When we put all of this together our estimate of the federal and provincial government program payments to farmers this year for crop insurance will be at least $4 billion. We anticipate farmers will draw from NISA, which is not the only eligible program; the Canadian farm income program; and other programs. These are moneys they will not have to pay back.
We will continue to work with the industry as we did with the federal-provincial ministers this summer in a number of areas: food safety, environment, renewable skills training, innovation and technology, and certainly trade issues. We will spend a critical amount of effort to strengthen and improve the safety net programs so that they work the best they can. The industry and all members have my pledge to continue working in that direction.