Mr. Speaker, we are here today to debate the Kyoto protocol. All of us want a clean environment. That is clear and it is one thing on which all of us in the House can agree.
I am fortunate enough to come from an area where we do have a clean environment. We have clean air. We have clean water. We have clean land. I can walk out to the end of my driveway, stand and listen and a lot of times hear nothing, which is a nice change from being here. We want that for all Canadians. We want them to have an opportunity to live in a good environment and to be in a situation where they can be healthy. The question is how to achieve that.
We have several different options. Kyoto is one of those options. The Kyoto option has floated around here for several years. I think we need to talk about what kinds of things will work in order to improve our environment and protect it from pollution.
We are told that this is a treaty that will reduce greenhouse gases. There are two ways to reduce greenhouse gases. One is to actually reduce emissions. We can set up a program that affects the environment, reduces emissions, and gets rid of some of the pollution we are faced with. The other option, of course, is that we do not really reduce emissions much at all, but we set up a bureaucracy so that we can trade credits back and forth. We can talk about emissions, we can give them a value and swap them back and forth. We can set up a bureaucracy that can interfere with the functioning of our economy. We can set up a bureaucracy that can regulate, and poorly, as they virtually always do, the environment through government intervention.
I happen to be from Saskatchewan and am obviously not at all a supporter of our NDP government. Even it has concerns about this protocol for our part of the world. As everyone knows, Saskatchewan is agriculture based. We depend on energy in many different ways. One thing that is clear about Kyoto is that it will raise the cost of producing energy. We need to ask what the impact will be of those increasing costs of energy.
Our office was concerned about Kyoto and how it would impact agriculture, so we decided we would try to do some research to see what the government actually has done to see what effect Kyoto would have on agriculture in Canada. We looked quite extensively and in fact we could find nothing. We found that the Canadian government basically has done absolutely nothing on the impact of Kyoto on agriculture. It has done research on other things such as carbon sequestration and methane gas and that kind of thing, but nothing directly on Kyoto and agriculture. We went to the agriculture department and again we could find nothing to indicate what impact Kyoto would have on agriculture.
Interestingly enough, we were able to find a 1998 U.S. study. The U.S. had taken the time to do some studies through the American Farm Bureau and a couple of other organizations. They reached a conclusion that is frightening for Canadian producers. They said that compliance with the Kyoto protocol could increase U.S. farm production expenses by $10 billion to $20 billion annually and depress annual farm income by 24% to 48%. That is almost 50%. Higher costs of fuel oil, motor oil and fertilizer and other higher farm operating costs would also mean higher consumer food prices, greater demand for public assistance with higher costs, a decline in agricultural exports, and a wave of farm consolidations. In short, they concluded that the Kyoto protocol represents the single biggest public policy threat to the agricultural community today.
When we saw that we began to get very concerned about what impact Kyoto would have on our farmers. Surveys indicate that farmers feel that rising input costs are the number one concern in their operations. They are under a big squeeze at this time for a number of reasons across the country, but rising input costs are their number one concern.
It is imperative that the federal government provide farmers and farm families with a thorough examination of Kyoto's impact on Canadian agriculture. We need answers to some questions. The first question we need answered is this: What would be the impact of higher energy prices? Clearly if Kyoto is implemented we will see higher energy prices. That will directly affect things like fuel. Diesel fuel will be hit directly. Fertilizer costs will be hit directly. We have talked to the Canadian Fertilizer Institute, which says it will face some substantial increases. Chemical companies will face substantial increases in the costs of their products if Kyoto is implemented.
So first of all we need to know what the impact of higher energy costs will be. From that, there are a few other questions that need to be answered. We hope to bring these up again and again over the next few months so that we can get answers to them.
How much will input costs rise? The Americans are suggesting that they could rise by as much as 32%. I do not know any farmers who can survive an increase of 32% on their input costs. It would not be possible for them to continue to make a living.
We need to know what effect Kyoto would have on net farm profits. We hear that net farm income is dropping again this year, particularly on the Prairies. It basically will be a disaster in terms of net farm income there. It is dropping again. Each year it seems to be coming down. What effect would Kyoto have on net farm incomes in Saskatchewan and also in the rest of Canada?
We need to ask what the overall impact would be on annual farm income. What would be the larger effect of the resultant economic downturn in the agricultural sector? I come from a small town. It is a really vibrant community where people are trying to get ahead, working together and putting their money together to form new projects. We need to know overall what Kyoto would do to the ability to start new ventures, to work together and to create prosperity in our towns. It is bad enough that we have drought; we do not need the further effect of this. Of course the agricultural industries would be affected as well.
On the other end of the spectrum, we need to know if Kyoto would result in higher consumer food prices. If Kyoto is implemented and there are more costs on the farm, when people go to the grocery store they likely will have to pay more for their food. If they do not have to pay more for it, that means that I as a producer would get less for what I produce.
There is a second question that really does need to be answered as well, that is, what would be the impact on the non-implementing countries? How much of an advantage would our non-Kyoto competitors gain from not ratifying this protocol? Canadian farmers are already struggling. They struggle against European subsidization and they struggle against the U.S. treasury. The government does very little to help them out and if it is bringing in a protocol that could have an impact of up to 30% on net farm incomes, what will that do in terms of our farmers' competitiveness? What will be the extent of the impact on our international competitiveness? How much of a decline will there be in Canadian agricultural exports, which this entire country depends on, if we implement this protocol?
I think these are reasonable questions that we could ask of the government in order to see what in fact it would do with Kyoto in terms of agriculture.
There are other questions that need to be raised as well, and we will talk more about them later, but the issue of carbon sequestration, carbon sinks and how the protocol mechanisms are to be implemented is something that we need to address. I understand that at the technical briefings given a couple of weeks ago the federal government basically said that it would be claiming those carbon sinks for itself. To me it seems that they are a natural resource, one that is probably in the purview of the provinces. We need to take a look at who actually should be dealing with those carbon sinks. Probably it should come right back to the farmers. They are the ones who are farming the land and growing the crops. They are the ones who should be able to access this. There is no indication that the government is going to give the farmers access.
We have three main concerns right now. The first is that this would raise the input costs for farmers. The second is that it would make us uncompetitive; an Australian study just put out states that Canada will fall further behind if we implement this in terms of competition with both Australia and the United States in agriculture. One of the concerns I have is that Russia is another one of our competitors and we are talking about using this to ship money to Russia to buy environmental credits. We would be propping up its economy at the same time that we would be destroying our own agricultural industry, which has to compete with Russia's.
In conclusion, we really do have a choice here. We can continue with Kyoto and end up seeing higher costs, with little or no emissions improvements and with money transferred out of Canada. Or we can come up with a different plan, one that will be far more successful, one that we design.
First we should sit down and domestically set the standards that we think are important and that we need to apply in this country, not just in the rural areas. like where I live, which would be affected by Kyoto, but in our cities as well. Let us set those standards. Let us set realistic goals for Canada. Let us take our own Canadian money and let us begin to use it to improve our own environment. It is crazy to talk about sending money across the world to other countries to pay for environmental credits when we can use it to improve our own environment.
Last, I would like to say that we should give our children a future. It is important. Because it is important, let us do it right.