Mr. Speaker, in terms of slaughter domestically within the provinces, the question would really be better put to the provinces because our responsibilities certainly are for federal inspections and guidelines through the Canadian Food Inspection Agency.
I want to come back to the question on the loan loss reserve program, because the way the member originally phrased the question was by saying if the loan loss reserve program does not work.
On this side of the House when we introduce programs, we expect them to work. We are a proactive government and the minister has shown clearly with his September 10 statement that we are being proactive through the feeder set-aside program and the fed cattle set-aside program, trying to increase slaughter capacity through the loan loss reserve, continuing to put the pressure on the U.S. to open the border and, since that time, trying to ease the difficult situation that farmers find themselves in by an advance in CAIS.
The fact of the matter is that we do expect the program announced on September 10 to work. At the Canadian Federation of Agriculture symposium I was at, several speakers, including those from the beef industry, felt that with the current expansions that are on deck now, by early 2006 we should be in a position to be able to match the supply to slaughter capacity.
I think it is important to recognize that substantial private investment is already under way, therefore, to increase slaughter capacity. However, we recognize that this investment by itself may not be sufficient. We recognize that there are some small and medium-sized enterprises, as well as start-ups, that are having more difficulty arranging financing than the larger established entities.
The loan loss reserve program is therefore intended to help bring the domestic slaughter capacity and the supply of ruminants, cattle in particular, into balance. The actual increase in domestic slaughter capacity will effectively be determined by the private sector, including slaughter enterprises, financial institutions, investors and ruminant producers.
It avoids the question and the problems caused by direct government financing determining exactly how much slaughter capacity should be added and where it should be located. The bottom line is that under the loan loss reserve program, loans will be made on commercial terms. The decision on whether or not to extend credit will remain with the lender, based on a sound business plan put forward by the applicant. The loan loss reserve is there to assist the expansion of capacity as long as there is a business plan that shows this increased capacity is sustainable and makes good business sense.
I think that clearly shows that as a government, through the minister, we are being proactive on a number of fronts. Our whole strategy is to increase that slaughter capacity through the lending community and the program we have added to it so that we balance up the ability for the packing industry and the slaughter plants to be able to handle all of the Canadian supply that is out there in terms of ruminants.