Mr. Speaker, I am pleased to speak today to this motion presented by the hon. member for Châteauguay—Saint-Constant. She has been an hon. member in this House for a year and a half and has made an interesting, important and concrete contribution both with her experience in agriculture and her ability to bring people together on ideas like the one we are discussing today. We know in this House that the motion she is proposing has support from a number of members. Furthermore, she is responding to a very serious concern of the entire agricultural sector in Quebec and Canada and even the world's entire rural population.
Agriculture is the cornerstone of our regional economies. Programs like supply management have helped our villages to develop in interesting ways and have assured them some degree of financial security. Now, if we want to be sure that the supply management system is maintained, then we must also talk about the problem of succession.
Even though our farms have increased in value over the years, they now employ fewer people than they did 50 or 60 years ago. However, their economic impact is still just as significant.
Since today's families are smaller, there is now a problem when parents want to transfer their farm either to their children or, if the latter are unable to buy the farm or have no interest in it, to other potential buyers. Since the parents put a lot into these farms—which have often been handed down from one generation to the next—the latter are now worth a great deal of money.
The most eloquent example is someone who wants to work in agriculture but who is not from a farming family. The financial requirements that need to be met in order to buy a farm are significant. Purchasing a farm is almost impossible. That is why we need to find solutions to this problem.
We also need to find a way to help the children of farmers who want to purchase the family farm but who, given its considerable value, are forced to accept a compromise. Temporarily, the parents have to make a significant concession with regard to the value of the farm they are transferring to their children. For their part, the children have to accept what almost amounts to co-management, so that their parents can transfer them the farm and still feel good about it.
At the same time, human aspects are not the only major factors that need to be considered. There are also tax implications.
The Bloc Québécois held a forum on this subject in fall 2004 at the agricultural technology institute in La Pocatière, in cooperation with the UPA, which has agreed to look at this issue with us during the election campaign.
This is the kind of issue on which the member for Châteauguay—Saint-Constant has worked hard. She has worked to develop ideas and turn them into concrete plans that could be considered in the House. That is an interesting and smart approach. I hope that it will produce results in the short term. I hope that, in the next legislature, we will be able to ensure that the government elected will again implement measures that reflect the work done by the member for Châteauguay—Saint-Constant.
I want to mention, among the motions we hope to make, the one to enhance rather than destroy the financial advantages associated with transferring a farm. The Bloc is proposing the following:
(a) increasing the allowable capital gains deduction for agricultural property from $500,000 to $1 million, exclusively for transactions as a result of which a farm remains in operation—
We would like to provide greater incentive for transfers, provided that such transfers ensure that the farms remain in operation. In fact, we want to prevent situations where farms are bought and immediately sold, in an attempt to control the market based on initial production. We want to prevent such business practices which are sheer capitalism. In connection with agriculture, we have to try to find somewhat different approaches.
We are also asking that the federal government extend the rollover rule to transfers other than those between parent and child. We are proposing “extending application of the rules governing rollovers to all members of the immediate family under 40 years of age”, to brothers, sisters, nephews and nieces, for example. This would better reflect today's reality. There are children who want to take over their parents' farm. But there are also many who do not. That is why we have to provide for the possibility of transferring a farm to relatives of the family that owns the farm, such as brothers, sisters, nephews and nieces.
In addition, we would like the following idea to be considered:
(c) setting up a farm transfer savings plan that would enable farmers to accumulate a tax-sheltered retirement fund;—
Governments could contribute to this plan as they do to registered education savings plans. This contribution would be conditional upon the farm remaining in operation following its transfer.
It has become apparent that parents were reinvesting all their money, all their profits, in their farm and that, when it was sold, that was their retirement fund. With a farm transfer savings plan, they could put money into this plan. This way, when the farm was transferred, the money amount transferred would be smaller. The burden on the young people taking over would be smaller, while the parents could rely on a decent income.
We are proposing that the possibility of putting this kind of measure in place be considered, to ensure the survival of our farms and meet one of the UPA's very ambitious primary objectives: preserving the 32,000 farms on all of Quebec's agricultural land by giving access to the farming profession to any young person who demonstrates the abilities, capabilities and skills required.
This body of taxation measures—the list of which I will complete shortly— would be the foundation for this system's operation. They would ensure a tangible result in ten years. The next generation of farmers would be assured. Children wishing to acquire farms would have been able to do so, and otherwise the continuity of the farm could have been ensured through more distant relatives or others interested in agriculture but lacking the means to make a start in it. Thus we would be spared from being left with nothing but vertical integration in agriculture.
This is important and is something that worries people, young farmers in particular. People in my riding have suggested having a national commission on agriculture which would hold general assemblies on agriculture, obtain a clear picture of the situation and propose solutions. That could certainly be part of this framework.
The fiscal plan would be complemented by what I consider a fourth proposal:
(d) make the rules governing property ownership more flexible so that young farmers can obtain a larger share of a residence held by a company and use their registered retirement savings plan to acquire an agricultural enterprise;
Let us take the case of a young man or woman out in the work force, perhaps a graduate of an institute of agricultural technology. The parents are still of an age to run the farm for a few more years, so the young man, let us say, works as a salesman for agricultural implements or feed or that sort of thing. He is able to put a bit away into an RRSP. When the time comes for the parents to want to retire, he would have to be able to transfer his money out of the RRSP in order to buy the farm without a penalty, rather than have to leave it there until he retired. The way things are at present, if he cashes out his RRSP, he will have to pay tax on it, so that is a disincentive to buy the parents' farm. We would like to see a measure along those lines adopted.
Then there is this fifth constructive proposal we are making to the federal government:...
(e) transfer a recurring envelope to the government of Quebec...for encouraging young people to go into farming
For example, the Government of Quebec could extend access to the start-up subsidy, improve interest rate protection and raise eligibility limits, introduce a start-up subsidy for young people starting up in agriculture part time and gradually moving into full time, and create a single-window approach to match farms with no succession and young aspiring farmers without farms.
This last proposal essentially comes back to the fact that agriculture is more of a provincial responsibility because of the tax system. I do not want to get into a debate over it, but the fiscal imbalance is the reality faced by the provinces, which do not have enough money to provide realistic, satisfactory help to their agricultural sector. Money transferred from the federal government to the provinces and Quebec would help them implement this type of program.
Given the tax framework we are working with, we may contribute to solidifying the topic for discussion at next year's UPA meeting on agricultural succession in La Pocatière, a topic firmly raised in the House by the hon. member for Châteauguay—Saint-Constant.
I hope that when we come back to the House, she can continue to work hard. Her arguments are very convincing and she knows the agricultural world in her riding quite well. I hope that we can continue to rely on her services in the years to come.
I invite all the hon. members of this House to support this bill.