Mr. Speaker, I will share the time I have with the member for Beauharnois—Salaberry. I have the great honour to speak tonight to the crisis in the pork and cattle industry. The pork producers have been going through a months long crisis with disturbing effects on their financial situation. The drop in pork prices combined with an increase in the price of grain is creating serious cashflow problems.
The federation asks the federal government to raise the $1.5 million ceiling in the AgriStability and AgriInvest programs and as well to raise the ceiling of the start-up fund, which is now set at $3 million. The federation also requests that labelling rules for Canadian products be tightened up to make sure consumers can clearly identify where products come from. It also requests that a new envelope be set up to support shared cost programs, allowing for regional flexibility in the next generation of Flexi-Farm agricultural policies. The Advance Payments Program, which has just been improved to include stock production should not use the business risk management program as a collateral since that forces producers to pay back advances when they receive a payment.
There is a huge economic impact in the agricultural sector. Farm income amounts to a total of $6.1 billion dollars, of which 13.6% comes from pork production—$844.9 million per year. Pork production accounts for 28,200 jobs and $1.3 billion in value added. This industry is present in several different regions of Quebec. Pork is the leading bio-food export product in Quebec and ranks twelfth among products exported from Quebec. Pork production provides a trade surplus of $890 million, thus producing a positive agri-food trade balance of $289 million; without it, there would be a $601 million deficit.
Pork production generates over $225 million in government revenue. It is a multiplier of both jobs and government revenue, which means that 100 direct jobs create a total of 415 jobs, that $100 in direct GDP equals $330 in total GDP, and $100 in total expenditures equals $12 in government revenue.
This is an untenable situation on a day-to-day basis. At present, a very large majority of producers are having to deal with cashflow problems that threaten the very survival of their businesses. This is an exceptional situation. There are several unfavourable factors in play at the same time, such as a drop in world prices associated with surpluses on the market and a rise in input costs, a low price situation that has been going on for over 16 months and a rapid rise in the value of the Canadian dollar to a level that has not been seen in 31 years.
Federal support programs are not doing their job. On December 19, the Minister of Agriculture and Agri-Food announced the first phase of an action plan to support Canada’s livestock sector. The news release refers to the implementation of the following programs as a way to provide assistance to producers in the short term: AgriStability, with interim payments and targeted advances; AgriInvest, including the federal $600 million Kickstart program; and a supposedly improved Advance Payments Program.
The existing programs are not providing an adequate response to the needs of pork producers affected by the enormity of the present crisis. That announcement is based on already existing programs and provides no fresh money. As well, because of how Agriculture and Agri-food Canada interprets the law, implementation of the Advance Payment Program for the livestock sector in Quebec has had to be delayed. Talks are continuing, but the program is still not available for pork producers in Quebec, and so they are experiencing hardship.
The Conservatives make bad investments. In the two years they have been in power, the Conservative Party has reinvested in agriculture. Yes, that is true, but it has invested in programs that do not create jobs. It converted the CAIS program into Agri-Green. What does that change? They traded four quarters for a dollar. Where is the money? The producers do not have more money in their pockets. I
The Conservative government did not pay Quebec its fair share. For instance, in its first budget in May 2006—how could we forget?—the Conservative government promised additional assistance of $2.2 billion over two years for the agricultural sector. Yet Quebec received only 6.8% of that particular grant. This translates into a shortfall of over $150 million.
Quebec agriculture represents 18% of all Canadian farm production and 12% of the production outside supply management. Thus, Quebec should have received at least 18%.
The Pronovost commission urged the federal government to give Quebec its fair share. The UPA is constantly calling for the federal government to balance its investments in agriculture. It mentioned that again in its prebudget document from October 2006.
Over a period of more than 15 years, per capita support for agriculture has dropped by 25% in Canada, although it has grown by 75% in the European Union, by 31% in the United States and by 14% in Japan. That says it all. The Conservatives tell us they have done a lot for agriculture and that they have opened doors everywhere. So why do we have a crisis? Why is it that other countries are allowed to give more subsidies than us? If the Conservatives are such good businesspeople, they are supposed to be able to fix everything. Well here is a problem; let them fix it.
La Terre de chez nous published a letter from Jean-Guy Vincent, president of the Fédération des producteurs de porcs du Québec. I would like to read the letter.
“Producers are in an untenable situation, says Jean-Guy Vincent, president of the Fédération des producteurs de porcs du Québec, who has launched a sort of appeal at a time when many people are in crisis. The Fédération des producteurs de porcs du Québec is forming a coalition to pressure Ottawa to give producers immediate access to cash.”
“The Minister of Agriculture, Fisheries and Food, Laurent Lessard, had been invited to join the movement but had not responded at press time. However, his press secretary told La terre de chez nous that the minister had met with his federal counterpart last week and had called for speedy action to help beef and pork producers. It is expected that the two men will meet and the Minister of Agriculture will respond shortly.”
I believe that the response did not come. I am not sure, the minister might know, but I have not heard otherwise.
“In fact, the federal programs that were announced are slow in coming. For example, the federal advance payment program is not expected to be in place until early April.”
Naturally, it will be in place provided there is no election. If there is an election, the program will not be in place until August. What will our producers do from April to August? Half of them will go bankrupt.
“Many farms have already reached their credit limit. Bankers and suppliers are patient, but they are understandably nervous. “They need reassurance”, says Mr. Vincent. We are therefore calling on Ottawa to quickly set up a program to provide loan guarantees and cover the interest producers are currently paying.”
“The Fédération des producteurs de porcs du Québec estimates that the current price of pork, which is $85 a kilogram at index 100, represents roughly half the costs of production.”
Yet, with a $10.5 billion surplus, the government could do something for farmers. I believe that helping farmers would benefit Quebec and Canada as a whole.
“Ottawa remains silent”, laments Mr. Jean-Guy Vincent who adds that if they do not receive a reply from the federal government within three weeks, Quebec and Canadian hog producers plan to organize a demonstration on Parliament Hill. The Canadian Pork Council and its President have sent a letter to the Prime Minister calling for an immediate response to what it calls a disaster caused by the soaring dollar and input costs combined with a major decline in hog prices.
We should bear in mind that the three weeks are just about up, given that the letter is dated January 31.
The CPC is asking for loans and improvements to existing programs.
They are looking for loan guarantees that cost the government nothing. The government has money; it has $10.6 billion.
Last December, six recommendations were made by the Standing Committee on Agriculture and Agri-Food. I will read them since I do not think the government remembers them.
The first recommendation was to provide:
—a special transitional measure that will provide cash-flow in the form of interest-free loans to be paid back over a period of three to five years, and bankable cash advances to hog and cattle producers.
There is nothing extraordinary there. That is a quote from a report of the Standing Committee on Agriculture and Agri-Food. Representatives from all parties—Conservatives, New Democrats, Liberals and Bloc members—participated. We work just as hard as the others. I believe we do our job and that we do good work as parliamentarians.
I will answer any questions.