Mr. Speaker, with regard to (a), the government undertook several initiatives over the past decade that assessed the impacts of amendments to the Canada Grains Act, CGA, including market impacts.
The CGA required that an independent and comprehensive review of the CGA and the Canadian Grain Commission, CGC, be undertaken in 2006 in response to concerns that the CGC had not kept up with grain industry needs and to deal with long-standing funding issues. Compas Inc., contracted by Agriculture and Agri-Food Canada, AAFC, completed this review and tabled its report in the House of Commons on September 18, 2006. Compas Inc. recommended that inward inspection become optional and that the CGC’s inspection services be contracted out to reduce costs to the industry. Compas Inc. also recommended exploring alternative producer payment protection models that provide optimal security at optimal prices and clarity to producers.
The Standing Committee on Agriculture and Agri-Food, SCAAF, studied the Compas Inc. report and, in December 2006, tabled its own report outlining unanimous all-party recommendations. SCAAF recommended moving to optional inward inspection to reduce unnecessary regulations and costs. SCAAF also recommended that an alternative model for producer payment security be explored to reduce costs.
The government attempted to act on these recommendations on two occasions prior to budget 2012. Unfortunately, members of Parliament from the NDP, the Liberal Party and the Bloc Québécois colluded to prevent the passage of this legislation.
In 2010-12 the CGC consulted with producers and industry organizations regarding changes to its user fees, using consultation documents that included service descriptions and standards as well as proposed fees. Stakeholders responded that changes to the CGA were required before its user fees were updated.
In 2011 the working group on marketing freedom, established to advise the minister on the Canadian Wheat Board, CWB, recommended that an updated CGA would complement the proposed changes to the CWB. These reforms would serve to transform the Canadian grain sector to a more competitive, market-oriented environment.
In 2012 the CGC asked for additional stakeholder feedback on possible changes to the CGA. Specifically, input was requested on the governance and mandate of the CGC, producer payment security, licensing, inspection and weighing, enforcement, and any other matter pertaining to the CGA. It was estimated that the elimination of CGC-provided inward inspection and weighing and the changes to producer payment protection would result in about $20 million in savings in CGC costs per year. Stakeholders, including producers, continued to request that the CGA be modernized to reduce costs for the sector.
In 2012 the CGC conducted a cost-benefit analysis of the proposed user fee regulations for the CGC’s updated services, based on changes to the CGA. This included an assessment of the costs and benefits of the elimination of CGC-provided inward inspection and weighing and registration and cancellation of elevator receipts. It was found that over a 15-year period, the net benefit of the changes to industry stakeholders, including producers, is a savings of $87.54 million for the elimination of CGC inward inspection and weighing and registration and cancellation of elevator receipts.
Officials from the CGC and AAFC appeared at SCAAF on November 6, 2012, to discuss these changes. Members of Parliament provided valuable feedback at that time. It should be noted that the committee and both Houses of Parliament agreed with the government’s approach and passed this legislation without amendment.
With regard to (b), the studies and consultations indicated that producers ultimately pay for any CGC services since the costs of these services are passed through grain companies on to farmers. Therefore, the impact of the projected net benefit of $87.54 million over a 15-year period for the elimination of CGC inward inspection and weighing and registration and cancellation of elevator receipts will ultimately benefit producers.