Elwin Hermanson

[Supply, June 19th, 1996]

Mr. Speaker, in light of the vigorous debate we have had over this issue I wonder if there might be unanimous consent to make this a votable motion.

[Supply, June 19th, 1996]

Mr. Speaker, I would like to respond to the member who seems to know a bit about Reform policy. She should know if she listened to my speech that I did give a definition of what dual marketing was and I gave examples of how dual marketing had worked, but obviously she did not listen.

In resolutions passed at our recent assembly in Vancouver, 91 per cent of our voting delegates voted in favour of marketing choice, in others words dual marketing.

As well, there was overwhelming support for a resolution calling for final offer arbitration in settling these labour disputes that effect the movement of grain to port. The member is not paying a whole lot of attention and is not coming with the facts into this debate.

She said Canadians demanded that the Canadian Wheat Board be established and thought that was wonderful, but she neglected to note that Alberta producers democratically demanded the right to market outside of the board and she ignored the wishes of those farmers.

She referred to the Kraft report as being some wonderful and reliable document when in fact it was funded by the Canadian Wheat Board and based on a private, secret information provided to that study group by the board. It does not have a whole lot of credibility.

She said her constituents are supportive of the Canadian Wheat Board. I wonder what kind of response she received from her constituents regarding the commissioner's high salary, which was recently released, and the immoral severance package, well over $250,000 over two years should they resign or retire from the board. Do her constituents support that? Does she think that if farmers want to market outside an agency that provides those kinds of exorbitant severance package to their commissioners, those benefits, they should have the right?

[Supply, June 19th, 1996]

Mr. Speaker, a brief comment and a short question.

The comment is with regard to the Deloitte & Touche report to which the parliamentary secretary referred. He said that all the recommendations have been fulfilled. In fact that is incorrect. One of the recommendations dealt with the structure of the board and

the fact that it had five equal commissioners. Deloitte & Touche called it a 1930s structure that does not work in the 1990s. That is still in place and cannot be touched until the Canadian Wheat Board Act is amended.

My question is for the hon. member from Ontario. We have not had one prairie farmer from the Liberal side speak yet. I think they only have one farmer.

Ontario corn producers can sell their product to whomever they choose. They can sell it across the line. They can load their trucks, go across the border into the states and sell their corn, or sell it domestically or export it around the world. But barley growers who are producing an equivalent product in western Canada do not have that same privilege.

Does the hon. member think it is fair that corn producers can market to whomever they wish but prairie barley producers are not allowed to do that because of the Canadian Wheat Board Act?

[Supply, June 19th, 1996]

Mr. Speaker, I have a couple of questions for the hon. member for Frontenac. I know he is not extremely familiar with the Canadian Wheat Board since its jurisdiction is the west and the prairies, but he is very familiar with the dairy industry.

If the dairy industry were run the way the Canadian Wheat Board is run and affects western Canada, would he support having to market through a milk selling agency if the producers had no voice on how that milk marketing agency functioned, had no producer voice, no democratic process to choose the directors on that milk marketing board? Would he support that board if there was no public accounting for how it marketed what the profit was, how much it cost it to market the milk on the producers' behalf?

That is what western farmers have to cope with because of the secrecy and the unaccountability of the Canadian Wheat Board. I do not believe that is in the dairy industry. Perhaps his attitude would change a little bit if the dairy industry was burdened with this undemocratic and secretive marketing agency.

The second question is an inspiration by the member for Malpeque who seems to think that the lowest bidder always gets the commodity. I would love to go to the member's auction sale if he ever has one because the lowest bidder is going to buy the items at his farm sale.

Do farmers in Quebec accept the lowest bid for their goods or do they accept the highest bid for their goods, the milk, the wheat or whatever they want to sell? What do they accept, the highest bid or the lowest bid?

[Supply, June 19th, 1996]

Madam Speaker, I think some of the frustration of my colleagues was over the fact that they thought when an opposition party put forward a motion on a supply day they might have been given the courtesy to question the minister first.

However, I agree with the minister's comments about going around in circles. Farmers have been going around in circles over these issues for a long time. The reason this is happening is simply because of the inaction on the part of governments to correct the problem, which is to reform our marketing system.

The minister went to great lengths to laud the qualifications of the members on marketing panel, and I am not going to challenge or dispute those remarks.

However, I question whether we will see much or any new material put on the table as a result of their deliberations. It would surprise me if they did not recommend a change in the structure of the board. If they do not do that, they have completely misread the industry. I suspect they would suggest some freedom in the domestic market if not broader.

I wonder why the minister went to great lengths to quote one person, Mr. Beswick, but seemed to ignore the polling results and the surveys and plebiscites I mentioned in my presentation which are as high as 66 per cent in Alberta and 58 per cent in Saskatchewan in favour of changes to the board and dual marketing. Why did the minister not address the concerns of the tens of thousands rather than the praises of one?

I would like an answer to the two fundamental questions I ask in my speech. First, does the minister believe dual marketing is impossible? He has talked about the philosophy of it and what he hears. I have said what I believe. I would like to hear what he believes.

Second, does the minister believe that a farmer should not have the right to sell his or her wheat or barley either to a pooled return account through the board or individually on a cash sale inside or outside the board? I would like to know his personal stand on those two issues. It is very important to the debate.

[Supply, June 19th, 1996]

Madam Speaker, the member for Frontenac makes an excellent and very valid point. I thank him for the question.

Simply put, the motion calls for a two-year opting out period, at which time we would review whether the member for Malpeque was right that dual marketing could not work or whether in fact the member for Kindersley-Lloydminster was right that dual marketing could work.

Some people would suggest that once they are out they should be out for life. Others would say they should be able to hop back in and market through the board or out of the board at will. We think that probably something in between is the right option. We are suggesting a two-year opting out period after which we can evaluate the effectiveness of a dual market and allow those who were out back in if they wanted. Others could opt out if they wanted after the two-year period.

[Supply, June 19th, 1996]

Madam Speaker, I hope I have as much time to answer as the member had to rant and rail.

I addressed most of the answers in my speech. I was very clear to underscore that I did not want this to become a spitting match to see who could run up the highest score. Obviously we can talk about a lot of ways the wheat board has failed. That is not the purpose of the motion. The purpose of the motion is to break the log jam we are currently in.

The hon. member for Malpeque talked about his great experience with western agriculture-I am sure, coming from Prince Edward Island. He suggests that only through the Canadian Wheat Board do we have reliability. That is a slap in the face to canola producers who have had to leave wheat to keep their farms above water. They would have gone broke during the tough years of the eighties and nineties had they not been able to market outside the Canadian Wheat Board.

My father was a pioneer on the prairies. When he was a lot younger than I am now he had to load 60 bushels into a wagon and pull it 26 miles with horses. There was one buyer at the end of that trip. Whatever that buyer offered him for the grain was the price he had to take. If he did not want to take it, he had to drive the 60 bushels all the way back to the granary. It did not make sense. He could not even phone ahead. There were no fax machines. There was no modern method of communication. That was in the 1920s.

Now we are almost in the 21st century. We have fax machines. We have more marketing options available than my father could have dreamed of when he was driving those bushels to market.

Dual marketing has been done and it can be done. The member has the attitude that it cannot be done. I guess he cannot do it. That is fine. That is his problem, not the problem of the prairie producers. I mentioned that Australia uses dual marketing. It has been done in Canada. It has worked. It has not been a problem.

The member said that if we do not market through the Canadian Wheat Board the mark will be set by the lowest price. That is not the case in other commodities. It certainly was not the case with canola. It certainly was not the case with peas. It certainly is not the case with potatoes. I wonder why it happens to be the case with wheat. It does not make sense. What is it about wheat? Is it because it is a different colour than potatoes or flax? Is it because it is a different weight than barley or oats? Is that why it will draw the lowest price? I wish the member would get his facts together and be a little more forthright with members in the House.

I mentioned there is a log jam. There is a big fight going on in the prairies. The minister of agriculture is upset because people are crossing the border without getting wheat board permits as required under the wheat board act.

Why do we not do something positive to fix this mess rather than continuing the fight? Why do we not let these people out of the wheat board if they want to market elsewhere?

There was a member of the Liberal Party who was not very happy with what the Liberal Party was doing about the GST. That member had the right to get out of the Liberal Party and sit as an independent member, but the Liberals will not allow prairie producers in western Canada the option to market on their own. If they do worse, that is their problem but they should at least have the same right as the hon. member for York South-Weston who got out of the Liberal caucus.

[Supply, June 19th, 1996]

moved:

That this House urge the government to amend the Canadian Wheat Board Act to include a special two year opting out provision permitting those prairie producers who believe they are missing market opportunities the flexibility and choice to market their wheat and barley outside the jurisdiction of the board.

Madam Speaker, it gives me great pleasure to move the motion in the House today that this House urge the government to amend the Canadian Wheat Board Act to include a special two year opting out provision permitting those prairie producers who believe they are missing market opportunities the flexibility and choice to market their wheat and barley outside the jurisdiction of the board.

The Canadian agriculture sector has proven over the years that it is prepared for the challenges it faces. We have seen this in the past and we will continue to see it in the future. If there is a need for a disease resistant breed or variety of seed, Canadians develop it. If there is a need for better farm equipment, Canadians invent it. If there is a need for an irrigation system, Canadians build it. If there is a need for more soil nutrients, Canadians apply them. If there is a need to produce more food, Canadians work harder and longer.

There have always been doubters and naysayers when it comes to agriculture in Canada. When Palliser was surveying the prairies in the 1800s he said the land in southern Saskatchewan and Alberta was too poor and dry for farming. Today that land has turned into a bread basket for the world. Why? Because farmers saw the potential.

Today the doubters are saying we cannot grow this type of wheat because the growing season is too short, or we cannot produce grains from the land because it is vulnerable to wind erosion when it is cultivated, or we cannot water our stock because it is too dry. Canadian know-how has resulted in the development of varieties that mature more quickly, the invention of no till drills to combat erosion, and the development of some of the best irrigation systems in the world. Apply a little Canadian ingenuity to a problem and 99 times out of 100, Canadians can fix the problem.

Therefore why does the minister of agriculture listen to all the negative whiners who cry that the Canadian Wheat Board will be destroyed if prairie farmers have a choice as to whether they market their own wheat and barley through the Canadian Wheat Board or outside of the board? Frankly, I do not know the reason other than the obvious conclusion that they have no confidence in the board which is a conclusion I do not share.

I could focus my speech on the past and in great detail explain past shortcomings and failures of the board, such as the creation of the board as a wartime act to keep prices to producers low, or how the board literally missed the boat on barley sales last year, or how the board fails to serve niche markets adequately. In all fairness, others could point to the successes of the board, such as large sales of wheat to communist China, the former Soviet Union and Brazil.

The point and purpose of this debate is not to see which side of the ledger can chalk up the most impressive total. The purpose of this debate is twofold. We need to ask and answer the questions: Can dual marketing work in the Canadian prairies? Should producers be compelled against their will to market wheat and barley through a state run marketing agency? This is the crux of the matter. This is at the root of the debate that is gripping the prairies at the current time. It is important that this House come to grips with those two questions.

I want to address the question of whether or not a dual market will work. A functional dual market in Canada is a workable and viable option. Just to define what a dual market is, it really means the right or the ability to market in a pooled account where farmers share together the proceeds from the sale of that grain or to market their produce individually, either through a marketing agency such as the Canadian Wheat Board or outside of that directly on a cash for purchase or cash sale basis.

Dual marketing could be accomplished in Canada. It would be far more easy to accomplish that than it was to put a human on the moon, or to split an atom, or to get an NHL hockey team for Saskatchewan, or perhaps even a bit facetiously, to get a winning team here in Ottawa.

We currently have dual marketing for feed grains. It is a matter of fact. Farmers have the option to go through the board to market their feed grain or they can do it independently from the board. There has been a dual market for barley in the past. On August 1, 1993 the Government of Canada removed from the control of the Canadian Wheat Board the sole authority over barley sold into the United States.

Although a continental barley market was a short lived 40 days, it showed that a dual market system was in fact viable. During those 40 days it was estimated that between 500,000 and one million tonnes of barley were sold into the United States. Prior to this 40 day record level of sales, the most feed barley the Canadian Wheat Board ever previously sold in one entire year was 240,821 tonnes and the average annual sales were close to a mere 98,000 tonnes. While other factors played into the increased barley sales to the U.S., such as the severe weather, it still illustrated the important market for prairie barley in the United States.

There is also a form of dual marketing in Australia under the Australian wheat board. This is not a concept that has not been proven and tried. The domestic grain market in Australia is now deregulated. The Australian wheat board pricing options offer a range of pools for wheat and other grains. It also offers forward contracts for a fixed price or a minimum price requiring active involvement in overseas futures markets. With Australia's move toward a deregulated system, the Australian wheat board has assumed many of the characteristics of private grain traders in the services that it offers to its suppliers and customers. As well, the greater flexibility of the operations of the Australian wheat board has increased the commercial orientation of grain growers.

Can a dual grain marketing system work in Canada? I believe the answer is yes. There is no doubt that some reforms to the Canadian Wheat Board Act will be required. This is not a negative option but a constructive one. The board needs to be reformed regardless of whether or not grain marketing moves to a dual system.

Should farmers be able to opt in and out of the board at will? This is a question I hear debated across the prairies from the grain elevators to farm meetings that I have attended. Maybe or maybe not.

Today's motion simply calls for producers who wish to market outside of the board to have that choice for two years. We are not talking about opting in or out. We are talking about producers opting out and staying out for two years, out altogether, no holds barred. It would be a test case allowing both sides in the argument a chance to prove their point. If dual marketing works, let it continue.

The minister has not allowed a prairie-wide plebiscite to decide this issue. Having broken his promise on this issue, I urge him to save face and allow the simply worded plebiscite: Do you want to continue having the choice to voluntarily opt out of the Canadian Wheat Board for a two-year period voted upon at the expiry of the first two years?

There was a plebiscite on this issue but it was not initiated by the minister of agriculture or the current government. It was initiated by the province of Alberta. I believe some of my colleagues from the province of Alberta will elaborate on whether or not farmers knew what the question meant, what it actually stood for, and what the consequences of a yes or a no vote would mean.

In that plebiscite the participation was high. Nearly 16,000 farmers cast their votes, a far greater number than in the vote for the advisory board elections which were held a couple of years previous to that. These are the percentages of producers who wanted marketing choice, to be able to market outside of the Canadian Wheat Board: barley producers were 66 per cent and wheat producers were 62 per cent.

Members opposite could say that is just Alberta and not all of the prairies. The province of Saskatchewan also initiated a poll which surveyed Saskatchewan producers. Saskatchewan is a province that strongly supports the Canadian Wheat Board. I want it on record in the House that I support the Canadian Wheat Board.

The first question asked whether or not the participants in the survey supported the board. About 80 per cent of the respondents said that they did support the Canadian Wheat Board.

They were also asked: Does the Canadian Wheat Board generally get the highest prices for Saskatchewan producers? Forty-three per cent said yes and 47 per cent said no. Saskatchewan producers were divided on whether or not they thought the Canadian Wheat Board got them the very best prices available.

They were also asked if they agreed that participation in the Canadian Wheat Board should be made voluntary, which is what we are talking about today in terms of whether we should permit dual marketing. Fifty-eight per cent said that participation in the Canadian Wheat Board should be made voluntary. This was in the province of Saskatchewan, the province that the minister of agriculture resides in. Thirty-six per cent disagreed. We now have the minority ruling the majority. The 36 per cent group has its way and the 58 per cent group of Saskatchewan producers surveyed is being left out in the cold.

Other questions in the survey included the level of support for allowing the direct sale of grain to a domestic food market. I outlined the scenario which occurred in Australia. About 70 per cent offered support for the concept of dual marketing at the domestic level. If they asked about a continental market, in other words a dual market into the United States, support dropped. In Saskatchewan it was about 50 per cent. Half of producers wanted to be able to market directly into the United States outside of the board and the other half did not.

The last question I will put on record was the question: Should the federal government have less control and influence over the Canadian Wheat Board? That is another whole subject. A resounding 67 per cent of respondents felt the federal government should have less of a hold over the Canadian Wheat Board. Only 25 per cent of the respondents disagreed with that position.

It seems clear there is growing support in the prairies for the concept of a voluntary nature to marketing wheat and barley. the minister of agriculture on several occasions has stated that once there is a dual grade marketing system we cannot go back. He has mentioned that in this very House. Can the minister supply the evidence that would support his claim? I believe the minister is more interested in maintaining and expanding his empire than allowing farmers the option to market their own grain as they see fit.

Are farmers prepared to meet the challenges of marketing their grain independently from the Canadian Wheat Board? The unequivocal answer is yes. Can dual marketing work? Again the answer is yes. Let us at least try it.

This leads me to the second question I asked earlier: Should producers be compelled against their will to market wheat and barley through a state run marketing agency? The answer to that question is obvious. It should be no. It is not morally right and perhaps it is not even constitutional. The case has never come before the courts because the wheat board has used delaying tactics to prevent dealing with this issue.

Let me use a hypothetical case to prove my point. What if all of the authors in Canada had to market their books through a state run publisher? I can hear the argument the state run publisher would use to support his existence: "A single book seller will get the highest price. There is no way a mere author could know who wants to buy his or her books, so he would be at the mercy of the multinational publishers who would underprice his book. There would never be any censorship, even if the book blasted the state run publisher or the government that controlled it. Trust me".

They would say: "By the way, we will sell your hard cover, illustrated, well written book and we will sell that cheap paperback novel to the customers and then we will average the return and give you half the proceeds after we subtract our selling commission and shipping and handling costs. Oh, no, we must not tell you what our costs are. That may give those other cheap shot publishers some sort of an unfair advantage. An advance? Oh, no, not an advance, not until the first books hit the stores. We will settle up after the final copy has been sold, both yours and the cheap paperbacks".

Members know full well that Canadian authors would scream at 100 decibels if they were subjected to such an unreasonable marketing scheme for their product. Yet farmers are branded as greedy and ignorant if they question the monopoly powers of a single desk seller.

Farmers realize their wheat or barley is not really their property. Farmers realize they have to share the return of their labour in a pool account with other producers. Nobody lets them share the cost of producing these commodities. That is never considered.

Some farmers protest. They are scorned by the minister. They are harassed by Canada Customs and the RCMP. If need be, the law is quickly changed to keep them in check.

The rigidness of the Liberal government is making martyrs out of those who challenge the current system. The minister and the Liberal government are the ones threatening and weakening and potentially destroying the Canadian Wheat Board. I want to reiterate that fact.

It is not the Farmers for Justice, those who cross the border, who are destroying the wheat board. It is the minister of agriculture and the unwillingness of the Liberal government to reform the board which is causing the board to fall into disrepute.

I know there are many people who work within the Canadian Wheat Board who want to see it reformed. I wonder why the minister is dragging his feet. Why will he not enter the 20th century-we are almost into the 21st century-and build a marketing agency for the 1990s and not be stuck with one designed for the 1930s?

It is those with the courage and confidence to propose constructive change who will secure a future for the Canadian Wheat Board and also provide farmers with the choice they are demanding.

Farmers know they can market their own produce. Talk to the canola, oats or potato growers and the cattle producers. Give those who wish to market wheat and barley the same freedom to do so, come what may. Let those who are happy to market through the Canadian Wheat Board pool their returns free from the worry or stress that comes from the pressures of the traditional market.

I was asked by a reporter today that if this measure passed would I market my grain through the wheat board or would I market it outside the board. I said it would depend on who gave me the best options. I think that is wonderful. Right now there is no competi-

tion. The wheat board can basically do whatever it wants. If I had an option to market through the board or outside the board, I would look at what was proposed and what the final pool return was and what the buyers of the grain outside the board offered. Then I would make a decision which would provide me with the best bottom line in my business. That is what farmers are asking for and that is what a responsible government would provide for prairie producers.

In a free and democratic society there are treasured freedoms and rights as well as responsibilities and requirements. We should obey the law but the law should guard our rightful freedoms. Our laws should respect the rights of Canadians to market legal goods to whomever they choose.

The Western Grain Marketing Panel will soon be providing its report to the minister. Conveniently the report will be tabled after the House recesses for the summer. The tabling of this report will not be an excuse for inaction on the part of the minister. If the minister fails to remove the monopoly powers of the Canadian Wheat Board he fails to respect the principles of ownership, democracy and fairness, and the principle of keeping his word. Simply put, if he does not act, he fails. That is why the Reform Party moved the motion:

That this House urge the government to amend the Canadian Wheat Board Act to include a special 2 year opting out provision permitting those prairie producers who believe they are missing market opportunities the flexibility and choice to market their wheat and barley outside the jurisdiction of the board.

We will have an opportunity to hear a response from the minister. I would like to see a positive response which looks at reform of the board, that has confidence in a board that can function in a continental market or an international market and in a domestic market, one that is open to competition, one that would roll up its sleeves and face the challenges ahead of it, not one that would bury itself away in a defensive little corner in a shell and not be open to the challenges facing us in marketing our products in the 21st century.

[Point Of Order, June 19th, 1996]

Mr. Speaker, I have raised a similar question. I wonder, if the government is offering to do this, if it would do the same thing for-

[Transportation, June 18th, 1996]

Mr. Speaker, the minister was supposed to answer the question and he said absolutely nothing, absolutely nothing.

The minister of agriculture has been encouraging producers to put forward an offer, but putting forward an offer costs money. The producers are not interested in spending hundreds of thousands of dollars to make a bid on these cars if the railways can match any bid and then take ownership of the cars.

They deserve an answer. Does the government have a signed commitment from the railways to relinquish the right of first refusal or is this whole bidding process for ownership of the cars an illusion which gives the producer group false hope?