Mr. Chair, I rise in the House today to address supply managed agricultural production.
Canada's dairy, chicken, turkey and egg producers work hard to provide Canadians with safe and reliable food products. The supply management system is a domestic policy choice made by Canadian dairy and poultry producers. These industries are producer led and do not require government subsidies, but the government does have a very significant role to play in determining the future of these industries.
Outside of the farmer led production and marketing systems, producers are in need of competitive tax regimes, reduced red tape and representation of their interests at trade negotiations. This is the job of the federal government. It is up to the government to ensure that these industries can continue operating in the way that producers want and need them to.
Instead though, what the Liberal government has done is to pay lip service to supply management. Its policies say one thing but its actions say something entirely different. Conversely, the Conservative Party has an inherent respect for agriculture. Most important, we recognize that Canadian agriculture is diverse and that different sectors of the industry have different needs. We deem this so important that we have now enshrined this view in our agriculture policy.
At this point I would like to talk briefly about avian influenza and its effect on the poultry industry. I have spoken about this before in the House, but I want to make it absolutely clear that what happened in the Fraser Valley will not soon be forgotten. While CFIA officials were scrambling to contain the disease without a predetermined plan, marketing boards were at work ensuring that there would be very little market disruption in Canada's poultry supply and therefore market prices.
The supply management system has been credited for the effective market flow of poultry products during this crisis, but it must be remembered that it was the producer led structure of the industry that prevented market disruption and limited the effect of the crisis on the consumer.
Another issue that has affected supply management recently, and which is far from over of course, is BSE. When the U.S. border closed to Canadian cattle, dairy producers watched the market collapse for their veal calves, replacement heifers and cull cows. There has since been price recovery for some of these animals, but the problem of what to do with cull cows continues to plague dairy farmers. Over 30 month cattle are a real challenge because most of these animals were processed in the U.S. and meat production from these animals has very little foreign market access.
Prices for steers and heifers have rebounded from the lows of 2003, but prices for cull cows have remained depressed. The fact that a U.S. border opening for live cattle will not include over 30 month animals further reinforces the need to assist owners of these animals until increased capacity comes on line.
The Conservative Party of Canada has been calling on the government for a year and a half now to do something about the surplus of older animals in Canada. We have developed and communicated practical solutions to the government but our solutions to deal with BSE continue to be ignored.
As the livestock industry teetered on the edge of collapse, the Liberal Party chased its tail trying to find someone to blame for the BSE crisis. I know that international diplomacy is not a strong Liberal point, but instead of focusing on getting the border open, the government implemented poorly designed aid programs that failed to address concerns brought forward by producers that would be viable in the long run.
The 2003 cull animal program is a case in point. An obvious flaw in the program was the determination of cull rates. The cull animal program did not compensate producers on these full cull rates, rather program cull rates were determined by taking 60% of those values. This resulted in much criticism from all cattle producers, but particularly the dairy industry.
The average dairy cull rate of 25% is essential to the operating nature of supply management. The last program only allowed compensation of 16% of mature dairy animals.
Our suggestion to the government has been a cull cow program to compensate producers for all cull cows that have become a burden due to the lack of market access. A reduction of the national herd with compensation to farmers would serve three purposes. It would provide immediate direct cash to farmers. It would relieve farmers of the burden of feeding cattle. It would reduce the national herd size so that market prices could be maintained.
It was interesting that the agriculture minister's press secretary was quoted in the Medicine Hat News this past weekend regarding a possible total closure of the U.S. border to Canadian beef. Her comments sounded an awful lot like what Conservative Party people have been saying for over a year, and I quote her, “The Canadian cattle industry will look at a number of options, including a culling of older animals”. It is nice to see that the agriculture minister is finally coming around to see that the Conservative Party has been right all along.
Obviously the biggest challenge that supply management faces is the international pressure to reduce tariffs on all agricultural commodities. Without tariffs, Canada's supply managed industries are not able to predict the amount of imports and the whole system is disturbed.
During this round of talks at the WTO, the Prime Minister and his Liberals are once again promising to protect supply management, but based on the Liberals' record and their complete lack of accountability as demonstrated by the sponsorship scandal, I wonder if Canadian dairy, poultry and egg producers can really trust them.
The last time around, the Liberals sold out Canada's farmers by signing away article XI, which protected the industry with quantitative import restrictions. These were replaced with tariffs which have proven to be a failure at protecting Canadian producers from international competition. A case in point: we are witnessing substitute products designed to get around the tariffs displacing Canadian dairy products in the production of ice cream.
The Liberals' utter failure to do something about the importation of butter-oil-sugar blends is just another example of the government's negligence in addressing issues that impact Canada's dairy farmers.
The Conservative Party of Canada recognizes the challenges facing the dairy industry as it pertains to the use of modified milk ingredients. We understand that dairy producers are concerned with the use of non-dairy substitutes in the production of products which are similar to ice cream and cheese but not actually processed with authentic dairy products.
We recognize that this is a complex trade issue that affects supply management producers on one side and food processors on the other. To this effect, the Conservative Party supports the comments of Peter Gould, general manager of the Dairy Farmers of Ontario, who just today expressed the need for dairy farmers and processors to get together and hash out possible solutions that can mutually benefit both dairy producers and the processors.
Another partial solution that the Conservative Party is considering supporting is truth in labelling legislation that would ensure that dairy terms referring to milk and milk products are used accurately in the description and presentation of food.
This truth in labelling legislation would allow consumers the freedom to make informed decisions as to what food products they wish to purchase and consume. I encourage the supply management industries to work with other representatives of Canadian agriculture, including the export dependent sectors, to develop solutions that will meet the needs of all Canadian agriculture and which will be accepted by our international trading partners.
I would like to assure Canadian dairy, poultry and egg producers that their next government, a Conservative government, will not bargain their domestic interests away. Rather than be part of the problem like the Liberals, we will continue to be part of the solutions.