Mr. Speaker, last summer a World Trade Organization panel ruled against Canadian policies affecting the importation of grain from the United States. The panel ruled that Canada should not treat imported grain differently from Canadian grain when it is mixed or authorized for entry into the system. The panel also found that the rail revenue cap treated imported grain less favourably than western Canadian grain.
The Conservative Party recognizes that implementing the WTO's decision is critical if we are to respect our international trade obligations. We understand it is important to treat foreign products the way we would want Canadian products to be treated in foreign countries. We recognize that there is a tight timeline regarding passage of this bill. However, if the Canada Grain Act is going to be amended, then the concerns of farmers and others in the grain industry should be formally recognized.
The Canadian Grain Commission is integral to our country's system of grain handling, but unfortunately the commission has been unable to keep up with changes in the industry both in Canada and abroad. The result has been a restrictive approach to regulating Canada's grain industry, an industry that demands that it has influence in establishing and maintaining a seamless grain handling system.
The Western Grain Elevator Association, an organization that represents major grain handling companies, has described in detail to the Standing Committee on Agriculture and Agri-Food how the grain commission is not enhancing the international position of Canada's producers; rather, it has become an obstacle to growth. In order to put the commission back on track to keep pace with the industry, simple amendments to its governing legislation, the Canada Grain Act, are no longer a viable option.
The obvious place to start would be to focus on the single barrier to realizing change, that being the governance structure of the grain commission. It is obvious that the role of the chief commissioner and the entire governing board must be looked at. The current governance structure of the grain commission has created a reporting relationship of commissioners that does not take into account the best interests of the industry. We would like to see the commission led by a more accountable body whose objective would be to serve the industry.
Those of us on this side of the House care about accountability. We recognize that a democratic process requires accountability to ensure that those who are subject to the decisions of a governing body are treated fairly.
This may be shocking to hear, but the regulatory decisions of the Canadian Grain Commission are not subject to appeal. These decisions can and do have far-reaching consequences for producers as well as for the entire grain sector. Nearly all commercially oriented transactions have dispute resolution mechanisms, so why does the Canadian Grain Commission leave industry participants without recourse? The answer is to amend the act to give members of the industry the ability to appeal decisions of the grain commission in a quick and cost effective manner.
The mandate of the Canadian Grain Commission must also be addressed. The principal objective of the commission is clearly stated in the Canada Grain Act. Clearly, it leaves out the interests of participants that handle grain after it has entered the system.
A key role of the grain commission is to protect primary producers from the risks of industry participants going belly up. The commission requires that all elevators post a bond to the commission, an amount equal to the value of the grain they are handling, but a frequent complaint in this regard has been a lack of enforcement on the part of the grain commission. Rather than address the lack of enforcement, the commission instead warns producers that the onus is on them, that they should only deal with licensed grain dealers.
Unfortunately we have seen that despite the licensing regime, the bonding system does not necessarily protect producers from the financial failure of grain elevators. Even if an elevator is bonded, the security held by the grain commission is occasionally not sufficient, and producers are still left with the loss if a company goes under. A requirement that results in such a major lack of operating capital within the industry should at least work.
Last but not least is a serious concern which the minister is well aware of but has not corrected. The issue is surrounding the certificate finals which are issued by the Canadian Grain Commission. These certificates are issued to grain companies identifying the grade of grain stocks that are destined for port. They are not so final. In some instances the grain commission has carried out tests of grain stocks after they have left for port, or even after they have left port. At that point certificates have actually been withdrawn and revised certificates have been issued. As the Western Grain Elevator Association puts it, this is like making an offside call in a hockey game and adjusting the score once the game is over.
Companies cannot manage their risk nor their business under such a system. The issue is so serious that it ended up in a federal court. The court recommended that either testing be done on a timely basis, or that a system of insurance be implemented so that grain handlers are not exposed to unreasonable liability due to no fault of their own.
Unfortunately, the court also pointed out that the commission can simply enact new regulations that allow it to cancel inspection certificates and issue new ones. That is exactly what the Canadian Grain Commission intends to do. This will not fix the problem though. It will simply allow this unacceptable situation to continue. This is indicative of the government's approach to agriculture policy. It is a top down approach with a certain disregard, if not outright contempt, for Canadian agricultural producers.
As previously mentioned, we recognize that there is a tight timeline regarding passage of this bill, but the current state of the Canada Grain Act must be formally recognized. The concerns of producers and others in the grain industry cannot continue to be ignored.
That being said, opening up the Canada Grain Act would be like opening up a can of worms. The worms are the concerns of primary producers and elevator operators, disgruntled participants in Canada's grain handling system. Opening up this legislation would present an opportunity to address many needed changes to the Canadian Grain Commission which is mandated by this act.
From a pragmatic point of view, the reforms needed cannot be made within the timeframe allotted to pass Bill C-40. That is why the Conservative Party of Canada will, among other things, propose an amendment that upon passage of this legislation the government initiate a mandatory comprehensive review of the Canada Grain Act and all organizations mandated by the act to be completed within one year of the bill coming into force.
Our amendment would draw attention to concerns raised both by primary producers and the grain industry. It would ensure that the concerns of the industry were formally recognized in a timely manner, paving the way for a comprehensive bill that would legislate much needed reform for the Canadian Grain Commission. We will be asking for the bill to be amended to reflect our party's concerns and those of the Canadian grain industry.
