Mr. Speaker, I am pleased to speak today on the jobs growth act which would implement key provisions for our 2012 economic action plan.
The legislation would serve to implement additional measures of the 2012 budget in order to continue to grow Canada's economy, fuel job creation and secure Air Canada's long-term prosperity.
First, I would like to thank the Parliamentary Secretary to the Minister of Finance as well as the departmental officials for their great work at the technical briefing of the bill. What we heard from officials at the technical briefing were clear and precise details outlining the department's rationale for each of the fiscal issues that make up Bill C-45. It was six hours well spent.
While I consider my riding of Red Deer, I reflect on its people and its prominence in the province of Alberta. Not only are its people innovative and hard working, but our riding is centrally positioned along Alberta's transportation corridor and acts as a vibrant industry service hub, and agriculture is one of those critical industries. It has been and continues to be vital to our community of Red Deer and I am proud to be part of a government that recognizes that Canada's agriculture industry is a key economic driver, not only for rural communities but for our nation as a whole.
Today I am pleased to recognize the exciting future that is in store for Canada's grain sector with the introduction of Bill C-45.
Earlier this year, western Canadian wheat and barley farmers were released from the shackles of the Canadian Wheat Board monopoly. After 75 long years of being legally prohibited from selling their own grain, they are at last able to reap the benefits of their hard work.
In conjunction with new freedom for western wheat and barley growers, today's bill, the jobs and growth act, proposes much needed legislative amendments to the Canada Grain Act in order to streamline and update the operations of our century-old grain commission.
I would also like to speak about the Red Deer Chamber of Commerce which presented to its national policy convention a resolution that encouraged marketing freedom for western Canadian wheat and barley growers, and it was passed by that organization.
Farmers' interests are best served when unnecessary costs and regulations are eliminated and when farmers can deliver grain into a competitive and efficient grain handling system. It has been 40 years since the Canadian Grain Commission was last updated to meet the needs of farmers, so it is definitely time for us to remove red tape and unnecessary regulations for grain growers.
Bill C-45 removes the requirement for inward inspection and weighing by the Canadian Grain Commission. This proposed change will eliminate over $20 million annually in unnecessary costs from the grain handling system; costs that have been downloaded onto farmers.
The original purpose of inward inspection and inward weighing was to ensure that grades and weights were recorded at each stage as grain moved through the system. The service was established when primary elevators, terminal elevators and transfer elevators were owned by different companies. Grain companies needed a system of checks and balances to follow the grain as it weaved its way through the system. The Canadian Grain Commission was required to act as a third party to ensure that this happened.
However, there have been many changes in the industry, which now call in question the need for the Canadian Grain Commission to inspect and weigh every shipment of grain that is unloaded at terminal or transfer elevators. These services are no longer required in a business environment where a prairie grain elevator is often shipping its own grain within its own terminal system. These inspections are redundant and unnecessary.
The shippers will be able to request third party inspections, but as for who provides these inwards services, that would be best determined by those involved in the transaction. The shipper and the elevator operator will also have the right to appeal to the Canadian Grain Commission for binding determination of grade and dockage if there is a disagreement.
There has been some criticism from across the way on these changes and I sometimes wonder whose interests opposition members are looking after. However, our government has consulted extensively with farmers on how to modernize the grain handling system and we are pleased to have the support of industry for these changes.
Richard Phillips, executive director of the Grain Growers of Canada, in a press release dated October 23, said:
Under the current system, we see duplication of services with grain company staff and grain commission inspectors both inspecting the same tens of thousands of railcars every year...This change will certainly reduce unnecessary overlap. The Grain Growers have always pushed hard to reduce red tape and regulatory burdens for our grain sector and so we fully support this change.
The industry agrees that this is the way forward to modernize the Canadian grain handling system and to provide an efficient competitive environment for farmers to operate in.
The other important change that is designed to benefit farmers is the introduction of insurance-based producer-payment protection. A key role of the Canadian Grain Commission has been to protect primary producers from the risk of industry participants going belly up. The commissioner requires that all elevators post a bond in an amount equal to the value of the grain that they are handling. The current payment protection program adds significant costs to western Canadian producers, but it is not cost effective and the costs of the program are ultimately borne by farmers.
Unfortunately, we have seen that despite the licensing regime, the bonding system does not necessarily protect producers from the financial failure of grain elevators. If an elevator is bonded, the security held by the Canadian Grain Commission is insufficient in some instances and producers are left with a loss if a company goes under. Unfortunately, all that this requirement has done is tie up a significant amount of operating capital in the industry without protecting farmers.
Bill C-45 would change this by allowing an insurance-based program that would reduce costs to the grain sector and reduce risks to producers. Grain elevators and dealers would continue to be licensed and providing security would continue to be a requirement of becoming licensed. However, an insurance-based program would reduce risks to farmers as an insurance program would guarantee that farmers would not left without payment.
As I have already said, these amendments reflect extensive consultation with industry and are supported. The Western Canadian Wheat Growers stated in its press release of October 22 of this year that it applauded changes to the legislation that would provide greater flexibility in how payments to farmers were secured. It has recognized that replacing the traditional bonding system with an insurance system could provide farmers with better coverage at a lower overall cost. Kevin Bender, president of the Western Canadian Wheat Growers, who happens to also be a constituent of mine, said, “the amendments represent a good first step toward modernizing the Canadian Grain Commission”.
The Canadian Grain Commission is essential to our country's system of grain handling, but it has been very difficult for the commission to keep up with changes in the industry both in Canada and abroad. The result has been a restrictive approach in regulating Canada's grain industry.
It is the Conservative Party, a party that has many farmers sitting in the House, of which I am one, that fights for this industry. It is this Conservative government that has followed through on studies and consultations with the grain industry to come up with the important amendments that we see today.
We received feedback from the grain sector during the 2006 Compass review, the recent Rail Freight Service Review, the Canadian Grain Commission's 2011 user fees consultation and the commission's engagement with stakeholders earlier this year. We have listened and we are acting.
There are a few things that I want to summarize so people recognize the significance of the points that are being made.
First is the removal of the inward inspection. The farmers deliver the grain. If they wish to confirm the quality, they bag it, tag it and send it to the Canadian Grain Commission. Then they know what they are going to be paid for because the weights have already been determined. That is the end of their transaction. That is the beauty of what we have had without the Canadian Wheat Board.
The grain companies are the ones that own it. They then move it through their system and by not forcing farmers to continue the inward inspection, there are no more extra costs added to the movement of the grain within the grain companies. Based on that, it means that they will not be downloading extra charges. It has been mentioned that there are tens of thousands of rail cars are being continually inspected and the cost of that ends up going to the farmer.
The second point that I have heard others talk about is the Grain Appeal Tribunal. With the removal of inward inspections, the need to arbitrate, therefore, becomes unnecessary. This has nothing to do with the producers. Remember they no longer own the grain. Their transactions were completed at the grain elevator. The discussion is between the Canadian Grain Commission, company X and company Y, not the farmers.
It is this Conservative government that is helping farmers by putting the Canadian Grain Commission on a track to keep pace with the industry in the 21st century. The status quo is not acceptable for grain producers in Canada. Therefore, I urge all members in the House to support these important legislative amendments.
