ST. JOHN’S, N.L. — The changes to AgriStability that were announced last week as part of the next policy framework have met with lukewarm response.
Government officials were to hold a stakeholder briefing this week to explain changes to business risk management programs under the Canadian Agricultural Partnership. The changes take effect April 1, 2018, and federal and provincial funding remains capped at $3 billion for the five-year term.
However, some said they weren’t sure how changing the AgriStability reference margin limit improves the program.
“Who knows?” said Todd Lewis, president of the Agricultural Producers Association of Saskatchewan. “At the end of the day I don’t think fiddling with the reference margin is going to make a difference. It won’t improve a bad program.”
The RML change will guarantee all participants 70 percent of their reference margin. Currently, the benefits are calculated using the lower of a producer’s reference margin or average allowable expenses in the years used to calculate that margin.
For example, a producer with a reference margin of $100,000 and allowable expenses of $40,000 under Growing Forward 2 is limited to using $40,000.
Under CAP, a producer with those same numbers would have a margin of $70,000 and use that figure in benefit calculations.
Federal Agriculture Minister Lawrence MacAulay said this change will allow low-cost producers who previously didn’t qualify for AgriStability to participate.
To make the BRM programs cost-neutral, however, AgriInvest will be cut. The maximum allowable net sales will be $1 million, down from $1.5 million, and government-matching contributions will drop from $15,000 per account to $10,000.
Grain Growers of Canada president Jeff Nielsen said that will concern producers who thought AgriInvest worked well.
Ron Bonnett, Canadian Federation of Agriculture president, said the cut is disappointing.
“The reduced annual contribution limit under AgriInvest raises new questions about the adequacy of available BRM support,” he said.
The Canadian Cattlemen’s Association said it was still evaluating the changes.
All said they are looking forward to participating in the BRM review over the next year.
“Maybe there can be further tweaks,” said Nielsen.