Last week, auditor-general Denis Desautels spent two hours listening to federal agriculture bureaucrats talk about plans to make the government’s cost recovery system better, more fair and efficient.
At the end, he pronounced himself pleased.
“I’m generally encouraged with the commitments that seem to have come through this morning,” he told the House of Commons agriculture committee March 30.
Next year, his office will do a check-up audit to make sure action followed the words.
Last autumn in a report to Parliament, Desautels raised questions about cost recovery and whether the system was fair, efficient and evolving.
Read Also
Agriculture ministers agree to AgriStability changes
federal government proposed several months ago to increase the compensation rate from 80 to 90 per cent and double the maximum payment from $3 million to $6 million
For years, the government’s determination to recover up to $130 million annually in fees for mandatory services to the food industry have created controversy.
Farmers and food companies have complained the cost recovery is an added financial burden, that farmers are being forced to pay for services that cost more than they should, that individual departments do not recognize the cumulative effect of fees and that there are not sufficient ways to appeal fee increases.
In recognition of the complaints, Agriculture Canada and its agencies have not raised fees on mandatory services since 1996 and agriculture minister Lyle Vanclief recently announced the freeze on fee increases will continue until the end of 2002. At the Canadian Grain Commission, the fees are frozen until 2003-04.
Siting idle
Last autumn, Desautels complained that the government seemed to have taken the moratorium as an excuse to stop all attempts to improve the cost recovery program.
Last week, officials from the department, the grain commission and the Canadian Food Inspection Agency assured MPs and the auditor-general that is no longer true.
Assistant deputy agriculture minister Andrew Graham said the department is improving the way the system is administered, even though it cannot increase fees right now.
At the grain commission, chief operating officer Dennis Kennedy said the freeze period will be used as an opportunity to design a better system that will make user fee collection more fair.
“While this freeze is necessary to support farm incomes, it is a constraint on our ability to adjust our mandatory fees to accurately reflect the costs of the service,” he told MPs. “By 2003, we expect to develop a plan for cost recovery which more closely matches fees to costs.”
Jean Chartier, vice-president of public and regulatory affairs at the food inspection agency, said work is continuing to simplify fees and to consult those who pay them.He did concede the fee freeze has made discussions about change difficult.
Some MPs expressed skepticism.
New Democrat Dick Procter noted the weight of cost recovery fees falls on the producer level with little or no charge at the processor or retail level.
Canadian Alliance MP Howard Hilstrom said user fees are used to prop up government services that are delivered less efficiently than if the private sector did it.
Agencies represented at the committee will charge $110 million for services this year. A total of $36 million will be collected by the grain commission, $47 million by the food inspection agency and $27 million by Agriculture Canada.
