The federal Liberals have launched a “revolution” in grain transportation policy, which will lead to a completely commercial system after a few transition years, transport minister David Collenette predicted June 5.
The implication was that the Canadian Wheat Board will be phased out of the grain transportation planning system.
As he testified during the opening of the House of Commons transport committee meetings on grain transportation legislation, the minister said the benefits of a commercial transportation system will soon be apparent.
Ottawa’s legislation states that for the next two crop years, the terms of at least 25 percent of Canadian Wheat Board grain traffic will be negotiated commercially. In two years, it will be at least 50 percent.
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“This is the beginning of a revolution in the way grain is handled on the Prairies,” said Collenette.
Later, he said in an “ideal world” all grain would move under commercial contract between grain companies and railways, as potash now moves.
But as the Commons committee began an intense week of public hearings, opposition MPs were casting doubt on how commercial and free of wheat board involvement grain transportation will really be.
The detailed plan being worked out between the government and the wheat board has not yet been made public.
Opinions differ
Canadian Alliance MPs suspect it will still involve the wheat board tendering cars it needs from the railways and then making them available through a contract to grain companies holding inventories that the board needs for sales.
“We’re still (going to be) in a highly regulated system,” complained CA agriculture critic Howard Hilstrom, who wants the wheat board out of grain transportation.
“No one denies we are still in a regulated system,” Collenette shot back. “But it will be less regulated than the status quo.”
The issue of the government’s deal with the wheat board played large with MPs as Collenette, agriculture minister Lyle Vanclief and CWB minister Ralph Goodale appeared as witnesses to kick off committee hearings.
Goodale said the agreement is not yet ready to be made public. Liberal MP and committee chair Stan Keyes from Hamilton said approval of the bill could be held up past the government’s one-week deadline for the committee if details of the deal are not given to MPs early in the week.
In a later interview, Liberal committee member and wheat board supporter Wayne Easter said he expects CA suspicions about a continuing wheat board role are accurate.
He welcomed them.
“I expect the wheat board to continue to be involved in organizing all the transportation needs,” said Easter. “I will want to be sure that is the case.”
Asked about Collenette’s comments in praise of the benefits of a fully commercial system, Easter said: “That’s his view but he lost the vote at the Liberal convention when delegates said the wheat board should remain a central part of the system. It is the farmer’s protection.”
Race against the clock
This week’s committee hearings will be extended into evenings as MPs try to abide by the government’s demand that the bill be approved and sent to the Senate by June 15 so the House of Commons can adjourn for the summer on June 16.
Prairie farm groups and provincial governments are expected to argue the bill is a half measure but should be approved to allow farmers to receive a freight rate reduction Aug. 1. Railways, some grain companies and conservative farm groups will argue the legislation subverts the chance for real change and a reduction in CWB powers.
On June 5, Goodale said the early reviews from farm groups have been positive. “So far so good in terms of reaction from producer organizations.”
In anticipation of railway complaints that an 18 percent reduction in revenues ordered under the bill will reduce their viability, Collenette said he thinks railways will be able to handle it.
“The railways have to understand they cannot extract enormous amounts of money … without being fair to producers,” he said.
“I think the railways can absorb this cut and absorb it rather well.”
