OTTAWA – Transport minister Doug Young has signalled a 1995 end to Transport Canada’s role in paying close to $600 million in annual grain-hauling subsidies to the railways.
“The direct payments to railways will be eliminated by 1995,” he told reporters June 8 outside the House of Commons. Young blamed it on requirements of the new General Agreement on Tariffs and Trade.
“We will not be able to make payments directly to railroads after 1995 because of international agreements. It’s not a domestic government decision.”
This was news to agriculture minister Ralph Goodale, who has been promising no decision on the Crow benefit method-of-payment will be made before ongoing studies are completed and industry consulted.
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“What I’m anxious to do is put all of that together in a thoughtful game plan for the future as to how these issues will be dealt with and I don’t want to prejudge the outcome of that work,” said Goodale.
It started three days of wild policy confusion. Goodale insisted no decisions had been made, and Young insisted as of July 1, 1995, Transport Canada has no intention of paying the Crow Benefit to the railways. Observers were left wondering who spoke for the government.
Reform Party House Leader Elwin Hermanson (Kindersley-Lloydminster) said he figured the decision has been made and Young simply erred in announcing it too soon.
“The WGTA is gone as of July 1, 1995 and we don’t know what they have to put in its place – a safety net, some other form of producer payment, or what.”
Bloc QuŽbecois agriculture critic Jean-Paul Marchand predicted the news will inflame the Quebec debate over separation, since the powerful Quebec farm lobby has long argued any payment to producers would be an unfair production subsidy to western farmers.
In some corners of the Liberal caucus, there was unhappiness.
“As far as I know, there has been no decision and there had better not have been a decision,” said MP Wayne Easter. “There is absolutely no subtlety with Doug Young. If it’s good news, bad news, no news, you get it straight between the eyes.”
The National Farmers Union and the Canadian Dehydrators Association both condemned any change in the method-of-payment.
Ken Edie, chair of Prairie Pools Inc., said the policy squabble caught them by surprise. “Setting policy in a scrum in a corridor is of concern to us. Until the government sorts itself out, we don’t know where we stand.”
For Ted Allen, president of United Grain Growers, Young’s comments made sense. “We at UGG have assumed since the GATT got signed that a change to the method-of-payment had to happen.”
It was left to Goodale to organize damage control, to make the industry believe his consultations are not shams, and to insist it is unclear exactly what the GATT requires.
“Processes are underway,” he insisted. “I am committed to seeing them completed before decisions are made.”
