Momentum is building to modernize the Canada Grain Act and the Canadian Grain Commission, says an industry executive.
There have been several legislative attempts to update the act, which hasn’t had a thorough overhaul since the early 1970s, but all attempts failed to pass through Parliament.
“It never seems to make it high enough on the priority list for any government to get it through,” said Wade Sobkowich, executive director of the Western Grain Elevator Association.
He believes the only way it will become a priority is if virtually the entire grain sector gets together and decides what changes need to be made and jointly lobbies the government like it did with the transportation file.
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Sobkowich thinks the industry is beginning to travel down that path.
“Conversations are starting and organizations are talking to each other and that’s starting to grow,” he said.
Sobkowich doesn’t believe it will be a decade-long process like it was with getting changes to the Canada Transportation Act because there have already been reports written and legislation drafted.
“A lot of the work has been done. It’s just a matter of coalescing around the right things,” he said.
Federal Agriculture Minister Lawrence MacAulay said regulatory modernization is a priority for the Liberal government.
Budget 2018 provided funding for regulatory reform for three targeted sectors including agriculture.
The government has been in contact with departments like the Canadian Food Inspection Agency and Health Canada and has been soliciting feedback from stakeholders in agriculture to develop a road map for reform.
He said the road map will respond to irritants and broader systemic challenges as well as proposing new approaches to the design and delivery of regulations.
“We are always willing to listen to farmers and stakeholders on any potential review or update to the Canada Grain Act or any other regulatory modernization that is important to Canadian farmers,” MacAulay said in an email.
“Any potential future update to the act or to the Canadian Grain Commission would be based on feedback received from Canadian farmers and be in the best interests of our grain farmers.”
The Alberta Wheat Commission and Alberta Barley are strongly in favour of modernizing the act and the commission.
The top priority for both organizations is to modernize the grain grading system.
There is some work happening on that front but it is slow going and involves highly technical tweaks to the existing grading system, said Tom Steve, general manager of both organizations.
The farmers he represents would prefer an entirely new system based on meeting certain specifications rather than relying solely on visual assessments.
“It becomes particularly evident in a year like this when we have a wet harvest and visually the wheat doesn’t look that great but in many cases the falling number will tell you it is of milling quality,” he said.
“We’d just like to see the system become a lot more nimble and more market oriented.”
The organizations would also like to see a change to the CGC’s funding formula. The CGC receives $5 million in core funding from the federal government for its $70 million operating budget.
The remainder comes from fees that farmers pay through the basis. They want taxpayers to pick up more of the tab.
A third priority for the organizations that Steve represents is redefining the CGC’s role.
“We think they should move more towards the oversight role and less in the service provision,” he said.
In particular, the groups would like to see the CGC drop its mandatory inspection and weighing services on grain vessels loaded at port.
A lot of buyers want their grain shipments inspected by third party providers such as SGS Canada or Intertek Canada and do not require a certificate final from the CGC.
Steve said about 80 percent of shipments are receiving a redundant second inspection by the CGC and farmers are footing the bill.
Sobkowich said his members agree that the CGC needs to get out of the outward weighing and inspection business and that will necessitate a new funding model for the agency.
“There is an inherent conflict of interest when a government agency operates on a near full cost-recovery basis,” he said.
“It becomes primarily motivated to implement policies that generate revenue for the organization itself rather than acting in the best interests of the grain industry.”
The WGEA would like to see a modernization of the CGC’s governance structure.
“Having three commissioners vote on everything is just not the way to do it,” said Sobkowich.
The association would like to see a more business-like model with a president and vice-presidents responsible for various areas.
The WGEA also wants a change in the commission’s mandate so that it is working in the best interest of the entire grain sector.
The current mandate of working in the best interest of producers puts the commission in a conflict of interest with some of the services it provides, such as arbitrating when there is a grain grading dispute.
“Should they be deciding in favour of the producer every time? I don’t think so,” said Sobkowich.
The WGEA also wants the CGC to have the power to penalize producers for misdeclaring at the elevator.
