The federal government is steering clear of the debate over rail car tendering.
The Canadian Wheat Board announced Aug. 7 that it would ship a maximum of 20 percent of its sales through commercial tenders, down from a minimum of 50 percent last year.
Some industry officials have suggested the reduction in tendering runs counter to the federal government’s goal of encouraging a less regulated and more commercial grain handling and transportation system.
They point to the fact that in 2000, the federal government and the CWB signed a memorandum of understanding that called for tendering to be phased in to a minimum of 50 percent over a three-year period.
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Barry Prentice, director of the University of Manitoba’s Transport Institute, said that indicates the federal government wants tendering and he can’t understand why Ottawa is now sitting on the sidelines.
“I’m surprised, because my belief was that the government had put forward a policy and the parties should follow it,” he said. “Where is the government on this? Do they have a policy or not?”
Agricultural economist Ed Tyrchniewicz, who worked on the 1998 Estey report that called for a fully commercial system with no CWB involvement in transportation, said he is also puzzled by federal inaction on the issue.
“I’m having some problems understanding why this is happening the way it is,” he said. “My assessment is (reduced tendering) isn’t where the government wants to go.”
But a spokesperson for Ralph Goodale said the wheat board minister told industry players some time ago that it was up to them to resolve their differences over the contentious issue of how much grain the CWB should ship under commercial tenders.
“His instructions were, ‘you sit down and figure this out. You have to be responsible for your own business,’ ” said John Embury.
“The players should be able to talk amongst themselves and come to some sort of agreement and do what’s best for farmers.”
CWB director Ian McCreary said the board never saw the memorandum as a long-term directive from Ottawa to keep moving toward more tendering. The government wanted the board to “give it an honest try,” he said, and the board was willing to do so as long it wasn’t required to go beyond 50 percent.
“We feel we gave it an honest try,” he said, adding that the experience of the past three years has shown that tendering is not the perfect solution.
Now, he said, Ottawa and most industry players recognize that the car awards system devised by the board three years ago does a better job of meeting the needs of both farmers and shippers.
National Farmers Union president Stewart Wells said the government’s decision to stay out of the fray shows the governing Liberals recognize that CWB directors are reflecting the views of farmers, and it doesn’t want to alienate farmers by imposing a different policy.
