CALGARY – There will be less money in the future for grain transportation subsidies, federal agriculture minister Ralph Goodale told United Grain Growers delegates.
“I can’t tell you what the amount of the (Crow) benefit will be. I will have to tell you in all candor and honesty that I will expect the number to be somewhat lower and that’s a product of the harsh fiscal reality we’re living in at this time,” said Goodale.
The agriculture minister also said he and transport minister Doug Young will go before cabinet early in the new year with comprehensive recommendations on transportation and grain-handling reform.
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Part of the reform package involves the Crow Benefit and who should receive the subsidy – producers or the railways.
The new rules of the General Agreement on Tariffs and Trade sharply limit how much money can be used to subsidize grain shipments.
However, the amount of money available for the subsidy after agriculture budget cuts is an unknown, he said.
The Crow Benefit has slipped from more than $700 million a year to $560 million. If the finance department gets its way, the amount left in the subsidy will be even lower as the government attempts to reduce its $42 billion deficit and soaring half-trillion dollar debt, he said.
No money to pay out
One delegate said he wanted the issue settled soon before there was nothing left of the Crow Benefit.
“Maybe when you go back to Ottawa you could ask the minister of finance to write out a cheque and put it in the bank until you are ready (to make a change). What I’m worried about is that when you finally decide to pay me something it won’t be a hell of a lot,” said delegate Lawrence Moran of Huxley-Trochu.
How to pay the money is another question yet to be decided.
Goodale said he’s looking for industry advice on how the money should be paid, if it’s paid to farmers. Should the money be based on arable or cultivated acres, a portion of the funds set aside for infrastructure maintenance, or should they follow the Alberta government suggestion that each province handle a share of the money to make up for regional differences?
If it’s paid out to farmers, railways will lose an average $15 per tonne revenue for wheat. The railways would likely recover the loss by increasing freight rates, he said.
After the minister left the meeting the delegates unanimously called for the abolition of the Grain Transportation Agency, saying the movement of western grain should be the responsibility of the National Transportation Agency.
They also voted to have the Crow Benefit paid out to farmers.
