Rules governing the Canadian Grain Commission must be strengthened, modernized and up-ended to improve producer protection and to allow the commission to contract out some inspection services, says a wide-ranging consultant’s report introduced in Parliament.
One of the most explosive recommendations is that the grain commission should lose its immunity from lawsuits if a licensed elevator or grain trader fails to properly compensate farmers because of bankruptcy or financial troubles.
Specifically, the report recommends that farmers who lost money because of the bankruptcies of Naber Seed and Grain Company of Melfort, Sask., and Venture Seeds Ltd. of Brunkild, Man., be fully compensated by the commission including their legal costs and an additional penalty for “causing needless distress.”
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The 123-page report with 102 recommendations would change many commission practices, policies and liabilities. It has been referred to the House of Commons agriculture committee for study.
Agriculture minister Chuck Strahl tabled the report late in the day on Sept. 18, so there was no time for comment before Western Producer deadlines.
“Canada’s new government is committed to an efficient Canadian Grain Commission supported by a modern Canada Grain Act that can better address the needs of farmers,” Strahl said in a statement tabled with the report.
The grain commission review was prompted by an amendment imposed by opposition MPs on the 2005 minority Liberal government during the last Parliament. When the Conservatives assumed office in February, they moved to hire Toronto-based consulting company Compas to do the review.
In the report, written after public consultations across the country, Compas president Conrad Winn said changes are needed in one of Canada’s key grain industry regulatory agencies because world demands for grain products are changing from traditional protein and quality requirements to a variety of priorities. Ethanol demand, customer trait specification and international standards all make Canada’s traditional inspection yardsticks outdated.
But Winn said industry rivalries and suspicions between producers and grain traders will make reform difficult.
“Major changes in the global and domestic setting of the grain sector do require major changes in the Canadian Grain Commission,” he reported.
“But a sector as apprehensive, mistrustful and disharmonious as this one may have difficulty embracing change.”
If the Compas report develops political legs, major change will be on the agenda.
Among its key recommendations are that:
- The grain commission should be given the right to contract out inspection services.
- The Canada Grain Act should be amended to include a modern producer bill of rights that includes the right of delivery access, the right to third-party grade and dockage verification, a renewed producer right to producer cars and a right that producer dealings with licensed companies will be “secure” from losses due to company bankruptcy.
- The grain commission should create a model contract to be used in the industry that will give producers a clear understanding of prices they are being paid for product and the charges for which they are being billed.
- The commission should create an industry consultation and advisory roundtable modelled on the Canadian Food Inspection Agency, which would make the commission more accountable.
“We recommend this because we see the (commission’s) consultation efforts as inadequate and largely so for budgetary reasons.”
- The commission should receive more government funding to cover consultation, costs of staff, infrastructure and overtime. This would reduce the commission’s costs and reduce the pressure on its budget and need for user fees.
- Inward weighing and inspection should become optional but available and at least partially paid for by the government. Outward (export) inspection and weighing should be mandatory and government funded.
- Licensing requirements for facilities that do not buy grain or incur liabilities should be reviewed.
- The system of provincially based assistant commissioners should be replaced by a president-chief commissioner and a new Office of Grain Farmer Advocacy to deal with farmer complaints against the system.
- Federal funding should be announced for a seven to 10 year plan to quadruple grain research spending with some emphasis on finding more effective grain testing methods.
