Despite a big jump in legal fees, the cost of running the Canadian Wheat Board remained essentially the same in 2006-07.
Total administrative expenses were $72.15 million, according to the board’s recently published annual report. That’s up slightly from the previous year’s $71.93 million.
When that is spread out over the 21.5 million tonnes of grain shipped by the board last year, it works out to a cost to farmers of 9.1 cents a bushel to run the $4 billion corporation.
That’s down from 9.8 cents a bu. the previous year, when shipments were lower at 18.8 million tonnes.
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CWB director Ian McCreary said the board of directors is conscious of keeping costs low and he thinks farmers should be pleased with the results.
“Nine cents a bu. to look after the administration of moving grain from the prairie to the West Coast, and the costs associated with having relationships with so many buyers around the world, is an awfully good value for that dollar,” he said.
He added one reason costs are under control is that three or four years ago, under the direction of former chief executive officer Adrian Measner, the board undertook a significant restructuring.
While it was painful at the time, with job losses and other cutbacks, it’s now paying off.
The biggest cost increase came in the category called professional services, which incurred expenses of $14.9 million, up 22 percent from $12.2 million the previous year.
The increase mainly reflects higher legal fees arising from a number of legal and quasi-judicial disputes that involved the board.
Those include three court challenges against the federal government over its attempt to remove barley from the CWB by regulation rather than legislation, the government’s October 2006 gag order preventing board officials from promoting single desk selling and a dispute over setting compensation for the agency’s chief executive officer.
It also includes costs associated with a service complaint launched against Canadian National Railway in the spring of 2006, and consulting costs around the start-up of an access to information system at the board.
Advertising and promotion costs declined by 14 percent to $1.4 million, while travel costs were down by 27 percent to $1.9 million and training costs down 45 percent to $453,000.
The biggest single expense was human resources, which increased slightly to $39.2 million, reflecting a new variable pay program, along with merit increases and higher benefit costs.
