No two farms are alike, but all farms – 229,373 of them, according to 2006 census data – are lumped together when it comes to designing farm policy and business risk management programs.
What is a farm? Statistics Canada since 1996 has defined a farm as “an agricultural operation that produces at least one of the following products intended for sale: crops, livestock, poultry, animal products or other agricultural products.”
To be a farmer, you have only to self-identify yourself as such and have the intention of selling some kind of farm product. In theory, a large crop of garden tomatoes intended for sale would qualify a person as a farmer, as would 27 quarters of land seeded to wheat, canola, barley and peas.
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Given the loose definition, it’s small wonder that governments are unable to devise farm programs with wide utility and acceptability.
However, that is the definition governments rely upon to formulate agricultural programs, policy and funding commitments.
There are good reasons for using a specific number: equality, manageability, communication, economy.
Yet most farmers and farm groups agree the current array of programs isn’t doing the job they want it to do; namely deliver needed funds in a timely fashion.
Various remedies are proposed but a recent report from the George Morris Centre puts forward a new and thought provoking scenario. It’s calledThe Business Risk Management Funding Debate in Canada: Understanding the Broader Context,written by Al Mussell.
The study outlines discontent with the level of direct payments to agriculture and documents the fact that, while public spending on business risk management programs has generally increased since 1990, farm income has not been improved to any lasting degree.
“This suggests that BRM programming is not working very well if its purpose is to support or stabilize farm incomes,” the study says. Indeed.
Dysfunctional programs lead farmers to ask for more money, creating the impression among the public of a chronically needy sector, the report notes. That doesn’t encourage new entrants to the agriculture business, even though there are many profitable farms and even though public interest in food and its production has never been greater.
The Mussell study crunches numbers related to annual revenue and farm size, and although there are many profitable small farms and many unprofitable large ones, in the main, “chronic low profitability in agriculture is an issue of small farms that are not of sufficient economic scale to provide a household income for a family.”
Larger commercial scale farms are the drivers of Canadian agricultural output, says the study. Twenty-two percent of the farms are responsible for 75 percent of farm cash receipts and 78 percent of operating income.
That doesn’t mean small farms are unimportant or unworthy of support, or that programs should concentrate on assisting the major agricultural drivers.
The study suggests that a BRM policy that is segmented to suit farm size might be more effective.
Smaller farms could benefit from a policy that recognizes their role in environmental protection, preservation of wildlife habitat, maintenance of species diversity, wetland stewardship and other benefits.
A different policy could address the needs of commercial farms, which are less dependent on outside funding, with “program payments contingent upon loss, with deductible provisions, not support.”
No two farms are alike. Can two different programs improve the ability to meet the needs of more farmers? It is an idea worthy of further exploration.
Bruce Dyck, Terry Fries, Barb Glen and D’Arce McMillan collaborate in the writing of Western Producer editorials.
