Ralph Eichler, agriculture critic for Manitoba’s Progressive Conservative party, wants to know how the provincial government wasted $4.5 million dollars on Rancher’s Choice Beef Co-operative, a proposed cattle slaughter plant in Dauphin.
And if the NDP government isn’t willing to provide answers, Eichler thinks there should be a provincial inquiry.
“Somebody dropped the ball big time on this one and stuck the taxpayers with $4.5 million boondoggle,” said Eichler, an MLA for Lakeside in Manitoba’s Interlake. “We’re going to ask the minister (of agriculture) to see what he says…. He may call it (an inquiry) himself, but if not, we’ll definitely be calling on one.”
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Eichler was planning to question Manitoba agriculture minister Stan Struthers during question period Dec. 7. Struthers’ response was not available at press time.
In 2005, the directors of Rancher’s Choice, a farmer owned co-operative, bought slaughterhouse equipment from a closed plant in Washington state for $1.5 million. The plant was never re-assembled in Dauphin because Rancher’s Choice failed to raise sufficient private investment and the co-op entered voluntary dissolution in the winter of 2007.
The province became the owner of the equipment after covering the losses of private investors. But when the government sold the equipment in an online auction this fall, it only recouped $15,000 on equipment purchased for $1.5 million.
The remaining government dollars, $3 million, were spent on engineering plans and environmental studies for a plant that was never built.
“Rancher’s Choice was doomed for failure from day one because the government didn’t do their homework,” Eichler said.
The government’s failure in this case, he added, is a bad sign for Keystone Processors, a proposed cattle slaughter plant in Winnipeg.
The Manitoba Cattle Enhancement Council, an agency with the mandate to expand the province’s beef processing industry, has invested $10.3 million into Keystone Processors. The MCEC administers an investment fund generated by a $2 producer checkoff and matching provincial contributions.
While the federal government has promised to loan Keystone $10 million as part of its $50 million slaughter improvement program, Eichler said the lack of private investors is concerning.
“You have to have some money that’s prepared to say this is what I believe in, this is what I’m prepared to put on the line…. Without that, that’s a red flag that I would say went straight up and should be paid attention to.”
Adam Dooley, a spokesperson for Keystone Processors, said the company expects to spend $25 million to renovate a Maple Leaf Foods hog slaughter plant in Winnipeg.
So far, paying for those renovations is based almost entirely on financial commitments from MCEC and the federal government, he said.
