Thanks but….
Canada’s farm community welcomed last week’s billion dollar farm aid package as a good start, but warned if markets continue to return inadequate prices, they likely will be back at government’s door come autumn.
They warned that $1 billion in spring cash, even if it arrives as promised, will not be enough to pull the industry out of its income doldrums.
“This is a very positive announcement and we thank the minister and the government for responding quickly but this in no way meets the full need,” Canadian Federation of Agriculture president Bob Friesen said.
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federal government proposed several months ago to increase the compensation rate from 80 to 90 per cent and double the maximum payment from $3 million to $6 million
“We now have to roll up our sleeves and find some longer term solutions but I can tell you if we find the income situation needs more investment down the road, we will be unapologetic in asking for more government investment.”
Federal agriculture minister Andy Mitchell said in his announcement that the aid is a response to an immediate problem. Farmers have been losing money in the marketplace “and 2005 is likely to be the third consecutive year that such a situation exists.
“This is an important liquidity injection to the industry but in and by itself, it is not the total solution to the challenges that we face,” the minister said in a March 29 announcement in Guelph, Ont.
“It is absolutely essential that we pursue transformative change in the agricultural industry.”
But the talk of “transformative change” also brought farmer skepticism.
If it means better functioning international markets, enough Canadian beef packing capacity to make access to American packing plants irrelevant and conditions that allow farmers to make a living from the market, the transformation will take years.
Getting from here to there is the problem.
“I think a billion dollars is a great headline and buying transformative change is a great headline but the reality is that I don’t see that on the horizon, at least from the field where I stand,” said Grain Growers of Canada president Jim Smolik, who farms near Dawson Creek, B.C.
Far from attracting universal praise, last week’s aid package announcement drew mixed reviews and unleashed some political storms.
It angered provincial governments that were not consulted and yet were put on the spot by Ottawa’s insistence that the provinces come up with $665 million to honour the 60-40 funding split between Ottawa and the provinces on farm aid. Farm groups immediately joined Ottawa’s demand for additional provincial funding.
“It is simply inexcusable that the provinces are not putting money in,” said CFA president Friesen.
“Farmers have invested equity. The feds have put their dollars up. Are the provinces partners or not?”
The provinces quickly rejected the federal call for matching funds, insisting they were not consulted, do not have the money and feel betrayed by Ottawa’s unilateral announcement.
“This really is a slap in the face to provinces and the whole idea of federal-provincial partnership,” responded Saskatchewan minister Mark Wartman, speaking after a 10 province conference call that rejected the federal demand.
The announcement of the latest federal ad hoc payment led some to pronounce this proof positive that the Canadian Agricultural Income Stabilization program, which was unveiled three years ago as the program that would end the need for ad hoc payments, is inadequate.
“Until there is a program that protects farmer equity, that compensates for equity loss, it will not meet farmer needs,” said University of Saskatchewan agricultural economics professor and former Saskatchewan deputy agriculture minister Hartley Furtan.
“There used to be talk about the three lines of defence, including the third line of defence, which is government disaster coverage. That is what is needed.”
Friesen said the flaw in CAIS “which has flowed a hell of a lot of money” is that it cannot be a disaster program that responds quickly.
Opposition MPs also quickly cautioned farmers about taking Mitchell’s announcement of April money at face value.
“I’ll believe it when I see the cash in farmers’ hands and I think that is a sensible attitude to take,” said Conservative Saskatchewan MP Gerry Ritz. “Announcements are easier than delivery.”
