It’s not easy to bridge the chasm between the single-desk sellers and dual marketers running in the Canadian Wheat Board election.
But one issue that seems to bring most of them together is the notion of a farmer-financed contingency fund for the board.
Nobody seems to like it.
At a recent election forum in Kenaston, Sask., seven of the nine candidates running in district six representing both sides of the marketing debate, said a resounding ‘no’ to the idea, while just one said ‘yes’ and another sat on the fence.
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“There is no good operational reason to hold back producers’ money, and with a $2.16 a bushel initial price, that money is needed out here,” said candidate Ian McCreary of Bladworth, Sask.
It was the same story at a meeting a week earlier in Rosetown, Sask., where four pro-monopoly candidates and one dual marketer agreed that farmers can’t afford to have money taken off their cheques to create the multi-million dollar fund.
And in interviews last week, four candidates from across the Prairies said they either opposed a contingency fund outright, or felt the federal government should put up the money, at least in the first few years.
“If the feds are backing away from their commitments on interim payments, do they not have some sort of responsibility to producers to help develop a contingency fund to offset that?” said district nine candidate Alan Ransom of Boissevain, Man.
Rod Flaman of Edenwold, Sask., running in district eight, was more adamant, saying he’s opposed to a contingency fund, period. Ottawa should continue to guarantee adjustment payments, he said, and the board can use the futures market to manage risks associated with such things as cash buying.
The creation and management of a contingency fund is one of the few specific tasks assigned to the new board of directors under the new CWB Act.
The purpose of the fund is to provide financial insurance against any potential risks associated with three of the “marketing flexibility tools” available to the new-look board: making adjustments to the initial payment during the crop year, buying grain for cash, and allowing farmers to cash out of the pool accounts before the end of the year.
Decisions such as how big the fund will be and how the money will be raised have been left up to the new directors – after they are elected.
“The actual amount depends a lot on what activities the directors get into, and those activities are really ideological,” said Derek Brewin, an agricultural economist at the University of Saskatchewan and a former CWB employee.
The minister responsible for the CWB, Ralph Goodale, will still have to approve the contingency fund arrangements before the board could proceed with some of the payment options. If the options could be structured to make money for the board, then a contingency fund might not be needed. But the minister would also be able to stop those payment programs if there was no adequate contingency fund.
Gordon Nelson of Milo, Alta., a candidate in district two, said if producers are expected to finance adjustment payments and other programs through a contingency fund, then the federal government should turn over complete control of the agency to farmers.
“If we’re fully responsible for any losses, I see no reason why the government needs to have five appointed directors on the board.”
He added Ottawa should support farmers by putting money into a contingency fund.
While critics have described it as a tax on farmers, Goodale has said the board of directors could look for other ways besides a checkoff to raise money, such as using the profits from its currency exchange transactions and interest.
