OTTAWA – The Liberal-dominated Commons agriculture committee has issued a highly critical assessment of the government’s cost recovery program for the food industry.
There is no comprehensive assessment of the impact nor co-ordination between departments imposing their own separate fees, the committee said last week in a sharp rebuking letter to Treasury Board president Marcel MassŽ.
While government departments set revenue goals from user fees, there is little or no analysis of the impact before the fees are set, complained agriculture-sensitive MPs.
“The full extent of the adverse impact of the cumulative impact of the various fees on the future development of agriculture is not known,” said the June 17 letter signed by committee chair Lyle Vanclief, former parliamentary secretary to the agriculture minister.
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“It could prove crippling as the government eventually moves to full cost recovery.”
Higher costs could particularly hurt sectors competing with foreign industries not saddled with the same fees, said the committee.
Lack of co-ordination
It sent the letter to MassŽ after several months of hearings during which food industry officials complained fee-for-service charges were higher for them than for their foreign competitors. They also complained there appeared to be no co-ordination between departments as they impose their fees.
Treasury Board officials appeared before the committee to say they have no responsibility for overseeing the total impact of government cost recovery. They set the goal and expect it to be met.
For Agriculture Canada, the 1996-97 revenue goal is $56 million. Other departments, whether health or transport, will add to that total when their services affect agriculture and food products.
“The committee urges the (agriculture) department to conduct an in-depth analysis of the cumulative impact of user fees on Canada’s ability to compete in the global marketplace and to monitor how our competitors handle user fees,” said the committee letter.
The plea came the same week that egg and poultry processors appeared to complain that while inspection user fees in Canada can cost a plant hundreds of thousands of dollars a year, there are no comparable inspection costs in the U.S.
The committee noted government officials had insisted part of their strategy is to temper the effects of cost recovery by reducing unnecessary costs in the system.
MPs were not impressed.
“Many committee members perceive the emphasis to be much more on revenue-generating than on cost reduction or cost avoidance,” said the committee letter.
It likely will be some months before the committee receives a response.
