Ottawa will have to pour more money into the agricultural economy in a pre-election budget expected in March despite the official government insistence that there is no money in the till, says agriculture minister Bob Speller.
He was reacting Feb. 9 to an estimate from his department that realized net farm income in 2003 will disappear nationally and for the first time ever, Canadian agriculture will suffer an overall loss.
The sector was battered by BSE, the after-effects of prairie drought and a rising Canadian dollar that depressed export prices.
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National figures mask the devastation in Alberta and Saskatchewan.
Agriculture Canada economists project that once Saskatchewan farmers pay their input bills and calculate depreciation, they will be $465 million in the hole for the year. In Alberta, the loss will be $230 million.
Manitoba will have a realized net farm income of $113 million, 78 percent below 2002 but still positive.
Speller said he is using those 2003 projections to convince the government and finance minister Ralph Goodale that more help is needed.
“I think frankly that will help me in my talks with cabinet colleagues,” Speller said outside the House of Commons.
Speller insisted any new money will be distributed through the Canadian Agricultural Income Stabilization program, which requires a 60-40 federal-provincial cost sharing.
In Regina, provincial agriculture minister Clay Serby said the “sobering” projection of Saskatchewan losses means additional money should be outside CAIS and the cost-sharing formula.
“Clearly, there is a signal here that there is going to be need for greater financial support from the federal government over and above CAIS.”
In Ottawa, opposition MPs indicated they will press the government for action.
“This indicates they have to do something in the budget that will address this issue,” said Regina New Democrat Dick Proctor. “We’ve been building up to this for awhile and the hope has been, well maybe we’ll get a good crop or this will happen or that will happen but everything has come into a crunch.”
Conservative agriculture critic Gerry Ritz said it reflects a decade of Liberal neglect of agriculture.
“The government spends one half of one percent on an industry that is one of Canada’s top three,” he said. “Even supply management is hurting.”
In fact, with its strong supply management sector and its more-generous-than-most provincial programming, Quebec is almost alone in expecting to do better in 2003. Agriculture Canada projects realized net income in the province will increase 39 percent in 2003 to $552 million.
The general farm economy collapse came despite a record $5 billion in program payments last year.
Departmental analyst Lambert Gauthier told a news conference Feb. 6 that the numbers may not end up being as bad as they look now because hundreds of millions of dollars still are slated to flow to farmers this year from programs that will trigger from last year’s losses.
However, he said there never has been a national negative realized net farm income since records started almost 80 years ago.
Prairie numbers are worse than during the devastating Great Depression of the 1930s.
