WHITEHORSE — Agriculture ministers have signaled a dramatic shift in Canadian agriculture policy from an emphasis on improving farm income support to insistence that farmers prepare to live by market demands.
“We must make sure farmers in the entire sector have the tools and the resources they need to stay ahead of the ever-changing demands of consumers,” federal agriculture minister Gerry Ritz said Sept. 14 as he announced a new agricultural policy framework.
A five-year Growing Forward 2 agreement signed in the Yukon capital will cut farm support programs by as much $2 billion over the course of the deal while increasing spending on non-farm support programs by $700 million to a total of $3 billion.
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The remaining savings will be available for governments to invest in other priorities.
Ritz and federal officials refused to speculate on how much saving will come from reducing business risk management programs, arguing that no estimate is possible because programs are demand driven.
However, Saskatchewan agriculture minister Lyle Stewart said in an interview that provinces had been told the savings could be substantial.
“The closest numbers we have are total federal and provincial savings of about $445 million a year over the next five and we think about $268 of that will be federal,” he said.
And while some of the money will be reinvested in non-BRM programs, as much as 60 percent will be available for other priorities including deficit reduction, he said.
While some farm organization leaders said their members are disappointed by reductions in BRM funding, they applaud an increased emphasis on non-BRM files such as innovation, research, competitiveness and market access.
Even though funding is reduced, the basic farm support programs for income declines, crop failure and disasters will remain.
“I think most farmers will be split on these changes,” Grain Growers of Canada president Stephen Vandervalk said in a news release.
Among the key changes to be introduced April 1 are:
- The payment claim trigger for AgriStability will drop from 85 percent of historic income to 70 percent with a reduction in the farmer participation fee.
- Coverage under AgriStability will be increased to 70 percent of loss with improved negative margin coverage.
- AgriStability reference margins will be reduced to accept either the lower of the farm historic reference margin or allowable expenses from the previous year.
- Government contributions to farmer AgriInvest accounts will fall by one-third to $15,000 per year from $22,500, although the cap on farmer contributions will be increased to 100 percent of allowable net sales. Ritz said this will make more money available to farmers to fill the gap in lower AgriStability program payments above the 70 percent level.
- Funds allocated to non-BRM programs will increase to $3 billion over the five years with a 50 percent increase in federal-provincial cost-shared programs.
- While government-supported crop insurance remains, ministers said they are encouraging private sector insurers to come up with products that can fill some of the gaps of reduced government coverage.
With the framework agreement signed, ministers have pledged to work with some producer groups to design the programs needed to implement the principles starting in April.
Quebec did not sign the agreement because a minister for the new Parti Québecois government had not been named when the conference was held.
