Provinces ponder feds’ BRM counter proposal

No consensus on changes to business risk management programs was reached during the latest round of federal-provincial-territorial agriculture minister meetings.

After the meetings ended this afternoon, federal agriculture minister Mari-Claude Bibeau said Ottawa was willing to maintain the current cost sharing of the programs at a 60-40 split between her government and the provinces.

Bibeau’s proposal also includes an increase in the compensation rate offered under the AgriStability program from 70 to 80 percent, and a removal of the reference margin limit.

She said removing reference margins will increase funding to farmers by more than 30 percent. An increase in the compensation rate would raise funding to farmers by more than 50 percent, she added.

“While I believe the compensation rate is the best action to take, I’m prepared to consider other options,” Bibeau said.

“But before we have this discussion on additional improvements, we have to agree on removing the reference margin limit.”

Bibeau brushed off a question on why she was taking such a firm position on removing the reference margin limit, and reiterated her proposal.

Ontario agriculture minister Ernie Hardemann said the meeting was the first time Bibeau had offered a counter proposal to the one made earlier this year by the provinces, which would have seen funding levels move from a 60-40 split to one where the feds would pay for 90 percent of BRM costs.

“To put it in perspective, this was the first time we were able to send all the provinces back home with a concrete proposal. We’ve talked about hypotheticals, we’ve talked about changes some may like and some may not, but this is the first opportunity we’ve had where the federal government has laid the cards on the table and said, ‘this is my hand, do you want to play?’ ” he said.

“We need to provide the opportunity for everybody to consider that, to look over that, to find what the impact would be to their producers and to their treasury.”

Other provinces had previously expressed frustration over Ottawa’s lack of a counter proposal before the final meeting.

Bibeau, in turn, said she will “give time” to her colleagues to analyze the proposal and get back to her “as soon as possible.”

Changes to the programs, particularly AgriStability, have long been called for.

At the heart of the issue is the amount of money being made available to farmers applying to AgriStability and the threshold that triggers payments.

The program is designed to support farmers who experience large declines in income, but lobby groups have suggested the required losses that trigger payments are too high and the compensation received is too low.

Making it easier for farmers to access those payments, while also increasing the money received, would be costly — government estimates provided in 2019 suggest costs would increase by $400 million. However, the federal government did not provide a cost analysis of today’s proposal.

Some provinces, particularly Manitoba and Saskatchewan, contend that paying their share of the program is difficult given their financial situations.

Earlier this year, Manitoba agriculture minister Blaine Pedersen cast doubt on the prospect of reforms.

“We are not going there any time soon just because of the cost implications for the prairie provinces,” he told the Manitoba Co-operator in June .

Moving AgriStability’s payout trigger to 85 percent instead of the current 70, and eliminating the reference margin limit, would cost the Manitoba, Saskatchewan and Alberta governments millions of dollars more, he added.

Asked if she sensed any progress was being made to find a positive outcome on the issue, Bibeau said she was “hopeful that we can reach consensus.”

“I understand that some have a fiscal challenge, let’s say, but we are talking about business risk management programs, so it’s kind of an insurance for farmers and it would pay out only if they have a bad year, so I’m hoping we can reach this consensus and proceed with the changes as soon as possible.”

No timeline was provided on when the provinces are expected to respond to Ottawa’s offer.

About the author

explore

Stories from our other publications